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Gene Ellis

Rise of the Robots - NYTimes.com - NYTimes.com - 0 views

krugman.blogs.nytimes.com/...rise-of-the-robots

shared by Gene Ellis on 19 Feb 15 - No Cached
  • Search Rise of the Robots
  • The most valuable part of each computer, a motherboard loaded with microprocessors and memory, is already largely made with robots, according to my colleague Quentin Hardy. People do things like fitting in batteries and snapping on screens.
  • Robots mean that labor costs don’t matter much, so you might as well locate in advanced countries with large markets and good infrastructure (which may soon not include us, but that’s another issue)
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  • But the college premium hasn’t risen for a while. What has happened, on the other hand, is a notable shift in income away from labor:
Gene Ellis

Finland's Problem Is The Same As Greece's; Neither Should Be In The Euro As Krugman Say... - 0 views

www.forbes.com/...be-in-the-euro-as-krugman-says

finland problem greece euro krugman

shared by Gene Ellis on 15 Jun 15 - No Cached
  • Finland's Problem Is The Same As Greece's; Neither Should Be In The Euro As Krugman Says
Gene Ellis

Crash of the Bumblebee - NYTimes.com - 0 views

www.nytimes.com/...an-crash-of-the-bumblebee.html

shared by Gene Ellis on 30 Jul 12 - No Cached
  • Gene Ellis on 30 Jul 12
     
    Krugman - the fate of the euro nyt
Gene Ellis

Greece as Victim - NYTimes.com - 0 views

www.nytimes.com/...krugman-greece-as-victim.html

greece victim nytimes nytimes com com

shared by Gene Ellis on 18 Jun 12 - No Cached
  • Gene Ellis on 18 Jun 12
     
    Good Krugman piece...
Gene Ellis

PAUL KRUGMAN: Euro crisis: Pay now, or pay more later | PressDemocrat.com - 2 views

www.pressdemocrat.com/...opinion

paul krugman euro crisis pay com

shared by Gene Ellis on 21 May 12 - No Cached
  • Gene Ellis on 21 May 12
     
    MUST READ
Gene Ellis

Those Depressing Germans - NYTimes.com - 0 views

www.nytimes.com/...-those-depressing-germans.html

shared by Gene Ellis on 04 Nov 13 - No Cached
  • Last year Germany, not China, ran the world’s biggest current account surplus. And measured as a share of G.D.P., Germany’s surplus was more than twice as large as China’s.
  • Now, it’s true that Germany has been running big surpluses for almost a decade. At first, however, these surpluses were matched by large deficits in southern Europe, financed by large inflows of German capital. Europe as a whole continued to have roughly balanced trade.
  • Instead, however, Germany failed to make any adjustment at all; deficits in Spain, Greece and elsewhere shrank, but Germany’s surplus didn’t.
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  • a country that runs a trade surplus is, to use the old phrase, beggaring its neighbors.
  • It shares a currency with its neighbors, greatly benefiting German exporters, who get to price their goods in a weak euro instead of what would surely have been a soaring Deutsche mark. Yet Germany has failed to deliver on its side of the bargain: To avoid a European depression, it needed to spend more as its neighbors were forced to spend less, and it hasn’t done that.
  • They consider their country a shining role model, to be emulated by all, and the awkward fact that we can’t all run gigantic trade surpluses simply doesn’t register.
Gene Ellis

Hot Money Blues - NYTimes.com - 0 views

www.nytimes.com/...krugman-hot-money-blues.html

shared by Gene Ellis on 25 Mar 13 - No Cached
  • for the time being, and probably for years to come, the island nation will have to maintain fairly draconian controls on the movement of capital in and out of the country.
  • It will mark the end of an era for Cyprus, which has in effect spent the past decade advertising itself as a place where wealthy individuals who want to avoid taxes and scrutiny can safely park their money, no questions asked.
  • To some extent this reflected the fact that capital controls have potential costs: they impose extra burdens of paperwork, they make business operations more difficult, and conventional economic analysis says that they should have a negative impact on growth (although this effect is hard to find in the numbers). But it also reflected the rise of free-market ideology,
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  • It’s hard to imagine now, but for more than three decades after World War II financial crises of the kind we’ve lately become so familiar with hardly ever happened.
  • But the best predictor of crisis is large inflows of foreign money: in all but a couple of the cases I just mentioned, the foundation for crisis was laid by a rush of foreign investors into a country, followed by a sudden rush out.
Gene Ellis

The Excel Depression - NYTimes.com - 0 views

www.nytimes.com/...gman-the-excel-depression.html

shared by Gene Ellis on 19 Apr 13 - No Cached
  • As soon as the paper was released, many economists pointed out that a negative correlation between debt and economic performance need not mean that high debt causes low growth.
  • Over time, another problem emerged: Other researchers, using seemingly comparable data on debt and growth, couldn’t replicate the Reinhart-Rogoff results.
  • and the mystery of the irreproducible results was solved. First, they omitted some data; second, they used unusual and highly questionable statistical procedures; and finally, yes, they made an Excel coding error.
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  • For three years, the turn to austerity has been presented not as a choice but as a necessity.
Gene Ellis

Op-Ed Columnist - Learning From Europe - NYTimes.com - 0 views

www.nytimes.com/...11krugman.html

europe krugman

shared by Gene Ellis on 24 Apr 13 - Cached
  • It’s true that the U.S. economy has grown faster than that of Europe for the past generation. Since 1980 — when our politics took a sharp turn to the right, while Europe’s didn’t — America’s real G.D.P. has grown, on average, 3 percent per year. Meanwhile, the E.U. 15 — the bloc of 15 countries that were members of the European Union before it was enlarged to include a number of former Communist nations — has grown only 2.2 percent a year. America rules!
  • In 2008, 80 percent of adults aged 25 to 54 in the E.U. 15 were employed (and 83 percent in France). That’s about the same as in the United States. Europeans are less likely than we are to work when young or old, but is that entirely a bad thing?
  • Broadband, in particular, is just about as widespread in Europe as it is in the United States, and it’s much faster and cheaper.
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  • Or maybe not. All this really says is that we’ve had faster population growth. Since 1980, per capita real G.D.P. — which is what matters for living standards — has risen at about the same rate in America and in the E.U. 15: 1.95 percent a year here; 1.83 percent there.
  • And Europeans are quite productive, too: they work fewer hours, but output per hour in France and Germany is close to U.S. levels.
  • After all, while reports of Europe’s economic demise are greatly exaggerated, reports of its high taxes and generous benefits aren’t. Taxes in major European nations range from 36 to 44 percent of G.D.P., compared with 28 in the United States. Universal health care is, well, universal. Social expenditure is vastly higher than it is here.
  • So if there were anything to the economic assumptions that dominate U.S. public discussion — above all, the belief that even modestly higher taxes on the rich and benefits for the less well off would drastically undermine incentives to work, invest and innovate — Europe would be the stagnant, decaying economy of legend. But it isn’t.
Gene Ellis

Op-Ed Columnist - The Making of a Euromess - NYTimes.com - 0 views

www.nytimes.com/...15krugman.html

Krugman Euro Spain Greece economics

shared by Gene Ellis on 24 Apr 13 - Cached
  • No, the real story behind the euromess lies not in the profligacy of politicians but in the arrogance of elites — specifically, the policy elites who pushed Europe into adopting a single currency well before the continent was ready for such an experiment.
  • Consider the case of Spain, which on the eve of the crisis appeared to be a model fiscal citizen.
  • But with its warm weather and beaches, Spain was also the Florida of Europe — and like Florida, it experienced a huge housing boom. The financing for this boom came largely from outside the country: there were giant inflows of capital from the rest of Europe, Germany in particular.
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  • The result was rapid growth combined with significant inflation: between 2000 and 2008, the prices of goods and services produced in Spain rose by 35 percent, compared with a rise of only 10 percent in Germany. Thanks to rising costs, Spanish exports became increasingly uncompetitive, but job growth stayed strong thanks to the housing boom.
  • Then the bubble burst.
  • But the flood of red ink
  • was a result, not a cause, of Spain’s problems.
  • The nation’s core economic problem is that costs and prices have gotten out of line with those in the rest of Europe. If Spain still had its old currency, the peseta, it could remedy that problem quickly through devaluation — by, say, reducing the value of a peseta by 20 percent against other European currencies. But Spain no longer has its own money, which means that it can regain competitiveness only through a slow, grinding process of deflation.
  • Now, if Spain were an American state rather than a European country, things wouldn’t be so bad. For one thing, costs and prices wouldn’t have gotten so far out of line: Florida, which among other things was freely able to attract workers from other states and keep labor costs down, never experienced anything like Spain’s relative inflation. For another, Spain would be receiving a lot of automatic support in the crisis: Florida’s housing boom has gone bust, but Washington keeps sending the Social Security and Medicare checks. But Spain isn’t an American state, and as a result it’s in deep trouble.
  • None of this should come as a big surprise. Long before the euro came into being, economists warned that Europe wasn’t ready for a single currency.
  • What we’ll probably see over the next few years is a painful process of muddling through: bailouts accompanied by demands for savage austerity, all against a background of very high unemployment, perpetuated by the grinding deflation I already mentioned.
  • Yes, some governments were irresponsible; but the fundamental problem was hubris, the arrogant belief that Europe could make a single currency work despite strong reasons to believe that it wasn’t ready. More Articles in Opinion »
Gene Ellis

Op-Ed Columnist - The Euro Trap - NYTimes.com - 0 views

www.nytimes.com/...30krugman.html

krugman euro trap nytimes

shared by Gene Ellis on 24 Apr 13 - Cached
  • The fact is that three years ago none of the countries now in or near crisis seemed to be in deep fiscal trouble.
  • And all of the countries were attracting large inflows of foreign capital, largely because markets believed that membership in the euro zone made Greek, Portuguese and Spanish bonds safe investments.
  • Then came the global financial crisis. Those inflows of capital dried up; revenues plunged and deficits soared; and membership in the euro, which had encouraged markets to love the crisis countries not wisely but too well, turned into a trap.
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  • During the years of easy money, wages and prices in the crisis countries rose much faster than in the rest of Europe. Now that the money is no longer rolling in, those countries need to get costs back in line.
  • Now that Greece and Germany share the same currency, however, the only way to reduce Greek relative costs is through some combination of German inflation and Greek deflation. And since Germany won’t accept inflation, deflation it is.
  • The problem is that deflation — falling wages and prices — is always and everywhere a deeply painful process. It invariably involves a prolonged slump with high unemployment. And it also aggravates debt problems, both public and private, because incomes fall while the debt burden doesn’t.
  • Earlier this week, when it downgraded Greek debt, Standard & Poor’s suggested that the euro value of Greek G.D.P. may not return to its 2008 level until 2017, meaning that Greece has no hope of growing out of its troubles.
  • Until recently, most analysts, myself included, considered a euro breakup basically impossible, since any government that even hinted that it was considering leaving the euro would be inviting a catastrophic run on its banks. But if the crisis countries are forced into default, they’ll probably face severe bank runs anyway, forcing them into emergency measures like temporary restrictions on bank withdrawals. This would open the door to euro exit.
Gene Ellis

Op-Ed Columnist - Bubbles and the Banks - NYTimes.com - 0 views

www.nytimes.com/...08krugman.html

Krugman banks

shared by Gene Ellis on 24 Apr 13 - Cached
  • Bear in mind that the implosion of the 1990s stock bubble, while nasty — households took a $5 trillion hit — didn’t provoke a financial crisis. So what was different about the housing bubble that followed?
  • The short answer is that while the stock bubble created a lot of risk, that risk was fairly widely diffused across the economy. By contrast, the risks created by the housing bubble were strongly concentrated in the financial sector. As a result, the collapse of the housing bubble threatened to bring down the nation’s banks. And banks play a special role in the economy. If they can’t function, the wheels of commerce as a whole grind to a halt.
  • Why did the bankers take on so much risk? Because it was in their self-interest to do so.
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  • Of course, that conflict of interest is the reason we have bank regulation. But in the years before the crisis, the rules were relaxed — and, even more important, regulators failed to expand the rules to cover the growing “shadow” banking system, consisting of institutions like Lehman Brothers that performed banklike functions even though they didn’t offer conventional bank deposits.
  • And here’s the thing: Since that aid came with few strings — in particular, no major banks were nationalized even though some clearly wouldn’t have survived without government help — there’s every incentive for bankers to engage in a repeat performance.
Gene Ellis

Talking Troubled Turkey - NYTimes.com - 0 views

www.nytimes.com/...n-talking-troubled-turkey.html

shared by Gene Ellis on 31 Jan 14 - No Cached
  • Talking Troubled Turkey
  • probably because most countries placed restrictions on cross-border capital flows, so that international borrowing and lending were limited.
  • a bigger version of the same story unfolded in Asia: Huge money inflows followed by a sudden stop and economic implosion.
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  • And the same forces that sent money sloshing into Turkey also make the world economy as a whole highly vulnerable.
  • If this is a good description of our situation, and I believe it is, we now have a world economy destined to seesaw between bubbles and depression
Gene Ellis

No Big Deal - NYTimes.com - 0 views

www.nytimes.com/...krugman-no-big-deal.html

shared by Gene Ellis on 19 Feb 15 - No Cached
  • No Big Deal
  • Basically, old-fashioned trade deals are a victim of their own success: there just isn’t much more protectionism to eliminate.
  • Implicit protection of services — rules and regulations that have the effect of, say, blocking foreign competition in insurance — surely impose additional costs.
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  • What they’re really about, in particular, is property rights — things like the ability to enforce patents on drugs and copyrights on movies.
  • What the T.P.P. would do, however, is increase the ability of certain corporations to assert control over intellectual property. Again, think drug patents and movie rights.
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