What we’re reading (10/5)
“Stock, Bond And Real Estate Prices Are All Uncomfortably High” (Robert Shiller, New York Times). “The prices of stocks, bonds and real estate, the three major asset classes in the United States, are all extremely high. In fact, the three have never been this overpriced simultaneously in modern history. What we are experiencing isn’t caused by any single objective factor. It may be best explained as a result of a confluence of popular narratives that have together led to higher prices.”
“Do Inflation Expectations Matter For Inflation?” (Marginal Revolution). “Many people (NYT) are talking about the new paper by Jeremy Rudd on exactly this topic — Rudd is skeptical that they matter very much. So I went to read the paper, and I have to say I am baffled. It didn’t change my priors at all. I didn’t see new empirical estimates, or new theoretical arguments, and furthermore I didn’t see the most relevant factors discussed much. I did see a lot of pokes at Friedman, Phelps, and Lucas (and there is also an introductory assertion that, even given enough time, markets with flexible prices do not clear. Then he goes on to deny that the theory of household choice is sufficient to derive downward-sloping demand…why do that???).”
“The Age Of Fossil-Fuel Abundance Is Dead” (The Economist). “In recent weeks…it is a shortage of energy, rather than an abundance of it, that has caught the world’s attention. On the surface, its manifestations are mostly unconnected. Britain’s miffed motorists are suffering from a shortage of lorry drivers to deliver petrol. Power cuts in parts of China partly stem from the country’s attempts to curb emissions. Dwindling coal stocks at power stations in India are linked to a surge in the price of imports of the commodity. Yet an underlying factor is expected to make scarcity even worse in the next few years: a slump in investment in oil wells, natural-gas hubs and coal mines”
“Empty Buildings In China’s Provincial Cities Testify To Evergrande Debacle” (Wall Street Journal). “Rows of residential towers, some 26 stories high, stand unfinished in this provincial city about 350 miles west of Shanghai, their plastic tarps flapping in the wind. Elsewhere in Lu’an, golden Pegasus statues guard an uncompleted $9 billion theme park that was supposed to be bigger than Disneyland. A planned $4 billion electric-vehicle plant, central to local leaders’ economic dreams, remains a steel frame with overgrown vegetation spilling into the road.”
“‘Some Are Just Psychopaths’: Chinese Detective In Exile Reveals Extent Of Torture Against Uyghurs” (CNN Business). “The methods included shackling people to a metal or wooden ‘tiger chair’ -- chairs designed to immobilize suspects -- hanging people from the ceiling, sexual violence, electrocutions, and waterboarding. Inmates were often forced to stay awake for days, and denied food and water, he said.”
