The Trade-off between Inflation and Unemployment in an MMT World
Emilio Carnevali (Northumbria U.) and Matteo Deleidi (Roma Tre U.)
October 2020
This paper is focused on Modern Monetary Theory’s (MMT) treatment of inflation from an open economy perspective. It analyzes how the inflation process is explained within the MMT framework and provides empirical evidence in support of this vision. However, it also makes use of a stock-flow consistent (open economy) model to underline some limits of the theory when it is applied in the context of a non-US (relatively) open economy with a flexible exchange rate regime. The model challenges the contention made by MMTers that measures such as the job guarantee program can achieve full employment without facing an inflation-unemployment trade-off.

Continue reading →

Supreme Court blocks restrictions on religious gathers to fight virus: CNN
Dr. Fauci worries that Covid-19 will soar during the holiday season: USAT
US Covid-19 hospitalizations rise above 90,000 for first time: WSJ
Trump says he’ll leave if Electoral College votes for Biden: CNN
Eurozone economic sentiment drops sharply in November: BBG
Will Black Friday offer lifeline to struggling stores? AP
Has Covid-19 ended the era of Hollywood blockbuster films? BBC
Bitcoin drops sharply after reaching record high: CNBC
Amazon ramps up its global workforce to over 1.2 million: NYT
Disney to lay off 32,000 as virus takes a toll on its theme parks: MW
US jobless claims rose for 2nd week; highest level in five weeks: CNBC

It’s been a rough year, but there’s always something to be thankful for. On my short list in 2020: American democracy survives. It’s taken a beating recently, but the challenges are also powerful reminders of what’s at stake. Judge Billings Learned Hand said it best: “Liberty lies in the hearts of men and women; when it dies there, no constitution, no law, no court can save it.”

US inflation was low before the pandemic started and as the nation heads into what’s shaping up to be a rough winter of resurgent Covid-19 the odds appear low for higher pricing pressure in the near term. But as investors, economists and policy makers consider life on the other side of the coronavirus crisis, contemplating the possibility of firmer inflation is gaining traction as a forecasting exercise.

Continue reading →

Yellen, incoming Treasury Sec, will be key voice in Biden’s economic policy: NYT
Biden team lays out foreign policy agenda for new administration: CNBC
Biden administration will inherit one of the weakest labor markets in history: PLTC
Dow Jones Industrials rise to record 30,000: WSJ
Coronavirus cases flooding hospitals in America’s heartland: RTRS
US jobless claims expected to hold at high level in today’s update: WSJ
Richmond Fed Mfg Index slipped in Nov but remains solidly positive: RF
US consumer confidence falls as coronavirus cases rise: PLTC
US home price index’s 1-year gain accelerates to 6-year high: WSJ

In a world awash in identified risk factors, the original quantitative profile of investment risk long ago fell from grace. If you spend ten minutes on the internet searching for research that finds beta to be irrelevant, at best, you’ll quickly line up reading material for a month. But the majority of the criticism focuses on beta’s weakness for parsing individual stocks. By that standard, beta suffers several well-known and reportedly fatal flaws as a risk measure. But applied to asset classes in the context of portfolio design and management, beta’s far from dead.

Continue reading →

Key gov’t agency (finally) recognizes Biden’s win: CNN
Biden selects former Fed chief Yellen as Treasury Sec: WSJ
Eurozone falls back into recession in November, survey data shows: IHSM
German business sentiment falls again, suggesting Q4 economic decline: RTRS
Chicago Fed president: expects rates to stay near zero through 2024: RTRS
Bitcoin above $19,000 for first time since 2017: BBG
US economic growth accelerated in Oct via Chicago Fed index: CF
US PMI survey data: “recovery gains further momentum” in November: IHSM

Broadly defined commodities rose for a third straight week for trading through Friday’s close (Nov. 20), posting the best gain for the major asset classes, based on a set of exchange traded funds.
Continue reading →

Biden team prepares for double-dip US recession in 2021: NYT
Oxford-AstraZeneca Covid vaccine: ‘highly effective’ at preventing virus: CNBC
China says it will respond to US admiral’s Taiwan visit: RTRS
Hospitalized Covid-19 patients surviving at higher rates: STAT
Will Covid-19 unleash pent-up demand? WSJ
G20 nations pledge to extend debt relief in 2021: RTRS
UK’s four-month expansion ended in Nov as coronavirus recession returns: IHSM
Eurozone economy falls back into recession via PMI survey data for Nov: IHSM

● How I Invest My Money: Finance experts reveal how they save, spend, and invest
Joshua Brown and Brian Portnoy
Interview with co-author (Brown) via NPR
Do you ever wonder how some of the world’s top financial advisors invest their own money?
If so, you aren’t the only one. Last summer, CEO of Ritholtz Wealth Management Josh Brown wrote a blog post titled How I Invest My Own Money that went viral in the finance and investment community.
Turns out, people are really curious as to how successful investors build their personal portfolios.
This blog post eventually turned into a book with Brian Portnoy called How I Invest My Money: Finance experts reveal how they save, spend, and invest where top investors share their personal investment strategies.

Continue reading →