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Median inflation (or other trimmed means) work best because of high variation in price changes

The standard inflation indexes track the average change in prices and one of the problems with using any average that is disproportionately influenced by outliers that are highly volatile due to market forces that have nothing to do with monetary

Posted in Macro

TIPS for investing and predicting inflation

A lot of people are worried about inflation because of hysteria at the Wall Street Journal and other media reports that sensationalize the issue.  I’m not worried because I trust the bond market which predicts inflation better than anyone.  To

Posted in Macro

Zero-reserve banking: Another historic revolution.

The Fed eliminated all reserve requirements for banks on March 16, 2020 for the first time in history and I didn’t even know about it until today because it got very little press. Also, it was the beginning of the

Posted in Macro

Blockchain NFTs have nothing to do with ownership rights. They are merely collectables and receipts for donations.

 NFTs are not property rights just like Bitcoin is not money. Property rights are usually described as a bundle of rights, but every concept can be described as having a bundle of qualities, so what matters is determining what qualities

Posted in Culture, Macro, Philosophy and ethics

Bitcoin is not money. Therefore it cannot replace the dollar which IS money.

UPDATED on 4/24/21 Bitcoin is not money.  There are three main functions of money: 1) a unit of account (a measurement of value); 2) a medium of exchange; and 3) a store of value.  The most important and unique function of money

Posted in Macro

Interest rates are low because of demographic changes and rising corporate power

Greg Mankiw wrote in the NYT about the puzzle of persistently low interest rates. Interest rates have been lower than ever before in history and they have been very low for decades so low interest rates seems to be the

Posted in Macro, Managerial Micro

Why did the stock market rise to record highs during the Covid-19 pandemic? Is it a bubble?

The timing of stock market gyrations are often hard to explain, and although the stock market crash at the beginning of the Covid pandemic is easy to understand, the dramatic rise later in the pandemic is harder to understand. Why

Posted in Macro

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