Long, Strange Trip

What a year.  First, I'll admit straight out of the gate I was wrong about having a vaccine in Q1.  The lab folks pulled a minor miracle, and we have several.  I was still right about other things, though: 1) We're at the end of Q1 and have barely made a dent on the number of people vaccinated, 2) there is no end in sight for the mess the economy is in regardless of what the stock market is doing, and 3) always verify claims of expertise.

And of course we have had plenty of messes so far this year.  Our worst was 6 January.  It shouldn't have come as a surprise to anyone, but you must remember that people in general and Americans in particular don't like to notice warning signs.  Everybody was surprised by 9/11 even though everyone knew you could fly a plane into a building without much trouble.  Everyone was surprised by the 2008 recession even though everyone knew what goes up must come down (and had with a vengeance just eight years earlier).  Everyone was surprised by the pandemic even though everyone knows viruses are out there constantly reinventing themselves.  If you refuse to see what's right in front of you, expect to be punched in the nose.  A lot.

IMF Gets Religion?

The International Monetary Fund (IMF) has long been the global stormtrooper for budget cuts, tax hikes, and radical austerity programs.  The IMF has held country after country hostage to its Austro-Chicago orthodoxy.


Which makes Larry Summers's recent report about the IMF's latest World Economic Outlook a stunner.  It seems the IMF (and Summers for that matter) has finally gotten what anyone with more brains than a turnip has known since the New Deal: If you need to jump-start an economy, the government should borrow money and spend it on infrastructure; you are almost guaranteed a net return.

At last, some sense in economic policy.  We might finally get some alternatives to austerity before we destroy every economy on the planet.  Of course there are still plenty of political prostitutes like Otmar Issing out there preaching the same, old Austro-Chicago Kool-Aid (If Issing wants to see where his "ideas" lead, he need look no further than Hungary and dumpster fire Orban is creating.  But Issing has already done that and isn't going to let reality get in the way of his bought and paid for opinion.  Hence my calling him a prostitute.).  But maybe the light at the end of the tunnel isn't just an oncoming train.