Professional Journal Publishes First Academic Article on Gross Output

“For forecasting, the new measure [Gross Output] may be more helpful than the GDP measure, because it provides information of goods in process.”  — David Colander (Middlebury College)

I am happy to announce that the first professional economics journal (Eastern Economic Journal) has published an article on Gross Output, the new macro statistic I’ve been advocating and now has been adopted by the federal government.

GO is an attempt to measure spending at all stages of production, the first statistic to be adopted since GDP was invented in the 1940s.  It is a way of measuring Hayek’s triangle, and I’ve found that the quarterly GO statistic a better, broader measure of the economy and a good predictor of final output (GDP).  In 2014, it has been rising faster than GDP, suggesting that the earlier stages of production are robust and predicting more growth ahead.

I consider the government publishing of a quarterly GO the greatest triumph in supply-side Austrian macroeconomics since Hayek won the Nobel prize 40 years ago.

The commentary is by the respected economist David Colander (Middlebury College), who, despite the headline, is largely positive about GO.  You can read his article here: http://www.palgrave-journals.com/eej/journal/v40/n4/full/eej201439a.html

And my response here: http://www.palgrave-journals.com/eej/journal/vaop/ncurrent/full/eej201465a.html

Austrian economists are now seeking to measure GO (or my own broader Gross Domestic Expenditures) in other countries, such as UK and Argentina.

Econologically yours, AEIOU,

Mark Skousen

US Economic Activity Jumps Sharply in Q2

For Immediate Release
Contact: Valerie Durham, vdurham@skousenpub.com

U. S. ECONOMIC ACTIVITY JUMPS SHARPLY IN 2ND QUARTER 2014

Washington, DC (Friday, November 14, 2014):  Gross Output, a broader measure of U. S. economic activity published by the Bureau of Economic Analysis, advanced to nearly $30.9 trillion in the second quarter of 2014, a 4.8% jump in real terms (annualized).  The GO data released by the BEA can be found at  http://www.bea.gov/iTable/iTable.cfm?ReqID=51&step=1#reqid=51&step=51&isuri=1&5114=q&5102=15

Gross Output (GO) is a measure of sales or receipts of all industries throughout the production process, including business to business transactions. 

GO advanced slightly faster than GDP.  Gross Domestic Product (GDP), which measures the value of final goods and services only, rose 4.6% in real terms to $17,328.2 billion in the second quarter. 

“The GO data demonstrates that the economy recovered sharply from the slowdown in the first quarter,” stated Mark Skousen, editor of Forecasts & Strategies, who champions Gross Output as a more comprehensive measure of economic activity.   He first introduced Gross Output as a macroeconomic tool in his work The Structure of Production (New York University Press, 1990).  Now the BEA publishes GO on a quarterly basis in its “GDP by Industry” data.  [Read more…]

Maxims of Wall Street

Maxims of Wall Street: A Compilation of Financial Adages, Ancient Proverbs, and Worldly Wisdom is a classic reference to read with delight for years to come, and an ideal gift to investors, stockbrokers and money managers. More than 800 pithy and insightful adages, inspirational short stories, famous quotes, and sage advice from Wall Street gurus, money managers, financial advisers, writers, philosophers and many others.

Buy the first copy for $20 and all additional copies for only $10, and I pay the U.S. postage. Also: If you order an entire box (32), you pay only $300 postpaid.  (For orders sent outside the United States, add $5 per book for S&H)

To order, call Eagle Publishing at 1-800/211-7661 or email CustomerService@MarkSkousen.com. Mention priority code MAXIMS to buy individual books and MARKR to buy a box of 32 books.

Note: I autograph all copies if you order through Eagle Publishing. Click here to read more about Maxims of Wall Street.

Derek Jeter’s Big Finale…and I Was There!

Last Thursday, at the invitation of Steve Forbes, I was able to attend Derek Jeter’s last game at Yankee stadium. Mr. Forbes has season tickets and occasionally invites me to join him. Tickets were selling for $850 and more, and those were bleacher seats, so I felt lucky. The Yankees were ahead 5-2 in the 9th inning when I told Mr. Forbes that I expected the Orioles to score three runs and tie the score, forcing Jeter to bat one more time to win it all in his final time at bat at Yankee Stadium. My prediction came true. Mr. Forbes can verify it. What a night!

I can relate to Derek Jeter. He never won the Most Valuable Player award, but he was a steady, reliable performer during his 20 years with the Yankees and ended up getting five World Series rings. By the same token, I consider my 35 years writing Forecasts & Strategies as a steady performer, never personally ranking #1 in any one year. But over the long run, I delivered a winning formula for financial success.

Mark Skousen and Steve Forbes enjoy Derek Jeter’s final home game at Yankees Stadium.

Missing Link in Economics Revealed!

by Mark Skousen
Presidential Fellow, Chapman University

For centuries economists have been searching for the missing link that would tie microeconomics (theory of the firm and individual behavior) with macroeconomics (theory of the economy as a whole).

I believe my four-stage model of the economy does just that.  Based on Austrian macroeconomics (known as Hayek’s triangles), I created a four-stage model of the macro economy in my book, The Structure of Production (NYU Press, 1990).  A few years later, John Taylor of Stanford University (famous for his Taylor Rule) independently produced a 4-stage micro model involving four stages in the production of Caribou Coffee.

A eureka moment!

I’ve incorporated both 4-stage micro and macro models in my textbook, Economic Logic (Capital Press, 2014), now in its 4th edition.  See especially chapter 14:  <http://www.amazon.com/Economic-Logic-Fourth-Edition-Skousen/dp/1621572226 It’s available in book print and Kindle.  If you want to buy it at a discount for only $34.95 plus S&H, call Eagle Publishing at 1-800-211-7661, and use code ECONL6.

SKOUSEN – TAYLOR LINK MACRO WITH MICRO

Figure 1.  Universal 4-stage Macro Model of the Economy

Source:  Mark Skousen, The Structure of Production (New York University Press, 1990); Economic Logic (Capital Press, 2014).

 

 

 

 

 

Figure 2.  4-stage micro model (production process of Caribou Coffee) 

Source:  John B. Taylor, Economics, 5th edition (Boston:  Houghton Mifflin, 2006)

U.S. Economy Doing Better Than Expected

U. S. ECONOMIC ACTIVITY HOLDS STEADY IN 1ST QUARTER 2014

Washington, DC —  Gross Output, a broader measure of  U. S. economic activity published by the Bureau of Economic Analysis, held steady at $30,210.6 billion in the first quarter of 2014.

“The GO data demonstrates that the economy is not as bad off as GDP figures initially suggested,” stated Mark Skousen, editor of Forecasts & Strategies and a Presidential Fellow at Chapman University, who champions Gross Output as a more comprehensive measure of economic activity.   He introduced Gross Output as a macroeconomic tool in his work The Structure of Production (New York University Press, 1990).  Now the BEA publishes GO on a quarterly basis in its “GDP by Industry” data.

The GO data was released by the BEA on Friday, July 25, 2014:  http://www.bea.gov/iTable/iTable.cfm?ReqID=51&step=1#reqid=51&step=51&isuri=1&5114=q&5102=15 [Read more…]

FreedomFest 2014 Report

Over 2,000 Look to Private Solutions at This Year’s “Greatest Libertarian Show on Earth”

By Mark Skousen
Producer, FreedomFest

“This was my seventh FreedomFest, and the best ever. It’s turned into an annual reunion with old friends and new who come from all over the country and the world.  There’s nothing like it.”   –Gene Epstein, Economics Editor, Barron’s

Over 2,000 wealthy investors, concerned citizens, and freedom organizations participated into this year’s big show at Planet Hollywood, Las Vegas.  They were anxious to find solutions to their financial and economic challenges without government involvement.

The buzz was palpable from the beginning of the opening cocktail party to the gala Saturday night banquet.  “It was a WOW experience.  I heard that from many attendees,” wrote a reporter.  “To see Steve Forbes and John Mackey there all four days, that was something,” said an attendee.  [Read more…]

Open Letter to All Freedom Lovers

From Mark Skousen, producer of FreedomFest

I woke up this morning thinking about “Why We Need to Get Together Once a Year.”  Over the years, I’ve been impressed with the proliferation of free-market think tanks and freedom organizations which are doing their part to make a difference:  publishing websites, special reports and books; holding meetings and conventions; influencing elected officials or using the court system to overturn bad legislation.

That’s where FreedomFest comes in. Our mission is simple: to bring together once a year all the freedom groups and provide a place to learn, network, socialize and celebrate liberty.  And we do it in the nation’s most libertarian city, Las Vegas. We are a for-profit organization, so we don’t compete for fundraising with all these good causes. We try not to promote one organization over another. We support them all. In Hayekian terms, it’s a spontaneous order, with every think tank and freedom organization deciding for themselves what to talk about. FreedomFest is not “my” conference, it’s “our” conference.

The idea came to me when I was president of the Foundation for Economic Education (FEE), the country’s oldest free-market organization. Why not have an annual reunion, I thought, and bring together all the think tanks and freedom organizations from around the world, to talk about philosophy, history, science & technology, healthy living, music & dance, investments, and geo-politics?  We would create an intellectual feast in a fun town, the entertainment capital of the world.

And then invite the general public, concerned citizens, business and political leaders, investors, and young people around the world to join us.  I imagined them walking into an exhibit hall full of booths of think tanks, publishers, film producers, and freedom organizations, highlighting their latest efforts.  I envisioned it as “one stop shopping for liberty.”

I was told, “It can’t be done. Libertarians are like a herd of cats.”

But the founders did it. At the end of the Constitutional Convention in 1789, Benjamin Franklin wrote, “It is a singular thing in the history of mankind that a great people have had the opportunity of forming a government for themselves. We are making experiment in politics. In these sentiments, I agree to this Constitution, with all its faults, if they are such. For when you assemble a number of men to have the advantage of their joint wisdom, you inevitably assemble with those men all their prejudices, their passions, their errors of opinion, their local interests, and their selfish views. It therefore astonishes me to find this system approaching so near to perfection as it does.”

Franklin also warned, “We must all hang together, or most assuredly we shall all hang separately.”

We all are doing our best to promote the principles of liberty and justice, but we must do more. We are losing the battle, slowly but surely. I’ve felt for some time that the enemies of liberty are better organized, and now more than ever, it is critical that all the movers and shakers in the freedom movement come together once a year if we are going to reverse the tide. There is strength in numbers.

Milton Friedman, before he died, wrote me a letter in which he caught the vision of this gathering: “FreedomFest is THE great place to talk, argue, listen, celebrate the triumphs of liberty, assess the dangers to liberty, and provide that eternal vigilance that is the price of liberty.” Steve Forbes and John Mackey are our co-ambassadors. They understand the importance of this “focal point” of liberty and set aside all four days in their busy schedule to attend. So do most of the other speakers.    As Steve Forbes says, “FreedomFest is where the best ideas and strategies are fleshed out.  I wouldn’t miss it.”

FreedomFest has been called many things: A Live Wikipedia for libertarians; a Renaissance gathering for free thinkers; the Trade Show for Liberty; the New Mecca for free minds; the Focal Point for freedom lovers; the Gathering of the Tribes; the Disneyland of the mind; the blow-out conference of libertarian gold bugs; the Libertarianism’s Church of What’s Happening Now; and the Greatest Libertarian Show on Earth. There’s something for everyone at FreedomFest.

And it’s catching on. We are growing every year.  Practically all the major think tanks and freedom organizations have caught the vision of FreedomFest and are making their way to Vegas every second week in July. Fox News is now coming and taping the Stossel show; other radio and TV stations are doing their shows there. Thousands of concerned citizens, investors, authors, professors, students and experts are joining us from around the world. Some even change their schedule to attend; they sacrifice to be there.

What do we have planned for this year? Check us out. For a list of all the great speakers, panels and debates, go to http://freedomfest.com/blog/2014/04/25/whattoexpect/ And don’t miss our ever-popular Anthem libertarian film festival going on all four days at FreedomFest. This time it includes a sneak preview of the new film “Atlas Shrugged 3″ hosted by John Stossel.

I know I’m a dreamer, but I’m not the only one.  If not us, then who?  If not now, then when?

Spread the word.  John Galt is calling….

FreedomFest is only a few weeks away. Now is the time to join us in Las Vegas.  Go to www.freedomfest.com to learn more and register.  Or call Tami Holland, our conference coordinator, at 1-866-266-5101.  It will change your life….and maybe even the world.

Yours for peace, prosperity and liberty, AEIOU,

Mark
Mark Skousen
Producer, FreedomFest
www.freedomfest.com
July 9-12, 2014, Las Vegas
Theme: “Is Big Brother Here?”
http://vimeo.com/70558676

Marx Madness is Back

“Capitalism automatically generates arbitrary and unsustainable inequalities that radically undermine democratic societies.” — Thomas Piketty, “Capital in the 21st Century” (2014)

The Economist magazine rightly called French professor Thomas Piketty the new Marx, although a watered down Marx. His bestseller (rated #1 on Amazon and the New York Times) is a thick volume with the same title as KCapital in the Twenty-First Centuryarl Marx’s 1867 magnum opus, “Kapital.” The publisher, Harvard University Press, appropriately designed the book cover in red, the color of the socialist workers’ party.

Piketty cites Karl Marx more than any other economist, even more than Keynes. He barely mentions Adam Smith. Instead of the modern scientific name “economics,” he prefers the old term “political economy,” a favorite of radical professors. [Read more…]

Economist Makes Lead Story in the Wall Street Journal….Barron’s….and Forbes

I made the lead story in the Wednesday, April 23, 2014, edition of the Wall Street Journal.  The title:  “At Last, a Better Economic Measure.”  You can read it here:  http://on.wsj.com/PsdoLM

The editors of the WSJ don’t allow the author to see or approve the headline or subhead, but they nailed it perfect.  And I love the cartoon graphics!  It’s a perfect rendition of my four stage model of the economy.

Many readers captured the essence of my message.  As economic forecaster Jim Hagerbaumer of Florida wrote:  “Skousen is introducing a whole new species. This is one of the most important WSJ op-ed articles in years.”

I also wrote about Gross Output (GO) in the December 16, 2013, issue of Forbes.  Here’s the online version, with charts and response to critics:

My original article in Forbes Magazine (December 16, 2013):

Mark Skousen, Beyond GDP: Get Ready For A New Way To Measure The Economy, Forbes

http://www.forbes.com/sites/realspin/2013/11/29/beyond-gdp-get-ready-for-a-new-way-to-measure-the-economy/

Additional Commentary by Steve Forbes:
Steve Forbes, New, Revolutionary Way To Measure The Economy Is Coming — Believe Me, This Is A Big Deal, Forbes

http://www.forbes.com/sites/steveforbes/2014/03/26/this-may-save-the-economoy-from-keynesians-and-spend-happy-pols/

Gross Output Includes B-to-B….GDP doesn’t [Read more…]