Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Tuesday, March 08, 2011
The Crude Oil Economic Booby Trap / Economics / US Economy
By: Mike_Whitney
Rising oil prices threaten to derail the recovery. Oil at $106 per barrel (Monday's price) is not a problem, but oil at $160 is. With fighting increasing in Libya and social unrest spreading across the Middle East, no one knows where prices will settle. That leaves Fed chairman Ben Bernanke with a tough decision. Should he call off QE2 prematurely and let the stock market drift sideways or go-til-June and hope for the best? If the Fed tightens too early, deflationary pressures will reemerge further straining bank balance sheets and consumer spending. Housing prices will fall sharply and foreclosures will mushroom. But if Bernanke holds-firm with his zero rates and bond buying program--especially when the ECB is raising rates--he could trigger a bond market rout and send the dollar into freefall.
Tuesday, March 08, 2011
Debt, Inflation and Global Economy Systemic Risks, The ZIRP Trap / Economics / Global Economy
By: John_Mauldin
I get a lot of client letters from various managers and funds, as you might imagine. I read more than I should. But one that shows up every quarter or so makes me stop what I am doing and sit down and read. It is the quarterly letter from Hayman Advisors, based here in Dallas. They are macro guys (which I guess is part of the magnetic attraction for me), and they really put some thought into their craft and have some of the best sources anywhere. So today we take a look at their latest letter, where they cover a wide variety of topics, with cutting-edge analysis and sharp insight. I really like these guys, and suggest you take the time to read the entire letter.#
Tuesday, March 08, 2011
U.S. Consumer Borrowing Posts Fourth Monthly Gain / Economics / Economic Recovery
By: Asha_Bangalore
Consumer borrowing advanced at an annual rate of 2.5% in January, the fourth consecutive monthly increase after posting declines during each month in the October 2008 - August 2010 and holding steady in September 2010. Of the two main components of consumer credit, revolving credit (credit card borrowing) fell 6.4% in January but non-revolving credit (borrowing for cars, vacations, durable goods, and other purposes) advanced at an annual rate of 6.9% (see Chart 4).
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Monday, March 07, 2011
How Wisconsin Can Turn Economic Austerity into Prosperity / Economics / Economic Austerity
By: Ellen_Brown
As states struggle to meet their budgets, public pensions are on the chopping block; but they needn’t be. States can keep their pension funds intact and leverage them into many times that sum in loans, just as Wall Street banks do. They can do this by forming their own banks, following the lead of North Dakota, the only state either to have its own bank or to have a major budget surplus.
Monday, March 07, 2011
Hidden Inflation: Rising Prices Are Hitting Consumers Harder Than the Fed Will Admit / Economics / Inflation
By: Money_Morning
Kerri Shannon writes: Any U.S. consumer that goes to the grocery store or the gas station on a regular basis knows that prices are rising.
Unfortunately, those rising prices are set to soar even higher - and their effects on consumers will continue to be ignored by the U.S. Federal Reserve.
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Monday, March 07, 2011
Rick Santelli Needs Austrian Economics to Refute Insufferable Keynesians / Economics / Economic Theory
By: LewRockwell
Mark R. Crovelli writes: In the world of financial "journalism," CNBC’s Rick Santelli stands out as a refreshing and intelligent antidote to the hoards of perma-bulls, fed apologists, and chart sorcerers that otherwise pollute the financial airwaves. Apart from his wonderfully energetic and quirky manner of speaking, and apart from his fantastic last name, Santelli is never afraid to challenge economists, Fed officials, and other mainstream talking heads. Talking points that are taken for granted or left unchallenged by Santelli’s mind-numbing colleagues are passionately attacked by the bond-tracking Italian dervish.
Monday, March 07, 2011
Is QE2 an Unmitigated Disaster? / Economics / Quantitative Easing
By: Dian_L_Chu
There was a debate recently between Rick Santelli of CNBC and James Bullard, President of the Federal Reserve Bank of St. Louis regarding the inflation effects of the QE2 initiative.
Monday, March 07, 2011
Hyperinflationary Deluge Is Imminent / Economics / HyperInflation
By: Submissions
Tyler Durden writes: A deluge of an unprecedented magnitude is both inevitable and imminent. The consequences of the economic and political mismanagement will have a devastating impact on the world for a very long time. And the consequences will touch most corners of the world in so many different areas; economic, financial, social, political and geopolitical. The adjustment that the world will undergo in the next decade or longer, will be of such colossal magnitude that life will be very different for coming generations compared to the current social, financial and moral decadence. But history always gives us lessons and the one that is coming will be necessary and eventually good for the world. But the transition and adjustment will be extremely traumatic for most of us.
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Sunday, March 06, 2011
More U.S. Jobs Mirage / Economics / Employment
By: Paul_Craig_Roberts
The announcement on March 4 that 192,000 new jobs were created in February was greeted with a sigh of relief. But the number is just more smoke and mirrors, as I will show shortly. First, let’s pretend the jobs are real. What areas of the economy produced the jobs?
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Saturday, March 05, 2011
The Fed's Promise of Inflation Means More Unemployment... / Economics / Inflation
By: Bob_Chapman
The Federal Reserve tells us we need inflation to overcome the overhang created by debt and its inflationary aspects. The inflation does not create jobs – it just distorts prices upward. We are told by the head of the Fed, Mr. Bernanke, that he can end inflation when he thinks it is necessary. That is not true, because if inflation ends deflation takes command and the economy collapses. There is no finely honed instrument for turning these two opposite effects on and off; thus, inflationary instruments have to be blunt and overused. That means more often than not that inflation is over implemented. This is the opposite of the Fed’s mandate of promoting price stability, full employment and in fact is used to prop up the banking system.
Saturday, March 05, 2011
China – The 800-Pound Inflation Gorilla! / Economics / Inflation
By: Sy_Harding
When it comes to the growing global worries about inflation, it looks like it will be ‘As goes China so goes the world’.
China is the 2nd largest economy in the world, and rapidly gaining on the U.S. Among other statistics, it’s the world’s largest importer of copper, steel, cotton, and soybeans, and the world’s largest exporter of goods - to say nothing of being the world’s largest owner of U.S. debt.
Saturday, March 05, 2011
U.S. February Employment Situation, Consistent Message of Improvement But Inadequate to Terminate QE2 / Economics / Employment
By: Asha_Bangalore
Civilian Unemployment Rate: 8.9% in February vs. 9.0% in January. 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: 192,000 in February vs. +63,000 in January. Private sector jobs increased 222,000 after a gain of 68,000 in January. Revisions for October and November resulted in a net gain of 58,000 jobs in the economy.
Friday, March 04, 2011
Inflation and Tax Rises Crush Britain's Middle Class, Real Earnings 25% Drop! / Economics / UK Economy
By: Nadeem_Walayat
UK annual earnings grew at an annualised rate of 1.1% (December 2010), this compares against the official UK inflation rate of CPI 4% and the more recognised RPI at 5.1%, with the real UK inflation rate as experienced by most of the people of Britain running at 6.6%.
Friday, March 04, 2011
U.S. Initial Jobless Claims Show Noticeable Improvement / Economics / Unemployment
By: Asha_Bangalore
Initial jobless claims fell 20,000 to 368,000 during the week ended February 27. This reading is the lowest since May 2008 (see Chart 8). Continuing claims, which lag initial jobless claims by one week, declined 59,000 to 3.774 million, the lowest since October 2008 (see Chart 9). Both of these readings suggest a noticeable improvement in the labor market. The number of applicants obtaining unemployment insurance under the special programs increased roughly 57,000 for the week ended February 13.Read full article... Read full article...
Thursday, March 03, 2011
U.S. Economic Death Spiral Into the Second Great Depression / Economics / Great Depression II
By: D_Sherman_Okst
Bernanke’s Unstoppable, Self Reinforcing, Negative-Feedback-Loop
Wracked up by both parties over many decades our debt has evolved into a yearly deficit that can no longer be serviced with tax revenue and borrowing.
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Thursday, March 03, 2011
Caught: Krugman's Shifting Arguments / Economics / Economic Theory
By: Robert_Murphy
It's not newsworthy when Paul Krugman contradicts himself. However, in two recent blog posts on the varying economic fortunes of US states, Krugman's about-face was so complete and so fast that I just have to share.
Thursday, March 03, 2011
What If The China Bubble Bursts / Economics / China Economy
By: Dian_L_Chu
Russ Winter writes: “If the situation does not improve, we’ll definitely want to quit (production). The sun is setting on the Christmas product industry (in China) right now.” — Owner of arts and craft factory in Shantou
Wednesday, March 02, 2011
Inflation and the Value of Gold Explained / Economics / Gold and Silver 2011
By: MISES
Rod Rojas writes: As the story goes, someone asked an economist how his wife was doing, and the economist answered "compared to what?"
Joking aside, this is one of the most important questions one can ask when dealing with many economic problems.
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Wednesday, March 02, 2011
ISM Manufacturing Forward Momentum in U.S. Factory Sector Remains in Place / Economics / Economic Recovery
By: Asha_Bangalore
The composite index of ISM manufacturing survey rose to 61.4 in February from 60.8 in the prior month. Indexes tracking new orders, production, employment, vendor deliveries, exports, and prices advanced in February. The composite index is highest since May 2004 (see Chart 4). The advances in production, new orders, employment, and exports are noteworthy.
Wednesday, March 02, 2011
Bernanke "Fed Prepared to Respond as Necessary" to Support Economic Recovery and Price Stability / Economics / US Economy
By: Asha_Bangalore
A likely threat of inflation following the Fed's extraordinary monetary accommodation and rising commodity prices is the most discussed topic in recent days. Chairman Bernanke addressed concerns about inflation in lucid terms in his semi-annual testimony this morning. First, he noted that the "rate of pass-through from commodity price increases to broad indexes of U.S. consumer prices has been quite low in recent decades, partly reflecting the relatively small weight of materials inputs in total production as well as the stability of longer-term inflation expectations." Read full article... Read full article...