2019-07-05 09:32:00 Fri ET
technology social safety nets education infrastructure health insurance health care medical care medication vaccine social security pension deposit insurance
Warwick macroeconomic expert Roger Farmer proposes paying for social welfare programs with no tax hikes. The U.S. government pension and Medicare liabilities are $47 trillion in total. As Farmer suggests, national treasuries should establish social care funds, and these public funds borrow money at low interest rates and invest the proceeds in many international stock markets. A recent study analyzes data from OECD economies over a century and empirically shows that the average stock return is about 7% above the return on government bonds. Also, the average equity risk premium ranges from 3.8% in Denmark to 9.9% in Japan. Stock market idiosyncratic volatility may not fully accord with economic fundamental factors such as size, value, momentum, asset growth, operating profitability, and market risk etc. This volatility instead shows the animal spirits and sentiments of investors who often buy and sell shares on the basis of self-fulfilling prophecies of greed and fear.
When the government institutes social care funds, these public funds can smooth out short-term stock price gyrations to invest in the long-term fundamental health of the global economy. The key Farmer proposal may work well in practice as most public funds can then earn an average 4%-7% equity premium per annum.
If any of our AYA Analytica financial health memos (FHM), blog posts, ebooks, newsletters, and notifications etc, or any other form of online content curation, involves potential copyright concerns, please feel free to contact us at service@ayafintech.network so that we can remove relevant content in response to any such request within a reasonable time frame.
2019-04-25 09:35:00 Thursday ET

Bridgewater hedge fund founder Ray Dalio suggests that the current state of U.S. capitalism poses an existential threat for many Americans. Dalio deems the
2018-03-13 07:34:00 Tuesday ET

From crony capitalism to state capitalism, what economic policy lessons can we learn from President Putin's current reign in Russia? In the 15 years of
2027-07-31 13:25:00 Saturday ET

In the broader context of stablecoins for asset tokenization worldwide, many governments now seek to enter the global markets for stablecoins and other U.S.
2018-12-29 09:32:00 Saturday ET

Andy Yeh Alpha (AYA) AYA Analytica financial health memo (FHM) podcast channel on YouTube December 2018 AYA Analytica is our online regular podcast and news
2017-11-05 09:45:00 Sunday ET

President Trump criticizes the potential media merger between AT&T and Time Warner, the latter of which owns the anti-Trump media network CNN. President
2020-07-26 15:29:00 Sunday ET

Firms and customers create value and wealth together by joining the continual flow of small batches of lean production to the lean consumption of cost-effec