Question 51

 

Question 51

Biden talked about a New World Order established in 1945 and that a new such order is coming again. Is that a real concept or is it just a description of the seating arrangements at UN dinners? Do we really have economic and political camps or changing groupings of nations that periodically break out in fits of genocide and those that don't?

As if inversely linked, Covid is beginning to vanish with the rise of Ukraine. A topic that dominated our lives is simply melting away.

It would be nice if Covid was not forgotten.

A demand for something to be done can morph into a demand for anything to be done. Faced with a series of supposed crises and epidemics – the binge-drinking crisis, the obesity epidemic, etc. – the government is told to take action at all costs. But taking action at all costs is a terrible way to make policy.--snowden

No state has completely deregulated car sales by allowing all manufacturers to sell all vehicles directly to customers. Faced with any move to end these anti-consumer laws and allow the market to function freely, dealerships cannot continue to plead the “mom-and-pop business” defense. “The top 10 dealership groups in America have annual revenue of around $100 billion, more than any car company...”

A forthcoming research article from the Independent Institute finds that Federal Reserve economists are increasingly driven by political activism and affiliation; they also demonstrate a growing preoccupation with politically charged topics such as climate change, discrimination, and economic inequality. These goals add more pressure on the Fed to maintain accommodative monetary policy, even as inflation spirals out of control.
Perhaps this provides another explanation for why the federal-funds interest rate is still at zero and the Fed is still engaged in quantitative easing after eleven consecutive months of the annualized CPI running above 4 percent..--salmon

U.S. stock volatility is 33 percent lower during wartime and periods of conflict. This is true even for World Wars I and II, which would seemingly increase uncertainty. In a seminal paper, Schwert (1989) identified the “war puzzle” as one of the most surprising facts from two centuries of stock volatility data. We propose an explanation for the puzzle: the profits of firms become easier to forecast during wartime due to massive government spending. We test this hypothesis using newly-constructed data on more than 100 years of defense spending. The aggregate analysis finds that defense spending reduces stock volatility. The sector level regressions show that defense spending predicts lower stock volatility for firms that produce military goods. Finally, an event-study demonstrates that earnings forecasts of defense firms by equity analysts become significantly less disperse after 9/11 and the invasions of Afghanistan (2001) and Iraq (2003).--cortes