If the official initially reported U.S. monthly unemployment rate falls below 8.0% for any month between now and June, 2015, I win $100. Otherwise, Mish wins $100.Adds Caplan:
Where will the new jobs appear? If I knew that, I'd probably be investing in them instead of blogging about my bets!My take:
There are two forces being engaged in the economy, accomplishing the restructuring of local and sate governments, and the arrival of technology to correct the constraints on the economy. The two economists are betting on the relative strengths of the two forces.
It is a tough call because the technology is nothing like we have seen before, and local governments are restructuring on such a massive scale. I tend to lean toward Caplan, technology will find a way to decorrelate from the problems of local government.
I still agree with Mish that substantial government delevering will continue, but the expansionary forces of technology will also continue. Within five years, expansion from technology outweighs government restructuring.
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