Economic Musings X: Legal Tender – Legal or Tender or What?

After World War II when the German Reichsmark was discredited and people were starving they would travel from their city to the local farms …

Economic Musings IX: We could all be millionaires …

… if we hadn’t destroyed literally trillions over the last 200 years!

Economic Musings VIII: Is there a limit to economic growth?

Something which puzzles many thinkers and frightens many young people concerned about waste or the pillaging of our natural resources is the question: can “an economy” (whatever that is – we’ll come to that in a minute) grow indefinitely?

How can there be unlimited economic growth if we’ve never heard of unlimited growth in, say, an elephant?

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Economic Musings VII: Marketing doesn’t advertise itself

Have you ever wondered if marketing and advertising are the same, if not, what’s the difference and which is the more important of the two? And why should you care?

Economic Musings VI: Modern Economies – Dying of Consumption

There is a great debate in the history of economics whether there can be under-consumption in any real historic moment of the state of an economy and if so, whether it has detrimental effects and if so, what is to be done about it. And modern economists seem to have found a magic wand with which to unfailingly repair any such damage and smoothen the otherwise rough ride of economic cycles. We’ll see if they have and what it might be worth, whether it’s a wand or a cane.

Economic Musings V: Subsidies, Brothers and Nannies

There are a thousand-and-one reasons why states “need” to subsidise economic activities. And there are at least as many critiques as to how the money was wisely spent, should not have been spent, should have been spent on something else, was too little, too much, at the wrong time, too early, too late, wasted or wonderful. Any policy that meets with such contradicting praise or censure is worth a deeper look.

Economic Musings IV: How Bank Robbers cause Inflation

If a robber robs a bank and runs away with the money, never gets caught or if he gets caught has spent the money before that, has that caused inflation? No – the bank now has less money and thus its money holdings have decreased exactly as much as the robber’s holdings increased. But what if the bank gets “recapitalised”?

Economic Musings III: The Bubble Analogy

There’s this fear that if a financial bubble bursts this would be tantamount to deflation (after all, when an inflatable dinghy bursts it’s called deflation). And because deflation is deemed to be a bad thing the panacea must be (re)inflation of “the” economy. Well, let’s look at what happens when a balloon bursts …

Economic Musings II: The Euro as a Basket Case

How not to Introduce a New Currency

The Euro has been touted as something of a capstone of the European Unification project. Now it may well prove its stumbling block. How ironic. And at the same time how stupid and humiliating!

How (and why) has it all happened?

Economic Musings I: The State of “the” Economy

It’s always amazed CrisisMaven how little a trained economist could know of the world going on around him or her, so as to not spot a bubble for example. Obviously it has to do with the indicators they use which are only remotely related to reality. Those who can only calculate a model with maybe two enterprises and “a” state are probably not able to fathom a newspaper article talking about how the fashion in clothes affects shoe manufacturers. Or that there is an association of dye manufacturers and the fashion industry that today knows which shades of green, blue or pink will be en vogue in, say 2014.