Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.Wednesday, July 18, 2012
The International Monetary Fund - World Economic Outlook / Economics / Global Economy
Yesterday the International Monetary Fund issued both its 'World Economic Update' and its 'Global Financial Stability Report'. If you read the short Executive Summaries at the beginning of each, you effectively will have read them. That will take you less than 2 minutes in total, and you ought to take the time to do it - see links following this commentary.
Read full article... Read full article...
Tuesday, July 17, 2012
United States Dependance Day / Economics / Government Spending
The Fourth of July week brought unwelcome birthday gifts to the United States in the form of poor domestic jobs data and similarly gloomy information from other major economies. Amidst the heat and festivities, it has become difficult to deny that the economy is deteriorating. Politicians appear helpless, thrashing about for a solution and blaming everything and everyone but themselves. This lack of leadership is apparent to those who have by now lost all confidence of a possible quick rebound, if only the tough decisions had been made early and swiftly.
Read full article... Read full article...
Monday, July 16, 2012
What Every American Should Know About the National Debt / Economics / US Debt
The U.S. government has stolen $15,876,457,645,132.66 from future generations of Americans, and we continue to add well over a hundred million dollars to that total every single day day. The 15 trillion dollar binge that we have been on over the past 30 years has fueled the greatest standard of living the world has ever seen, but this wonderful prosperity that we have been enjoying has been a lie. It isn't real. We have been living way above our means for so long that we do not have any idea of what "normal" actually is anymore. But every debt addict hits "the wall" eventually, and the same thing is going to happen to us as a nation. At some point the weight of our national debt is going to cause our financial system to implode, and every American will feel the pain of that collapse. Under our current system, there is no mathematical way that this debt can ever be paid back. The road that we are on will either lead to default or to hyperinflation. We have piled up the biggest debt in the history of the world, and if there are future generations of Americans they will look back and curse us for what we did to them. We like to think of ourselves as much wiser than previous generations of Americans, but the truth is that we have been so foolish that it is hard to put it into words.
Read full article... Read full article...
Monday, July 16, 2012
How the Malaysian Government Manipulate the CPi to Undermine Inflation / Economics / Inflation
The Consumer Price Index measures the movement of goods and services purchased for consumption over a period of time. It is a very good measure for households to evaluate their financial position and purchasing power over time. As far as we know, folks like us knows that the prices of goods and services had risen much for the past few years and yet the government had been telling us the contrary. This is because according to their calculation based on the CPI, the basket of goods and services only goes up by 2-3% per annum. As we know all governments lies about their inflation figures. They will report inflation figures of 2-3% even though the prices of food, fuel, education, medical expenses and etc have been sky rocketing in the past few years.
Read full article... Read full article...
Sunday, July 15, 2012
China's End Game, the dark side of a great deleveraging / Economics / China Economy
1. The frustrated and aggressive central bank
If one wants to know how bad the health of China's economy has gone, look no further than PBOC's composure, which seems rather frustrated and aggressive as of late. On 5th July, the central bank cut benchmark interest rates for the 2nd time in less than a month. This happened right after the fact that in December 2011, PBOC cut the reserve requirement ratio(RRR) by a 50 bp to 21%, it followed up with another 50 bp in February and another 50 bp in May to 20% currently.
Read full article... Read full article...
Saturday, July 14, 2012
China Economic Growth Slows in 2012:Q2 / Economics / China Economy
Real GDP for China slowed to a 7.6% pace from a year ago in the second quarter compared with an 8.1% increase in the first quarter. The latest read on GDP growth in China is the slowest since the first quarter of 2009 not only on a year-to-year basis but also on a quarterly basis (See Chart 3), with the second quarter gain at 6.4%.
Read full article... Read full article...
Saturday, July 14, 2012
U.S. Wholesale Price Inflation Reverses Part of Recent Decline / Economics / Inflation
The Producer Price Index (PPI) of Finished Goods moved up 0.1% in June, following a string of three monthly declines. The energy price index fell 0.9% in June vs. a 4.3% decline in May. Wholesale gasoline and natural gas prices moved up in June but residential electricity costs declined and provided a large enough offset to bring down the overall finished energy price index. The 0.5% increase in food prices was one of the culprits for a gain in the headline index.
Read full article... Read full article...
Saturday, July 14, 2012
Chile at an Economic Crossroads / Economics / Emerging Markets
Chile's accession to the Organization of Economic Cooperation and Development in 2010 was more than just a confirmation that they'd earned the right to join the world's top ranked economies. As the first South American country to be accepted into the OECD, it was also a symbolic affirmation of several decades worth of market-oriented reforms that transformed the country from an illiberal backwater to what is arguably one of Latin America's most stable and thriving nations. As a result, we feel that Chile qualifies as a good choice for international investment (for other investment locales that we have our eye on, see the latest Euro Pacific Global Investor Newsletter).
Read full article... Read full article...
Friday, July 13, 2012
U.S. Labour Market Distortions Lead to a Sharp Drop of Initial Jobless Claims / Economics / Unemployment
Initial jobless claims fell 26,000 during the week ended July 7 to 350,000. The sharp decline would be bullish if in fact it was not distorted by the July 4 holiday and fewer summer auto plant shutdowns. Typically in the summer, auto plant shutdowns and return of auto workers causes wide swings in jobless claims numbers.
Read full article... Read full article...
Friday, July 13, 2012
Are there suddenly signs of growth in UK retail? / Economics / Sector Analysis
Whisper it but there’s just a touch of optimism surrounding the retail sector in the UK at the moment.
The past financial year has been a difficult one for the majority of retailers but there have been just enough signs in recent company results and economic indicators that things might be picking up.
Read full article... Read full article...
Thursday, July 12, 2012
EU in Recession, US Entering Recession and China is Lying About Its Growth / Economics / Recession 2012
The emerging markets, especially China, are showing signs of a major slowdown. Indeed, recent revelations have made it clear that China’s slowdown is in fact much worse than expected:
Read full article... Read full article...
Wednesday, July 11, 2012
U.S. Labor Market and Sales News Remains Unsatisfactory / Economics / US Economy
There were 3.642 million job openings in May according to the job openings and labor turnover report (JOLTS), which lags the employment report by one month. The job openings rate (number of job openings on the last business day of the month as a percent of total employment plus job openings) moved up slightly to 2.7% in May from 2.5% in April, but matches the rate seen in March. The hiring rate (number of hires during the entire month as a percentage of total employment) at 3.3% in May has held at this level in three out of first five months of the year. Essentially, the report confirms the message from the employment report of sluggish labor market conditions.
Read full article... Read full article...
Wednesday, July 11, 2012
U.S. Already in Recession, Thinks ECRI's Achutan / Economics / Recession 2012
Lakshman Achuthan, co-founder of the Economic Cycle Research Institute, spoke with Bloomberg Television's Tom Keene today and said that, "What we said back in December was that the most likely start date for the recession would be in Q1 and if not then, by the middle of 2012. I'm here to reaffirm that. I think we're in a recession already."
Read full article... Read full article...
Monday, July 09, 2012
Barack Obama's Presidency Economic Report Card – Fail / Economics / US Economy
We are now three and one half years into Barack Obama's presidency. I thought a few pertinent charts would help us assess the success of his economic policies. Upon his election he demanded an $800 billion stimulus package in order to keep the unemployment rate from surpassing 8%. The $800 billion was to be spent over two years we were told and then government spending would be scaled back to pre-stimulus levels. There were 145 million Americans employed when Obama was elected. There are 9 million more working age Americans today than there were in 2008. There are now 142.4 million employed Americans. So, we've added 9 million potential workers and still have 2.6 less Americans employed. We have the same number of Americans employed as we did in early 2006, when there were 17 million less working age Americans.
Read full article... Read full article...
Monday, July 09, 2012
The Unseen Hand in Economic Progress / Economics / Economic Theory
The assessment of economic growth based on Gross Domestic Product is a fallacy, because GDP is merely a measure of the amount of money in an economy. The one thing it does not measure, which is central to economic progress (note progress, not growth), is the level of entrepreneurial activity. This has important implications for the efficacy of government interventions and solutions to the current economic crisis.
Read full article... Read full article...
Saturday, July 07, 2012
U.S. Labour Market Stood Sill in June, Strengthens the case of FOMC Doves / Economics / Employment
Civilian Unemployment Rate: 8.2% in June, unchanged from May. Cycle-high jobless rate for the recent recession is 10.0%, registered in October 2009.
Payroll Employment: +80,000 jobs in June vs. +77,000 in May. Private sector jobs increased 84,000 after a gain of 105,000 in May. A net loss of 1,000 jobs due to revisions of non-farm payroll estimates of April and May.
Read full article... Read full article...
Friday, July 06, 2012
U.S. Falling into a Liquidity Trap, Leading to a Japan Style Economic Depression / Economics / US Debt
Central bank printing and excessive government borrowing are two themes that need no introduction. The U.S. consumer could become a source of stability for the financial world again (well get to this). And oh how it hurts to wake up in the morning when you are old. What follows is the cornucopia of negativity that can be unfurled when looking at the financial world today a world that is only out-daunted by one thing: how the world will look tomorrow.
Read full article... Read full article...
Friday, July 06, 2012
Latest from the US Labor Market / Economics / Employment
The customary initial jobless claims report shows a reduction in jobless claims by 14,000 to 374,000 during the week ended June 30, putting the four-week moving average at 385,750. Continuing claims, which lag initial jobless claims by one week, rose 4,000 to 3.306 million. The year commenced with initial jobless claims at 390,000 in the first week of January, the year-to-date low has been 361,000 and the latest reading is 374,000, as noted earlier. These numbers imply that there has been only a small improvement in the initial jobless claims, nothing to write home about.
Read full article... Read full article...
Thursday, July 05, 2012
Sorry Folks, Spain Isn’t “Saved” And The Next Leg Down is Coming Soon / Economics / Eurozone Debt Crisis
Spain has supposedly been “saved” by a €100 billion bailout.
However, the details surrounding the source of the funding for this “bailout” still remain a mystery as there is no entity capable of providing the €100 billion in capital: neither the IMF, nor the Federal Reserve, nor the ECB have the political backing to launch a bailout of this size… and of the two EU mega-bailout funds, the EFSF and the ESM, the former can’t even raise €10 billion successfully while the latter doesn’t even exist yet.
Read full article... Read full article...
Wednesday, July 04, 2012
What Next For The Euro-Zone? / Economics / Eurozone Debt Crisis
The European Union has just completed its 20th "make or break" Summit in a little over two years, and actually managed to beat expectations. Two key agreements were reached on June 28-29: expanding the remit of the two bailout funds - the temporary European Financial Stability Facility (EFSF) and permanent European Stability Mechanism (ESM) - to include sovereign debt purchases and eventually direct banking sector support; and creating a unified banking regulator for the Euro-zone under the auspices of the European Central Bank (ECB). These apparently-small steps are actually quite far reaching. The Summit outcome also indicates that, faced with really significant risks - in this case, unsustainable funding pressures on the Spanish and Italian sovereigns - the politicians are still willing to make some of the compromises necessary to support the Euro-zone. In our opinion, this combination of muddle-through and compromise in the face of crisis will lead to a closer fiscal union over the coming years. However, we also think that the likelihood that Greece will not be a member of the Euro-zone by end-2013 has risen to over 60%.
Read full article... Read full article...