Will somebody please tell the Fed that US construction spending has grown faster when rates are high or rising, than when they are falling, low, or zero. Thanks.
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I was going to write about Greece this morning, but a closely watched gauge of American manufacturing has just turned …
By insuring spoiled brats/vested interests never face the consequences of their actions and choices, we guarantee failure of the entire system.Spoiled brats do not take kindly to being called out as spoiled brats. Since economies are aggregates of…
After sweating through several days of the expected Greek default, it is nice when the Central Bankers provide us with humor to help keep our sanity. Federal Reserve Vice Chairman Stanley Fischer claims that the USA is finally near full employment! Well, the number of people NOT in the labor force is greater than 37% […]
when it comes to generating the greater efficiencies that are the country’s best hope for sustainably high living standards, America is falling way short.
More damning evidence that Fortune was looking for a chance to score some cheap rhetorical free trade points.
These days, the battered population of Greece is getting an even harsher tutorial on the imperatives of high quality growth and an “economy built to last.”
Greece’s debt woes deepened over the weekend. Banks are closed for a week, with capital controls in place.
Couple of interesting charts on Greece.
As the Beltway-centric punditocracy saw it, the mega-story was marriage equality – which should make clear that its worldview is grossly distorted.
Bloomberg prints an exercise in extrapolating Greek devaluation to Mexico peso crisis. It is an interesting exercise in so far as it does indicate (imperfectly) one side of the ‘pain coin’ currently spinning in the air. But it does not provide for any realistic comparatives to the other side of the same coin: the side of Greece not opting out of the euro area. Suppose the estimated path in the Bloomberg chart is correct and Greece, exiting the euro does face a devaluation ‘bill’ of some 300 percent-odd. As Bloomberg article says, there will be pain. Huge pain. Now, suppose Greece does not opt for direct devaluation. Then what? Then – exactly the same adjustment will have to happen via internal devaluation. Absent inflation (of any significance) in the euro area (and even given the ECB target inflation), this means all of this adjustment will be carried by Greek people. Except, with devaluation and exit, Greece will still retain internal markets for adjustment: with reforms (not guaranteed by any means), and with some pain taken on the side of capital / funding, it might ameliorate the period of post-default devaluation (the ‘jump’ stage in the chart below). Staying in the euro clearly implies zero adjustment on capital side, with all adjustment on households’ side (employment, earnings, pensions etc). In addition, staying with euro implies no imports substitution (no price effects), exiting implies devaluation-driven imports substitution. Finally, staying with the euro implies no exports boost from devalued currency.
Because whether Reuters wants it or not, in Europe, what the bank does, the banks’ kings say.
Greek 2 year sovereign bond yield surged by 1,366 basis points.
Ok, folks. I never was a fan of Jean Claude Juncker, the [one of oh so many] European President.
The problem with the post-2007 world is that we are not in a cyclical recovery; we are in a structural depression defined as a sustained period of below-trend growth with no end in sight.
Plenty of analysts, market-watchers, and thought leaders are excited about Uber, Airbnb, and the advent of the so-called “sharing economy.”
Here’s the thing: The sharing economy isn’t for everybody.
Why not? Because, as we learned in the sandbox, not everyone wants to share.
Although they are certainly part of the equation, the question is whether the real sharers and their financial backers are willing to back the notion of a vast array of industries whose regulatory landscape is just taking shape…
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Late Friday night a solid blow was struck for sound money, free markets and limited government by a most unlikely force. Namely, the hard core statist and crypto-Marxist prime minister of Greece, Alexis Tsipras. He has now set in motion a cascade of disruption that will shake the corrupt status quo to its very foundations. And just in the…