The yearly rate of growth of money M2 fell to 5.2% in November from 7.5% in October while the yearly rate of growth of money M3 fell to 4.7% in November from 7.5% in the previous month.

How seriously should one take the recent softening in the yearly rate of growth of money supply? Some analysts believe that this softening in the growth momentum could cause problems for financial markets since a fall in the rate of growth implies that the pace of liquidity generation is slowing down. It is also held that a softening in the growth momentum is likely to hurt economic activity.

Ninety years ago this month, on December 23, 1913, the Congress passed the Federal Reserve Act, establishing a national central-banking system in the United States. The governing board of the Federal Reserve was organized on August 12, 1914, and the Federal Reserve banks opened for operation on November 16, 1914. [Continued]

From Chapter Six of David C. Colander’s principles-level Macroeconomics 5th ed., (McGraw Hill, 2004) is titled “Economic Growth, Business Cycles, Unemployment, and Inflation.” Appendix A to this chapter (pp. 157-59) is titled “Nonmainstream Approaches to Macro.” In addition to short introductory and concluding sections, Colander deals with the Austrians, the Post Keynesians, the Institutionalists, and the Radicals.

AUSTRIANS

 

From  MSNBC: “suborbital spaceship being tested by aircraft designer Burt Rutan and his team at Scaled Composites fired its rocket engine and went supersonic for the first time today, on the centennial of the Wright brothers’ historic first flight.”Our flight this morning by SpaceShipOne demonstrated that supersonic flight is now the domain of a small company doing privately funded research, without government help,” Scaled Composites, based in California’s Mojave Desert, said in a

According to  this story in the St. Louis Post-Dispatch, the price of flu vaccines has more than quintupled. So what’s the problem?  Entrepreneurs are allocating resources to the uses that bring people the greatest benefit. They should be applauded for doing so, right?

“The only difference is that Saddam would kill you in private, where the Americans will kill you in public,” Mohammd Saleh, a 39-year old building contractor in Baghdad, tells the  Washington Post  . This item and many others are linked at Antiwar.com.

This paper by Philip Oreopoulos argues that dropping out of school isn’t such a bad idea after all. ”I estimate dropping out one year later increases present value income by more than 10 times forgone earnings and more than 2 times the maximum lifetime annual wage.”

Interesting price chart from CNN: