In late February 2014, the Research Institute of Economy, Trade and Industry in Japan put on a seminar with guest lecturer Adam Posen, President of the Peterson Institute for International Economics. The topic of discussion was Abenomics, more broadly, and the Japanese brand of QE specifically. Mr. Posen, from his perch atop an establishment/inside think tank of mainstream economic orthodoxy, [...]
Gallup’s latest figures on consumer spending in June put to rest any idea of a major surge, completing a picture of the second quarter that is far more tepid than any weather-related symmetry with the first would have you believe. It has been an ongoing theme for several weeks as incoming estimates (aside from sentiment surveys that never mean what [...]
Existing home sales re-attained the 5 million SAAR level again in June, but that remains well behind last year’s trajectory. In other words, the bounce in sales after the most recent trough is not nearly as robust as predicted when it was simply assumed that the housing market would just revert back to 2013’s trend. In terms of yearly comps, [...]
If it seems as if there is a proportional relationship between the disappointment of economic growth and predictions about the vitality of the recovery that is supposed to follow, I think that captures the newest state of policy psychology. I don’t think at any other moment in recent history, going back probably to the founding of the Federal Reserve central [...]
It really shouldn’t be that you can follow so closely in agreement with a good deal of a person’s commentary yet end up on opposite ends. Can it be, like the DNA commonality of gorillas and humans, that the last 1% or less of a system or argument can make all the difference? There is much to admire in the [...]
There is a tendency of the modern age (post-modern) to disregard conventions of the past as mere anachronisms suited only to academic curiosity about how people lived in less “civilized” times. There is much to be said about that impulse, not the least of which is the caution of such hubris. In seeking out history you often find that those [...]
The core of 2014 Chinese defaults is really about control, as it ever is in 21st century finance. Central banks believe they have it and can exercise it with precision, a mysticism that is accepted widely by market participants. In allowing smaller firms to default, they are sending the signal that they want greater order in what is near-universally recognized [...]
I wrote a few weeks back about the college debt bubble, not solely as it relates to the financial imbalances evident in that, but rather how such monetary flow truly and sharply malforms the economic system. Orthodox theory posits that monetary policy is neutral over the long run, thus short run intervention, even extreme applications, is more than acceptable. That [...]
The US stock market rose 2% last week based primarily on the perceived wisdom of various central economic planners around the world. Mario Draghi announced a new bond buying program in Europe designed specifically to circumvent the verdict of the market and prop up the governments of the peripheral countries. There are conditions which the beggar countries must meet before [...]
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