economics

Conversely, if foreign purchases of government bonds lowered a country’s interest rate, the higher a country’s current account surplus, the higher its interest rates should be. Why? Because of the need for the capital and current accounts to balance: the net amount of foreign purchases of U.S. government bonds and other U.S. dollar assets is

But increasing agriculture output further was no trivial feat. The key limitation that farmers had faced throughout history was nitrogen in the soil. Plants require nitrogen for growth, the element is a significant component of chlorophyll and amino acids. Soil nitrogen, however, is produced at the whim of nitrogen-fixing microbes that live in the

When it comes to investment analysis, looking for relevant historical parallels (e.g., comparing the US real estate boom of the 2000s to the Japanese real estate market in the 1980s)

Processes and values define how resources—many of which can be bought and sold, hired and fired—are combined to create value.

With regards to the workings of the capital cycle, investors focus on current (and projected) future profitability but ignore changes in the industry’s asset base from which returns are generated.

Global liquidity, which I measure as global broad money supply of major currencies, translated into a dollar denomination, continues to be rangebound as well. The weaker dollar index has been supportive for global liquidity growth in recent months, but China’s flat money supply from March 2024 to the present has been a drag on global liquidity

Robert Habeck should take some cues from the fate of Desertec. Politically motivated grand projects are not known for strong governance structures. Governmental ministers can mobilize large quantities of money, but they don’t have accountability for a financial or broader economic return on that money. That leads to attrition and waste in the best

Henry Simons was the source of Minsky’s lifelong interest in finance, as well as the idea that the fundamental flaw of modern capitalism stemmed from its banking and financial structure. Minsky took the lesson that capitalism could be stable if, first, large-scale capital investment were owned and financed publically rather than privately and,

A country with well over 100% debt-to-GDP has two main choices in this scenario. The first choice is that they can keep interest rates very low despite periods of price inflation that occurs, and debase all of the currency holders and bond holders. Japan is far enough into fiscal dominance that they’ve chosen that route. The second choice is that