Jonathan H. Todd

Finance, Investing, Economics

Category: Politics (page 1 of 2)

How well did the betting markets predict the first round of the French presidential election?

French citizens put Emmanuel Macron and Marine Le Pen in the final round of the French presidential election. Did the betting markets get it right?

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These 4 charts explain what the betting markets say about the French presidential election

Sunday April 23rd is the first day of the French presidential election. Betting markets are expecting a different race than the polls.

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When political consolidation hurts: Brexit version

Theresa May should get a full vote of confidence from the Tories, but will that actually result in real policy? Ask Donald Trump.

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To Infuriate ISIS, Support Infrastructure Investment

Global terrorism and weak economic growth are two key themes in this election cycle. While these could seem like two totally separate issue, could managing both simultaneously could come in one neat, tidy package?

There is a 100% chance of a terrorism attack on a U.S. city in the future, Gillian Tett wrote in her piece, Resilience in a time of crises. She argues that there is no way to eradicate ISIS, but we can minimize the damage they can do. Tett notes, “‘The classic city today has one big water purification and distribution system, and one power station,’ Kilcullen told me. While this pattern might look efficient, it is disastrous if the water or power is compromised; in a crisis you need a second, back-up system, which is disconnected from the main platform.”

The idea that Tett is arguing is that by passing a large infrastructure investment bill, we can minimize the disruption and damage ISIS or any other terrorist group can inflict on our physical environment. By duplicating existing systems that deliver our water, power, or other vital utilities, we would be able to better manage any disruptions that a terror group could inflict. Destroy a part of the electrical grid? No problem, it’s been rebuilt as a nodal network so service is unaffected.

Source: American Society of Civil Engineers

Source: American Society of Civil Engineers

Terrorism is a huge motivator to the electorate these days, and – call me cynical – it just happens to be a good excuse to cut through the the partisanship. But whether or not we want to use ISIS as the catalyst for making this kind of investment happen, it needs to happen no matter what. In its 2013 Report Card for America’s Infrastructure, the American Society of Civil Engineers says that the U.S. will need to invest $3.6 trillion by 2020 to modernize our national infrastructure. Over four years (and we’ll call it four years, because nothing would happen until a new administration takes office in 2017), that’s $900 billion a year, or about 5% of GDP.

That’s a hefty price, but “Invest in America, defeat ISIS” is not a difficult political sales pitch. A large, multiyear infrastructure investment bill would immediately create a huge number of jobs and inject a huge amount of money into an economy that has suffered from a persistent output gap since the Great Recession. That is the kind of demand-side action many economists have been wanting for years, and it just happens to present itself at a moment when the candidates of both major parties are interested in both infrastructure spending and fighting terrorism.

Populism and Globalization: Short-run, Long-run, and Also-Ran

Use all the macroeconomic models to point out the flaws of anti-globalization you’d like, it’s only going to add fuel to the fire.

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The Puerto Rico Debt Default Probably Doesn’t Hurt Your Portfolio, But Don’t Ignore It

Investors may not take a hit directly from the Puerto Rico debt default, but there are still lessons to be drawn.
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Selling: An Inevitable UBI World

Universal Basic Income, or UBI, is the economic theory du jour, but there remains a gap between theory and practice.

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Why Cities Are The Solution To The Populist Wave

Simon Kuper wrote an excellent commentary this weekend on why journalists need to get out of their city bubbles and talk to real citizens who represent more typical life experiences. As he notes, “Today, most remaining journalists live in metropolitan enclaves such as Brooklyn, north London and central Paris, and look like the elites they cover.” It’s difficult to understand how a voter in Iowa feels if you live/work/play all within two miles of Fort Greene.

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Private Equity, Mitt Romeny, and Donald Trump: Lessons in Inconsistency

Watch any given night of coverage leading up to the Iowa Caucus, and you wish for those halcyon days of the Romney/Ryan tickets: two clearly smart people with quite different, yet relevant, skill sets, running as the GOP ticket. While one day Mitt’s dangerous streak was on full display – he could get pinpoint his message with full detail without seeming pedantic or professorial, like Obama – the next day, he seemed to have all the grace of a three year old petting a puppy.

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The Silliness of the 3 Page Tax Code

The 3 page tax code is simply fantasy. The tax code should be simplified, but a dose of realism is first needed.

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