Links for the Week Ending 28th April (Rather Late)

  • The Transition Network now has a newspaper up and running called The Transition Free Press. In the inaugural issue, you can find an interesting interview (conducted by Transition founder Rob Hopkins) with Kevin Anderson, one of the most politically active U.K. climate scientists. Anderson basically argues that everything has to change if we are to have any hope of limiting the damage from rising temperatures. You can read the full interview here
  • My favourite ‘thinking man or woman’s’ hedge fund manager, Jeremy Grantham, has a new quarterly letter out on the race between technology and resource depletion—one of the central concerns of this blog. You can find it here. And a thought-provoking commentary on the letter by FT blogger Izabella Kaminska, together with some links relating to Grantham’s ideas, is here.
  • Following the Excel spreadsheet furore, Reinhart and Rogoff mounted a solid defence of their work in this op-ed piece in The New York Times. In particular, they stressed that they have always recognised a two-way causation from debt to growth and growth to debt. Personally, I see the modern problem as very much being a lack of growth causing ballooning debt, rather than the converse, but accept that there is an element of the reverse causation.
  • In the wake of the R&R debate, there has also been a flurry of articles on the U.K.’s massive debt in the 1800s, which did not impede growth. If you want a good primer on the historical background, I recommend this piece by Professor Robert Neild from the Royal Economic Society web site.
  • Again in the FT, we saw a sympathetic commentary on Spain’s jobless titled “Stuck on the Sidelines” last Thursday. I struggle to see how these unemployed people can be put back to work in the current global economic environment. Further, for how long can the state afford to pay people like Mr Perdones, one of the unemployed profiled in the article, €1,200 per month? But if they don’t pay (won’t pay, can’t pay), I fear all hell will break loose.
  • On the same theme, The Economist has a special section on global joblessness, pointing out that 290 million of the planet’s youth, almost a quarter, are neither working nor studying. As usual for The Economist, it ends on an upbeat note: “Policymakers know what to do to diminish the problem—ignite growth, break down cartels and build bridges between education and work.” Hardly new. Plus the body of the article explains how technology is making such job creation solutions ever-less effective.
  • Naked Capitalism has a cross post by Alejandro Nadal on the degree to which technical change is driving increased global inequality. Nadal argues that the standard neoclassical responses to the growth slow-down have also played a major part in concentrating income and wealth. This echoes Raghuram Rajan, who argued in “Fault Lines” that the Fed caused the 2006/07 bubble in a vain attempt to prop up broad-based demand. Personally, I believe such critiques of monetary policy are very rarely aired. Aggressive QE bids up assets, but it is the richer segments of society that hold such assets. In other words, such aggressive monetary policy is premised on ‘trickle down’ economics, which patently is not working.

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