Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Wednesday, July 16, 2008
UK Flawed Inflation Measure Stoking Wage Price Spiral and Worker Discontent / Economics / Inflation
By: Nadeem_Walayat
UK inflation continues to accelerate after busting through the 3% ceiling in April, and hitting 3.8% in June. However the real rate of inflation being experienced by consumers is a function of the actual purchases made rather than the price of the wide ranging basket of more than 110,000 goods and services that the CPI inflation rate attempts to track. The reason for this is that consumers are feeling the relentless impact of rising fuel, energy, food and credit costs whilst at the same time impacted by asset price deflation as the housing market completes its 10th month in a bear market that has seen house prices now decline by nearly 10% from the August 2007 high or by an average of £20,000. In addition to this the UK stock market has lost 20% of its value from its 2007 highs.Read full article... Read full article...
Tuesday, July 15, 2008
Profit from Economic Boom and Bust Cycles / Economics / Liquidity Bubble
By: Brent_Harmes
Rather than study theory, let's watch the news!
Here is a Yahoo Finance Video . This is exactly the stuff that Mike Maloney was predicting on stage years ago - and it is happening today! Mike sounded slightly nuts when he was talking about this during the housing boom. Few forecasters anticipated that this boom ever really would bust, but the credit balloon can only inflate so far and then it wants to deflate. This has happened repeatedly throughout history.
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Tuesday, July 15, 2008
Bernanke Delivers 'Hogwash' Testimony to Congress / Economics / US Economy
By: Mike_Shedlock
Chairman Ben S. Bernanke testified Before the U.S. Senate in the Fed's Semiannual Monetary Policy Report to Congress . Let's take a look at some of the highlights.
The economy has continued to expand, but at a subdued pace. In the labor market, private payroll employment has declined this year, falling at an average pace of 94,000 jobs per month through June. Employment in the construction and manufacturing sectors has been particularly hard hit, although employment declines in a number of other sectors are evident as well. The unemployment rate has risen and now stands at 5-1/2 percent.
Tuesday, July 15, 2008
Former Prime Minister Confesses Real UK Inflation is 10%, Triple Official Rate of 3.8% / Economics / Inflation
By: Mark_OByrne
Gold finished trading in New York yesterday at $972.10, up $12.00 and silver was up to $19.15, up 38 cents. Gold rose in trading in Asia before further rises in early European trading. Gold is now up some 7% in the last 5 trading days (from below $920 to over $983) and in normal circumstances one would expect a correction and consolidation. However, these are not normal circumstances. Read full article... Read full article...
Tuesday, July 15, 2008
Inflation Surges to 3.8% as Bank of England Loses Control of Monetary Policy / Economics / Inflation
By: Nadeem_Walayat
The official rate of UK inflation as measured by the CPI index surged higher for June to 3.8% from 3.3% which is inline with Market Oracle expectations that is expected to see inflation continue trending higher to well above 4% over the summer months, with the RPI inflation measure set to rise to above 5%. The impact of the inflationary surge is for the Bank of England to have effectively lost control of monetary policy in that the Bank is paralysed into inaction, neither able to cut interest rates to prevent the UK economy from plunging into a recession, nor able to raise interest rates to curb surging inflation for fear of triggering a deeper recession. Read full article... Read full article...
Monday, July 14, 2008
Global Money Supply Data and Comparison for 2008 / Economics / Money Supply
By: Mike_Hewitt
This essay makes comparisons between the money supply of 25 selected economic areas and discusses the ratios between the values of official gold reserves to outstanding currency.
For the purposes of this essay, the Euro-Zone includes the thirteen countries that use the Euro currency: Austria, Belgium, Czech Republic, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Slovenia and Spain. China includes Hong Kong. All other economic areas are individual countries.
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Monday, July 14, 2008
An More Accurate Measure of the Money Supply TMS or M3 ? / Economics / Money Supply
By: Mike_Shedlock
There has been an interesting discussion between Steve Saville and Paul van Eeden over the monetary aggregates M3 and TMS. For those not familiar with TMS it stands for True Money Supply and it is a monetary measure based on Austrian economic principles. I will come back to the description of TMS in a moment but let's listen to a couple of discussion points from Steve Saville and Paul van Eeden first.
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Monday, July 14, 2008
Economic Forecasts and Analysis For US Financial Markets (July 14-18) / Economics / US Economy
By: Joseph_Brusuelas
The week of July 14-18 will see a major five days macro data, earnings and Fed Talk in the context of a very shaky market. Just a few potential market moving events upcoming on the schedule are: the two-day testimony on monetary policy and the economy by Fed Chair Ben Bernanke scheduled for Tuesday and Wednesday. Earnings statements that may shape the entire trading week will be published will be JP Morgan on Wednesday and Merrill Lynch, Citi and Thornburg Mortgage on Thursday. Read full article... Read full article...
Monday, July 14, 2008
The US Economy Is in Deep Trouble / Economics / US Economy
By: Joseph_Brusuelas
Over the past few weeks many notable analysts have made the case that the economy is in the process of recovery. The market has celebrated the wonder of the “resilient consumer.” Given the still fragile state of the economy we think that this is a bit overblown. A cold-eyed, hard-nosed analysis of the true condition of all things financial provides us with a very different assessment of the economy. But, with a major week of fundamental data and the onset of earnings season for financials upon us we thought it pertinent to put a few ideas to rest.Read full article... Read full article...
Saturday, July 12, 2008
Credit Crisis Losses Pass $1.6 Trillion as Credit Contraction Ensures Recession / Economics / Credit Crisis 2008
By: John_Mauldin
- $1.6 Trillion in Losses and Counting
- Banks Start to Reduce Their Lending
- Take Freddie Mac. Please.
- The Ugly Muddle Through
- Once Again, the BLS Numbers Paint a False Picture
It seems that with each passing month the estimates for losses in the international banking system keep rising. This time last summer the largest estimates (from credible sources), if memory serves me correct, were around $400 billion, give or take a few months. By the end of the year it was in the neighborhood of twice that. Then last quarter we saw estimates approaching $1 trillion. Last week, the number being broached was $1.6 trillion, by Bridgewater Associates, one of the top, and more credible, analytical firms in the world.
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Friday, July 11, 2008
US Trade:Deficit Realities and Fallout / Economics / US Economy
By: Andy_Sutton
I want everyone to forget the first sentence of last week's column. Things are not scary; they're bordering on out of control on several fronts. In particular, there are two items which are getting nearly no press that urgently need to be discussed. While the media world continues to focus on whether or not Fannie Mae and Freddie Mac have another 12 hours of solvency left, our trade deficit continues to persist despite continued weakness in the Dollar and out of control import prices. I like to use these two macro measures as a barometer of not only what is going on now, but what is likely to happen down the road.Read full article... Read full article...
Friday, July 11, 2008
Protect Your Wealth from the Coming Hyper-Inflation! / Economics / HyperInflation
By: Money_and_Markets
Larry Edelson writes: The Chairman of the Federal Reserve and a bevy of Wall Street economists want you to believe that the economy is okay.
The Secretary of the Treasury tells us the "economy may avoid a recession." In other words, just pretend that it's never going to happen.
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Thursday, July 10, 2008
Bank of England: Caught Between Inflation and Recession / Economics / UK Economy
By: Victoria_Marklew
As expected, the Bank of England's (BoE) Monetary Policy Committee (MPC) left the repo rate unchanged at 5.0% this morning, despite the fact that May's annual rate of inflation hit 3.3%. This was the highest since the BoE won full independence over monetary policy in 1997, and caused BoE Governor King to have to write an open letter to Chancellor Darling last month explaining why CPI is more than one full percentage point over the Bank's 2.0% target. But, as King pointed out, while inflation is likely to remain above target for some months yet, there is also a downside risk that the economy will slow sharply and pull CPI below target in two years. The past few days have certainly brought mounting evidence of a marked slowdown, with some analysts starting to whisper of the risk of recession. Read full article... Read full article...
Thursday, July 10, 2008
Global Stock Markets Hit by Staglation Fears and Threat of War with Iran / Economics / Stagflation
By: Gary_Dorsch
In today's lightning fast and violent markets, where a constant barrage of news and noise flows into the marketplace each day, it's easy to forget a vital piece of information that was released just a few hours or days earlier. Trader sentiment is often swayed by the price action of the moment, and it's easy to lose sight of the mega-trends and core issues, that move the markets over the longer-term. It was nearly one-year ago, on July 17, 2007, when Bear Stearns BSC said in a letter to investors, that two of its troubled hedge funds that bet heavily on risky sub-prime mortgages had very little value. “The preliminary estimates show there is effectively no value left for the investors in the Enhanced Leverage Fund and very little value left for the investors in the High-Grade Fund, as of June 30, 2007,” BSC said.
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Thursday, July 10, 2008
Economists Continue to Favor Failed Doctrine Against Real Facts / Economics / Credit Crisis 2008
By: Tim_Iacono
What if what they taught you is wrong? - In this Financial Times commentary , Wolfgang Münchau comes ever so close to asking what must be one of the most difficult of all questions for any practicing economist to ask, "What if what they taught you is wrong?"
[Note: This is similar to what some U.S.-based financial advisers might be asking themselves today, eight years into a secular bear market in stocks where "stocks for the long run" may not make a whole lot of sense for someone whose "long run" is only 15 years or so and happened to begin around 2000.]
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Wednesday, July 09, 2008
Soaring Unemployment, Collapsing Credit From Stagflation to Deflation / Economics / Deflation
By: Mike_Shedlock
I recently received an Email from "RS", a long time member of the hyperinflation is coming crowd now but now sees things in a different light. Let's tune in and see what "RS" has to say.
Mish, I was a true believer in the "hyperinflation is coming" theory for quite some time. However, I have since changed my mind. Here's why: I own a computer business and I used to pay techs $15-20/hr. I now have people willing to work for $8-$10/hr. While the nice guy inside is saying “pay people well” the businessman is saying “market conditions demand paying people what the market will support.”
Wednesday, July 09, 2008
Stagflation Sightings Multiplying / Economics / Stagflation
By: John_Browne
We have long warned that stagflation, or economic contraction accompanied by inflation, would become so evident that even the most optimistic observers could not deny its virulence.Read full article... Read full article...
Tuesday, July 08, 2008
Strip Mall Vacancies Spike to Levels Last Seen in 1995 / Economics / US Economy
By: Mike_Shedlock
MoneyNews is reporting Retail Property, Vacancies Q2 Worst in 30 Years .U.S. store closings and cutbacks turned the second quarter into the worst for strip mall owners in 30 years, as budget-conscious consumers flocked to low-cost warehouse-style grocery centers, according to a report by real estate research firm Reis.
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Tuesday, July 08, 2008
Bursting Bubbles Mean Inflation to Give Way to Deflation / Economics / Deflation
By: John_Mauldin
There is a reason I call this column Outside the Box. I try to get material that forces us to think outside our normal comfort zones and challenges our common assumptions. And this week's letter does just that. I have made the comment more than once that is it unusual for two major bubbles to burst and for the conversation and our experience to be rising inflation and not a serious problem with deflation.
Van Hoisington and Dr. Lacy Hunt give us a seminar on why it will be deflation that will ultimately be the problem and not the current inflation we are dealing with today. This week's letter requires you to think, but it will be worth the effort. Remember our lesson from Economics 101. If you raise the supply of something, in normal markets the price goes down. And if you increase the price, suppliers will respond by producing more.
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Sunday, July 06, 2008
UK Economy Slams Into Reverse as Retailers Experience Sales Hell / Economics / UK Economy
By: Mike_Shedlock
The Independent is reporting Seven days that shook the British high street . It was a week that most retailers would probably prefer to forget – seven days that shook the high street. From the grandest names to the most minor, the news has been uniformly grim. Yesterday, the mighty John Lewis reported that its sales are running 9 per cent down on last year. Marks & Spencer, still Britain's leading clothes retailer, warned on Wednesday of sharply lower sales and profits, and promptly saw a quarter of its stock-market value wiped out.
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