Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Wednesday, February 19, 2014
Venezuela Exchange Controls and Plunging Petroleum Production / Economics / Venezuela
By: Steve_H_Hanke
Foreign airlines have begun to restrict ticket sales in Venezuela. As the bolivars’ value evaporates, and with exchange controls in force, the airlines fear that the funds they have in Caracas will evaporate, too. By restricting ticket sales, the airlines will limit the amount of new money that is trapped behind the government’s wall of exchange controls.
Of course, President Nicolas Maduro isn’t the first autocrat to impose exchange controls, and he won’t be the last to impose these confiscatory policies. Indeed, the pedigree of exchange controls can be traced back to Plato, the father of statism. Inspired by Lycurgus of Sparta, Plato embraced the idea of an inconvertible currency as a means to preserve the autonomy of the state from outside interference.
Read full article... Read full article...
Tuesday, February 18, 2014
Manufacturing Numbers Show Cause for Concern in China / Economics / China Economy
By: Submissions
Richard Cox writes: As the global recovery continues to progress, investors as keenly focused on developments in early Asia as a means for gauging whether or not the progress in economic growth is being seen in all areas. Without clear evidence that emerging markets in Asia have participated in the improvements, there is less reason to believe that the global recovery is moving forward as strongly as had been thought previously.
Read full article... Read full article...
Tuesday, February 18, 2014
China Fooled the World (But It Cannot Last) / Economics / China Economy
By: Mike_Shedlock
Steen Jakobsen, chief economist at Saxo Bank emailed a pair of interesting links on the explosion of investment and debt in China.
First consider the BBC report How China Fooled the World by Robert Peston.
Read full article... Read full article...Robert Peston travels to China to investigate how this mighty economic giant could actually be in serious trouble. China is now the second largest economy in the world and for the last 30 years China's economy has been growing at an astonishing rate. While Britain has been in the grip of the worst recession in a generation, China's economic miracle has wowed the world.
Monday, February 17, 2014
Europe in the Calm Before the Next Financial Storm / Economics / Eurozone Debt Crisis
By: MISES
Andrew Cullen writes: Austrian business cycle theory explains that the “bust” phase of that cycle is created by extension of the cheap and plentiful credit by a fractional reserve banking (FRB) system. A FRB system is inherently fragile during the bust phase as its leverage (lending as a percentage of its own capital) exposes the banks to the emerging tsunami of non-performing loans and impaired collateral that are the manifestations of malinvestment.
Monday, February 17, 2014
The Economic Singularity - Stuck in a Liquidity Trap / Economics / Economic Theory
By: John_Mauldin
I fully intended to write today about a recently released academic paper that illustrates nearly every bad idea currently being bandied about in the field of economics. The insidious part is that the paper is considered mainstream and noncontroversial. Simply reading it required me to up my blood pressure medicine dosage. It is going to take me a little longer to finish that letter, and I realized that it needs a certain setup – one that coauthor Jonathan Tepper and I conveniently wrote a few months ago and included in the book Code Red.
Sunday, February 16, 2014
Global Economy Economic Stink-Tanks / Economics / Global Economy
By: Andy_Sutton
There’s an old quote along the lines of if you’re going to lie, make it a big one, repeat it like crazy, and eventually, people will regard it as truth. Truth is awfully cheap these days. For as buffaloed as most people are with the state of economic affairs not only in the United States, but also in the rest of the world, you’d think they still believed the Earth was flat.
Saturday, February 15, 2014
How Special-Interest Groups Benefit from Minimum Wage Laws / Economics / Wages
By: MISES
Gary M. Galles writes: Those campaigning for a substantial jump in the minimum wage all assert that the purpose is to help working families. Unfortunately, careful students of the evidence come to a different conclusion. As Mark Wilson summarized it, “evidence from a large number of academic studies suggests that minimum wage increases don’t reduce poverty levels.”
Tuesday, February 11, 2014
The Broken Limb and Burst Pipe Economic Fallacies / Economics / Economic Theory
By: James_Quinn
Economics is haunted by more fallacies than any other study known to man. This is no accident. While certain public policies would in the long run benefit everybody, other policies would benefit one group only at the expense of all other groups. The group that would benefit by such policies, having such a direct interest in them, will argue for them plausibly and persistently. It will hire the best buyable minds to devote their whole time to presenting its case. And it will finally either convince the general public that its case is sound, or so befuddle it that clear thinking on the subject becomes next to impossible.
Read full article... Read full article...
Monday, February 10, 2014
The Circular Economy – Roundabouts And Toboggans For Growth / Economics / Energy Resources
By: Andrew_McKillop
Waste Dumps to Resource Mountains
The Sochi Winter Games waste dump could interest future corporate geologists a lot more than the Chernobyl sarcophage. Leaked reports and furtive newsreel footage shows a pyramid 35-stories high, thinly and partly covered in soil, more than 150 metres wide at its base. And growing. Leakage from the Sochi pyramid of waste is, of course, toxic but also contains a hard-to-believe mix and mingle of metals, minerals and organic compounds including gold and with in fact little surprise, uranium and also of course pesticides, chrome hexafluoride, dioxin and similar deadly poisons with a high dollar value per unit weight – either as a resource or as a threat to society needing expensive disposal.
Read full article... Read full article...
Sunday, February 09, 2014
Most Dangerous Economic Era, The Great Divergence: Productivity and Wages / Economics / Earnings
By: John_Mauldin
"In the economic sphere an act, a habit, an institution, a law produces not only one effect, but a series of effects. Of these effects, the first alone is immediate; it appears simultaneously with its cause; it is seen. The other effects emerge only subsequently; they are not seen; we are fortunate if we foresee them.
"There is only one difference between a bad economist and a good one: the bad economist confines himself to the visible effect; the good economist takes into account both the effect that can be seen and those effects that must be foreseen.
"Yet this difference is tremendous; for it almost always happens that when the immediate consequence is favorable, the later consequences are disastrous, and vice versa. Whence it follows that the bad economist pursues a small present good that will be followed by a great evil to come, while the good economist pursues a great good to come, at the risk of a small present evil."
– From an essay by Frédéric Bastiat in 1850, "That Which Is Seen and That Which Is Unseen"
Read full article... Read full article...
Saturday, February 08, 2014
U.S. Economic Outlook Is About More Than Just Jobs / Economics / US Economy
By: Sy_Harding
The Labor Department’s employment report for January was the second straight monthly negative surprise in that area of the economy. It showed only 113,000 new jobs were created in January, well short of the consensus forecast for 190,000.
As they did in reaction to December’s dismal jobs report, Wall Street analysts are blaming it on the weather.
Read full article... Read full article...
Saturday, February 08, 2014
Ominous Looking Picture in U.S. Healthcare and Education Jobs / Economics / Employment
By: Mike_Shedlock
Month in, month out, recession or not, there has been a strong uptick in the number of healthcare and education jobs. Until now. A few charts will show what I mean.
Saturday, February 08, 2014
U.S. Employment Report - Real Earnings of Private Employees Down Slightly / Economics / Earnings
By: PhilStockWorld
Courtesy of Doug Short: Here is a look at two key numbers in Friday’s monthly employment report for January:
- Average Hourly Earnings
- Average Weekly Hours
The government has been tracking the data for Production and Nonsupervisory Employees for decades. But coverage of Total Private Employees only dates from March 2006.
Read full article... Read full article...
Saturday, February 08, 2014
Chronic U.S. Employment Data Conflict: Establishment versus Household Surveys / Economics / Employment
By: PhilStockWorld
Courtesy of Doug Short: Yesterday’s employment report again highlights an ongoing conflict between the jobs number in the Establishment Survey versus the roughly comparable data in the Household Survey. The Nonfarm Payrolls of the former came it at a disappointing 113K new jobs — well off the consensus forecasts for 185K or more. In contrast, the Household Survey reported a 638K increase in civilian employment age 16 and over, a number that gets trimmed to 616K after the BLS applies its “annual adjustment to the population controls.” Business Insider, not surprisingly, picked up on this oddity with the headline “By One Measure, This Was A Stupendous Jobs Report“.
Monday, February 03, 2014
The Keynesian Multiplier – Does it Exist? / Economics / Economic Theory
By: Submissions
Dan Lieberman writes: Can someone clarify a significant economic and well accepted proposition that bothers me?
The notion that the Keynesian multiplier means that “an exogenous increase in spending, such as an increase in government outlays, increases total spending by a multiple of that increase,” is troublesome. Is it possible to add one dollar to the money supply and magically turn it into more dollars? I don’t think this is possible. I believe economists have misinterpreted the multiplier. To me, it is not a multiplier. It is a divider.
Monday, February 03, 2014
New U.S. Recession 2014-2015 90% Chance / Economics / Recession 2014
By: Jas_Jain
Q: Have Bernanke, Krugman and Yellen predicted any recession, in their career, before it happened?
A. N-O-NO.
Q: Have Bernanke, Krugman and Yellen predicted recoveries before they happened?
A: YES, always.
Read full article... Read full article...
Sunday, February 02, 2014
A Tale of Two Europes Deflation Video / Economics / Deflation
By: EWI
Today's post is a 7-minute video from European Financial Forecast Editor Brian Whitmer. Brian gave this presentation in London to The Society of Technical Analysts. This portion of "A Tale of Two Europes" is packed with myth-busting charts about government's inability to stop deflation, cheap credit's role in an economic recovery and more.
Friday, January 31, 2014
For Europe’s Youth, Minimum Wages Means Minimal Employment / Economics / Employment
By: Steve_H_Hanke
Yesterday, in the wake of Tuesday’s State of the Union address, I poured cold water on President Obama’s claim that a hike in the minimum wage for federal contract workers would benefit the United States’ economy, pointing specifically to unemployment rates in the European Union. The data never lie: EU countries with minimum wage laws suffer higher rates of unemployment than those that do not mandate minimum wages. This point is even more pronounced when we look at rates of unemployment among the EU’s youth – defined as those younger than 25 years of age.
Read full article... Read full article...
Friday, January 31, 2014
Canada Debt Crisis, Economic Meltdown, Why the ECB Cares / Economics / Canada
By: David_Hague
Dear Reader, you probably said to yourself that the premise of this article is absurd and preposterous. Canada is a paragon of fiscal responsibility. It is a bastion of good governance in a confused world of financial instability. It is a shining beacon of democracy, the envy of the world. I would have agreed with you until I received a very disturbing early morning phone call from Gustavo Laframboise-Pierre, the Director of Statistical Creation, at the European Central Bank [ECB]. My relationship with Gustavo LaFramboise-Pierre went back many years. He had been my bookie since 1980 when I began my career in the investment industry. His life took a significant turn for the better when a senior member of the European Central Bank [ECB] bet large and incorrectly on the outcome of the 2010 World Cup. The only way the senior member of the ECB could settle the debt was to offer Gustavo a high paying sinecure at the ECB. Overnight, Gustavo found himself living in Paris, with the responsibility of fabricating fictional statistics to support whatever policies were being propagated by the world's central banks.
Thursday, January 30, 2014
Minimum Wage Laws Kill Jobs / Economics / Economic Theory
By: Steve_H_Hanke
President Obama set the chattering classes abuzz after his unilateral announcement to raise the minimum wage. During his State of the Union address, he sang the praises for his action, saying that “It’s good for the economy; it’s good for America.”[1] Yet this conclusion doesn’t pass the economic smell test; just look at the data from Europe.
Read full article... Read full article...