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The Recovery Fallacy

By |2015-07-14T12:29:52-04:00July 14th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

In looking through the CBO’s litany of economic projections, past and present, I wrote yesterday that the major economic problem started to become clear by what was missing. The main orthodox models all view economic potential in much the same fashion, as if the economy exists completely upon a curve of inflation and employment, whereby the intersection of those two [...]

What Comes Next; Part 2, The Looming Transformation

By |2015-06-12T14:38:49-04:00June 12th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

Part 1 is here, the history of defining systemic operation since 1907. The quest over equality or the “right” to impose optimal outcomes is one that cannot go backward. The inevitable failures lead no duty to re-assess overall, but only the means by which the results are to be commanded. That was the essence of Triffin’s Paradox, which was only [...]

What Comes Next; Part 1, Useful History of the 20th Century

By |2015-06-12T14:40:11-04:00June 12th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

Value as a foundation seems almost too literal to be an economic or financial concept, but it is perhaps the bedrock association that makes the economic system. We are used to aspects like profits and money, even inflation, but those are all symptoms of the ever-changing world surrounding value. Karl Marx understood very well how deeply embedded value was even [...]

Olympic Waste Isn’t Just For The Olympics

By |2014-12-29T16:24:56-05:00December 29th, 2014|Economy, Federal Reserve/Monetary Policy, Markets|

Every once in a while it is heartening to think that world’s people may finally be awakening from their economic anesthesia and experiencing rightful revulsion about what has occurred. We are told that the global economy fell on its own into a pit of despair in 2008 and has been unable to escape it all “despite” the best efforts and [...]

How We Got Here

By |2014-12-16T16:05:11-05:00December 16th, 2014|Economy, Federal Reserve/Monetary Policy, Markets|

The answer to every economic problem is one version of statism or another. If monetarism doesn’t succeed in “pump priming” with credit and inflation “stimulus” then surely the fiscal side will with “automatic stabilizers” and indiscriminate government expansion. These two grand economic strategies are often separated as if they are distinct sets of disparate theory; they are not. They represent [...]

The Numbers Behind The PBOC’s Take

By |2014-12-09T16:46:33-05:00December 9th, 2014|Economy, Federal Reserve/Monetary Policy, Markets|

As if it needed further reinforcement, the actions of the PBOC follow a simple script – huge monetarism doesn’t work and is ultimately harmful. That is why “reform” in China is being turned into something unrecognizable to the world’s stock investors especially at a time when China’s economy is expressly vulnerable. Only a week or so ago, China’s researchers issued [...]

Contours of the Cliff

By |2014-11-25T11:35:00-05:00November 25th, 2014|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

I usually ignore sentiment surveys as, to reiterate one more time, they do not mean what people think they mean (and certainly not how they are used). The ISM Manufacturing Survey, for example, has been on fire for most of 2014 in an almost exact mirror of 2011. And just like 2011, that told us very little about the state [...]

Better Be A Shovel-Ready Future

By |2014-11-13T12:00:33-05:00November 13th, 2014|Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

In reviewing commentary about all the posturing in Japan preparing for what looks like, to me, an end of the recovery idea, there was one very alarming passage that I think may be important (and not just widely ridiculous) that ties together failure and the possible future course: Abe said yesterday he hadn’t decided whether to proceed with any snap [...]

At What Point Can We Actually Try Something Else?

By |2014-10-31T11:53:18-04:00October 31st, 2014|Economy, Federal Reserve/Monetary Policy, Markets|

The common refrain from any true believer in Communism (and even communism) is that it has never truly been tried. Forget the Soviet Union and those stuck behind the Iron Curtain, they were instead a corruptive manifestation of Stalinism that betrayed the ideals of Lenin, Marx and the “true” revolution. Maoist China doesn’t apply either for these people because it was [...]

Seven Years Without Trend and the Clock Is Ticking

By |2014-09-03T17:59:22-04:00September 3rd, 2014|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

They say the road to hell is paved with good intentions, but that is not the only ingredient in the asphalt used to make the highway to Perdition. Typically, intent is augmented (or actually degraded) by a degree of incompetence that masquerades as complexity. The breadth of that observation is staggering in the current circumstances as Japanification has seemingly gained [...]

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