Blog Archives

What’s wrong with economics? Part 1: The disorganisation of economics

These days economists have a bad reputation. And not only because almost all of their forecasts are wrong. They failed to predict both the financial crisis and the Euro crisis; indeed, most of them did not even have a vague

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Posted in Economics

Are global prices for natural gas about to converge again?

Due to the nuclear disaster in Fukushima 2011 and the US shale revolution prices for natural gas have developed in different directions in the past. However, this trend seems to have reversed recently.

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Posted in Long-Term Charts, Long-Term Trends

Preventing financial meltdowns

A great video with Tim Harford from the FT, putting financial meltdowns into the broader context of complexity.

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Posted in Economics, Financial Markets

The preposterous deflation scare Part IV – Who should be scared of deflation?

There is no sound empirical evidence and no convincing theoretical justification for why deflation is such a danger to the economy. Although deflation can be the result of an economic crisis, it can also be caused by cost reductions due

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Posted in Economics

The preposterous deflation scare Part III – The empirical data: When has deflation really been dangerous?

There have been different stages of varying levels of inflation in world economic history, but also long periods of price stability. The present period, which is characterised by relatively moderate and constant inflation rates of about 2% p.a., is relatively

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Posted in Economics

The preposterous deflation scare Part II – Why are low inflation rates supposedly so dangerous?

The concept that very low rates of inflation are dangerous is closely related to the belief that there is some sort of an “optimum rate of inflation” for the economy, at which economic growth can progress at its smoothest. This

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Posted in Economics

The preposterous deflation scare Part I: How stable is price stability?

For months now, we have been showered in a flood of press reports and comments by economists, warning us about the catastrophic effects of potential deflation. However, they never justify their statements to any great extent. As a rule, the

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Posted in Economics
“With a Steady Hand”
Welcome to the weblog of Karl-Heinz Thielmann, fund manager, financial analyst, economist and dedicated long-term investor.

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