Discover more from Economics Matters by Laurence Kotlikoff
Economics Matters -- Our Six Month Anniversary
Today is the six-month anniversary of Economics Matters — the Newsletter and, the new addition, Economics Matters — the Podcast. Since then, I’ve written 30 newsletters and co-hosted, with my son, Alex, six podcasts, with another five tapped and soon to be posted (once Alex gets married, which is happening this weekend!!!).
That’s a lot of content. Maybe too much? But, Say’s Law, proclaimed in 1803 by French economist Jean-Baptist Say, says supply creates its own demand. It seems to be working. We started with a few thousand subscribers. We’re now close to 15,000. I thank you on this score — for spreading the word.
This is a net figure. Some subscribers dropped off when more content showed up than expected. Indeed my most successful newsletter, in terms of likes, is the one inviting readers to unsubscribe if I was overcrowding their inbox!
Not clear that anyone has successfully marketed a product by saying, “Feel free to walk away.” but, on balance, it seemed to help.
Why Am I Doing This?
Why did I start this? And why am I writing this piece at 4:50 AM? Lots of motives and excitement are the answers. I was certainly inspired by my close friend, Glenn Loury, who started the Glenn Show a couple years back. I’ve been a frequent guest on Glenn’s show (and we just posted a podcast with Glenn here on Economics Matters.) Glenn’s goal was/is to raise the level of discussion on race relations in the U.S. Glenn leans right, politically, except when he veers left. But he’s thought deeper and harder on this issue than any economist and will likely receive the Nobel Prize in Economics for his many technical publications on the issue in the very top journals. I’m especially proud of Glenn as I hired him to Boston University from Harvard. (He’s writing an autobiography, The Enemy Within, that will surely be a bestseller when it comes out.) In two years of joining BU, Glenn published four articles in top-five economics journals — a publishing feat few, if any economists have matched.
Raising the Public Debate
Like Glenn, my aim is to raise the level of public debate, but on the entire gamut of Political Economy, the original name for Economics, when the field was more discursive and catholic. And so much of what I read, see, and hear, from professional economists or those pretending they are, is deeply confused or straight out wrong. My blood is constantly boiling to set the record straight. Economics has a tremendous amount to offer. But there are precious few economists who aren’t in thrall to some political party. They’ve sold their souls and generally can’t be trusted. Hence, correcting the often egregious record is a big challenge. Economics Matters is here to fill the gap.
Of course, I come with my own political baggage. I’m not a blue or a red. But I can tell traitors when I see them, can figure out that our citizenry has too many nut jobs free to buy assault weapons and kill our children, know that imprisoning 16 year-olds for murder because they had an abortion in, say, Oklahoma, will lead to economic civil war, see that student loan forgiveness is neither fair nor the answer, think that killing the economy to save it and install Larry Summers as Fed Chair, instead of addressing core problems, is first-order stupid, and realize that signaling to Putin that we’re ok with limited nuclear war is Biden challenging Camberlain at Munich in 1933. Fortunately, the President seems, at long last, to be setting some red lines.
I’ve also wanted to spread the world about economics-based financial planning. As many of you know, I’ve spent the last three decades developing software through my company to guide households on how to spend, save, insure, invest, diversify, deal with housing, maximize their Social Security, handle retirement accounts, etc. My new book, Money Magic, spreads my profession’s very practical gospel. But it also delves into, for me, fresh turf (but also soft sod that the software can easily plow), with chapters like Don’t Borrow for College, My Daughter the Plumber, and Marry for Money.
Clearly, no card-carrying member of the Dismal Science would operate without a profit motive. So, to be clear, I also started Economics Matters with the hope to persuade vast numbers of people to ignore Wall Street and focus on economics’ personal financial prescriptions. The personal finance subfield of economics started with Yale’s Irving Fisher’s seminal work, The Theory of Interest, published in 1930, which you can buy for $1.49 on Kindle.
Surely the newsletter would lead vast hoards to use MaxiFi Planner and Maximize My Social Security, buy Money Magic and my co-authored NY Times Best Seller, Get What’s Yours — Secrets to Maxing Out Your Social Security, and turn me into Suze Orman — but a Suze delivering quantitative answers, not just intuitive (and, generally, good advice). This would excite the public by seeing how to safely make lots of money by properly handling Social Security, retirement accounts, location decisions, housing decisions, marital decisions, … , invest in the stock market while maintaining a base living standard with no risk, and decide when to retire, whether to get divorced, etc. — knowing the economic costs to the dollar.
Private interest is a great motivator and sales are picking up. But I and my 29 year-old, still-fledgling company, from which I’ve never taken a salary, need your help. We can’t market against the big boys. So word of mouth is the primary way to keep my small band of dedicated engineers and other wonderful marketing, design, and accounting team members eating and improving our tools — so we can improve your financial lives.
Let me raise something in this regard that I find both deeply puzzling and super challenging. People, including economists, aren’t dying to do financial planning — even when there’s the most user-friendly, intuitive, incredibly powerful, and fully accurate software to run that promises to safely and dramatically raise their living standards. I think most of Behavioral Finance is a form of highbrow handwaving (horse… is my 5:30 AM term of art). But when I see all the parched horses standing at the trough and not drinking, I fear Behavioralists are onto something.
It seems that lots of us have a psychological barrier when it comes to examining our finances. We need someone to literally hold our hand and take us to the dentist before realizing we’ve actually landed in a wonderful massage chair. Anyway, if you go to MaxiFiPlanner.com next week and click on Sign Up, you’ll see we’re launching a co-piloting service featuring, as co-pilot, a terrific PhD in economics as well as CFP — Jay Abolofia — who, for a fee, will hold users’ hands — in onboarding their data, navigating the program, explaining the results, and performing personal money magic.
So, if you need a co-pilot, just sign up next week for Jay’s co-piloting service. The service will be posted at the end of the Sign Up screen. It’s not cheap compared to DIY and, as needed, buying an Expert Review with our marvelous head of MaxiFi customer support — Dan Royer. But the net cost, given how much money the tool can safely find— is surely negative. Plus, once you’ve learned MaxiFiPlanner isn’t drilling your teeth, but dispensing chocolates, you’ll be able to run it on your lonesome for the rest of your days.
Economics Matters — the Newsletter
I’ll say this. The price is right. Zero. I started out thinking I’d provide paid subscribers more content or quicker access. But so far, I’ve made everything available to everyone at the same time and simply appealed to subscribers to take out paid subscriptions to support this effort and give me the financial wherewithal to consult with you, not for companies. Feel free to kick in any amount.
The 30 columns have covered lots of ground. Some examples:
Personal finance — how to safely handle the stock market’s doing crazzies.
Ukraine — admit Ukraine to NATO and immediately declare a ceasefire. Also publicly announce that Putin and bros will be at the top of our target list if he uses nukes, nuclear “accidents,” or other unconventional WMD.
Social Security — Its horrific, in practice, sexists rules and how to end them.
The End of Roe — Why this will likely lead to economic civil war.
Inflation — How to protect the elderly.
If You Talk Up Recession Enough, It Will Come — Self-induced economic collapse.
Fixing Everything — Message from a former Presidential candidate
What Saving Glut? — Is Secular Stagnation invented out of whole cloth?
Inequality — The real story.
So far the Economics Matters — the Podcasts have featured Apollo’s Chief Economist, Thorsten Slok on inflation and self-induced recession, Uri Dadush (the world’s premier international trade expert) on the End of World Trade?, Martin Wolf from the FT on his current global outlook, Sebastian Mallaby from the Washington Post on Ukraine and his fab new book — The Power Law: Venture Capital and the Making of the New Future — , Terry Savage from terrysavage.com, who’s chock full of The Savage Truth, Glenn Loury from Brown University on the persistence of racial inequality, and Eytan Sheshinsky and Yuval Steinitz from Hebrew University and the Israeli Government (not currently, but check his resume!) on Iran, Israel’s gas find, Ukraine, and the future of the Middle East.
We’ve recorded and will shortly be posting podcasts with Lee Krevat and Roger Ballentine, from, respectively, Krevat Energy Innovations and Green Strategies, on the new IRA bill’s climate impact and whether it’s too late to stop climate change (Lee and Roger are extraordinary experts), renowned journalist and author, David Cay Johnston, on his outstanding new book, The Big Cheat — How Donald Trump Fleeced American and Enriched Himself and His Family, Yahoo’s Kerry Hannon on personal finance and her new book, In Control at 50+: How to Succeed in the New World of Work, University of Pennsylvania’s Kent Smetters (host of Sirius XM’s Wharton on Money) on student loan forgiveness and America’s fiscal insolvency, and acclaimed journalist and author, Roger Lowenstein, on his equally fab book, Ways & Means, covering Lincoln’s financing of the Civil War. Echos to today are truly eerie.
Quick note: If you’re a fan of the former President, maybe don’t listen to the podcast with David. If you do, expect your blood to boil, but also to be deluged with facts — real facts. David is opinionated, but he does his homework like no other investigative journalist. This is why he won the Pulitzer Prize.
Please Spread the Word
Ok, enough of the anniversary party. More is coming soon. Please spread the word and please become a paid subscriber is you can swing it.