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The Shipping News Suggests Economic Weakness

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Re: The Shipping News Suggests Economic Weakness

#61

Post by trevelyan »

brc wrote: post #4

The world economy is dominated by people in governments who believe that printing money, burying it and paying people to dig it up again will increase the amount of trucks built and goods shipped. No amount of failure of this theory will be enough for it to be abandoned, because it has a certain amount of truthiness to it, and it excuses profligate and wasteful behaviour. Both these things are fun and buy votes. The…

Yup. Lets go back to gold so that when times get tough people can go to the mines and dig it up instead.

Re: The Shipping News Suggests Economic Weakness

#62

Post by danharaj »

vezzy-fnord wrote: post #54
jjoonathan wrote: post #48

Earlier quoted context omitted.

I don't buy it. Boom & bust cycles are driven by the fundamental difficulty of quantifying value. Since there is no true value, people base their opinions on those of others (+delay), leading to "inertia," leading to oscillation. The government might exacerbate the oscillations, but the lion's share of responsibility lies with the market. Complaining that the oscillations happen because the market "just isn't free en…

What you're describing might explain fluctuations, but it's inadequate and incomplete for the business cycle. Virtually no one, not even Keynesian or other left-economists support make-work. It's mostly an idea favorable to laymen, or often done for more nationalistic rather than economic reasons. FDR was inspired by William Trufant Foster's and Waddill Catchings' policy advice for instance, who had Keynesian-esque u…

> It's not as if there is some objective essence called "value" that people seek.

use-value? you know, people actually using the goods and services they acquire?

Re: The Shipping News Suggests Economic Weakness

#63

Post by sbardle »

brc wrote: post #4

The world economy is dominated by people in governments who believe that printing money, burying it and paying people to dig it up again will increase the amount of trucks built and goods shipped. No amount of failure of this theory will be enough for it to be abandoned, because it has a certain amount of truthiness to it, and it excuses profligate and wasteful behaviour. Both these things are fun and buy votes. The…

Central banks are the problem. They have destabalised the global economy by constantly lowering interest rates and creating asset bubbles to promote the illusion of growth. Central bankers are politically appointed in many cases so they have no interest in cooling an economy. It messes up the business cycle and creates the conditions for even bigger booms and busts. Alternative currencies like Bitcoin will rise in popularity and may hold the key to a less manipulated financial system in the longer term - but I fear we will have another financial crisis before the new alternative currencies have gained traction. We shall see...

Re: The Shipping News Suggests Economic Weakness

#64

Post by csours »

hawkice wrote: post #29
foobarian wrote: post #3

Earlier quoted context omitted.

I also don't appreciate that the Y axes are not 0-based.

The Baltic Dry Index chart IS zero-based. It is at an all time low, that's not just some weird illusion.

A few of the charts in the article are zero based, but most are not.

Re: The Shipping News Suggests Economic Weakness

#65

Post by vezzy-fnord »

danharaj wrote: post #62
vezzy-fnord wrote: post #54

Earlier quoted context omitted.

What you're describing might explain fluctuations, but it's inadequate and incomplete for the business cycle. Virtually no one, not even Keynesian or other left-economists support make-work. It's mostly an idea favorable to laymen, or often done for more nationalistic rather than economic reasons. FDR was inspired by William Trufant Foster's and Waddill Catchings' policy advice for instance, who had Keynesian-esque u…

> It's not as if there is some objective essence called "value" that people seek. use-value? you know, people actually using the goods and services they acquire?

But use value cannot be quantified, since utility is not a mathematical scale, but a subjective feeling that varies from person to person and with time as preferences shift or swing. I'm also unaware of how you can explain diverse business cycles throughout history as emanating from it.

Practically every economic theory that has tried to objectively quantify "value", i.e. those of Ricardo, Marx and Sraffa, relies on gigantic and complicated expositions involving leaps of abstraction and mathematical transformation problems that are completely detached from how real-world people actually think about or treat value.

(Indeed, such exercises in value theory aren't so much about determining value as much as trying to work out given theories of income distribution and perceived exploitation.)

Re: The Shipping News Suggests Economic Weakness

#67

Post by crimsonalucard »

jjoonathan wrote: post #48
brc wrote: post #4

The world economy is dominated by people in governments who believe that printing money, burying it and paying people to dig it up again will increase the amount of trucks built and goods shipped. No amount of failure of this theory will be enough for it to be abandoned, because it has a certain amount of truthiness to it, and it excuses profligate and wasteful behaviour. Both these things are fun and buy votes. The…

I don't buy it. Boom & bust cycles are driven by the fundamental difficulty of quantifying value. Since there is no true value, people base their opinions on those of others (+delay), leading to "inertia," leading to oscillation. The government might exacerbate the oscillations, but the lion's share of responsibility lies with the market. Complaining that the oscillations happen because the market "just isn't free en…

>Boom & bust cycles are driven by the fundamental difficulty of quantifying value. Since there is no true value

I disagree with this statement. Although I do agree that it is hard to quantify or even estimate value, all things do have a true intrinsic value relative to the utility they can provide human beings.

Entire empires have been built based on the concept of intrinsic value. Berkshire Hathaway is probably the most famous.

Re: The Shipping News Suggests Economic Weakness

#70

Post by bcg1 »

pessimizer wrote: post #55
horsecaptin wrote: post #44

Earlier quoted context omitted.

A stronger dollar combined with a lack of a middle-class that can actually use the dollar's strength to consume more stuff means trouble.

A stronger dollar is what destroys the middle class by crushing exports: http://www.tradingeconomics.com/united-states/balance-of-tra... (click MAX) http://www.usatoday.com/story/money/business/2015/05/05/trad...

Perhaps worse for people in the US than a potential drop in exports (we've had a negative balance of trade for a while, irrespective of dollar strength) is the effect on corporate earnings for US companies that make money abroad. A strong dollar wreaks havoc on their balance sheets (since they need to report their earnings in dollars) and can absolutely lead to falling share prices as well as domestic job cuts.
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