The Nobel Prize committee has never withdrawn a prize. It might want to consider it. In Tuesday’s New York Times, prizewinner in economics, Paul Krugman reveals either that he knows nothing about economics…or that there is nothing worth knowing in it. We’re beginning to think it’s the latter.
September 13th, 2010 | Bill Bonner | 0 comments | ContinuedAll Posts Tagged With: "stimulus"
Hindenburg Meets Iceberg
Another week in Australia without a new government. Not bad for a Monday. The current Prime Minister is set to meet with three so-called independent members of Parliament to discuss forming a minority government. This gives us a chance to correct an error we made awhile back.”Every election is a sort of advance auction sale of stolen goods,” wrote HL Mencken. We misattributed that quote to Mark Twain, another great American wit.
August 30th, 2010 | Dan Denning | 39 comments | Continued
Don’t worry, I’m a central banker!
The Bernanke-led Fed … announced on Aug. 10 it will buy Treasuries to set a $2.05 trillion floor on its balance sheet and keep interest rates from rising. Trichet said Aug. 5 that the euro-area economy was surpassing forecasts, which may pave the way for the ECB to look at phasing out its emergency lending measures.
August 28th, 2010 | Nickolai Hubble | 0 comments | Continued
Earnings Aren’t What They Used to Be
As Wall Street’s big money players return from the Hamptons in the coming weeks, they will have to reassess the earnings power of their portfolio companies. Last week, Staples confirmed the message we heard from Office Depot and Office Max: the small business sector as a whole isn’t very healthy.
August 24th, 2010 | Dan Amoss | 0 comments | Continued
Economic outlook – look out (take 2)
Double dippers are on the rise. Nouriel Roubini: “Risk of a double dip recession in advanced economies (US, Japan, Eurozone) has now risen to 40%.” Robert Schiller: “… also said last week that there’s a greater than a 50 percent chance of falling into another downturn.”
August 21st, 2010 | Nickolai Hubble | 83 comments | Continued
Fake Plastic Economy
Our guess is that it is both. What is most remarkable about this whole episode is that the people who are most responsible for it – in the sense that they caused it…and that they now pretend to fix it – still show no evidence of understanding what it going on. Geithner did mention that households were paying down their debts.
August 9th, 2010 | Bill Bonner | 5 comments | Continued
Road to Nowhere
Where is it going to get you in the next five years? Who knows? But with government influence and debt on the rise, there are probably some severe misallocations in the economy. On a global and local scale. At some point they are going to have to reallocate.
August 7th, 2010 | Nickolai Hubble | 0 comments | Continued
How to Cure an Economic Depression
“As recently as two years ago, anyone predicting the current state of affairs (not only is unemployment disastrously high, but most forecasts say that it will stay very high for years) would have been dismissed as a crazy alarmist.” That was Paul Krugman in today’s newspaper. Thomas Friedman is fixing problems in the Middle East, so we’ll have to make do with Krugman to entertain us on economic matters.
July 14th, 2010 | Bill Bonner | 2 comments | Continued
You’re the Voice, But Don’t Understand It
Daily Reckoning editors have written endlessly about how such stimulus will merely “pull forward demand”, causing a slump once the stimulus is withdrawn. They have been proven right in textbook fashion. But Schiff points out a further crucial consequence of this economic mismanagement. In addition to pulling forward demand, there is the interest on the debt used to pull this demand forward.
July 10th, 2010 | Nickolai Hubble | 1 comment | Continued
V-Shaped Recovery, Where Art Thou?
To make matters even more unsettling, the world’s governments have pledged to reduce their countercyclical spending. They won’t get an argument from us on that score. They are doing the right thing. But if they follow through, it will result in the private sector and the public sector de-leveraging at the same time. This is highly deflationary.
July 7th, 2010 | Bill Bonner | 0 comments | Continued
Independent from What?
Obviously, that kind of boom can’t go on forever. And when it came to an end in 2007 it changed the financial picture for governments as well as households and businesses. Tax revenues went down. Expenses went up. And so did the bailouts and boondoggles that they call ‘stimulus’ spending.
July 7th, 2010 | Bill Bonner | 0 comments | Continued
A Rhyme of the Times
Perhaps we are just overly curmudgeonly about the whole idea of spreading the wealth around. Still, it seems like a fraud has been foisted upon the Australian public…that everyone is entitled to benefit from the risk-taking of others without taking any risk at all…because the resources “belong” to all Australians.
July 2nd, 2010 | Dan Denning | 14 comments | Continued
Where Debt Goes to Die
But the meandering action in the markets has caused us to step back and assess where we are at in the whole scheme of things (other than level one of an office on Fitzroy Street in a wintery St Kilda, nibbling at a chicken and bacon sandwich). Financially and historically speaking, we’re into phase two of a global debt crisis brought about by the fraud that is fiat money.
June 29th, 2010 | Dan Denning | 76 comments | Continued
Going to Tokyo
Readers with even a faint recollection of recent financial history will remember that this is what Alan Greenspan did when he was still the smartest man in the world. He kept extending the period of emergency low rates after the mini-recession of ’01. The Fed kept lending money at less than the rate of inflation – for 4 years, as we recall.
June 28th, 2010 | Bill Bonner | 4 comments | Continued
Even Taxes are Pretty in Pink
Forcing the more productive, intelligent and resourceful people in the economy to bear the weight of those who should be going out of business is just stupid. That hasn’t stopped countries from trying it. But the IMF points out that most countries abandon it. And what would happen to government revenue when the economy slows?
June 26th, 2010 | Nickolai Hubble | 11 comments | Continued
