Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Saturday, July 21, 2007
Chinese Money Supply - How Do You Say "Rube Goldberg" in Chinese? / Economics / China Economy
By: Paul_L_Kasriel
China has an economic problem - inflation. When I speak of Chinese inflation, I am referring to what the People's Bank of China (PBOC, not to be confused with PB&J) is doing - creating massive amounts of credit "out of thin air." Chart 1 shows that the total assets on the PBOC's balance sheet grew by approximately 29% in the 12 months ended May. Although that is down from peak growth of 38% in the 12 months ended September 2005, 29% still is a sizeable increase in central bank credit creation.Read full article... Read full article...
Saturday, July 21, 2007
Return Of The Gold Standard / Economics / Money Supply
By: James_West_2
We humans are remarkably committed to self delusion.
From the personal level to the most powerful government on earth, we contrive realities with distorted perspectives so we can execute ideas that would otherwise cause us to hesitate if we were to objectively and honestly consider their moral implications. The moral code is constantly being revised to accommodate current events.
World War I is a perfect example.
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Friday, July 20, 2007
Central Bankers - Stop! Or the Economy Gets It / Economics / Inflation
By: Adrian_Ash
"...If only consumers hadn't taken the world's central bankers at their word..."
WE ONLY have ourselves to blame. Consumers in the West, rich in credit ratings if not cash, shouldn't have borrowed and spent so much money when interest rates hit a half-a-century low in 2003.
Nor should we have continued to borrow and spend when the rate of interest slipped below the inflation rate – making debt pay as cash savings lost value – over the next two years.
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Thursday, July 19, 2007
Who Do We Owe and How Much? / Economics / US Debt
By: Mike_Hewitt
This essay takes an in-depth look at the magnitude and consequences of the large debt levels within the United States. Topics discussed include: composition of foreign and domestic holders of U.S. debt, consequences of the government borrowing from the Federal Reserve, and a look at the current U.S. housing market.
The National Debt
The national debt (also known as public debt) is money owed by the federal government. As the government represents the people, government debt can be seen as an indirect debt of the taxpayers. The U.S. government incurs debt by issuing treasuries (bills, notes and bonds).
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Saturday, July 14, 2007
Philly Fed President Plosser: Consumer Spending, Exports Are Cause for Optimism / Economics / US Economy
By: Paul_L_Kasriel
Really?
Light motor vehicle sales down for six consecutive months (see Chart 1) is cause for consumer spending optimism? Bed Bath & Beyond, Best Buy, Circuit City, Sears Holdings, Home Depot and West Marine recently issuing profit warnings are a cause for consumer spending optimism?
Thursday, July 12, 2007
US Economy Nightmare Warnings! and How to Protect Yourself Now! / Economics / Financial Crash
By: Money_and_Markets
Larry Edelson writes: I hate to say it, but I believe the next five to six months will harbor nightmares for the U.S. economy so profound that they will impact each and every one of us.
Before I go any further, let me say that I'm not a gloom-and-doomer. Longer term, I am very optimistic about U.S. and global economic growth. I'm even optimistic on the U.S. real estate market. But I'm also a realist …
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Wednesday, July 11, 2007
The Crack-up Boom Series Part V, Introduction - It's Bigger Than Just the dollar! / Economics / Money Supply
By: Ty_Andros
For greater insight into our publication, have a look at the Overview of Tedbits . It helps current and potential subscribers understand our mission in serving you. It also gives a broad description of what's unfolding globally and what you can expect from Tedbits as a regular reader.
Crack-Up Boom Series Intro
The Crack Up Boom series is exploring the unfolding “Indirect Exchange” (as detailed by Ludvig Von Mises), that dollar holders will be using to exit their holdings now and eventually is will be followed by all holders of fiat currency holdings no matter which country is perpetrating the “crime” of confiscation of wealth through the printing and credit creation process that all such monetary schemes evolve into.
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Tuesday, July 10, 2007
US Bureau of Labor Statistics "Phantom" Workers Now Account for 56% of Payroll Increase / Economics / US Economy
By: Paul_L_Kasriel
Each month the Bureau of Labor Statistics attempts to estimate how many jobs were created (or eliminated) by smaller businesses not yet included in its survey of employers. This estimate is referred to as the "birth/death" adjustment. In the 12 months ended June, total-not-seasonally-adjusted nonfarm payrolls increased by 1.982 million. During the same interval, the birth/death adjustment contributed 1.111 million jobs to the total. That is, in the 12 months ended June, the birth/death adjustment accounted for 56.0% of the 12-month increase in total nonfarm payrolls.Read full article... Read full article...
Tuesday, July 10, 2007
Explaining the US Consumer Price Index / Economics / Inflation
By: John_Mauldin
This week in Outside the Box we look at a Congressional Budget Office publication that dives us the details on how the consumer price index for all urban consumers (CPI-U) is created. This is, as the CBO posits, the best-known official measure of inflation.The brief that follows will venture to explain the methods used to construct the CPI-U, and how and why the index's estimates of inflation might differ from a consumer's perceptions of price changes. Though I think this article may be somewhat akin to discovering what components comprise the makeup of sausages (knowledge that is usually best left undiscovered), it is useful to understand just how the inflation data is constructed. Some of the points they make are controversial, especially when it comes to "hedonic" pricing, which they refer to as "shifts in the quality of goods and services over time." This does allow for some quite subjective influence in the inflation numbers. While I will visit this topic in a later letter, it is good to know what is and is not being measured.
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Friday, July 06, 2007
The Tentacles of the Housing Recession Are Beginning to Strangle the US Consumer / Economics / US Economy
By: Paul_L_Kasriel
Light motor vehicle sales in the U.S. dropped 3.4% month-to-month in June to a seasonally adjusted rate of 15.6 million units. Excluding the Katrina-depressed sales of September 2005, the June 2007 sales rate was the slowest since September 2002. Light motor vehicle sales have declined sequentially for six consecutive months (see Chart 1). On a quarterly average basis, new light motor vehicle sales contracted at an annual rate of 12.7% in Q2 vs. a 6.2% increase in Q1.Read full article... Read full article...
Tuesday, July 03, 2007
Credit as a Public Utility: the Key to Monetary Reform - Part 2 / Economics / Money Supply
By: Richard_C_Cook
A continuation of Richard C Cook's two part article on reforming the US Monetary System - Click Here for Part 1
THE AMERICAN EXPERIENCE
Monetary matters were clearer in England's American colonies. From the founding of Jamestown in 1607 to late in the American Revolution in 1779 there was not a single bank in North America. Goods were bartered, coinage entered the colonies through trade, and even Indian wampum was utilized. But all this was insufficient, so the colonial governments began to issue their own paper money. Notes were issued to landowners who use their land as collateral, or, in Virginia, to owners of tobacco in government warehouses.
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Saturday, June 30, 2007
Sovereign Wealth Funds / Economics / Global Financial System
By: Mike_Hewitt
Central banks have traditionally kept their reserves in relatively low-yielding, highly liquid government securities, agency debt, money-market instruments and bank deposits. The most current official IMF figure for official worldwide foreign currency reserves is US$5.89 trillion. At US$1.35 trillion, China holds the world's largest pool of official reserves, followed by Japan with US$911 billion and Russia with US$403 billion.Read full article... Read full article...
Thursday, June 28, 2007
Chicago Fed Index Suggests Continued Below Trend US Growth in Q2 / Economics / US Economy
By: Paul_L_Kasriel
The Chicago Fed publishes a national economic activity index each month that only the Chicago Fed's economic research department and I pay attention to. This index is not a leading one, but is a coincident one.
The Chicago Fed National Activity Index (CFNAI) is a weighted average of 85 existing monthly indicators of economic activity drawn from five broad categories: 1) output and income 2) employment, unemployment and hours 3) personal consumption, housing starts and sales 4) manufacturing and trade sales and 5) inventories and orders.
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Wednesday, June 27, 2007
So, the US Housing Recession Is Contained? / Economics / US Housing
By: Paul_L_Kasriel
That's the conventional wisdom, but recent reports from retailers might suggest otherwise. Early in June, Bed Bath & Beyond issued a profit warning. BB&B's chief executive, Steven Temares, said: "Based upon what we have experienced and has been reported by others, the overall retailing environment, especially sales of merchandise related to the home , has been challenging" (emphasis added).Read full article... Read full article...
Tuesday, June 26, 2007
Credit as a Public Utility: the Key to Monetary Reform - Part 1 / Economics / Money Supply
By: Richard_C_Cook
We live in an era of deregulation, where economists and politicians speak of “the market,” not government, as the appropriate vehicle for economic decisions. President Ronald Reagan said in his 1981 inaugural address, “Government is not a solution to our problem, government is the problem.”Read full article... Read full article...
Monday, June 25, 2007
Fear of the Future, Japanese Deflation 18 Years On / Economics / Deflation
By: Adrian_Ash
"...If depression is short-hand for fear of the future, then here's a glimpse of what lies beyond today's bubble in credit, debt and financial confidence..."
YOU COULD KNOW less than even the British government about trading gold and foreign currencies for profit, but you'd still have to reckon the money of this mystery country a "buy":
Its jobless rate just hit a 9-year low of 3.8%, and there's plenty more growth to come. The ratio of jobs to jobseekers rose yet again last month.
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Monday, June 25, 2007
Banks Fight to Postpone Day of Reckoning on Bad Loans Defaults Crisis / Economics / Global Financial System
By: Axel_Merk
The U.S. trade deficit with the rest of the world leapfrogged in recent days: aside from goods and services, we are now importing “consensus based crisis management” from Japan. Out of fear that a cleanup of bad loans would trigger widespread defaults, Japanese banks got themselves deeper and deeper into trouble by hushing up the problems. We are talking about the crisis at Bear Sterns' subprime hedge fund. The crisis shows that major adjustments on how the market prices risks are overdue; this may have negative implications for stocks, bonds, commodities as well as the dollar.Read full article... Read full article...
Friday, June 22, 2007
Cash is Not King - What Have You Bought For Me Lately? / Economics / Money Supply
By: Andy_Sutton
In the 1930's during the Great Depression, there are literally thousands of cases where people stuffed money under their mattresses because they were scared of putting it in banks. They had confidence that when they needed the money six months or a year later that it would buy them what they needed to survive. The fact that we were in a deflationary depression validated their strategy. In a deflationary environment, cash is King. Hold onto it and it will buy at least as much as it did when you stuffed it under the bed, maybe even more. I think that a few too many Americans paid a little too much attention to these stories and automatically assume that the same strategy will work today.Read full article... Read full article...
Thursday, June 21, 2007
Inflation Statistics - The Biggest Hoax of All Time! / Economics / Inflation
By: Money_and_Markets
Larry Edelson writes: I am thoroughly convinced that they're smoking something in Washington. After all, the pundits by the Potomac keep dishing out these absurdly low inflation figures, thinking you're too dumb to realize they're full of it!
Case in point: Last Friday's Consumer Price Index (CPI) data. The so-called "core" inflation rate rose a modest 0.1%. So every politician on the Hill plus all the idiot Wall Street analysts grabbed onto that figure and proclaimed inflation "dead."
Inflation? "Not a problem" … "tame" … "easy to deal with" — those were some of the comments and headlines that came out after the figure was released.
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Wednesday, June 20, 2007
The Perils of Monetizing US Debt / Economics / US Debt
By: Jes_Black
In our weekly reports, we often take the classical view on money. While we admit that monetarism may fail as an easy policy approach, from a fundamental standpoint, the supply of money will ultimately decide the long term rate of interest.
The classical view holds that interest rates will adjust to the equilibrium level between savings and investment. The prevailing Keynesian view is that interest rates will adjust to the supply and demand for money.
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