Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Sunday, October 19, 2014
Reasons the Bernanke-Yellen Asset-Price Inflation May Be Nearing Its End / Economics / Inflation
By: Joseph_T_Salerno
There are strong indications that the remarkable run up of asset prices in the last few years is beginning to run out of steam and may be on the verge of collapse. We will leave aside the question of whether the asset inflation is symptomatic of a garden-variety inflationary boom or is a more virulent bubble phenomenon in which prices are rising today simply because buyers anticipate that they will rise tomorrow.
Friday, October 17, 2014
Why The Business Cycle is Failing / Economics / Business Cycles
By: Alasdair_Macleod
Since WW2 economic theorists have posited that demand in the economy could be stimulated by a combination of deficit spending by the government and by suppressing interest rates. The separation of demand from production was promoted by Keynes and interest rate management of the economy by monetarists, though there is considerable overlap between the two. Yet no progress in economic management has been achieved: instead we appear to be on the brink of a major economic dislocation.
Read full article... Read full article...
Friday, October 17, 2014
America Flirts With Deflation / Economics / Deflation
By: Raul_I_Meijer
“When it becomes serious, you have to lie,” said brand-new EC head Jean-Claude Juncker back in May 2011. I’m thinking the last few days have been serious enough to warrant some real whoppers from Brussels. And beyond.
Yesterday, one hour after the S&P reached its low point, not only was it deemed necessary to bring out the Plunge Protection Team, Fed grey head Janet Yellen was trotted out as well to soothe the dark mood with rosy tales about the US economy.
Read full article... Read full article...
Thursday, October 16, 2014
The Inflation Imputation, Dear Saver, May You RIP / Economics / Inflation
By: John_Mauldin
A note has been circulating among economists, calling into question the wisdom of another group of economists who wrote an open letter to the Federal Reserve a few years ago suggesting that one of the risks of their quantitative easing program was increased inflation. Since we have not seen CPI inflation, this latter group is calling upon the former to admit they were wrong, that quantitative easing does not in fact cause inflation. To no one’s surprise, Paul Krugman has written rather nastily and arrogantly about the lack of CPI inflation.
Wednesday, October 15, 2014
Governments Need Inflation, Economies Don't / Economics / Inflation
By: Peter_Schiff
In an article in the UK's Telegraph on October 10, veteran economic correspondent Ambrose Evans-Pritchard laid bare the essential truth of the nearly universal current embrace of inflation as an economic panacea. While politicians, CEOs and economists talk about demand stimulus and the avoidance of a deflationary trap, Evans-Pritchard reminds us that inflation is all, and always, about debt management.
Wednesday, October 15, 2014
Is the Surge in Capital Goods Orders Due to Malinvestment? / Economics / US Economy
By: Frank_Shostak
Orders for US non-military capital goods excluding aircraft rose by 0.6 percent in August after a 0.2 percent decline in July to stand at $73.2 billion. Observe that after closing at $48 billion in May 2009, capital goods orders have been trending up.
Most commentators regard this strengthening as evidence that companies are investing both in the replacement of existing capital goods and in new capital goods in order to expand their growth.
Read full article... Read full article...
Tuesday, October 14, 2014
Price Deflation and Price Inflation Are Always “Optimal” / Economics / Economic Theory
By: MISES
Mateusz Machaj writes: Recently, the Polish economy experienced its first price deflation since the 1980s, which sparked in the country deflationphobia (or, as Mark Thornton calls it, apoplithorismosphobia).
Media sources and many economists focus on price inflation and price deflation as the source of various economic ills, but, contrary to much of the rhetoric, price inflation and price deflation are always “optimal” in the economic sense. At first, such a claim may seem controversial, since virtually all economists have something negative to say about either inflation or deflation. This concerns almost all schools of economic thought, mainstream and heterodox, including the Austrians.
Read full article... Read full article...
Monday, October 13, 2014
When The Economy Went Ponzi / Economics / Economic Theory
By: Andrew_McKillop
Adam Smith and the Ponzi Economy
Like the archetypal images of love that were handed down by early Greek philosophers, of Erotic love, Parental love, and what later became Christian or Dutiful love towards fellow persons and living things of all kinds, the supposed “classic image” of the economy is the “Wealth of Nations”. Taken by the “Neolibs” of the 1980s and their surviving throw-offs as a timeless ode to invisible but all-powerful “market forces”, this classic model was handed down by their guru – Adam Smith.
Saturday, October 11, 2014
U.S. 5.5% Unemployment Rate Represents Full Employment / Economics / Unemployment
By: EconMatters
3-5 Months Ahead of Fed Forecasts for Employment Levels
What has sort of gone under the radar recently with Ebola fear mongering, Europe throwing a tizzy fit until they get their ‘stimulus fix’ and everything is miraculously all well again, profit taking in front of earning`s season here in the US, and oil on one of its customary $20 trading range moves to the downside is that last Friday the unemployment rate dropped to 5.9% due to another robust employment report and several upward revisions to prior month`s reports. Yes we are in the 5`s for unemployment, well ahead of everyone`s forecasts including the Federal Reserve.
Read full article... Read full article...
Thursday, October 09, 2014
It’s Inflation All the Way, Baby! / Economics / Inflation
By: Gary_Tanashian
The title’s quote is one of many eminently quotable messages I had the pleasure of receiving over a few years of contact with a late, great and a very interesting man* named Jonathan Auerbach, who headed a unique specialty (emerging and frontier markets) brokerage in NYC called Auerbach Grayson.
Jon was an honest and ethical man. He was also a gold bug (in that descriptor’s highest form) who innately understood the Kabuki Dance that has been ongoing by monetary authorities since the ‘Age of Inflation onDemand‘ (what guest poster Bruno de Landevoisin calls the Monetized New Millenium) started its most intense and bald faced phase in 2000.
Read full article... Read full article...
Thursday, October 09, 2014
The Truth About Economic Boom And Bust Cycles - Video / Economics / Economic Theory
By: Submissions
Claudio Grass writes: Most believe that expansionary monetary policy helps ease crises. Austrian School economists argue that central banks don't help in smoothing the amplitude of the cycles, but rather are the cause of cycles. In this microdocumentary video, we look back at four major busts in the last 100 years and explain how central banks created them. We also clarify why we believe the next bust is just around the corner. This video will not explain the mainstream view, but rather the view of the Austrian Business Cycle Theory (ABCT).
Thursday, October 09, 2014
Youth Unemployment - The Disgrace of Sacrificing a Generation / Economics / Unemployment
By: Raul_I_Meijer
Would you like to know how bankrupt our societies are? Financially AND morally? Before you say yes, please do acknowledge that you too ar eparty to the bankruptcy. Even if you have means, or you have no debt, or you’re under 25, you’re still letting it happen. And you may have tons of reasons or excuses for that, but you’re still letting it happen.
Our financial and moral bankruptcy shows – arguably – nowhere better than in the way we treat our children. A favorite theme of mine is that any parent you ask will swear to God and cross and hope to die that they love their kids to death, but the facts say otherwise. We only love them as far as the tips of our noses, or as far as the curb. That means you too.
Read full article... Read full article...
Thursday, October 09, 2014
Europe’s Economic Austerity, You Must Be Kidding / Economics / Euro-Zone
By: Steve_H_Hanke
The leading political lights in Europe -- Messrs. Hollande, Valls and Macron in France and Mr. Renzi in Italy -- are raising a big stink about fiscal austerity. They don't like it. And now Greece has jumped on the anti-austerity bandwagon. The pols have plenty of company, too. Yes, they can trot out a host of economists -- from Nobelist Krugman on down -- to carry their water.
Read full article... Read full article...
Wednesday, October 08, 2014
The European Financial Crisis Is Going Global – and We're Along for the Ride / Economics / Eurozone Debt Crisis
By: Money_Morning
Peter Krauth writes: After printing $4 trillion since 2008, we've little to show for it.
Endless debates about the effectiveness of QE, or its lack thereof, haven't spawned better decisions, especially in Europe. Think periphery nations like Greece, Spain, Portugal, and Italy.
Better yet, take a look at the stock market, where worries about Europe's economy rattled investors. It's certainly not a pretty picture...
Read full article... Read full article...
Wednesday, October 08, 2014
Germany’s Bad Economic Numbers Are Great News For All Of Us / Economics / Germany
By: Raul_I_Meijer
Something’s happening in Europe that I would like to cheer and encourage at the top of my lungs. While only yesterday, most European leaders, the ECB and the IMF were busy chiding Germany for not lowering taxes or increasing government investment in its economy, today’s release of German economic data should either shut them up or drastically change their tune.
Tuesday, October 07, 2014
Inflation is Not the Only Way Easy Money Destroys Wealth / Economics / Inflation
By: Frank_Shostak
The US Federal Reserve can keep stimulating the US economy because inflation is posing little threat, Federal Reserve Bank of Minneapolis President Kocherlakota said. “I am expecting an inflation rate to run below two percent for the next four years, through 2018,” he said. “That means there is more room for monetary policy to be helpful in terms of … boosting demand without running up against generating too much inflation.”
The yearly rate of growth of the official consumer price index (CPI) stood at 1.7 percent in August against two percent in July. According to our estimate, the yearly rate of growth of the CPI could close at 1.4 percent by December. By December next year we forecast the yearly rate of growth of 0.6 percent.
Read full article... Read full article...
Sunday, October 05, 2014
Grandma Yellen And The Economic Mushroom Cloud On The Horizon / Economics / US Economy
By: Tony_Caldaro
Weekend. Saturday. Beautiful Indian summer imitation where I’m presently located in western Europe. Good time to start out with an empty sheet of text file (for lack of a better term), and stream some consciousness.
Most people must have figured out that things in the economic sphere haven’t gotten any quieter lately. That’s at least something. Stock exchanges in the developed world jumped from a -1%+ loss one day to a 1%+ gain the next. Volatility, nerves, and probably ritalin, have returned. You have to wonder what that means in markets reigned supreme by high-frequency robot traders and central banks, but nevertheless, the public perception remains. And perception is key.
Read full article... Read full article...
Thursday, October 02, 2014
Lagarde Admits Europe Facing Serious Crisis on the Horizon / Economics / Euro-Zone
By: Bloomberg
In an interview with Bloomberg's Tom Keene at the International Monetary Fund's Headquarters in Washington D.C., IMF Managing Director Christine Lagarde said the world still faces serious clouds on the horizon., "We are facing serious clouds on the horizon; we have a lot of uncertainty...we are revising potential growth." Lagarde also said:
Thursday, October 02, 2014
Europe Is Crumbling Into Economic Collapse / Economics / Euro-Zone
By: Raul_I_Meijer
For me, the quote of the day is this one: “If there’s a periphery of the eurozone’s periphery, that’s Naples.”. The city of Napoli hosts ECB boss Mario Draghi and the heads of Europe’s central banks this week in some very posh former Bourbon family royal palace, and the contradictions involved couldn’t be more striking.
Napoli is home to an immense amount of poverty and misery, and the advent of the EU and the euro has done absolutely nothing to make life in the city any better. Quite the contrary. And there’s not a single thing in sight that holds any promise of alleviating the deepening Italian downfall. Therefore things can, and will, only get worse from here.
Read full article... Read full article...
Tuesday, September 30, 2014
Europe Teetering the Ddge of a "Japan-style" Deflation / Economics / Deflation
By: EWI
The Continent is now teetering on the edge of a "Japan-style" deflation. Here's our take on it.
It's happened. The one economic comparison Europe has dreaded more than any other; the name that's akin to Lord Voldemort for investors has been uttered: "deflation."
And it's not just "deflation." You can still spin that term in a positive light if you get creative enough. Say, for example,
Read full article... Read full article...