On October 1st the autonomous Spanish region of Catalonia held a referendum on independence, despite fierce opposition from the central government, which said that the vote violated the Constitution. Hundreds of people were injured in clashes with the police during one of the gravest tests of Spain’s democracy since the end of the Francisco Franco's dictatorship … Continue reading The Catalan’s independence: who’s wrong and who’s right?
Tag: economy
We can all agree that, although the market is a very efficient tool to allocate resources, there are some cases, such as education and wealth, where the government intervention is, if not essential, certainly highly required. But how can the government understand what people want and what people need? How it should invest, and how … Continue reading The cost and the benefit of a rocket
A Lender of Last Resort (LLR) is an institution, usually a country's Central Bank (like the Federal Reserve in the United States), that offers loans to banks or other organizations that are having financial difficulties or that are near a collapse or a bankruptcy. Generally, LLRs borrow money to those companies or financial institutions whose … Continue reading What is a Lender of Last Resort?
Donald Trump conducted an interview on May 4 with the Economist. Here follows the accurate transcription: [talking about his tax plan] But beyond that it’s OK if the tax plan increases the deficit? It is OK, because it won’t increase it for long. You may have two years where you’ll…you understand the expression “prime the … Continue reading Donald Trump: “you understand the expression prime the pump?”
John Maynard Keynes (1883-1946) was a famous British economist, mainly known for his book "The General Theory of Employment, Interest and Money", published in 1936, and for being the father of Keynesian Economics. In particular, Keynes was a strong advocate of full employment and government intervention in order to stop economic recessions: in his opinion, absolutely … Continue reading John Maynard Keynes
A financial bubble is an economic period in which the prices of particular types of assets increase in an exaggerated way, strongly exceeding their intrinsic value, only to contract later, when the bubble burst. It is usually originated by an exuberant bullish market and it ends when no more investors or speculators are willing to … Continue reading What is a financial bubble?
On September 15th, 2008 the Great Recession, officialy started in December 2007, materialized in the financial world with the bankruptcy of Lehman Brothers Holdings Inc., one of the oldest and largest investment banks in Wall Street. The fate of the famous financial firm has shown to all the world the fragility and the weakness of the current economic system, centered … Continue reading Are banks necessary?
We all hear talking about inflation, but how does it really work? It is define as the rate of change of prices, and the change can be more or less fast (if it is really high we are talking about hyperinflation); positive or negative (deflation). If we have a little amount of inflation it doesn't … Continue reading 101 Inflation
Before talking about small and medium enterprises (SME) we have to face a problem: global SME are not always comparable, we do not have certain data to look at. European commission defines SME as less than 250 employees, but USA set the amount at 500, on the contrary in Australia the number is less than … Continue reading The Big Role of Small Enterprises
https://www.youtube.com/watch?v=PHe0bXAIuk0 "Created by Ray Dalio this simple but not simplistic and easy to follow 30 minute, animated video answers the question, "How does the economy really work?" Based on Dalio's practical template for understanding the economy, which he developed over the course of his career, the video breaks down economic concepts like credit, deficits and … Continue reading How The Economic Machine Works by Ray Dalio
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