Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Thursday, November 11, 2010
China's Trade Imbalance Threatens Global Economic Stability / Economics / Global Economy
By: Money_Morning
Kerri Shannon writes:
China announced yesterday (Wednesday) that its trade surplus grew 60.7% in October from the month before as efforts to rebalance its economic growth this year have failed. Furthermore, recent policy tightening measures mean domestic demand is unlikely to pick up in the near future.
"The rebalancing of China's economy has an awfully long way to go – in fact it's hardly even got started," Mark Williams, an economist at Capital Economics Ltd. who previously worked at the U.K. Treasury as an adviser to China, told Bloomberg. "In normal circumstances, the world might be willing to wait, but not when the likes of the U.S. are struggling with very high unemployment."
Read full article... Read full article...
Thursday, November 11, 2010
U.S. Jobless Claims Decline and Trade Gap Narrows, Exports Continue Boost Economy / Economics / Economic Recovery
By: Asha_Bangalore
Initial jobless claims fell 24,000 to 435,000 during the week ended November 6. Initial jobless claims have dropped in three out of the last four weeks. The 4-week moving average at 446,500 is the lowest since September 13, 2008 (see chart 1). Each of these developments is noteworthy and encouraging. In addition, the date is haunting because this is the last weekly reading before the Lehman Brothers debacle in September 2008.
Thursday, November 11, 2010
Marc Faber on U.S. Trade Deficit Doom as a Cause of the Financial Crisis / Economics / US Economy
By: Videos
Marc Faber Discussing the U.S. trade deficit as the real cause of the financial crisis that boosted emerging markets and commodities which should be thanking Ben Bernanke. U.S. could benefit form exporting agricultural commodities.
Wednesday, November 10, 2010
Quantitative Easing During Mid 1930s Appears to Have Been Successful / Economics / Quantitative Easing
By: Paul_L_Kasriel
There is much skepticism as to whether the Fed's second round of quantitative easing, QE2, will be effective in stimulating the nominal demand for goods and services in the U.S. economy. It was explained in our November 4, 2010 US Economic and Interest Rate Outlook why the Fed's first round of quantitative easing, which ran from the end of November 2008 through the end of March 2010, was rather unsuccessful in stimulating nominal aggregate demand and why we believe that the Fed's just-announced second round will be more successful. Keying off Mark Twain's aphorism that although history may not repeat, it often rhymes, perhaps we can get some guidance as to whether QE2 will be successful from the results of the quantitative easing that was initiated in the second half of 1933.
Wednesday, November 10, 2010
Why QE2 INCREASES the Risk of Deflation / Economics / Deflation
By: Submissions
Tim
Waring writes:
Markets lapped it up!
QE2 was met with rapture by commodity and stock markets as traders and investors continue the easy money ride of a sinking dollar. The effect on the real economy is unknown but common sense rather than models suggests this extra $600billion is a mistake.
Read full article... Read full article...
Tuesday, November 09, 2010
How to Profit from China's Consumer Boom Throttling Up GDP Growth / Economics / China Economy
By: Money_Morning
Keith Fitz-Gerald writes: BEIJING, People's Republic of China – There's something inherently satisfying about waking up on a clear, crisp fall day in this bustling capital city, and seeing this headline atop the lead story in this morning's China Daily newspaper:
"World Bank Sees Change in Growth Pattern"
Read full article... Read full article...
Tuesday, November 09, 2010
Deflation is Still a Problem Despite Fed Money Printing QE2 / Economics / Deflation
By: Mike_Whitney
Deflation is not a problem because the Fed can always create inflation by printing more money.
Wrong.
While it's true that the Fed can print as much money as it chooses, adding to the money stock does not decrease deflation or increase inflation. It merely adds to the reserves the banks have at their disposal to lend out to businesses and consumers. Here's how British economist John Maynard Keynes summed it up:
Tuesday, November 09, 2010
Common Sense vs. Academic Economist Formulas; Fed Concludes Structurally High Unemployment is a Myth / Economics / Economic Theory
By: Mike_Shedlock
Ben Bernanke and the Fed have great belief in academic models whether they make any real world practical sense or not.
Indeed, Bernanke's reliance on formulas instead of common sense is what told him there was no housing bubble, that unemployment would not get above 8.5%, and that Quantitative Easing in massive force would cause the unemployment rate to drop. He was wrong on all counts.
Tuesday, November 09, 2010
Fed Pushes U.S. Economy into an Inflationary Death Spiral / Economics / Inflation
By: Michael_Pento
It seems the Fed has given up on the idea that the country can build a viable and stable economy through the conventional means. Instead, our central bank has resorted to once again growing GDP and increasing employment by the creation of asset bubbles. This is a dangerous game that no one, least of all the Fed, knows how to play.
Tuesday, November 09, 2010
U.S. Commercial and Industrial Demand for Loans Remains Weak / Economics / US Economy
By: Asha_Bangalore
The Fed's Senior Loan Officer Survey results of October indicate that demand for commercial and industrial loans from large and medium sized firms was weaker compared with the third quarter survey (see chart 1). A larger percentage of bankers indicated weaker demand from small firms. This information is discouraging because stronger economic growth in the months ahead is tied to a likely pickup in loan demand.
Monday, November 08, 2010
Thinking Clearly about Capital, Interest, and Income / Economics / Economic Theory
By: Robert_Murphy
Nowadays, Austrian economists are most famous for their theory of the business cycle, as developed by Ludwig von Mises and Friedrich Hayek. However, they also made many contributions to the pure theory of capital and interest, most notably in the seminal work of Eugen von Böhm-Bawerk and later in that of Hayek. In the present article we'll see that these insights are relevant today, as mainstream economist Scott Sumner lashes out justifiably against absurd tax policies but, in the process, throws economic theory out the window too.
Monday, November 08, 2010
The Business Boom-Bust Cycle in Microcosm / Economics / Economic Theory
By: George_Reisman
The essential features of the boom-bust business cycle can be understood by viewing them in terms of the financial circumstances of a single individual.
Thus, imagine that an ordinary person has been going about his life more or less living within his means. And now, one day, he receives a registered letter from a major bank. The letter informs him that he is the sole heir of a distant relative who possessed a substantial fortune, and that he should come into the bank's main office in his city to sign the necessary documents and receive all the necessary authorizations to henceforth dispose of this fortune as he sees fit. Naturally, he quickly goes in and takes possession of his newfound fortune.
Read full article... Read full article...
Monday, November 08, 2010
How the Government Lies About Low CPI Inflation, Krugman Deflation Propaganda / Economics / Inflation
By: Submissions
Robert Wenzel writes: With commodity prices soaring, Paul Krugman is in a trap with his deflation call, so he has decided to turn to Richard "I am not a crook" Nixon to explain why price inflation is really not happening.
Krugman tells us to forget about the prices that are going up. They are too volatile, he tells us. He says that what we should focus on are tricky sticky price indexes, specifically, core CPI.
Monday, November 08, 2010
Lessons From the 1930's Great Depression, Create Jobs by Executive Order / Economics / Government Spending
By: Global_Research
Jeanne Mirer and Marjorie Cohn writes: On May 6, 1935, with the country in the midst of the Great Depression, and with indirect efforts to create jobs having not moved the needle of unemployment rates, President Franklin D. Roosevelt signed Executive Order 7034 and appropriated $4.8 billion for the Works Progress Administration (WPA). The WPA put millions of Americans to work constructing buildings, painting murals to decorate them, and performing plays for audiences that had never before seen a dramatic production. In the process, many were saved from poverty and starvation and the economy began to revive.
Monday, November 08, 2010
Fed Debases the Imperial Dollar, Inflation, Stagnation and Higher Interest Rates Ahead / Economics / Inflation
By: Prof_Rodrigue_Trembl
"Under a paper money system, a determined government can always generate higher spending and hence positive inflation."Ben Bernanke, future Fed Chairman (in 2002)
“My thesis here is that cooperation between the monetary and fiscal authorities in Japan could help solve the problems that each policymaker faces on its own. Consider for example a tax cut for households and businesses that is explicitly coupled with incremental BOJ purchases of government debt – so that the tax cut is in effect financed by money creation. Moreover, assume that the Bank of Japan has made a commitment, by announcing a price-level target, to reflate the economy, so that much or all of the increase in the money stock is viewed as permanent.”Ben Bernanke, future Fed Chairman (in 2002)
Read full article... Read full article...
Saturday, November 06, 2010
Bernanke Leaps into a Liquidity Trap, Thoughts on the U.S. Employment Numbers / Economics / Economic Theory
By: John_Mauldin
A Few Thoughts on the Employment Numbers
Bernanke Leaps into a Liquidity Trap
How to Spot a Liquidity Trap
Toy Blocks
I am in London finishing my new book, The End Game, which will be out after the first of the year, as soon as Wiley can make it happen. Working with my co-author, Jonathan Tepper, we are making good progress. We intend to quit (a book like this is never finished) tomorrow afternoon.
Read full article... Read full article...
Saturday, November 06, 2010
U.S. October Employment Report Shows Economy is Slowly But Surely Retreating From the Cliff / Economics / Economic Recovery
By: Asha_Bangalore
Civilian Unemployment Rate: 9.6% in October, virtually steady for five straight months. The unemployment rate was 5.0% in December 2007 when the recession commenced. Cycle high for recession is 10.1% in October 2009 and the cycle low (for the expansion that ended in December 2007) is 4.4% in March 2007.
Payroll Employment: 151,000 in October vs. -41,000 in September. Private sector jobs increased 159,000 after a 107,000 increase in September. Net gain of 93,000 jobs after revisions of private sector payroll estimates for August and September.
Friday, November 05, 2010
Bernanke's Bubble Making Solutions Are the Problem / Economics / Economic Theory
By: Mark_Thornton
Ben Bernanke, the man who purports to be the savior of the economy today, was actually deeply involved in creating the housing bubble, encouraging people to invest in toxic assets, and orchestrating the cover-up after the bubble collapsed. Now he is bludgeoning the economy into depression. Just like his predecessor Greenspan, his statements are replete with misleading, convoluted, and inconsistent claims, all designed to disguise the role of the Fed in the economic calamity.
Friday, November 05, 2010
From QE2 To Economic Titanic, The Global Asset Inflation Surge / Economics / Inflation
By: Andrew_McKillop
Ben Bernanke has cranked the U.S. Fed's printing presses one more time, with a new injection of
US$ 600 billion. Market operators have responded with the only tune they know: bid up all hard
asset real resource prices in the Commodities space and, for a while, also talk up their paper
cousins in the Equities space, while the US dollar wilts by the hour. Not so far forward, however,
this creation of virtual value will hit the iceberg of runaway asset inflation, then vast deflation, as
QE2 turns to Titanic.
Thursday, November 04, 2010
John Locke vs. the Mercantilists and Inflationists / Economics / Inflation
By: Murray_N_Rothbard
From the early decades of the 17th century, English mercantilists were bitter at the superior prosperity and economic growth enjoyed by the Dutch. Observing that the rate of interest was lower in Holland than in England, they chose to leap to the causal analysis that the cause of the superior Dutch prosperity was Holland's low rate of interest, and that therefore it was the task of the English government to force the maximum rate of interest down until the interest rate was lower than in Holland.