China Eclipsed the US As the Biggest Trading Nation – Questions to Ask From an Austrian Perspective
Last month one of the Bloomberg’s headline news was titled “China Eclipses the U.S. as Biggest Trading Nation”. Fact are facts. Modern day economists and politicians are forced to accept them but are they posing the right questions when giving the public their ‘so-called solutions?” Following are questions to Bloomberg’s article’s highlights from an Austrian School of Economics perspective.Brazilian Economy Is Building Momentum
Earlier this month we saw confirmation that the Brazilian economy grew by just 0.9% during 2012 which was well below initial expectations of 4.5% in early 2012. In many ways this was something of a hangover from growth of the previous year and the fact that the ongoing European debt debacle is still continuing. However, there do seem to be signs that the economy is building up yet more momentum although many experts are reluctant to issue forecasts for 2013 at such an early stage.Representational Monetary Identity
Let us analyze what happens in commercial banking. First, we have a deposit. Then, we have a loan of up to a fraction (of 90%) of this deposit. Finally, the borrower can deposit the borrowed money into another bank account, in the same bank or not. Suddenly, the trillion dollar question emerges: is the borrowed money in these two bank accounts… the same? On the one hand, the answer is yes: all borrowed money came from the original deposit — so it is that same original money. On the other hand, the answer is no: all money deposited into the borrower’s account possibly stays in the original depositor’s account — so it is not that same original money. How can that be?Consumer Price Index (CPI): Does It Measure Inflation?
The Federal Government relies on the CPI as the “official” measure of inflation, however is it accurate? Once we peer into what the CPI is and HOW it is calculated we quickly learn that we are no longer measuring inflation, but rather the Cost of Living.Hugo Chavez Leaves His Mark on Venezuela
As we await seven days of official mourning following the death of Venezuelan President Hugo Chavez it is interesting to see that just prior to his death his economic reforms began to have a greater influence upon the Venezuelan economy. The 58-year-old president had a very controversial political career which began at one extreme and slowly but surely moved towards the other extreme.Brazil’s Economy Moving Forward Again
At the start of 2013 a number of experts were suggesting a significant slowdown of the Brazilian economy which has for some time been the centre stone of the Latin American revival. Some experts were predicting economic growth for 2013 as low as 0.9% although after a revival in the first part of 2013 these forecasts have been substantially upgraded.Washington Agenda Has Americans Moving
As the administration in Washington, D.C. continue to pretend as if they are working to grow America, the statistical facts point in an otherwise poorer direction. To combat this attack by the government that is supposed to be “For the People,” many are taking matters in their own hands by relocating to other states where the job market offers some hope of employment, even if those jobs are minimal wage.Clean Energy and System Purism
Much of the 20th century revolved around a conflict between capitalism and socialism. On both sides there were many people willing to die for either system. My response is that a system – any system – is a tool and nothing more than a tool; and the point is not to be a purist to either system but to maximize benefits of all systems while doing away with their negative effects.The Mysteries of the VIX
The VIX is an index in the financial markets that is frequently used to gauge “Fear” and “Greed”. But what is it really, is it accurate, should we trust it, and how do we use it?Should Overseas Investors Be Wary of Latin America?
This week’s revelation that the Bolivian government is to nationalise three airports owned by a Spanish company has caused a major political argument between Bolivia and Spain. It seems as though the Bolivian government believes that the Spanish operator of the three main airports has not delivered on further investment and expansion as promised. However, the Spanish company in question, Sabsa, has refuted these allegations.Will Consumer Debt Hold Back the Brazilian Economy?
There is no doubt that the Brazilian economy has performed very well over the last four or five years and indeed while slowing down in 2012 there are high hopes for 2013 and beyond. However, one issue which is being mentioned more and more is the fact that consumer debt has increased dramatically and many consumers are maxing out on credit cards and other financial arrangements. Is this a danger for the Brazilian economy going forward?