Econintersect: Every day our editors collect the most interesting things they find from around the internet and present a summary "reading list" which will include very brief summaries (and sometimes longer ones) of why each item has gotten our attention. Suggestions from readers for "reading list" items are gratefully reviewed, although sometimes space limits the number included.
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Topics today include:
Economist Modeling on Plane Mistaken for Terrorist (Wonderful Parable)
Trigger for New Financial Crisis
Donald Trump is Imaging Bernie Sanders
Peter Schiff Displays Misunderstanding of Money and Finance
UK Conservative Government U-Turns Previous Years of Government Actions
Tories Stall UK Economy
Australia Election is "Economic Vision vs. Man of the People"
Canadian Officials Say They Have a "Handle on the Alberta Wildfire"
Articles about events, conflicts and disease around the world
Donald Trump performs massive U-turn to back taxing the rich and increasing minimum wage (The Independent) The resumptive nominee's policy meanderings promise to futher confound Republicans bamboozled by his ascent. Donald Trump has reversed his stance on two key economic principles - saying he now supports a higher national minimum wage and would raise taxes on the rich rather than lowering them. Providing fresh evidence he is making up his policy priorities as he goes along, the Republican presidential candidate contradicted previous statements during an interview with NBC.
Trump just exposed America's dirty little secret: Schiff (CNBC) Presumptive Republican presidential nominee Donald Trump just revealed an inconvenient truth about U.S. debt, the outspoken and often controversial Peter Schiff told CNBC in a recent interview. Last week, Trump joined CNBC's "Squawk Box" last week to discuss a wide range of topics including U.S. debt, interest rates and replacing Fed Chair Janet Yellen. It was Trump's comments about potentially renegotiating the more than $19 trillion in U.S. debt and the sensitivity surrounding higher interest rates that raised eyebrows. While some observers argued that Trump's approach could be tantamount to a debt default, Schiff told CNBC the GOP nominee was fundamentally correct in his observation. "Trump just admitted on CNBC that America has too much debt to afford a rate hike, and that he wants our creditors to accept less than 100 cents on their Treasuries," the Euro Pacific Capital CEO explained on CNBC's "Futures Now" last week. "In other words, Trump knows a U.S. government default is inevitable." Econintersect: Both Trump and Schiff have no concept of sovereign money. Both seem trapped in a gold standard menatality. The idiocy of Schiff's position is revealed when he equates Puerto Rico's insolvency with the monetary status of the U.S.
Tax credits, disability benefit and nine other U-turns from the first year of a Conservative government (The Independent) It is a year since the Conservatives won a surprise majority the 2015 general election. While many Tories may have looked forward to a bright future freed of the shackles of coalition, it has been anything but plain sailing for the party’s leadership. Years of progressive actions have been attacked and in the first year of a Conservative government free of their coalition partners, there have been several major reversals. See also next article.
Conservative economics: what's happened to the UK economy after a year of Tory rule (boing boing) It's been a year since David Cameron's Tories took control of the UK Parliament with a majority that gave their free rein to govern UK, plc to their taste. It's been a disaster. Growth is down. Unemployment is rising. Productivity is falling. Inflation is up. Wages are stagnant. The stock market is sliding. The Conservative pitch is that they are the party of business, and in times of economic uncertainty, only they can govern. But when selling off public assets, slashing services, and giving tax breaks to the super rich fails to materialize the promised economic miracle, they move the goalposts, claiming that because of the economic uncertainty, they couldn't have possibly done any better. Then they warn that if they hadn't imposed all this pain on the 99% (and lavished so much treasure on the 1%), things would be so much worse.
Federal election 2016: Economic vision vs ‘man of the people’ (The Australian) Election 2016 is the contest between Malcolm Turnbull’s economic strategy and Bill Shorten’s people strategy. Turnbull aims to win by persuading the public to trust him as a superior economic manager while Shorten plays to the people’s angst, daily tribulations and pressure on family living standards.
Canada officials start to get a handle on largest wildfire (Reuters) Canadian officials on Sunday showed some optimism for the first time that they were beginning to get on top of the country's biggest wildfire, as cooler weather and light rain stopped the blaze from growing as much as feared and winds took the flames away from oil sands boomtown Fort McMurray.
Other Scientific, Health, Political, Economics and Business Items of Note - plus Miscellanea
Passenger mistakes math equations for 'terrorist code,' gets economics professor escorted off flight (Mashable) An Ivy League economist was pulled off an American Airlines regional jet from Philadelphia to Syracuse after a fellow passenger incorrectly identified the mathematical equations he was scrawling for foreign script, and suspected him of terrorism. An unidentified woman sitting next to him tried to strike up a conversation with her seatmate, Guido Menzio, as they waited for American American Airline Flight 3950 to take off. However, Menzio wasn't interested in chatting with the woman. He was giving his full attention to writing "cryptic notes, scrawled in a script she didn’t recognize". American Airlines spokesman Casey Norton told the Post that the woman initially handed a crew member a note saying she was feeling "sick," but when she was later escorted off the plane she revealed that she actually wasn't ill at all. According to The Washington Post, the unidentified woman was scared that her seatmate might be a terrorist because she couldn't identify the foreign script he was writing. The plane remained on the tarmac for nearly 30 minutes before security personnel removed Menzio from the plane. Econintersect: This is episode is almost a parable for the state of modern economics. (1) Economists can't speak to ordinary people; in fact many don't even try. (2) The modeling of many economists is not comprehensible. See also next article.
Lessons to be learned when an economics professor is asked to leave a flight after doing equations (The Independent) The lesson is plain. Mathematical economics - which, with their spurious certainties and tendency to rubbish-in, rubbish-out predictions, did so much to create the great banking crisis - are best avoided if you, and the wider world, would prefer a quiet life. Economic history is a much safer bet for a flight, as part of an economist's education; it can also help you fall into a restful snooze, which even the most fretful neighboring passenger couldn't mistake for terrorist intent.
These are the triggers for a new financial crisis (The Independent) With existing political elites seen as captured by businesses, banks and the wealthy, electorates are turning to political extremes in search of representation and solutions. The resulting policy uncertainty and inconsistency further suppresses recovery. A list of trend which may be triggers for the next crisis are discussed in this article.
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