News Story of the Day: the global economy can be described as this: debt on debt on debt…on debt. But how much debt does the entire planet have?
Well, thanks to central bank intervention, governments spending like drunken sailors and consumers embracing plastic, the global economy has a total of a whopping $230 trillion, according to estimates from Value Walk. That’s a lot of money. The key question is: how in the heck do you plan to pay that all down?
Here is what the website states:
“At the end of every supernova comes a black hole. Black holes have such a strong gravitational effect that nothing can escape their pull. And gravitational principles are distorted in the very center of a black hole, also known as the gravitational singularity. We’re seeing a similar phenomenon in the investment world: the crushing weight of all this global debt is distorting some fundamental economic principles.”
What’s incredible is that number is a conservative estimate. It’s likely a lot higher, especially when you add in future unfunded liabilities.
Chart of the Day: no, Brexit did not cause the world to blow up. Brexit did not cause economic collapses across the globe. Brexit did not send Britons into immediate and perpetual poverty. As the Bloomberg chart below shows, UK consumer mood is surging in the post-Brexit nation. “Britons’ confidence and their eagerness to make big-ticket purchases partly rebounded in August,” the publication reported.
Illustration of the Day: do you want a summary of why the Clinton Foundation was established? Here is a cartoon that perfectly sums up this supposed philanthropic organization:
Quote of the Day: Cafe Hayek‘s Don Boudreaux smacks down the Wall Street Journal in the myth that worker pay hasn’t kept up with worker productivity:
Dear Editor:
Hunter Blair opposes cutting corporate income taxes because, as he puts it, “Corporate income-tax cuts are supposed to boost wages by incentivizing investment in plants and equipment, which boosts economy-wide productivity. But for most of the past few decades, increases in economy-wide productivity have not translated smoothly into wage increases for the vast majority of workers. Instead, the fruits of this productivity growth have disproportionately accrued to workers at the very top of the salary scale” (Letters, August 31).
Forget that, as Liya Palagashvili and I argued in your pages not long ago, it is a myth that worker pay hasn’t kept pace with increasing worker productivity. If it is true that the increased worker productivity brought about by more investment has not yet been, and will continue not to be, matched by increased worker pay, then Mr. Blair should quit his job at the Economic Policy Institute and launch his own business to take profitable advantage of the legions of underpaid workers who he so confidently insists populate the land. If he’s correct, he’ll make a mint! If, however, Mr. Blair refuses to exploit in some form or fashion, using his own money, this profit opportunity that he himself avers is real, then he has no business advising government to continue to tax away huge chunks of money from other people – other people who, unlike Mr. Blair, put their own skin in the market.
Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030
Video of the Day: if free market economist Milton Friedman was around today then it’s quite plausible that college campuses would ban him from delivering speeches or communicating with students. Because of his wisdom on free market economics (not monetary policy), he was able to tackle every single matter presented in front of him. And facts terrify college students today. Here is a video of his greatest hits:
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