Because industrial production for the Eurozone was estimated to have risen 2.4% in January, first quarter GDP was boosted to 0.6% (quarterly rate) as statisticians were expecting that European industry would at least hold up the rest of the quarter. While not figuring the same blistering pace, the GDP figure suggested at least the European economy holding on to that [...]
Japanese officials including those at the Bank of Japan have been acting very erratic of late, eschewing the more traditional financial setting of vagueness. First it was NIRP that immediately blew up in their face, leading to very loud rumors of additional bank “stimulus” to offset NIRP only to have the BoJ instead do nothing at its last policy meeting. [...]
It is absolutely clear that the eurodollar system last functioned on August 8, 2007. Starting August 9, nothing would ever be the same. In describing and detailing how it got that way (the sudden fragmentation between “dollars” in NYC and London, for example) there is a natural tendency to compartmentalize even realizing the drastic implications of what it all meant. [...]
Throughout 2014 and even into 2015, the word “decoupling” was resurrected to try to calm growing unease about the direction of global growth. It’s first broad usage was during the first part of the Great Recession, as economists were sure that emerging markets then would be able to weather the “slowdown” of 2008 believed at that time confined to the [...]
The ongoing lesson in PMI interpretation added another layer with China’s turn. The official manufacturing PMI dropped back to 50.1in April from 50.2 in March. Last month’s rise above 50 was the first in that position since last July. Because of the mainstream interpretation about what 50 or not 50 means, it was taken then as if it were definitive [...]
If there is any wonder why PMI’s deserve scorn, this morning’s twin bill delivered solid reasoning. Both the ISM Manufacturing Index and the Markit Manufacturing PMI declined, and both remained above 50. However, there was no real consensus about what any of it meant. Depending on the media outlet determining commentary about either, there was both positive and negative spin [...]
You can always tell what kind of monthly variation any economic account provides from the commentary by which it is described. And there are, apparently, only two options: upward variations mean stimulus is working; downward variation just means that there will be more stimulus. Even by this crude cipher, you can still discern the state of the economic world since [...]
The only common factor on the economy viewed from the mainstream in the past few years is the shrinking standards by which it is judged. Janet Yellen can somehow suggest erratic 2% GDP growth is “overheating” or close to it only because that is the reduction of the “new normal.” Because that has been so declared by the very same [...]
Household spending in February 2016 in Japan rose year-over-year for the first time in six months. That was the sum total of any good economic news for the monetary-stricken economy, and it doesn’t really survive closer inspection. The rise in spending was due largely to “other” activities you don’t associate with strong economic rebounds. The overall figure was just +1.6% [...]
There was a robust debate inside economics earlier in the recovery period over Okun’s “Law”, the seemingly stable relationship between the unemployment rate and real GDP. The Great Recession was stunningly large in terms of the skyrocketing unemployment rate given that initial estimates for real GDP were bad but not as catastrophic. This was more than a theoretical problem for [...]
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