Gross Domestic Product has been reported to be an unexpectedly high 3.5% in the third quarter (on an annual basis). However the growth was led by a “surprisingly” high increase in defense spending and a reduction in the trade deficit (which accounts for 2% of the 3.5%). The last time defense spending had a surprising increase was the third quarter of 2012 (also a quarter leading up to an election) there was a sharp fall off in defense spending the next quarter.
As the world reflects on the incomprehensible horror of the Great War which erupted 100 years ago there is a question which goes unasked in the media coverage. How was there no peace deal between the belligerents in 1915 or at latest 1916 once it became clear to all — especially after the Battle of the Somme — that the conflict had developed into a stalemate and holocaust of youth?
The economic phenomenon known as the “tragedy of the commons” instructs us that commonly-held resources that are insufficiently protected will be plundered to extinction. The phenomenon was recognized in the early nineteenth century to explain why the commons in England quickly came to be denuded by sheep. All sheepherders had an equal right to graze sheep on the commons. There often was no agreement as to how many sheep each could graze, so it was sheer rational self-interest for each to graze as many sheep on the common ground as possible.
Fair trade is once again a rallying cry for many Americans. Many contemporary leftists believe that the U.S. government should impose restrictions or tariffs on imported goods that are alleged to have been produced by underpaid or oppressed Third World workers. Few contemporary protectionists are aware of the sordid history of trade conflicts earlier in American history.
According to a Wall Street Journal article posted online this morning, the Federal Reserve chair(wo)man Janet Yellen expressed that the “economics profession... could benefit from a more diverse range of views.” Delivering introductory remarks at a conference, Yellen stated:
The Federal Reserve has finally ended its quantitative easing programs. Since the financial crisis of 2008, the Fed has pursued what seemed like an endless policy of asset purchases. As recently as September 2008 the monetary base in the US was just a hair over $800 bn. Today this figure is just shy of $4.2 trillion, for a total increase of 425%.
Reading the news, one could be forgiven for coming to the conclusion that virtually all economists work for the government or the Fed, and that few of them have real (i.e., private sector) jobs. Of course, there are many practitioners of microeconomics who do an enormous amount of good in society for private clients. Austrian economists have long focused on microeconomics because only microeconomics focuses on the only unit that matters in economic action: the individual.
Ben Kramer-Miller writes at Seeking Alpha:
Summary
PressTV Reports:
Over the past several years, most of the attention of the eurozone debt crisis has been focused on the economic struggles of Greece, Spain and Portugal and without a doubt things will continue to get even worse in those nations.
However, the predictions have been that in 2014 and 2015, Italy and France will start to take center stage in eurozone debt crisis. France has the fifth largest economy on the planet, and Italy has the 9th largest economy on the planet, and at this point both of those economies are rapidly contracting.
John Tamny, of Forbes magazine has written a recent article in which he takes Austrian economist David Gordon to task for not being Misesian enough in a book review of Money by Steve Forbes and Elizabeth Ames.
