Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Wednesday, January 12, 2011
The Ruling Clan of India Has Lost the Plot on Inflation / Economics / India
By: Justin_John
THE PERILOUS COURSE
THE 2008 credit crisis exposed the financial
whizkids on the Wall Street who hardly had an idea on where their acts were taking the financial markets
. Years of booming markets made them complacent to risks that were building up in the system. Few saw the apocalypse that collapsed many venerable institutions.
Tuesday, January 11, 2011
Hoover and Bush, Interventionism Turns Crisis into Great Depression / Economics / Great Depression II
By: Mark_Thornton
The most basic rule of economic policy is to allow prices to adjust to market conditions. This maintains Say's Law and produces what Frédéric Bastiat called economic harmony.
Furthermore, unhampered markets minimize distortions and disruptions introduced by external forces. Most importantly, the unhampered price system minimizes the impact of the business cycle on the economy. This paper examines two historical episodes where interventionist policies turned business cycle corrections into depressions.[1]
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Tuesday, January 11, 2011
John Williams Eyes Gold as Insurance Against Hyper Inflation Armageddon / Economics / HyperInflation
By: The_Gold_Report
Stronger corporate balance sheets, tighter reins on costs and better stock performance in 2010 haven't swayed ShadowStats Editor John Williams' assertion that the bottom-bouncing economy is weaker than ever, with specters of hyperinflation and systemic financial collapse on the not-so-distant horizon. As he says in this exclusive Gold Report interview, the yellow metal is his "insurance against Armageddon"—or at least the single best asset that people can use to ride out the storm.
Monday, January 10, 2011
Following the Efficient-Markets Hypothesis into Absurdity / Economics / Economic Theory
By: Robert_Murphy
Austrians in the tradition of Mises and Rothbard stress the resilience of a free-market economy, and they believe that the institution of private property — along with the profit-and-loss test — will steer resources into their most valuable niches.
However, most Austrians stop short of following Chicago School economists' advocacy of the "efficient-markets hypothesis" (EMH). In its most extreme form, the EMH becomes a caricature of itself in which asset bubbles are not just unlikely but logically impossible.
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Sunday, January 09, 2011
India reports Exports: Massive surge 36% and Current Account deficit slips to $2.5bn / Economics / India
By: Justin_John
The country’s merchandise exports reached $22.5 billion, up 36.4 per cent in December from last year, highest in last 33 months, while imports topped $25.1 billion narrowing the trade deficit to $2.6 billion in December.
A quick look at the charts speaks about the surge in exports seen in the last 3 months.
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Sunday, January 09, 2011
U.S. and Global Economic Forecast 2011, Russia and the Roots of World Inflation / Economics / US Economy
By: John_Mauldin
It is time once again to throw caution and wisdom to the wind and actually make my 11th annual forecast. I have to admit this is the most stressful letter I write each year. I do at least 5-10 times more research and thinking about this issue than any other. On a positive note, this may be one of the more optimistic forecast letters I have done in a long time. But there are some asterisks, as always. We will survey the world, trying to peer through the fog of the future. There are some very interesting side trails we will want to explore. Did you know some events in Russia could have real ramifications for inflation in China, the US, and the world? I pay attention to the background details and bring them to you. So settle back as we tour the world.
Sunday, January 09, 2011
Number of Discouraged American Workers Hit Record High: QE3 = A Matter of When / Economics / Employment
By: Dian_L_Chu
The latest U.S. Labor Department data indicated that non-farm payroll added 103,000 jobs in December, which is far short of expectation, but the unemployment rate somehow managed to fall sharply to 9.4% (from 9.8% in November) far exceeding expectation.
Saturday, January 08, 2011
December Employment Report – Slow Pace of Hiring Supports Fed’s Accommodative Stance / Economics / Employment
By: Asha_Bangalore
Civilian Unemployment Rate: 9.4% in December vs. 9.8% in November. 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.
Friday, January 07, 2011
The Indian Economic Growth Story: Steady and Sure! / Economics / India
By: Justin_John
India has withstood the global crisis beyond most would have expected. Even while the rest of the world has been recovering, India and China (credibility of growth is at stake) have not only bounced back but has now started to grow at a very steady and sure rate. In fact a quick glance at S&P and Sensex performance over the last 10 years, will highlight the incredible performance of this much ignored economy.
Friday, January 07, 2011
U.S. Real GDP vs. Potential GDP – Time to Assess this Yardstick / Economics / US Economy
By: Asha_Bangalore
The U.S economy has registered six quarters of economic growth, inclusive of the projected increase in real GDP during the fourth quarter of 2010 (see Chart 1).
Friday, January 07, 2011
Will The Tea Party Congress Bring Economic Recovery? / Economics / Economic Recovery
By: John_Browne
While the markets have known for almost three months that the 2010 election delivered the House of Representatives to the tea-infused Republican Party, I did expect a greater reaction on Wall Street to the formalities of the opening sessions of Congress yesterday.
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Wednesday, January 05, 2011
China Economic Outlook 2011, The Red Dragon Takes Its Next Step Forward / Economics / China Economy
By: Money_Morning
Jason Simpkins writes:
If the United States has a growth problem, China has just the opposite. The world's second-largest economy is set to grow 9-10% this year, building on its strong rebound from the global financial crisis.
Furthermore, Beijing is determined to accelerate China's transition toward a more domestically based economy, while stabilizing prices and cutting government waste.
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Wednesday, January 05, 2011
Deflation Ahead / Economics / Deflation
By: Brian_Bloom
Recently, I had the privilege of watching the YouTube video below of a lecture given in Australia by Professor Niall Ferguson
In my view, except for the fact that Professor Ferguson did not even make a passing reference to the critical importance of energy in the economic stew, I think he absolutely nailed the current economic situation. He was looking at the world economy from the perspective of long term history – which I believe is most appropriate at this point in time. He is unequivocally of the view that the probabilities favour deflation. For various reasons, I agree with him.
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Wednesday, January 05, 2011
America's "Money Time Bomb": Quantitative Easing is Inflationary / Economics / Quantitative Easing
By: Bob_Chapman
With Ben Bernanke as our Shepard how can we go wrong? He tells us quantitative easing is not inflationary. He says that with assurance because he knows all the CPI statistics are as realistic as a Madoff Ponzi scheme. He also tells us he doesn’t create money out of thin air. He fails to mention that he does so digitally. His job is to further enrich the elitists who own the Fed and want to create a new world order. Prices are up 6-3/4% across the board as official inflation has only risen 1.2%.
Wednesday, January 05, 2011
Global and Regional Economic Outlook 2011 / Economics / Global Economy
By: David_Urban
The problem with making a year long commentary is that things can change which throws off your initial theory. That was the main problem with my forecast as Bernanke decided to launch QE2 amidst criticism from global central banks. This put a floor under the market and lit the fuse for the rally in equities and commodities.
So what happens in 2011 and how does that affect investment portfolios? From my chair looking out over the world here is what I see happening based on current events.
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Wednesday, January 05, 2011
Price Inflation to Pay the Debt / Economics / Inflation
By: Richard_Daughty
The lights of the Mogambo Security System (MSS) glowed dimly in the gloom of the bunker as I cowered in the darkness, and there were no sounds except the thumping, thumping, thumping of my terrified heart at The World Outside (TWO), a place I consider to be a vicious, hostile environment containing not only enemies of every sort, both real and imagined, but family members who want to know if I am coming out for dinner, or to tell me that someone is on the phone for me, or that somebody is going to greedily eat the last of my treasured Double-Stuf Oreos, somehow trying to get me outside and into their clutches so that they can take all my money and ask me to sign various forms and documents.
Wednesday, January 05, 2011
FOMC Meeting Minutes Indicate Fed Sees "Slow Progress" Towards Full Employment / Economics / US Economy
By: Asha_Bangalore
The Fed is focused on meeting its dual mandate of price stability and full employment. In this regard, the minutes indicate that the FOMC sees "only a gradual pickup in growth with slow progress toward maximum employment." A few participants held that an upside risk could emerge from a sharp growth in bank lending, given the easy monetary policy stance in place. At the same time, there was a great deal of concern about the housing market, particularly the large supply of unsold homes.
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Wednesday, January 05, 2011
Economists Can't Forecast for Toffee, In Defense of the “Old Always” / Economics / Economic Theory
By: John_Mauldin
Long time readers of Outside the Box are familiar with the name of James Montier, who is now with GMO in their London office. Today, James, with his usual acerbic wit, takes on the notion of the "New Normal" and offers us a defense of the "Old Always." James is a value investor and sees mean reversion as still alive and kicking, where some proponents of the New Normal think we should throw out all of the old aphorisms. While I am in the New Normal camp, I also agree with James. This makes for some quick and thought-provoking reading.
Tuesday, January 04, 2011
The ISM Manufacturing Survey Kicks Off the New Year on a Bullish Note / Economics / Economic Recovery
By: Asha_Bangalore
The U.S. manufacturing sector closed the year on a strong footing and kicked off 2011 with bullish news on the first trading. The ISM manufacturing composite index moved up to 57.0 in December vs. 56.6 in November, the highest reading since May 2010. The sharp increases in indexes tracking new orders (60.9 vs. 56. 6 in November) and production (60.7 vs. 55 in November) accounted for the higher composite index in December. Indexes measuring employment, vendor deliveries, inventories, exports and imports declined in December but are holding above 50.0. Readings above 50 denote an expansion while those below 50.0 are indicative of a contraction.
Tuesday, January 04, 2011
Australia Heading for Economic Crunch as Families Face Financial Collapse / Economics / Austrailia
By: Mike_Shedlock
The party is over in Australia. Many anti-dollar investors and Pollyannas living down under just don't realize it yet. Nonetheless, Australia faces an economic crunch as family finances collapse under the burden of record debts, rising interest rates and utility bills.