Saturday, June 24, 2017

In Long Run, There’s No Such Thing as an Einstein Investor

There are no easy answers in investing. It is tempting to replicate a successful strategy — one created by an outstanding investor, like Warren Buffett, or through in-depth statistical analysis of the wisdom of crowds — and such approaches can actually work for long periods.

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Tuesday, May 23, 2017

Understanding Today’s Stagnation

NEW HAVEN – Ever since the “Great Recession” of 2007-2009, the world’s major central banks have kept short-term interest rates at near-zero levels. In the United States, even after the Federal Reserve’s recent increases, short-term rates remain below 1%, and long-term interest rates on major government bonds are similarly low. Moreover, major central banks supported markets at a record level by buying up huge amounts of debt and holding it.

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Friday, May 19, 2017

How Tales of ‘Flippers’ Led to a Housing Bubble

There is still no consensus on why the last housing boom and bust happened. That is troubling, because that violent housing cycle helped to produce the Great Recession and financial crisis of 2007 to 2009. We need to understand it all if we are going to be able to avoid ordeals like that in the future.

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Tuesday, April 4, 2017

Caution Signals Are Blinking for the Trump Bull Market

Despite an eight-day losing streak that ended on Tuesday, the stock market has generally been buoyant in the opening weeks of the Trump administration. The bullish mood could be a self-fulfilling prophecy and lead to continuing gains for a while.

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Wednesday, March 22, 2017

Robotization Without Taxation?

NEW HAVEN – The idea of a tax on robots was raised last May in a draft report to the European Parliament prepared by MEP Mady Delvaux from the Committee on Legal Affairs. Emphasizing how robots could boost inequality, the report proposed that there might be a “need to introduce corporate reporting requirements on the extent and proportion of the contribution of robotics and AI to the economic results of a company for the purpose of taxation and social security contributions.”

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Saturday, February 18, 2017

Why Trump’s 2-for-1 Rule on Regulations Is No Quick Fix

President Trump intends to pare back a vast array of government regulations in fields like environmental protection, food and drug safety, and consumer finance. On Jan. 30 he ordered that for every new regulation it imposes, the government must get rid of two old ones.

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Sunday, January 22, 2017

Narrative Economics

This address considers the epidemiology of narratives relevant to economic fluctuations. The human brain has always been highly tuned towards narratives, whether factual or not, to justify ongoing actions, even such basic actions as spending and investing. Stories motivate and connect activities to deeply felt values and needs. Narratives “go viral” and spread far, even worldwide, with economic impact. The 1920-21 Depression, the Great Depression of the 1930s, the so-called “Great Recession” of 2007-9 and the contentious political-economic situation of today, are considered as the results of the popular narratives of their respective times. Though these narratives are deeply human phenomena that are difficult to study in a scientific manner, quantitative analysis may help us gain a better understanding of these epidemics in the future.

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