Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Tuesday, April 24, 2012
The Pain in Spain, Debt Spiral and Housing Market Crash / Economics / Eurozone Debt Crisis
By: John_Mauldin
It really does seem to be All Spain All the Time, but there is a reason. Unlike Greece, Spain makes a difference to the eurozone. It may be both too big to allow to fail and too big to save. Last week I came across a very informative 50-page PowerPoint on the situation in Spain from Carmel Asset Management. It is too big to send, but I asked Jonathan Carmel to draft a smaller document with some of the key points. I find it compelling. You can access the entire PowerPoint on my website. If you are not registered with me, you will need to enter your email address and, if you would, your zip code or country. There is a lot if information and data in the report. It will certainly make you think.
I want to emphasize that I do not think Spain is hopeless. Rather, it has a narrow set of limited options that will require a great deal of austerity and economic pain on the part of Spain and significant help from the rest of Europe, combined with the forbearance and patience of the bond market or massive buying of Spanish bonds by the ECB for an extended period of time. I think it will need to be the latter, as the bond market is on the brink of breaking down on Spanish debt, failing a realistic path to economic balance and growth. The way ahead is most difficult and treacherous. It appears to me that at the end of the day only ECB participation can buy Spain the time it needs. If they give Spain the time, it can get through. But the pain will then be spread to the valuation of the euro and thus the entire eurozone.
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Tuesday, April 24, 2012
U.S. Mortgage Refinancing: Stimulative or Redistributive? / Economics / US Economy
By: Paul_L_Kasriel
This "etude" has nothing to do with today's economic or market events. Rather, it is a little "acorn" for you to bury today and dig up in the future when some partial-equilibrium yahoo on CNBC says that total spending in the economy will get a boost as households refinance their mortgages at lower interest rates. Yes, the folks doing the refinancing will now have more income left over after making their monthly mortgage payment to spend on other things.
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Friday, April 20, 2012
Get Ready for 'Hot' Inflation / Economics / Inflation
By: Submissions
Gregor Macdonald writes: Ideological deflationists and inflationists alike find themselves both facing the same problem. The former still carry the torch for a vicious deflationary juggernaut sure to overpower the actions of the mightiest central banks on the planet. The latter keep expecting not merely a strong inflation but a breakout of hyperinflation.
Thursday, April 19, 2012
Mark-to-Market: From David Hume to Adam Smith…From Ludwig von Mises to Hiroshima / Economics / Economic Theory
By: Andrew_Butter
From Daniel James Sanchez of the Mises Institute (somewhat condensed):
According to Ludwig von Mises, the notion of money as a measure of value is an artifact of the "classical economics" of Adam Smith, David Ricardo, and John Stuart Mill, who, by and large believed that value was an objective attribute of “goods”. Economic actors, according to classical theory, only exchanged goods if the respective values were equal.
Mises had another theory which he called the subjective-marginal-utility theory of value, where value is derived from utility and valuation is a matter of preferring one set of goods over another, according to the goods' respective utilities.
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Wednesday, April 18, 2012
Must Understand Issue – U.S. Unemployment! / Economics / Unemployment
By: Ian_R_Campbell
Why Read This: Because it is important that when your read articles on Job Reports you understand what Structural Unemployment is, and what it means to economic growth.
Featured Article: An April 9 article by Joe Duarte discusses the April 6 U.S. Jobs Report in the context of Structural Unemployment. In his article, Duarte concludes:
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Tuesday, April 17, 2012
Falling Standard of Living for Average American's, Debt/Income/Productivity / Economics / US Debt
By: John_Mauldin
Lacy Hunt kicks things off with a bang in Hoisington's Quarterly Review and Outlook, this week's Outside the Box:
"The standard of living of the average American continues to fall."
The reason, in a word: debt. Lacy explains what happens:
"Efforts by fiscal and monetary authorities to sustain growth by further debt accumulation may produce some short-term benefit. Sadly, these interludes fade quickly as the debt becomes more destabilizing. The net result of increased indebtedness then becomes the opposite of what policymakers intend when they promote economic growth by either borrowing funds for increased government expenditures or encourage consumers to borrow with artificial and temporary incentives."
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Tuesday, April 17, 2012
Seniors Worried about the Debt They Are Passing on to Their Heirs? / Economics / Pensions & Retirement
By: Paul_L_Kasriel
I recently celebrated my 65th birthday, which allowed me to become eligible for Medicare. On May 1, I will begin collecting Social Security benefits. I was curious to see what has been happening to combined federal expenditures on Social Security and Medicare in relation to total federal expenditures excluding those for national defense. My curiosity was satisfied by the data in Chart 1.
Tuesday, April 17, 2012
The Cyclical Macroeconomic Impact of Taxmageddon 2013 / Economics / Taxes
By: Paul_L_Kasriel
As you file your 2011 federal income taxes, you are being bombarded in the media with frightening talk about an impending Taxmageddon befalling us as we wake up on January 1, 2013. Of course, if some of the more apocalyptic predictions of the coming end on December 21, 2012, of the “Long Count” Mayan calendar come to pass, then we will not have to concern ourselves with Taxmageddon 2013. But assuming that most of us will be around for January 1, 2013, what is Taxmageddon all about and what will be its cyclical macroeconomic impact on the U.S. economy?
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Monday, April 16, 2012
Edgar the Entrepreneur Demonstrates Harm the Minimum-wage Inflicts on Workers / Economics / Economic Theory
By: MISES
Daniel James Sanchez writes: Edgar the Exploiter is a wonderful animated short by Tomasz Kaye that defends voluntary employer-employee relations and demonstrates the harm that policies like minimum-wage laws inflict on the very people they are supposed to help.
Edgar is a capitalist who hires Simon as an unskilled laborer, until a minimum-wage law impels Edgar to lay Simon off.
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Monday, April 16, 2012
Why Has the American Economic System Failed? / Economics / US Economy
By: Jesse
"We always want to keep in mind what the function, the purpose, of the economy is. The purpose of an economy is not producing GDP. It is increasing the welfare of citizens, and it is increasing the welfare of most citizens. And the American economic system has failed, and failed very badly. Most Americans today are worse off, most American households have lower real income adjusted for inflation than they had fifteen years ago."
Sunday, April 15, 2012
March U.S. CPI Inflation Points Highlights Economic Risks / Economics / Inflation
By: Tony_Pallotta
Friday's release of the March consumer price index (CPI) highlights the risk facing the US economy as we have been discussing over the past few weeks. When the US exited the 2008 recession (using exited loosely) it was not final demand from consumers that initiated growth but rather government stimulus. Debt as is the case with most recoveries is what fuels the initial leg.
Sunday, April 15, 2012
Spain in Debt Crisis War, Fighting to Stop Turning into a Black Economy / Economics / Eurozone Debt Crisis
By: John_Mauldin
I fully intended to ignore Spain this week. Really, truly I did. I had my letter all planned, but then a few notes drew my attention, and the more I reflected on them, the more I realized that the inflection point that I thought the ECB had pushed down the road for at least a year with their recent €1 trillion LTRO is now rushing toward us much faster than ECB President Draghi had in mind when he launched his massive funding operation.So, we simply must pay attention to what Spain has done this week – which, to my surprise, seems to have escaped the attention of the major media. What we will find may be considered a tipping point when the crisis is analyzed by some future historian. And then we'll get back to some additional details on the US employment situation, starting with a few rather shocking data points. What we'll see is that for most people in the US the employment level has not risen, even as overall employment is up by 2 million jobs since the end of the recession in 2009. And there are a few other interesting items. Are we really going to see 2 billion jobs disappear in the next 30 years?
Friday, April 13, 2012
U.S. Jobless Claims, Wholesale Prices, and Trade Gap – Mixed Economic Message / Economics / US Economy
By: Asha_Bangalore
Initial jobless claims rose 13,000 to 380,000 during the week ended April 7, putting the four-week moving average back at 368,500 after posting readings below this level in the past two weeks. Continuing claims, which lag initial jobless by one week, fell 98,000 to 3.251 million. The soft payroll gains in March and the currently weekly gain in claims support the view that labor market conditions are improving only gradually.
Tuesday, April 10, 2012
Economic Recovery - Who are We Kidding? / Economics / US Economy
By: Axel_Merk
The global economy is healing, so we are told. Yet, the moment the Federal Reserve (Fed) indicates just that - and thus implying no additional stimulus may be warranted - the markets appear to throw a tantrum. In the process, the U.S. dollar has enjoyed what may be a temporary lift. To make sense of the recent turmoil, let's look at the drivers of this "recovery" and potential implications for the U.S. dollar, gold, bonds and the stock market.
Sunday, April 08, 2012
U.S. Job Creation Just Trying to Keep Up Wth Population Growth / Economics / Employment
By: John_Mauldin
Today's employment numbers were decidedly soft, but the unemployment rate went down anyway, and that is about the best you can say. And this being a holiday weekend, it provides us an opportunity to look deep into the employment numbers, while we put off thinking about Spain for at least a week. And who knew that being an unmarried Asian-American in the US was a risk for unemployment? Plus a few other interesting items will make for an interesting letter.
Saturday, April 07, 2012
War Torn Iraq and Free Market Capitalism / Economics / Economic Theory
By: MISES
In the course of my deployments to Iraq I learned a great deal about economics, though I didn't realize it at the time. I hadn't yet been introduced to the Austrian School or a Rothbardian view of laissez-faire capitalism. Looking back, however, I can see quite clearly that in several important areas voluntary systems not only existed in that country but thrived.
Saturday, April 07, 2012
Discouraged U.S. Workers NOT THE REASON for decline in March Unemployment Rate / Economics / Unemployment
By: Paul_L_Kasriel
Civilian Unemployment Rate: 8.2% in March, down one notch from February. Cycle high jobless rate for the recent recession is 10.0%, registered in October 2009.
Payroll Employment: +120,000 jobs in March vs. +240,000 in February. Private sector jobs increased 121,000 after a gain of 233,000 in February. A net gain of 4,000 jobs due to revisions of payroll estimates of January and February.
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Saturday, April 07, 2012
Learning to Think in Multiple Scales and U.S. Jobs Creation / Economics / Economic Theory
By: Ashvin_Pandurangi
Most politicians, bureaucratic officials, business "leaders", mainstream academics and media pundits in the world are stuck in a single-scale mindset. They approach every problem and issue from the perspective of a human being looking out into an increasingly inter-dependent global society. They take the structures of extensive trade, multinational corporations, global regulatory institutions, international treaties, etc. as irreversible truths that are embedded into the very fabric of existence.
Saturday, April 07, 2012
Eurozone, US, China, the Global Economy's Ups and Downs / Economics / Global Economy
By: William_R_Thomson
The Business Times Singapore Investment Round Table
PANELLISTS
Kenneth Courtis: Former vice-chairman, Goldman Sachs (Asia) and co-founder of Themes Investment Management
Ernest Kepper: President, Asia Strategic Investment Associates, Japan
Robert Lloyd-George: Chairman, Lloyd-George Investment Management, Hong Kong
William Thomson: Chairman of Private Capital, Hong Kong, director of Finavestment, London
Wednesday, April 04, 2012
Economic Depression and Deflation / Economics / Deflation
By: EWI
Has the United States met that precondition?
Well, consider that total credit market debt as a percent of U.S. gross domestic product was
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