In the manufacturing sector we find the most supreme test of economic credentials. Despite what is clearly taking place, the mainstream, orthodox outlook and assessment continues to dominate. There isn’t any doubt anymore about the manufacturing sector, as recession not only is broad enough there on its own it continues to deepen and darken. Yet, because Janet Yellen declared the [...]
From the perspective of foreign economies, the primary economic problem is US consumers. That sets up a contradiction as noted earlier today with durable goods estimates; economists think US consumers are quite healthy and the contraction in manufacturing is due to foreign economies. The inventory imbalance, or bloat as it was aptly described, cannot be an overseas problem and therefore [...]
China’s trade estimates continue the trend of the global economy pushing closer to recession, assuming that it is not already there. We know that the lower part of the global supply chain below Chinese manufacturing and assembly, the resources and materials flow, has already been pushed beyond simple recession in some places, like Brazil, into defining a new disastrous economic [...]
The Fed has many problems with its attempt to convince the world that it has itself fulfilled its recovery mission. That self-reflected “mandate” is meant to include a masterful revisit to prior American infatuation with debt and credit. There was no more visible and visceral demonstration of those terms than the middle 2000’s, and it is the intent of monetary [...]
The unrelenting economic decline in China is finally getting the attention of economists and the media as something more than a big problem “for them.” Imports declined by 18.8% in October after having contracted by 20.5% in August. On the export side, Chinese goods sent abroad fell 6.9% year-over-year in dollars which confirms that the contraction is not China’s alone [...]
Much like global “inflation”, if you set out to find global “demand” you will be hard pressed to find it. QE was supposed to be a huge boost to aggregate demand, through inflation expectations, yet the score in 2015 is hugely negative. Overseas problems are not unfortunately so remote, despite all mainstream protestations, as you can simply trace it all [...]
There must be a universal speech template included in the monetary textbook that is shared among the various central banks. On September 28, 2015, Haruhiko Kuroda, Governor of the Bank of Japan, delivered a speech that wasn’t just similar to the press conference Janet Yellen had endured only a week or so before, it was a close enough replica that [...]
The US Producer Price Index declined 0.5% month-over-month in September, much farther than the 0.2% drop expected by economists (statisticians, really). With retail sales providing little positive emphasis even among the large segment of commentary focused exclusively on the monthly variation rather than the intense consequence of wider context, the idea that the Fed will confirm the final stage of [...]
Unsure what to make of the renewed disaster in Chinese trade figures, there has been renewed emphasis on China being China. Almost every media story about the 20% collapse in imports references an assumed attempt by China to transform out of exports and into a consumer-driven economy without reconciling how or why that has so obviously and spectacularly failed. Nor [...]
It may be unexpected to economists, but the sudden and uniform economic downside that is either appearing or strengthening almost everywhere in the world is closely tracking the wholesale “dollar.” In many cases, that flows through China and so is given that gloss, but there can be little doubt now about either cause or effect. In Japan, machine orders (a [...]
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