Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Thursday, October 20, 2011
U.S. Inflation Shows Signs of Moderation in September / Economics / Inflation
By: Asha_Bangalore
The Consumer Price Index (CPI) moved up 0.3% in September, following gains of 0.5% and 0.5% in July and August, respectively. The core CPI, which excludes food and energy, rose only 0.05% in September after a 0.24% increase in August. The September increase is the smallest gain since March 2011 (see Chart 1). These signs of moderation in inflation are noteworthy because they allow the Fed to focus on growth in the inflation-growth debate.
Thursday, October 20, 2011
Murder of the Savers, Killed by Inflation / Economics / Inflation
By: Adrian_Ash
Savers and pensioners! Your murderers need no revolution to storm your stately homes and palaces...
IT'S NOW 100 years since Great Britain established its welfare state. Shortly after, and as the First World War kicked off, it abandoned the free exchange of bullion for notes under the classical Gold Standard.
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Thursday, October 20, 2011
Nouriel Roubini's Global Research Brand vs. His Prescription for the Economy / Economics / Economic Theory
By: Mike_Shedlock
Nouriel Roubini has called the economic crisis rather well. He gas gone on to turn success at RGE into an "economic brand". The Institutional Investor has an 8-page article on How Nouriel Roubini Became a Research Brand.
The article also notes that Roubini has been in the inner economic circles at the World Economic Forum at Davos, the Council on Foreign Relations, and the U.S. Congress.
Thursday, October 20, 2011
Fed’s Dual Mandate Not Workin, Inflation and Unemployment Are Rising / Economics / Inflation
By: Michael_Pento
We are all aware that the Fed has a dual mandate of stable prices and maximum employment. But what may come as a surprise to most is that they have a distinct preference in their mandates. The Federal Reserve under Ben Bernanke has a clear bias towards fulfilling the goal of maximum employment. Given the situation where unemployment is high and prices are relatively stable, the Fed has opted to pursue a policy of pursuing higher inflation in the hopes of engendering lower unemployment rates.
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Tuesday, October 18, 2011
U.S. Economy Operating in Midst of a Long-term Slump, Depression / Economics / Great Depression II
By: John_Mauldin
Dr. Lacy Hunt and Van Hoisington of Hoisington Investment Management write a "Quarterly Review and Outlook" that is a must-read for me. This quarter they focus on US monetary policy, noting that "After peaking at 1.69 in the second quarter of 2010, M2 velocity declined for four consecutive quarters, and we estimate that a major contraction in velocity to 1.59 is likely for the third quarter." (I mentioned the importance of the velocity of money in judging inflation vs. deflation prospects in this week's e-letter, too.)
Tuesday, October 18, 2011
UK Inflation Accelerates to CPI 5.2%, Bankrupt Britain's Stealth Debt Default Continues / Economics / Inflation
By: Nadeem_Walayat
UK CPI Inflation smashed through the 5% barrier by rising to 5.2% for September (4.5%), which is now approaching near triple the Bank of England's 2% target that continues to make a mockery of the central bank whose primary remit is supposedly price stability, where 3% was supposed to have been the maximum level a break above which was supposedly to trigger a series of panic measures to bring inflation under control, instead of which the Bank of England has instead opted to print money as it recently announced another £75 billion of electronic money printing that the fractional reserve banking system would eventually leverage to over £1 trillion, for the primary objective for the monetization of government debt, i.e. the same policy that the Weimar republic had been engaged in on its path towards hyperinflation. UK public debt is probably being monetized at the rate of 15% per annum with approx 30% monetized to date, only the deflation fools and the vested interest academic economists cannot or choose not to realise the highly inflationary consequences of governments monetizing their debt.
Monday, October 17, 2011
Bursting of the Debt Bubble, Evaporation of Wealth on a Vast Scale / Economics / Deflation
By: EWI
The bursting of the "debt bubble" which started in 2008 is far from over. It's the financial story of our age and it's happening before our eyes. The full scope is hard to keep up with because it's unfolding at various levels. The top level is the sovereign debt crisis:
Sunday, October 16, 2011
The Pitfall Of Rock Star Economists / Economics / Economic Theory
By: EconMatters
The whole idea of going to University and studying Economics, replete with a thorough understanding of the importance of analyzing economic data points seems to be lost on these Rock Star Economists who dominate the financial media landscape these days. The only barometer these so called economists utilize is: “Oh, the stock market has been selling off hard for two weeks we must be in a recession”!
Sunday, October 16, 2011
Hyperinflation, Can It Happen Here? / Economics / HyperInflation
By: John_Mauldin
"Bankruptcies of governments have, on the whole, done less harm to mankind than their ability to raise loans." - R.H. Tawney, Religion and the Rise of Capitalism, 1926
"By a continuing process of inflation, government can confiscate, secretly and unobserved, an important part of the wealth of their citizens. - John Maynard Keynes, Economic Consequences of Peace
"Unemployed men took one or two rucksacks and went from peasant to peasant. They even took the train to favorable locations to get foodstuffs illegally which they sold afterwards in the town at three or fourfold the prices they had paid themselves. First the peasants were happy about the great amount of paper money which rained into their houses for their eggs and butter… However, when they came to town with their full briefcases to buy goods, they discovered to their chagrin that, whereas they had only asked for a fivefold price for their produce, the prices for scythe, hammer and cauldron, which they wanted to buy, had risen by a factor of 50." - Stefan Zweig, The World of Yesterday, 1944.
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Sunday, October 16, 2011
Economic Crisis in Europe; Unpayable Debts, Impending Financial Insolvency / Economics / Euro-Zone
By: Bob_Chapman
The big question is will Greece succumb to insolvency in November? Our answer is probably not. It should take 3 to 6 months but it is coming no matter how much money and credit is thrown at the problem. The markets on the short-term basis believe it is a coin toss. If the funds are not forthcoming you could see a 60-80 percent haircut on bond losses. If it is 3 to 6 months it will probably be 100%. Many in Europe believe the Merkel-Sarkozy team has a plan that will work, but as yet we do not know what that plan is. In spite of that the euro this past week rallied from $1.32 to $1.38 as the US dollar fell lower.
Saturday, October 15, 2011
U.S. September Retail Sales Noteworthy Pickup, But Q3 Consumer Spending is Tepid / Economics / US Economy
By: Asha_Bangalore
Retail sales rose 1.1% in September, after an upwardly revised 0.3% increase in August (previously reported as unchanged). Strong auto sales (+3.6%) and a 1.2% jump in gasoline sales were only part of the story. Purchases of apparel (+1.3%), furniture (+1.1%), and general merchandise (+0.7%) also advanced in September. In the third quarter, total retail sales increased at an annual rate of 4.5% vs. 4.7% in the second quarter. Excluding gasoline, retail sales move up at annual rate 4.6% in the third quarter vs. 3.1% in the second quarter.
Saturday, October 15, 2011
Bank of England's Quantitative Inflation Bankster's Paradise Inflationary Depression Economy / Economics / Inflation
By: Nadeem_Walayat
The Bank of England recently hit the panic button again by announcing another print run of £75 billion (electronically), which is in addition to the £200 billion already printed since March 2009. The news has been accompanied by much economic propaganda across the media sphere from the Bank Governor Mervyn King and Politicians including Osbourne and Cameron to the BBC's journalists / pseudo economists virtually all in unison reading from the same script of printing £75 billion being necessary to boost the UK economy in the face of the imminent threat of Recession / Deflation.
Friday, October 14, 2011
This Recession May Be Worse Than the Great Depression / Economics / Great Depression II
By: Barry_Elias
“It is difficult to make any kind of forecasts with any great degree of confidence. In my area it’s got to the point where it’s very hard to say anything... but you’ve got to take a view, that’s what you’re paid for.”
According to a recent CNN report, the above quote was provided by a U.K. financial equity analyst with Oriel Securities. That statement is emblematic of how the financial industry has metastasized into a pathological cancer that mostly transferred and decimated wealth and value, rather than creating it.
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Friday, October 14, 2011
United States and China: International Trade Data Underscore Softening Economic Fundamentals / Economics / Global Economy
By: Asha_Bangalore
The trade gap of the U.S. economy was virtually unchanged at $45.6 billion in August. Exports of goods and services held steady in August, while imports of goods and services also were almost unchanged. The real trade deficit of goods widened to $47 billion from $46 billion in July, reflecting a drop in exports of goods (-0.7%) and a 0.2% increase in imports of goods. From a year ago, exports of goods rose 6.7% and imports of goods moved up 1.9% (see Chart 5). Read full article... Read full article...
Friday, October 14, 2011
Cash Rich Firms Will Not Hire and Invest Until Demand Gains Momentum / Economics / US Economy
By: Asha_Bangalore
Non-financial corporate firms were holding $2.047 trillion in liquid assets in the second quarter of 2011. These liquid assets (Sum of foreign deposits, checkable deposits/currency, time & savings deposits, money market fund shares, security RPs, commercial paper, US government securities, municipal securities, and mutual fund shares) as a percent of short-term liabilities are close to historical highs (see Chart 1).
Wednesday, October 12, 2011
China Continuing Economic Boom or Bursting Bubble? / Economics / China Economy
By: Casey_Research
In a recent article, How China Ate America’s Lunch, Clif Carothers described what China has accomplished in the last thirty years:
In thirty short years, China was able to accelerate her GDP from $216 billion to $6 trillion. She amassed reserve capital of $3 trillion. She reversed America’s fortunes from the greatest creditor nation to the greatest debtor nation. She gutted America’s factories while creating the world’s largest manufacturing base in her own country. A measure of output that highly correlates to GDP is energy consumption. In June of this year, 2011, China surpassed the United States as the largest consumer of energy on the planet. While the US consumes 19% of the world’s energy, China consumes 20.3%.
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Wednesday, October 12, 2011
Poor Sales Continue to Haunt Small Businesses / Economics / US Economy
By: Asha_Bangalore
The September survey of the National Federation of Independent Business (NFIB) shows an improvement in the outlook of small businesses. The Small Business Optimism Index rose to 88.9 in September from 88.1 in August after a string of six straight monthly declines, which is good news.
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Wednesday, October 12, 2011
How Economic Collapse Will Happen / Economics / Economic Theory
By: Videos
Discussion about how the coming economic collapse will happen, and how to prepare yourself.
First - Imports to the Country increase drastically and exports decrease.
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Tuesday, October 11, 2011
The Folly of Economic Forecasting / Economics / Economic Theory
By: Douglas_French
President Obama's mostly forgotten jobs package would reportedly create 1.9 million new jobs, a one-percentage-point drop in the unemployment rate, and goose GDP by two percentage points. That was the prediction of Mark Zandi, chief economist of Moody's Analytics. You see, he has a model. He did a simulation, and presto — 1.9 million jobs!
Tuesday, October 11, 2011
How Long Will This Economic Depression Last? Five Key Data Points That Can’t Be Ignored / Economics / Great Depression II
By: Mac_Slavo
Living within the realm of a 24 hour news cycle can often make it seem like things really are getting better. On any given day a particular company may report better than expected earnings, the Dow Jones may rise 250 points, and a few thousands more workers than expected were hired into private sector jobs. As a result, we receive a string of positive assessments on the economy, despite the fact that just one day prior we may have had central bankers and IMF advisors suggesting a depressionary collapse was all but inevitable.