- Difference between macro and micro economics - It's more than just size. A look at how macro economics evolved in the 1930s, in response to the Great depression and macro disequilibrium
- The UK Unemployment Mystery - why is unemployment falling, as we head for a triple dip recession?
- The Best form of economic stimulus? - Give it to me, I'll spend it for you. More seriously, a look at how a stimulus in US, 1936 helped.
- Remittances from migrants was three times greater than foreign aid to developing countries. Does this mean aid can fade away?
- Total US debt has actually fallen in past few years. Government spending debt has increased, but private sector debt has fallen at a greater rate.
Total UK debt has risen to over 500% of GDP. One of biggest in world's second only to Japan. Don't panic!
- How bad is government debt? A popular question, but not so straightforward to answer. Why debt can be good or bad depending on when, for what, and how you borrow
- The Treasury View - What the Treasury view is in economics. It is actually a belief of economics that pre-dates the creation of macro-economics. In essence, it means balance the budget at all costs. To a large extent the UK treasury has been following this old fashioned 'Treasury view'
- High Street shopping and buying online. Is window shopping on the high street becoming a free rider problem?
- German and Chinese exports- why Germany still exports a lot, despite having higher wages
- One quarter away from a triple dip recession
- Should we tax swearing?
- The Luddite Fallacy - always popular with economists
1 comment:
I was slightly amazed to see this post. To add sovereign debt to household debt and commercial debt certainly gets you a number, but it's a meaningless number, like adding a length to a temperature.
Sovereign debt isn't even really debt. It's a claim on a tiny slice of tax revenue in the future. Financial institutions don't buy sovereign to tide the Government over till Thursday, but to buy themselves a guaranteed income stream in the future.
Some household debt is net debt, such as credit card debt, but most is mortgage debt, which is gross, not net debt, since a mortgage is backed by a house. You can't add net to gross debt and expect to get a meaningful number.
Commercial debt is almost all gross debt, since businesses borrow to acquire assets. Currently, businesses are sitting on large amounts of cash, so they are borrowing for future expansion.
Commercial debt is either domestic or foreign. Domestic commercial debt is backed by the UK's industries, and foreign commercial debt is backed by about $6trn in overseas assets owned by UK individuals and companies. The UK has even more overseas assets than Germany, which is a significantly larger economy.
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