Marshall Auerback

Marshall Auerback is a Fellow at Economists for Peace and Security and a Research Associate at the Levy Institute. He also works as a global portfolio strategist for Madison Street Partners, LLC, a Colorado based investment management group.

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Articles by Marshall Auerback:

European’s Have Rejected Austerity Madness: Will the U.S. Get the Message?

May 7, 2012 by

So the voters of Europe have spoken, and surprise, surprise: they are not too keen on fiscal austerity. France’s president, Nicolas Sarkozy, became the first incumbent to lose since 1981. In Greece, the mainstream parties that have been happily participating in the country’s national suicide were soundly rejected by the electorate.

Why Low Minimum Wages Kill Jobs and Crush Living Standards for Everyone

May 3, 2012 by

Senator Tom Harkin, Democrat of Iowa, has introduced a bill to raise the federal minimum wage to $9.80 from its present level of $7.25. Polls are showing many voters in favor, though they are confused about what it would mean for the job market. The truth is that a move would be good for a slow economy and have a positive impact on the jobs crisis. Naturally, this has led to the usual cries of opposition, largely based on the notion that raising the minimum wage hurts the very people it is supposed to help. Typical of this view is a letter to the New York Times from Michael Saltsman, a fellow at the Employment Policies Institute, a business-backed nonprofit research group (surprise!).

Spain is the New Greece

April 29, 2012 by

Nearly one Spaniard in four is unemployed, according to data released on Friday, as the country’s economic and financial predicament prompted a government minister to talk of a “crisis of enormous proportions”. The data from the National Statistics Institute showed 367,000 people lost their jobs in the first three months of the year. At this pace, Spanish job losses are equivalent to 1 million per month in the United States.

Trouble in Euro Zone Paradise?

February 24, 2012 by

The Europeans evidently thrive on instability and the ongoing threat of systemic risk. There is nothing else to explain the renewed hardline stance adopted by both Mario Draghi of the ECB and the German government on fiscal policy, just as the markets appeared to be calming down again.

Greece: A Default is a Better Outcome Than the Deal on Offer

February 13, 2012 by

Pick your poison. In the words of Greek Finance Minister Evangelos Venizelos, the choice facing Greece today in the wake of its deal with the so-called “Troika” (the ECB, IMF, and EU) is “to choose between difficult decisions and decisions even more difficult. We unfortunately have to choose between sacrifice and even greater sacrifices in incomparably more dearly.” Of course, Venizelos implied that failure to accept the latest offer by the Troika is the lesser of two sacrifices.

The Elephant in the Room is Spain, Not Italy

February 6, 2012 by

Another day and the markets remain fixated on whether Greece comes to a “voluntary” arrangement with its creditors. The key word is “voluntary” because the myth of “voluntary compliance has to be sustained so that those deadly credit default swaps avoid being triggered. But let’s face it: Greece is a pimple. If the rest of the euro zone could cut it lose with a minimum of systemic risk, Athens would have long gone the way of Troy.

US Employment Growth Shows Fiscal Policy Matters

February 3, 2012 by

US Q4 2011 GDP growth was slightly disappointing, and the mix was terrible as the growth was mostly due to inventories. I took issue with that report, arguing that the weakness was due to statistical distortions in the government spending data and the PCE services data. With that disappointing Q4 GDP report, expectations for quite weak economic growth in this year’s first half were encouraged.

Anschluss Economics – The Germans Launch A Blitzkrieg on the Greek Debt Negotiations

January 31, 2012 by

Anschluss Economics – The Germans Launch A Blitzkrieg on the Greek Debt Negotiations

News stories continue to suggest that Greece once again appears on the verge of reaching a deal with its private sector creditors on how much of a loss they would be willing to accept on their bond holdings. The latest numbers suggest a 70% write-down. A pretty striking comedown for what is supposed to be a “voluntary default” and, hence, not subject to the triggers of a credit default swap on Greek debt.

There Will Be Blood

December 5, 2011 by

Another week to go before the euro blows up, or so we’re told again for the thousandth time. More likely is that the ECB does barely enough to keep the show on the road, fiscal austerity continues and riots intensify on the streets of Madrid, Athens, Rome and Paris. Like the film, “there will be blood” before there is any likely change toward a sensible growth oriented policy in the euro zone.

Is Merkel Right on Greece?

October 11, 2011 by

The doom mongers are out in force. The British Prime Minister, David Cameron, has dramatically stated that European authorities have “just a matter of weeks” to avert economic disaster. Likewise, the mouthpiece of conventional financial “wisdom”, the Financial Times, argues that 3 steps must be taken immediately to solve the euro crisis.

Are Trade Deficits Really That Bad?

October 3, 2011 by

In a recent piece in The Nation Thomas Geoghegan argues fiercely that few points were made more emphatically by John Maynard Keynes than his opinion that: “no country, ever, should run up any kind of trade deficit, much less the trade deficit on steroids we are running”, and that he even fought for a global currency: the bancor, that would push creditor countries like the United States to pull debtor countries out of debt.