Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Tuesday, June 17, 2008
UK CPI Inflation Breaks Above Bank of England's Upper 3% Limit / Economics / Inflation
By: Nadeem_Walayat
The UK Consumer Price Index rose to 3.3% for May 08 above the consensus forecasts of 3.2% pushing inflation to a 11 year high on the back of a surge in import and producer prices. Surging inflation not only puts a hold on further UK interest rate cuts but opens the door to what can only be construed as panic rate hikes later in the year to prevent a wage price spiral from taking hold and pushing the UK economy into stagflation.Read full article... Read full article...
Tuesday, June 17, 2008
Lousy Monetary Policy and Economic Commentary Due to Ignorance / Economics / Liquidity Bubble
By: Gerard_Jackson
Some readers think I'm exaggerating the dismal state of economic debate in Australia. Alas, if that were only true. Last April The Australian referred to P. D. Johnson, aka Henry Thornton, as opining that current economic policy with respect to inflation could cause a recession. He went on to argue that we could be seeing the return of 'Goodhart's law'. ( The Australian , Is he on the right track? , Graham Lloyd, 26 April 2008). Johnson defines this law as "Any statistical relationship that is relied upon will cause changes of behaviour that?changes the?relationship". ( The Return of the Check List ). This is really bad stuff.Read full article... Read full article...
Monday, June 16, 2008
Emerging Markets Infrastructure Boom Opportunities / Economics / Emerging Markets
By: Frank_Holmes
The investment opportunity in infrastructure seems to be getting bigger and better all the time, especially in emerging markets.
Merrill Lynch came out with a new research report that raises the expected spending on emerging-markets infrastructure to $2.25 trillion over the next three years, nearly double its earlier estimate.
Read full article... Read full article...
Monday, June 16, 2008
Fed Failure has Put United States on the Path to Hyper-inflation / Economics / Stagflation
By: Captain_Hook
Man is his own worst enemy – this truism has proven itself over and over in history – and is doing so once again in our handling of economy. As you undoubtedly know the consumer is on the ropes and in need of relief due to excessive credit. True to form however, and consistent with our title today, just when this is happening, commodity prices have lit-up, and are showing no signs of retreat, especially energy prices. This has created a very big problem for central planners they can actually identify within their incompetence, that being, in order to tackle the effects of inflation, they will genuinely (a few choice words in the Fed Minutes won't do the trick) need to show fiscal restraint, or crude oil will go to $200, the dollar will break 70, and it's hyperinflation here we come. Read full article... Read full article...
Monday, June 16, 2008
Economic Calendar Forecasts and Analysis: Week Ahead In US Financial Markets (June 16-20 2008) / Economics / US Economy
By: Joseph_Brusuelas
The market will observe a healthy amount of macroeconomic data to be released during the upcoming five trading days. The major data that have the capacity to move the market will be the release of the PPI and housing starts data for May, both of which will be released on Tuesday. Fed talk for the week will be light and Fed Chair Ben Bernanke will speak before a Senate committee on healthcare and US competitiveness on Monday. Read full article... Read full article...
Sunday, June 15, 2008
INFLATION Means the Choice Between Stagflation and Recession- Part 2 / Economics / Inflation
By: Prieur_du_Plessis
Click here for Part 1 - Jim Sinclair (Mineset): Bernanke has painted himself into a corner
“The euro is down hard today on the premise that this is the start of increased interest rates in the US, a statement that is totally ludicrous.
“There are two possibilities here:
Read full article... Read full article...
Sunday, June 15, 2008
INFLATION Means the Choice Between Stagflation or Recession / Economics / Inflation
By: Prieur_du_Plessis
The Electric Light Orchestra lyrics “… you took me ohh, higher and higher baby, it's a living thing, it's a terrible thing …” have been mulling through my head over the past week as central bankers' inflation-fighting rhetoric moved to centre stage.
A succession of hawkish comments from US policymakers persuaded pundits that the US rate-cutting cycle was over, resulting in a stronger US dollar, plummeting government bonds, predominantly lower global stock markets (with Asia seeing the most red), and non-agricultural commodities coming off the boil.
Read full article... Read full article...
Saturday, June 14, 2008
Recession Required to Defeat Inflation? / Economics / Inflation
By: John_Mauldin
- Whip Inflation Now
- Where Can We Get Help on Inflation?
- The Patient Died Anyway
- Inflation in Asia and Europe
- There Are No Good Solutions
President Nixon instated price controls on the 15th of August, 1971. Inflation was a little over 4% at the time. Price controls manifestly did not work (resulting in shortages of all sorts and a deep recession) and were rescinded a few years later. President Ford went to Congress with programs to fight inflation that was running closer to 10% in October of 1974, with a speech entitled "Whip Inflation Now" (WIN). He famously urged Americans to wear "WIN" buttons. That policy too was less than effective, and the buttons, in a history replete with silly gestures by governments, should stand on anyone's top ten list of such silly gestures.
Read full article... Read full article...
Friday, June 13, 2008
The Consumer Price Index: Inflating the Money Supply / Economics / Inflation
By: Adrian_Ash
"...With the cost of living always rising, not falling, it's a good job there's so much more money around to help pay for things. Right...?"
SURELY the 20th CENTURY'S greatest marketing coup – besides making cigarettes taste of freedom and youth rather than the Sandakan death-march – was kidding the world that "inflation" meant rising prices.
Read full article... Read full article...
Friday, June 13, 2008
Bernanke's Open Mouth Operations Attempt at Halting Inflationary Dollar Slide / Economics / Inflation
By: Joseph_Brusuelas
Over the past fortnight Fed Chairman Ben Bernanke has engaged in “open mouth operations” to shape market expectations regarding future monetary policy out of the US Federal Reserve. Mr. Bernanke rhetorically intervened in the global currency markets to prop up a beleaguered dollar, explicitly expressed unease over the current course of inflation and signaled that the Fed would not tolerate a breakout of inflation expectations. Not bad, for a Fed Chairman fighting multiple crisis on multiple fronts. Read full article... Read full article...
Friday, June 13, 2008
China's Geopolitic Imperatives and its Current Economic Position / Economics / China
By: John_Mauldin
No matter where in the world I am, in South Africa, in Europe, in La Jolla, there's one question I get asked over and over, "What about China?" And small wonder. The increasing impact of China in the last generation is just staggering and seemingly accelerating every day. If you're in the market for oil, minerals, arable land, equities or debt, you're bidding against Chinese government-sponsored entities with a $1 trillion warchest. And the list of markets where China is a key player grows every day. Bottom line: whether you're filling up your gas tank or trading credit default swaps, China's decisions impact your pocket book.Read full article... Read full article...
Wednesday, June 11, 2008
Consumption and Investment Fallacy / Economics / Economic Theory
By: Gerard_Jackson
For years I have been stressing the media's lousy economics. For those readers who think I have been exaggerating the situation allow me to introduce you to Bernard Salt, a partner in the well known accounting firm of KPMG. According to Mr Salt
It was a no-brainer in the 1950s: half the working age population was not engaged in the paid workforce. Change based on the role of women was always going to transform our society over the course of a generation.
Read full article... Read full article...
Wednesday, June 11, 2008
Manipulated, Corrupted and Unreliable Government Data Points to Hyperinflation / Economics / Stagflation
By: Stephen_Lendman
Walter "John" Williams thinks out of the box. He makes disquieting reading, but you won't find him in the mainstream. At least not often. He runs a "Shadow Government Statistics" site with an electronic by-subscription newsletter. Anyone can access some of his data and occasional special reports. They can also assess his reasoning. In his judgment, government data are manipulated, corrupted and unreliable. He's not alone thinking that. First, through technical changes over time in how data are collected and/or interpreted. The intent is to portray a more rosy scenario and ignore real world experiences of ordinary people. Calculating the CPI is an example:
Read full article... Read full article...
Tuesday, June 10, 2008
Inflationary Demand Destruction Delusion / Economics / Inflation
By: Captain_Hook
Demand destruction refers to the effect of a rising price on a good, service, or commodity, where a rising price has the increasing effect of curbing demand. Central planners live under the assumption the above condition set applies to commodities within current circumstances, which we categorize as quasi-hyperinflationary times at present. Here, the understanding is monetization efforts aside for definitional purposes; along with recognizing True Money Supply (TMS) growth rates have been contracting in the States, and nowhere near what could be even be considered high levels, the theory is lags associated with accelerated gains witnessed previously are still working through the system sufficiently to export reactionary inflation in emerging markets that reside on the very cusp of potential hyperinflationary conditions. Read full article... Read full article...
Tuesday, June 10, 2008
Friday's US Employment Report and the Stock Market / Economics / US Economy
By: Paul_J_Nolte
Friday's reaction to the employment report was somewhat of a surprise, given that fewer job losses were “created”, however what spooked everyone was the big jump in the unemployment rate. The report left a sour taste in investor's mouths, given the good news from the merger front (Verizon and Alltel) as well as good numbers from Wal-Mart (the “main” recipient of the rebate checks). Energy prices were in full retreat earlier in the week, but that reversed with a vengeance by the end of the week, as oil prices rose by their largest daily amount ever.Read full article... Read full article...
Tuesday, June 10, 2008
UK Producer Price Inflation Soars Suggesting Stagflationary Recession / Economics / Stagflation
By: Nadeem_Walayat
UK Producer Price inflation soared in May to 8.6% for the price of output of manufactured goods to levels not seen since the early 1980's stagflationary recession. The trend not only signals a halt to further rate cuts but increasingly the expectations are that despite sharply lower economic growth, UK interest rates will be forced higher as inflationary forces make themselves visible in the CPI data that currently stands at the Bank of England's upper limit of 3%. Read full article... Read full article...
Monday, June 09, 2008
The Wealth Effect Goes into Reverse / Economics / Liquidity Bubble
By: Chris_Ciovacco
In our current global economic environment, the number of moving parts for the individual investor to track and attempt to analyze is often overwhelming. Without a systematic approach to the global asset markets, it is virtually impossible to discern the relative importance of an almost infinite number of inputs. While it is a tall order, we'll attempt to highlight the some of the key moving parts of the economic engine in terms of the possible long-term impact on your portfolio and purchasing power.Read full article... Read full article...
Monday, June 09, 2008
UK Heads for Stagflation as Factory Price Inflation Soars to New Record / Economics / Inflation
By: Mark_OByrne
Gold closed at $895.50 in New York Friday and was up $23.30 and silver closed at $17.37 and was up 30 cents. In the New York Globex market gold subsequently rallied to $902.20 late Friday. Both traded sideways in Asia this morning prior to rallying higher in early European trading.The gas explosion in Western Australia will further curtail supply of gold from that part of the world. It has led to the loss of some 30% of the state's gas supplies and is already creating serious problems for Western Australia's massive gold mining industry and will curtail supply for months, rather than weeks.
Read full article... Read full article...
Sunday, June 08, 2008
Bernanke Cries "It's all China's Fault!" / Economics / Credit Crisis 2008
By: Mike_Whitney
He's at it again. Bernanke, that is. Thursday the Fed chief delivered a rambling 45 minute speech at the International Monetary Conference in Barcelona, Spain laying out all the reasons why the Federal Reserve is NOT responsible for the present crisis in the financial markets. Here's what he said: Read full article... Read full article...
Friday, June 06, 2008
Inflation One Year Ahead - A Look at the Inflation and the Consumer Price Index / Economics / Inflation
By: Joseph_Brusuelas
The recent rise in inflation has not yet been properly captured by the variety of inflation indexes used by the market to assess the pricing environment. The publication of the April Consumer Price Index elicited howls of derision from the market due to the very dubious -2.0% decline in the price of gasoline suggested by the report. At the time, our reaction was that it did not pass the “laugh test” and that once the seasonal adjustments made by the Bureau of Labor Statistics are “adjusted” we are quite confident that the actual increase in headline prices will be accurately accounted for and the increase in core prices that most individuals have observed will also work their way into the data. Read full article... Read full article...