Category Archives: ekonomi

Trapped in the SEK-Zone

This book (technically it’s not a book, it’s a blog post but I could make a pdf and then it’s a book right?) deals with the economic problems Sweden is facing due to its membership in the SEK-Zone. It is inspired by Hans -Werner Sinns upcoming book “Gefangen im Euro” (which from the look of it will be x pages of whining about foreigners). All numbers are taken either from the Swedish statistics agency or IMF.

A textbook case

Sweden has:

  • High unemployment: 8.5% in February 2014.
  • Strong public finances: The decifit 2013 was 1.1% of GDP and general government debt at the end of the year was 41% of GDP.
  • Deflation: Inflation rate of -0.2% in February 2014.
  • A monstrously large current account surplus: 5.7% of GDP in 2013.

If ever there was a textbook case for fiscal and monetary expansion, this is it. Yet the political parties all agree that doing nothing is the best course of action, except a small xenophobe party that wants to do nothing and blame the immigrants when it doesn’t work. Why is that? The explanation lies in the strict rules imposed by Sweden due to its membership of the SEK currency region.

20 years of failure

Sweden has been a member of the SEK-Zone since 1873 and the first 120 years it seemed to work relatively well. However, in the early 90s the country was hit by a severe banking crisis. The crisis was solved by letting the SEK float so that Sweden could export itself out of rescession. The crisis also led to treaty change in the SEK-Zone with members agreeing to:

  • An independent central bank with an inflation target of 2%.
  • A budget surplus goal of 1% over a budget cycle.

So have these policies been succesful? The short answer is no. The figure below shows unemployment in Sweden. One can see that unemployment recovered immediately following the crisis but then got stuck at a high level.


One explanation for the failure is that the central bank has been completely ignoring its mandate. Since the inflation target was introduced in 1995 average inflation has been 1.2%. Another explation is that the surplus rule means that the goverment sector will be a drag on the economy.

A bleak future

The future looks bleak for Sweden. With a gigantic current account surplus it can’t export itself out of the mess. Actually it’s more likely that Sweden will eventually have to stop being a drag on the global economy. Possible ways out could be:

  •  Euro membership: This would have the advantage of a more active central bank and free Sweden from the current “one size doesn’t fit one” regime. It would also give room for a substantial fiscal boost: Government expenses could have been 1.5% of GDP higher in 2013 and still fit within the Maastricht criteria.
  • Treaty change: In principle Sweden could dump its budget surplus goal and demand that the central bank explains what the hell it is doing. The problem here is that a treaty change would have to be approved by one parliament and there is little apetite for that, especially in an election year.

The only hope left is a global economic recovery. Sweden is, as usual, hoping that other countries will solve it’s problems.

Crowdfunding cost-benefit analysis

I am participating in a crowdfunding project: The making of a new album by The Men They Couldn’t Hang. Was this a wise investment? I identified five possible outcomes to try and answer that question:

A) It’s all a scam, they spend the money on Nintendo and Vodka, and I  find out about it.

B) Three possiblities with  the same end result.

  1. It’s all a scam, they spend the money on Nintendo and Vodka but I don’t find out about it.
  2. The project fails and they don’t manage to produce a record.
  3. They produce a crap record.

C) They produce a record with one or two decent songs.

D) The record is really good

E) The record is a magnificient masterpiece.

So now all that remains is to put a probability and a value for each outcome.

A) 1% | -100 €

B) 40% | 0 €

C) 40% | 20 €

D) 18% | 200 €

E) 1% | 2000 €

So I should contribute 63€ to the project.

There are some perks that could have a value in themselves, but stuff like a signed banjo or curry in Manchester doesn’t really appeal to me.

Q: Couldn’t I just free ride on the others and get the benefits anyway?

A: Don’t be ridiculous

Jobben som försvann

Sysselsättningsgraden i Sverige är lägre än vid maktskiften 2006 enligt SCB (se figur)


Det hindrar inte DN från att helt fräckt påstå motsatsen “Sysselsättningsgraden är också marginellt högre än vid maktskiftet“.

Hur kommer dom fram till det?

Jo, dom fokuserar på den gula linjen i figuren, sommarjobbarna. I Sverige har vi ju val i september när sommarjobbarna är tillbaks i skolan.

Kapitalkostnader och driftkostnader

Lisa lånar 100 kronor för att bygga ett vindkraftverk.

Varje år betalar hon 5 kronor i ränta och 1 krona i underhållskostnader.

De första åren kan hon sälja elen för 8 kronor per år.

Lisa är glad, hon tjänar 2 kronor per år.

Plötsligt halveras elpriset. Nu kan Lisa bara sälja elen för 4 kronor per år.

Lisa är ledsen, hon förlorar pengar, i värsta fall går hon i konkurs.

Då får Jasmina köpa vindkraftverket och driva det vidare.


Appropå dagens tankevurpa i SvD

Och risken är att miljösatsningen på vindkraft kommer att leda till att den svenska naturen kommer att vara full av fladdrande stål- och kompositskrot om tio år. För några medel för att garantera en nedmontering av vindkraftverken om lönsamheten kollapsar finns inte

Björn Wahlroos svamlar

Ordförande i Nordea Björn Wahlroos har enligt SvD hållet ett fullkomligt sinnesförvirrat seminarium:

Arbetskraftskostnaderna och diverse andra kostnadsposter i Europa måste bara anpassa sig till världsmarknadsnivån. Om det inte sker kommer vi ha misär och elände och gud vet vad framför oss, varnar Björn Wahlroos.

Detta är fullkomligt nonsens. Lönerna i Europa är för låga alternativt är euron för svag. Om ni inte tror mig kanske ni tror på IMF vars prognos för bytesbalanser 2013 är:

  • EU +219 miljarder dollar
  • Kina +238 miljarder dollar
  • Euroländerna +295 miljarder dollar
  • USA -473 miljarder dollar kan tänka sig tre möjliga försklaringar:

  • Björn Wahlroos är felciterad
  • Han har en hemlig agenda och ljuger helt hämningslöst
  • Han har förläst sig på Blå Lotus och börjat röka opium