Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Thursday, February 19, 2015
UK Unemployment Plunge Conservative Election Boost / Economics / Unemployment
By: Nadeem_Walayat
UK unemployment falls to its lowest level for 6 years as statistics for the 3 months to December 2014 register a drop of 97,000 claimants to 1.86 million, standing at 5.7% of the workforce, and down nearly 1/2 million on a year ago that illustrates a continuing strong trend in the reduction of domestic unemployment that is set against approx 700,000 jobs created. The difference being that these jobs have gone to migrant workers from firstly Eastern Europe and then the bankrupting PIIGS nations with Spain, Portugal and Greece that have lost many of their brightest to the likes of Britain's NHS, so if your puzzled by the origins of your accented NHS consultant then you may find that they are probably Greek.
Thursday, February 19, 2015
Here's What's Wrong with the 'Good' Deflation Argument / Economics / Deflation
By: EWI
Editor's note: This article was adapted, with permission, from the February issue of The Elliott Wave Financial Forecast, a publication of Elliott Wave International, the world's largest market forecasting firm. All data is as of Jan. 30, 2015. Click here to read the complete version of this article, including specific near-term forecasts, 100% free.
Deflation is a decline in the supply of money and credit relative to goods and services in an economy.
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Wednesday, February 18, 2015
UK Good Deflation Election Boost for Conservatives But Inflation Mega-trend Remains Exponential / Economics / Inflation
By: Nadeem_Walayat
The latest UK official CPI inflation data is at an historic low rate of just 0.3% which prompted the mainstream financial press and academic economists to go overboard on commentary on the dangers of deflation, much as the Bank of England tends to propagandise in its quarterly inflation reports of why Inflation needs to be at or above 2% CPI. The press continues to warn of outright deflation later this year as CPI is expected to nudge below 0% and how this is bad for the economy as people put of consuming today in the anticipation of lower prices tomorrow.
Wednesday, February 18, 2015
Why the Austrian Understanding of Money and Banks Is So Important / Economics / Economic Theory
By: MISES
Jörg Guido Hülsmann writes:
The classical economists had rejected the notion that overall monetary spending — in current jargon: aggregate demand — is a driving force of economic growth. The true causes of the wealth of nations are non-monetary factors such as the division of labor and the accumulation of capital through savings. Money comes into play as an intermediary of exchange and as a store of value. Money prices are also fundamental for business accounting and economic calculation. But money delivers all these benefits irrespective of its quantity. A small money stock provides them just as well as a bigger one. It is therefore not possible to pull a society out of poverty, or to make it more affluent, by increasing the money stock. By contrast, such objectives can be achieved through technological progress, through increased frugality, and through a greater division of labor. They can be achieved through the liberalization of trade and the encouragement of savings.
Tuesday, February 17, 2015
Economic Austerity is Now Extinct / Economics / Economic Austerity
By: Michael_Pento
Greece’s newly elected leftist Prime Minister, Alexis Tsipras, is bringing deficit spending back into vogue. The charismatic prime minister laid out plans to dismantle Greece's "cruel" austerity program, ruling out any extension of its international bailout and setting himself on a collision course with the European Union. Unabashedly candid, he has burst on the scene as the veritable anti-austerity rock star; serenading fans with a return to big spending, including a raise in the minimum wage and pensions.
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Tuesday, February 17, 2015
Population Decline and the Great Economic Reversal / Economics / Demographics
By: STRATFOR
George Friedman writes: In recent weeks, we have been focusing on Greece, Germany, Ukraine and Russia. All are still burning issues. But in every case, readers have called my attention to what they see as an underlying and even defining dimension of all these issues — if not right now, then soon. That dimension is declining population and the impact it will have on all of these countries. The argument was made that declining populations will generate crises in these and other countries, undermining their economies and national power. Sometimes we need to pause and move away from immediate crises to broader issues. Let me start with some thoughts from my book The Next 100 Years.
Sunday, February 15, 2015
How Truly Free Markets Help the Poor / Economics / Economic Theory
By: MISES
Ryan McMaken writes: Discussing poverty as an advocate of free markets is tricky business in today’s world. If one takes poverty seriously and points out the very real plight of the impoverished, it is often assumed that one must therefore be advocating for government “solutions” to the problem. The knee-jerk reaction of many defenders of free markets is to simply deny that poverty exists much at all, or that if the poor just try a little harder, or aren’t so lazy, they won’t be poor anymore.
Friday, February 13, 2015
Bad Economic Idea of Devaluing Currency to Help Exporters / Economics / Economic Theory
By: Frank_Hollenbeck
Frank Hollenbeck writes: The European Central Bank's (ECB) decision to shortly print over 1 trillion euros has reignited concerns over currency wars. The euro has dropped almost 20 percent over the last six months after endless hints from the ECB.
We are in a currency war, and have been since 2008. Our current global monetary system is deeply flawed in spite of the International Monetary Fund (IMF), which was supposedly created to foster monetary cooperation and financial stability. Yet, the IMF has been eerily silent lately, which has not gone unnoticed by those who butter the IMF’s bread.
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Thursday, February 12, 2015
You Can’t Create More Savings by Printing More Money / Economics / Quantitative Easing
By: Frank_Shostak
Savings has nothing to do with money. For instance, if a baker produces ten loaves of bread and consumes one loaf, his savings is nine loaves of bread. In other words, the “savings” in this case is the baker’s real income (his production of bread) minus the amount of bread that the baker consumed. The baker’s savings now permits him to secure other goods and services.
For instance, the baker can now exchange his saved bread for a pair of shoes with a shoemaker. Observe that the baker’s savings is his real means of payments — he pays for the shoes with the saved bread. Likewise, the shoemaker pays for the nine loaves of bread with the shoes that are his real savings.
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Thursday, February 12, 2015
Deflation, Interest Rates and Currency Wars / Economics / US Economy
By: John_Mauldin
Forecasting is a singularly difficult task and is more often than not fraught with failure. The Federal Reserve has some of the smartest economists in the world, and yet their forecasts are so wrong so often (as in, they almost never get it right) that some have pointed out that it’s almost statistically impossible to be as bad as the Fed. Yet they continue to issue such forecasts and to base economic and monetary policy on them. Go figure.
Their forecasts, like most economic predictions, are based on past performance. Intricate economic models look at history to try to determine the future relationships among economic determinants. I really shouldn’t pick on the Fed so much as point out that almost all of us in the forecasting business have dismal track records. The world has grown so complex that it is singularly difficult to understand the interrelationships of the million-odd factors that determine the outcome of an economy.
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Wednesday, February 11, 2015
Fourth Turning Shadow of Crisis of Debt, Civic Decay & Global Disorder / Economics / Global Debt Crisis 2015
By: James_Quinn
In Part One of this article I laid the groundwork of the Fourth Turning generational theory. I refuted President Obama’s claim that the shadow of crisis has passed. The shadow grows ever larger and will engulf the world in darkness in the coming years. The Crisis will be fueled by the worsening debt, civic decay and global disorder. I will address these issues in this article.
Debt, Civic Decay & Global Disorder
The core elements propelling this Crisis – debt, civic decay, and global disorder – were obvious over a decade before the financial meltdown catalyst sparked this ongoing two decade long Crisis. With the following issues unresolved, the shadow of this crisis has only grown larger and more ominous:
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Tuesday, February 10, 2015
Fed's Powell Sees Slack in U.S. Economy, Inflation Too Low and Following Greece Events Carefully / Economics / US Economy
By: Bloomberg
Federal Reserve Governor Jay Powell spoke with Bloomberg's Peter Cook following his speech at Catholic University today. Powell said that low inflation gives the central bank time to remain patient as it considers when to raise interest rates. He said, "There's plenty of slack out there in the economy" and that "wages do not suggest any tightness in the labor market."
PETER COOK, BLOOMBERG NEWS: I am joined by Governor Jay Powell. Thank you for the time, rare opportunity for us to have a chance to chat with you. I want to ask you first of all about your speech today. You made a pretty strong argument against audit the Fed, the push that we're seeing right now in Congress. The fact that you're making this speech at all tells me that you and your colleagues at the Fed see this as a real threat right now.
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Tuesday, February 10, 2015
The "Big Lie" About the U.S. Jobs Picture / Economics / Deflation
By: EWI
Some 30 million people are either out of work or severely underemployed
Editor's note: You'll find the text version of the story below the video.
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Monday, February 09, 2015
Yes, Minimum Wage Still Increases Unemployment / Economics / Wages
By: MISES
Andrew Syrios writes: Raising the minimum wage has become the cause célèbre for many on the progressive left. Most notably, Seattle has passed a $15 per hour minimum wage. In addition, California lawmakers are trying to pass a state-wide $13 per hour minimum wage and President Obama is supporting the increase of the federal minimum wage from $7.25 to $10.10.
Monday, February 09, 2015
The Financialized Economy / Economics / US Economy
By: Gary_Tanashian
Does the US Economy and Stock Market Need Manufacturing?
The ISM PMI reports for December and January showed deceleration in line with our view that a persistently strong US dollar would begin to eat away at US manufacturing, exporters and other companies that depend on significant foreign business. But in an age where investors will bid up Twitter* (with its forward P/E of 141 and 30B market cap to 1.2B revenue) by 16% in a day, are we returning to the old days of ‘PE’s don’t matter’ with the hook or tout being ‘it’s all about ad revenue’?
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Monday, February 09, 2015
Yellen Looking For Inflation In All The Wrong Places / Economics / Inflation
By: Michael_Pento
In 1958, economist W.H. Phillips wrote a paper that argued an inverse relationship existed between wage inflation and unemployment. The crux of his theory was when unemployment is high wage growth is absent; but when the unemployment rate is low wages rise rapidly. Philips established his theory under the framework of a curve and it was aptly referred to as “The Phillips Curve”. However, many economists wrongly adopted the Phillips Curve by relating it to general price inflation, rather than to just wage inflation. Sadly for Phillips Curve enthusiasts, the high inflation and high employment rates of the 1970’s turned this metric on its head.
Monday, February 09, 2015
Trade Data Show China’s Credit Bubble is Bursting, UK to See Deflationary Effects – Global Depression Ahead? / Economics / China Economy
By: GoldCore
- Chinese imports, primarily of raw materials, crashed 19.9% in January
- Exports fall 3.3% against expectations of 6.3% rise
- Total Chinese debt rose from $7.4 trillion in 2007 to $28.2 trillion in 2014
- Capital outflows last quarter were the highest on record
- China may devalue yuan to boost exports
- Currency depreciation by worlds biggest exporter may trigger global deflation and depression
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Saturday, February 07, 2015
How Economic Aggregation Hides the Problems of Interventionism / Economics / Government Intervention
By: MISES
Gary Galles writes: I was going through the textbook for my economics principles course recently, thinking about how I could better reconcile the fact that since only individuals choose, the logic of economics is about individual choices facing the fact of scarcity. Yet macroeconomics is generally presented directly in terms of aggregates and how to control them, as if aggregates were the relevant measures.
Friday, February 06, 2015
Greece To Leave The Euro or Not to Leave The Euro, That is The Question / Economics / Eurozone Debt Crisis
By: Julian_DW_Phillips
As we watched the Prime Minister and the Finance Minister of Greece travel though Europe in a failed attempt to re-negotiate the terms of the "Bailout" it received, we find ourselves thinking quite differently to the mainstream commentators. Ours is not a jaundiced view but a realistic one. Pragmatism demands we do so. The prime underlying factors that will be brought into play are the interests of each side.
After all, countries don't have friends they have interests, even with fellow members of the Eurozone. These will dictate the result and likely the tactics on each side. We do not see these as friendly negotiations at all. For Greece the stakes are higher than they are for the E.U.
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Friday, February 06, 2015
“Forgive Us Our Debts” – Only Way To Prevent Economic Meltdown / Economics / Global Debt Crisis 2015
By: GoldCore
- Europe and western world is in a debt-fuelled deflation which is spiralling out of control
- Global debt has risen a massive $57 trillion or more than 25% in 7 years since the crisis of 2008
- Managed debt forgiveness is essential now to avoid chaos of defaults, mass unemployment depression and economic collapse
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