At the same time the Bank of Japan cut its outlook for “inflation” last month, seriously violating the standard set at the beginning of QQE to meet its target within 2-years, they also raised their growth predictions for the coming fiscal year (starting in April). Nobody seems to have appreciated the irony of that since almost all of the increase [...]
The latest figures on housing construction have almost flipped the circumstances from late 2013. It was apartment construction that kept up hope that any retrenchment in single family construction would not be so devastating. Permit and start activity was, at the margins, almost totally dependent on multi-family construction to offset weakness in single homes. As of December 2014, the flattening [...]
There has been nothing good out of China in the past few months, which is why the call for more action by the PBOC has only grown. Despite what are really clear intentions, economists continue to look at financial operations in China as if it were still 2010 or even 2012. When the China PMI disappointed (for whatever that is [...]
We keep hearing about pent up demand as if it is a foregone conclusion. For some, particularly orthodox economists, it really is – it has to be. If there is no pent up demand awaiting some ephemeral trigger, then their whole theory of the economy is wrong, from the ground up. The Fed reduced interest rates throughout the economy (though [...]
The primary argument in favor of “aggregate demand” policies, or at least attempts at demand-side “stimulus”, amounts to putting more money into the economy as spending. You hear it all the time, as in give money to people that do not have it now and they will spend it, thus creating a “pump priming” that stirs the economic engine as [...]
Stay In Touch