Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.Saturday, February 09, 2008
US Recession WIll Kill Inflation - Lies to Destroy the Value of Your Money / Economics / Inflation
"...The US recession is sure to send inflation to zero – just like it didn't in four of the last five recessions..."
WORRIED ABOUT INFLATION...? Oh stop your carping and set an extra place at dinner for the fast-looming recession instead.
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Thursday, February 07, 2008
The Bush Financial and Economic Bust of 2008 - The Destruction of Capital / Economics / Economic Depression
" I just saw a picture Bernanke stripped to the waist in the boiler-room shoveling greenbacks into the furnace .” Rob Dawg, Calculated Risk blog-site
On January 14, 2008 the FDIC web site began posting the rules for reimbursing depositors in the event of a bank failure. The Federal Deposit Insurance Corporation (FDIC) is required to “determine the total insured amount for each depositor....as of the day of the failure” and return their money as quickly as possible. The agency is “modernizing its current business processes and procedures for determining deposit insurance coverage in the event of a failure of one of the largest insured depository institutions.” ( http://www.fdic.gov/news/news/financial/2008/fil08002.html#body )
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Thursday, February 07, 2008
The Dichotomy of the US Economic Downturn / Economics / US Economy
We crave transparency but once we have it we tend to no longer want it. We seek information, but once we get the news we react poorly. We look for some signs from a time past hoping that what once happened could possibly shed light on what is. But this time it is different.
At no time in recent history have we been confronted by so much conflicting information, cloaked appraisals of where we are and where we are headed, veiled attempts at regaining normalcy or risk with as little risk as possible and all this while we have two economies running side-by-side. One economy, that according to Mr. Bush is doing just fine and the other one, the rest of us live with each day.
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Thursday, February 07, 2008
Response to Subprime Article by Nobel Prize Winner Joseph Stiglitz / Economics / Subprime Mortgage Risks
Mr. Joseph E Stiglitz, a Nobel Prize winner in 2001 for his work on the economics of information, recently attended the World Economic Forum in Davos and wrote an article published on February 5th, 2008 titled:
Sub-prime crisis has led to the humbling of America.
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Thursday, February 07, 2008
Case Shiller Home Price Index the Leading Indicator of Economic Downturn / Economics / US Economy
By popular demand, the collection of charts featuring the S&P Case-Shiller Home Price Index has been updated. First, the home price index versus one of stupidest things that economists have ever dreamed up - the home ownership cost substitute used in the consumer price index, otherwise known as "owners' equivalent rent".Read full article... Read full article...
Wednesday, February 06, 2008
Opening the Mint to Gold and Silver - Last Chance to Stabalise the US Dollar! / Economics / Money Supply
A sequel to "The Double Whammy of Geopolitical Global Gold Games" - In my last article I suggested that the superpowers China, Russia, and the United States may be, without they knowing it, racing towards reopening their Mints to the monetary metals. The governments of these countries are like the heroes of Greek tragedies: they are drawn to their fate by destiny. There is no way for them to avoid Kismet, regardless of what they do. Many readers have asked me to explain what the term "opening the Mint to the unlimited coinage of gold and silver free of seigniorage charges" means.Read full article... Read full article...
Wednesday, February 06, 2008
Is Monetary Policy Destroying Our Manufacturing Base? / Economics / Money Supply
In both America and Australia the fear that the manufacturing base is shrinking to the detriment of the economy seems to garner more by the week. Australia's Labor Government has expressed the opinion that the fall in manufacturing as a proportion of GDP is of deep concern. Our so-called free market commentators mock this view, arguing that it is a historical trend that merely indicates that consumer demand has largely moved from manufacturing to services, and this is only to expected as an economy grows richer. In defence of this viewpoint they invoke the law of diminishing marginal utility. This law states that demand for a good will fall as more of it is produced. Hence the shift to services.Read full article... Read full article...
Tuesday, February 05, 2008
US Panic Interest Rate Cuts and the US Economic Recession / Economics / US Economy
Harold Wilson once said that "a week in politics is a long time". Well, that goes double for economies. Last week I said " against my better judgement " that the report on US manufacturing by the Institute for Supply Management was painting a rather grim picture that showed manufacturing was contracting.
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Saturday, February 02, 2008
US in Recession - Rising Unemployment and Slowing Consumer Spending / Economics / Recession
- What Does a Recession Look Like?
- The Starbucks Index
- Consumer Spending Slows Down
- Rising Unemployment Starts to Show Up
- It is All About Valuations
- Phoenix, Prime Rib and My Conference
What does a recession look like? How does it feel? What does it mean for your life and your investments? We explore these questions and more in this week's letter. I have been working on this letter all week, and think you will find it interesting.
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Saturday, February 02, 2008
US Jobs Lost Worst Since 2003 Confirms US Recession / Economics / Recession
As kids we used to play a game where one person would hide something, and their counterpart would look for it. As the person searching looked around, usually with a blindfold on, the person doing the hiding would tell them ‘you're getting warmer' or ‘you're getting colder' depending on their proximity to the object. When the searcher would get really close, the hider would yell ‘you're red-hot!' and usually success was not far away at all.Read full article... Read full article...
Friday, February 01, 2008
US Fed Insanity - Bernanke Repeating the Same Mistakes as Greenspan / Economics / Liquidity Bubble
Despite the fact that the Fed still believes that a recession is unlikely to occur, Bernanke & Co. followed up on last week's emergency 75 basis point rate cut with a 50 basis point kicker on Wednesday. Not to be outdone by the Fed's generosity, the House of Representatives and the Bush Administration slapped together a $150 billion “stimulus package”, which can only be delayed by the Senate's desire to join in the bead throwing. On Wall Street these actions were cheered as heroic, with praise and accolades for all (what could be more politically courageous than handing out free money in an election year.) In a recent poll, fully 78% of economists thought these policies were appropriate…while 18% thought that they were not aggressive enough.Read full article... Read full article...
Friday, February 01, 2008
United States Exporting Inflation Worldwide - From Credit to Money, Part II / Economics / Money Supply
"Living in a credit era, we cannot go back to a currency era without massive upheavals..."- Robert L.Smitley, Popular Financial Delusions (1933)
WHY DON'T we just do away with all the different currencies of the world, and settle on one single money to buy, sell, invest and light our cigars with?
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Friday, February 01, 2008
US and European Economies Heading for Depression 2.0 / Economics / Economic Depression
Depression 1.0 started about 1929 and ended around 1940 with the entry of the US into WW2. Even then, many economists say that, had the US not entered WW2, the depression would have continued for years in the US, and the rest of the world.
Now, since WW2, the US and West entered a period of unparalleled post war prosperity. This resulted in an incredible rise in the standard of living in the US and West. People don't realize, but much of the US didn't even have electricity in the 1920's!
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Wednesday, January 30, 2008
2008 Crunch Time for the Australian Economy? / Economics / Austrailia
The economy is beginning to look more and more like the proverbial "poisoned chalice". The Treasure, Wayne Swan, is complaining about interest rates putting "financial pressures on families". This bloke is every bit as bad as Costello. If he really wants to know what is happening he should visit the Reserve Bank, there he will find that the bank's balance sheet is collapsing, not that he would know how to interpret the figures.Read full article... Read full article...
Tuesday, January 29, 2008
Economic Stimulus Package Will Not Fix the US Economy / Economics / US Economy
This past week in Washington there has been much talk about the economy. It seems by their actions the leadership and the Fed is finally willing to admit we have a problem, and we need to do something about the economic mess we are in. This is a good thing. However, they are still not being honest about the root cause of our impending crisis and want to deal only with symptoms, not the disease.Read full article... Read full article...
Monday, January 28, 2008
The Crash of the Bank of United States and the Great Depression / Economics / Financial Crash
Benjamin M. Anderson* - By the fourth quarter of 1930 the trouble with the Bank of United States gave occasion to grave concern. - The Bank of United States was a bank which ought never to have existed, and which certainly ought never to have had the name it had. One leading banker of New York went personally to Albany to protest against the giving of such a name to that bank or to any other bank, and was told that there was a political debt to pay.Read full article... Read full article...
Monday, January 28, 2008
US Economic Booms and Busts and Monetary Policy History / Economics / Money Supply
The extent to which media commentators are ignorant of economic history, let alone basic economics, is genuinely staggering. We got a good look at this ignorance when the 1990s boom was compared to the 1960s boom. Then many of the same commentators started to compare the stock market boom with tulipmania or the South Sea Bubble. The crash, of course, was invariably described as an innate feature of capitalism, except if it happens under a Republican president: then it's his fault.Read full article... Read full article...
Saturday, January 26, 2008
US Economy Rescue Plan - "I know what you did last rebate-time" / Economics / US Economy
We'd just finished a nasty fall in the stock market. Tech stocks had crashed, with the NASDAQ losing over 60% of its value. The economy was slowing down and a recession seemed imminent. Something clearly had to be done. The last thing a rookie President needs in his first days in office is a recession. What better an idea to curry favor with the voters than a tax rebate? I remember receiving my $600 Bushbate during the summer of 2001. Mired in graduate school tuition bills, I did the most un-American thing of all: I paid bills with my check. My rebate didn't really stimulate anything other than my own sanity perhaps. However, in order for the rebates to stimulate the economy, the recipients of the money have to spend it into the economy. In theory, this will cause production to increase and growth to ensue.Read full article... Read full article...
Friday, January 25, 2008
US Economy Rescue Plan of $1,200 per American Family, More Checks Will Follow! / Economics / US Economy
One Gold Coin for Every American FamilyIf American families are smart (and if they are able), they'll take that $1,200 check coming from the gubment and buy a single one-ounce American Eagle gold coin. Now that monetary policy and fiscal policy appear to be firing on all cylinders, it will probably be one of the easiest and best decisions they'll ever make - the only real question is whether or not $1,200 will be enough by the time the checks arrive in May.
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Friday, January 25, 2008
US Financial Services Industry the Next Sector to Move to Asia / Economics / US Economy
Over the past half-century, the United States has seen its global dominance in dozens of industries slip away. One plum that we have maintained is our gargantuan financial services industry, whose contribution to total GDP more than tripled between 1947 and 2005. However, the current global financial crisis, manufactured on Wall Street and exported to the entire world, may result in the U.S. losing its financial crown as well.Read full article... Read full article...