Surprising news!!! (NOT..)
It is a real shock if you live in a parallel universe of your own... (News initially read at Naftemporiki )
Posts
It's the animal spirits: some evidence.
It has been a while, since I posted " It's the animal spirits " trying to identify some reasons why the US economy is underachieving in terms of employment and growth. Unfortunately, I was unable to substantiate some of my claims one of which was: In addition, households curb their optimism for their future income and are intimidated to spend; either they cannot be confident that they will maintain their current job or the unemployed household members cannot be sure that they will be hired in the near future. David Beckworth on Macro and Other Market Musings: The Ongoing Dereliction of Duty fortunately provides evidence that actually expected household income plays a vital role in the future course of the US economy. Enjoy his post!
It's the animal spirits!
After DeLong's " L ESS THAN 100,000 PAYROLL JOBS, A 58.5% EMPLOYMENT-TO-ADULT-POPULATION RATIO EXACTLY WHERE IT WAS A YEAR AGO, AND LABOR FORCE PARTICIPATION DOWN BY 0.5 PERCENTAGE POINTS IN THE PAST YEAR " I once more started thinking of the Keynesian animal spirits . Keynes attributed the so called "Great 1929 Depression", back in 1933, to the low profit expectations of the business coordinators and other economic agents. As a result, investment was being gravely hindered by the adverse economic environment and by the blunted consumption (demand) resulted by the unemployment. Bradford DeLong is anxiously concerning for what he could reply to future "whippersnapper economic historians who will come to interview him" for the currently sluggish economic activity of the US. I do not blame him! He does not overreact, either! I have something in mind that could serve as an answer to future historical quests. It has been a while since I first started ...