Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.Wednesday, December 09, 2009
Aristophanes on Inflation / Economics / Inflation
It used to be that every economist worth his salt knew Gresham's Law (or, if he was Polish, Copernicus's Law): "bad money drives out good." Narrowly understood, this rule says that when the government requires people to accept different forms of money at an exchange rate fixed by law, the form of money that is overvalued (the "bad money") will circulate, while the form of money that is undervalued (the "good money") won't.
Read full article... Read full article...
Wednesday, December 09, 2009
Debt Deleveraging Is a Necessary Consequence of Deflation / Economics / Deflation
A blinding affliction can be seen with the gold bugs. Make reference to a strong dollar and falling gold, and you must be a supporter of the central banks, as well as the powerful families with cross-border tentacles that stand behind them. In our case, nothing could be further from the truth. We must put politics and other biases aside if we are to understand the big picture, in order to avoid, and not be ruined by, what’s around the corner.
Read full article... Read full article...
Wednesday, December 09, 2009
Have We Avoided the Economic Depression Many Feared? / Economics / Great Depression II
President Obama spoke about the economy at the Brookings Institution.
Read full article... Read full article...“We acted to get lending flowing again, so businesses could get loans to buy equipment and ordinary Americans could get financing to buy homes and cars, to go to college, and to start or run businesses. We enacted measures to stem the tide of foreclosures in our housing market, helping responsible home owners stay in their homes and helping to stop the broader decline in home values which was eating away at what tends to be a family’s largest asset.
Wednesday, December 09, 2009
Government Socialist Intervention and the Distortion of Capital / Economics / Economic Theory
In all times, but more especially of late years, attempts have been made to extend wealth by the extension of credit.
I believe it is no exaggeration to say, that since the revolution of February, the Parisian presses have issued more than 10,000 pamphlets, crying up this solution of the social problem.
Read full article... Read full article...
Tuesday, December 08, 2009
Productive Debt versus Unproductive Debt / Economics / Economic Theory
The credit crunch continues, with businesses large and small finding that their bankers remain exceedingly stingy in the wake of the 2008 financial debacle. "We need to see banks making more loans to their business customers," Federal Deposit Insurance Corporation (FDIC) Chairwoman Sheila Bair told reporters recently after the FDIC released figures showing that the amount of loans outstanding in the nation's banks fell $210.4 billion in the third quarter of 2008. That is the largest quarterly decline since the FDIC began tracking loans in 1984.
Read full article... Read full article...
Tuesday, December 08, 2009
U.S. Unemployment Statistics Numbers, Official, Unofficial, Real / Economics / Recession 2008 - 2010
Last Friday we got word that the employment picture in the U.S. improved substantially over the month of November. According to the Labor Department, the nation shed 11,000 jobs, a mere fraction of the 130,000 economists were expecting.
Read full article... Read full article...
Tuesday, December 08, 2009
U.S. Social Security Will Go Bankrupt in 2010 / Economics / US Debt
For the third time in my life, the Social Security System will go belly-up.
The first time was in 1977 – well, almost. To head off the bust, Jimmy Carter got Congress to pass a major FICA tax increase – sorry, "contribution" increase – in order to save Social Security. The rate would be hiked in phases from 2% to 6.15% (times two: employee and employer). He promised: "Now this legislation will guarantee that from 1980 to the year 2030, the Social Security funds will be sound." (http://tinyurl.com/ybksxs4)
Read full article... Read full article...
Tuesday, December 08, 2009
Email Exchange With The Cleveland Fed On U.S. Inflation Expectations / Economics / Inflation
A couple weeks ago I received an email from the Cleveland Fed on A New Approach to Gauging Inflation Expectations.
Read full article... Read full article...
Monday, December 07, 2009
Bernanke Says He Cannot Guarantee Double-Dip Recession Won’t Happen / Economics / Recession 2008 - 2010
Chairman of the Federal Reserve, Ben Bernanke, in a speech to the Economic Club of Washington, said that it is too early to declare a lasting recovery:
Read full article... Read full article...
Monday, December 07, 2009
Guide to Keynes's Dangerous and Destructive Economic Theory / Economics / Economic Theory
Defenders of Keynes, such as the recent convert Bruce Bartlett, often claim that he supported capitalism. (Bartlett's The New American Economy has this as a primary theme.) His interventionist measures had as their aim not the replacement of capitalism by socialism or fascism. Rather, it is alleged, Keynes aimed to save the existing order.
Read full article... Read full article...
Monday, December 07, 2009
Where Is the U.S. Economy Heading? / Economics / Economic Recovery
Economists are currently divided on the issue of how strong the US economic recovery is going to be. Some are of the view that as a result of the stimulus policies of the Fed and the Federal government, the recovery is going to be quite strong. Some others are more pessimistic given still-rising unemployment, which they believe will keep consumer spending subdued. In October the unemployment rate jumped to 10.2% from 9.8% in the previous month and 6.6% in October last year.
Read full article... Read full article...
Sunday, December 06, 2009
Deflationary Economic Depression 2010, Ready or Not Here it Comes! / Economics / Great Depression II
Much has been written about the Great Depression and the present crisis. There is much that is similar and some that is not. The differences explain why events have unfolded differently. The similarities explain why the end will be the same.
Read full article... Read full article...
Saturday, December 05, 2009
Marc Faber Why Dubai Debt Default is Just the Tip of the Iceberg / Economics / Global Debt Crisis
Uber bear investor and Gloom, Boom and Doom Report editor Marc Faber says Dubai World’s debt problems are just the tip of the iceberg, and suggests investors will be better off not buying U.S. government bonds.
Read full article... Read full article...
Saturday, December 05, 2009
U.S. Unemployment Rate Edges Lower to 10%, But Jobs Keep Contracting / Economics / Recession 2008 - 2010
This morning, the Bureau of Labor Statistics (BLS) released the November Employment Report.
The unemployment rate edged down to 10.0 percent in November, and nonfarm payroll employment was essentially unchanged (-11,000), the U.S. Bureau of Labor Statistics reported today. In the prior 3 months, payroll job losses had averaged 135,000 a month. In November, employment fell in construction, manufacturing, and information, while temporary help services and health care added jobs..
Saturday, December 05, 2009
Mauldin on the Debt Deleveraging, Deflationary, Asset-bubble-bursting Recession / Economics / Recession 2008 - 2010
This week I am in New York, and have a whirlwind of meetings (and I admit, a lot of fun on the side) and not much time to write. I have been saving today’s letter for a month or so, for a time such as this. Damien Hoffman of the Wall Street Cheat Sheet interviewed me and posted the transcript on his web site. I thought it was one of the better interviews I have done recently, and so it is this week’s Thoughts from the Frontline. In addition to the wide-ranging economic questions, he asks for my thoughts on how one becomes an investment writer. I often demur when asked that question (what do I know?), but did my best to answer this time. I think you will enjoy the letter. (By the way, he does a lot of interesting interviews, which he posts for free on his web site at www.wallstcheatsheet.com.)
Read full article... Read full article...
Friday, December 04, 2009
Britain, the Canary down the Western Coal Mine / Economics / Recession 2008 - 2010
Friday, December 04, 2009
The Economic Recovery Is Looking Stronger Every Week / Economics / Economic Recovery
The stimulus efforts were expensive for sure, and the cost, like the cost of two 7-year wars that were supposed to be three-month skirmishes, will be with us for years to come. But the stimulus efforts at least seem to be working even faster than expected.
Read full article... Read full article...
Friday, December 04, 2009
China Looking for Entrepreneurs / Economics / China Economy
Filmmaker Ole Schell has given us a compelling one-hour documentary that reveals exactly why we should be concerned about China’s challenge to the United States.
Read full article... Read full article...
Friday, December 04, 2009
Welcome to the Asian Century / Economics / Asian Economies
[Editor’s Note: This interview was adapted from a recent issue of the McKinsey Quarterly, the business Journal of McKinsey & Co. It is reprinted with McKinsey’s permission.]
Asia has proven comparatively resilient against the current downturn, but hurdles still lie ahead. In order to maintain robust growth rates in the face of weak U.S. demand, the region’s dynamic economies must stoke domestic consumption and embrace environmentally sustainable development policies, says Stephen Roach, chairman of Morgan Stanley Asia (NYSE: MS) and author of “The Next Asia: Opportunities and Challenges for a New Globalization.”
Read full article... Read full article...
Thursday, December 03, 2009
How Progressive Capitalism Conquers Mass Poverty / Economics / Economic Theory
Throughout history, until about the middle of the 18th century, mass poverty was nearly everywhere the normal condition of man. Then capital accumulation and a series of major inventions ushered in the Industrial Revolution. In spite of occasional setbacks, economic progress became accelerative. Today, in the United States, in Canada, in nearly all of Europe, in Australia, New Zealand, and Japan, mass poverty has been practically eliminated. It has either been conquered or is in process of being conquered by a progressive capitalism. Mass poverty is still found in most of Latin America, most of Asia, and most of Africa.
Read full article... Read full article...