Economics @ ITT

What Might the US Government Crisis Cost?

Posted in economics, macroeconomics by ittecon on October 14, 2013

From the fiscal cliff to sequestration to the current shutdown debt ceiling debate: Whats the cost of the U.S. government careening from crisis to crisis?About 900,000 jobs lost … and the potential for another recession.

via Crisis cost? Lost jobs and maybe another recession – NBC

How to Graph Specialised Growth with Two Production Possibility Curves

Posted in economics by ittecon on October 8, 2013

In response to my post on How to Graph a Production Possibilities Frontier in Excel 2007 and Excel 2003, several people have asked how to chart two production possibilities curves, so I have created the amendment for Excel 2010, which is substantially similar to Excel 2007, and the concepts still apply to Excel 2003, though the mechanics are different. Some texts reference these curves as PPC, PPF, or PPFC. No matter, they all server the same function, which is to graphically represent opportunity costs.

From the Insert menu, select Scatter, and choose the one with smooth lines and markers—unless you do not want markers.

The key is simply add the second item to be represented on the Y-axis; otherwise follow the same steps for a single curve,

PPC - Specialised Growth

The resultant chart will appear like this:

PPC - Specialised Growth Chart

If you wish the specialisation to appear on the X-axis instead of the Y-axis, simply reverse the values for these on both data series. And there you have it. For details on how to swap X- and Y-axis data, refer to my post on Graphing Supply and Demand Curves in Excel.

Chart: Know Your Economics

Posted in economics by ittecon on September 19, 2013
economic chart

Know your branches of economics


This was sent to me from a friend without ties to academic or professional economics.

A Free (Rigged) Market is Good for Everyone Except 99% of Americans

Posted in economics by ittecon on September 16, 2013

A nice piece by Paul Buchheit.

Free-market libertarians go to outrageous exremes to convince themselves and others of the infallibility of the market. Even when opposing evidence smacks them in the face, they conjure up sound bites that seem vaguely convincing but are in reality meaningless. Here are some examples.

via A Free Rigged Market is Good for Everyone Except 99% of Americans.

The US economy will never recover?

Posted in economics by ittecon on September 13, 2013

Words from the “wise,” based on shaky premises. This is where corporate economics is divorced from reality.

“Significant monetary stimulus, the end of fiscal austerity, a booming housing market, a cheap dollar, record corporate cash balances…if the US economy does not significantly accelerate in coming quarters, it never will,” Michael Hartnett, Bank of America Merrill Lynch’s chief investment strategist, wrote in a report Thursday.

via We still love stocks, but not as much: Goldman.

China’s American Bailout?

Posted in economics by ittecon on August 26, 2013

The twenty-first-century economy has thus far been shaped by capital flows from China to the United States – a pattern that has suppressed global interest rates, helped to reflate the developed world’s leverage bubble, and, through its impact on the currency market, fueled China’s meteoric rise. But these were no ordinary capital flows. Rather than being driven by direct or portfolio investment, they came primarily from the People’s Bank of China (PBOC), as it amassed $3.5 trillion in foreign reserves – largely US Treasury securities.

via China’s American Bailout? by Alexander Friedman – Project Syndicate.

Putting China’s Low Household Consumption in Perspective

Posted in economics, International Economics by ittecon on July 22, 2013

It is widely known that China needs to rebalance its economy to rely more on consumption, but the extent of China’s imbalance between consumption and investment is not fully appreciated.  Comparisons to other emerging markets and countries like Japan, Taiwan, and Korea that pioneered the East Asian growth model show that China’s low levels of consumption are unparalleled.

via Putting China’s Low Household Consumption in Perspective |


This is an article from 2011, but it was mentioned by Paul Krugman’s latest post.

The Big Lie Behind Food Stamps

Posted in economics by ittecon on July 22, 2013

Walmarts wages and benefits are so low that many of its employees are forced to turn to the government for aid, costing taxpayers between $900,000 and $1.75 million per store…

via Daily Kos: The big lie behind food stamps.

Why Should Taxpayers Give Big Banks $83 Billion a Year?

Posted in economics by ittecon on June 21, 2013

The top five banks—JPMorgan, Bank of America Corp., Citigroup Inc., Wells Fargo & Co. and Goldman Sachs Group Inc.—account for $64 billion of the total [US government tax] subsidy [of $83 billion], an amount roughly equal to their typical annual profits see tables for data on individual banks. In other words, the banks occupying the commanding heights of the U.S. financial industry—with almost $9 trillion in assets, more than half the size of the U.S. economy—would just about break even in the absence of corporate welfare. In large part, the profits they report are essentially transfers from taxpayers to their shareholders.

via Why Should Taxpayers Give Big Banks $83 Billion a Year? – Bloomberg.

The Banking Revolution that Would Wipe Out Britain’s Debts

Posted in economics by ittecon on June 11, 2013

Banking reform has been back in the headlines over the past week, with calls from a parliamentary committee for consideration to be given to more radical options – including the break-up of the Royal Bank of Scotland – and a scathing attack by MPs on Dame Clara Furse’s fitness to serve on the Bank of England’s new financial stability committee.

via The banking revolution that would wipe out Britains debts – Telegraph.