Things in the economy are getting more and more stressful, and the company's revenues are down, precipitating the rumor around here that there are going to be more cuts in staff, and the odds are pretty good that I will be one of those unceremoniously fired since, ever since they fired Carl, I am now the company's worst employee.
[Read more...]The Paradoxically “Sick? Economy
July 27, 2010 By Leave a Comment
Dow up…gold down. That's been the micro-trend over the past few days. The 30 bluest chips are up about 400 points since last Thursday. The Midas metal, having suffered a $21 selloff since this time yesterday, is down to around $1,160 an ounce.
At first glance, it would appear that things are looking up for the world's most indebted economy. People are selling their catastrophe insurance – gold – and freeing up a bit of cash to take to the casino – stocks. But as our fellow reckoners already know, things are not always as they seem.
[Read more...]Spending Cuts in the Age of De-Leveraging
July 27, 2010 By Leave a Comment
As we were saying yesterday, there are several schools of thought regarding the present economy.
1) We're recovering… (Geithner, Summers, et al)
2) We're not recovering…we're headed into inflation (Faber, Stansberry, Casey)
3) We're not recovering…we're headed into hard-core deflation (Prechter, Shilling)
Stagnant Stock Prices Still Have Lower to Go
July 15, 2010 By Leave a Comment
Not much action in the markets yesterday. The Dow barely budged, but still ended the day in positive territory – the 7th day in a row of gains. Gold fell $6.
Investors beware!
Why? Because they are trapped. After 12 years without a real gain, they can't afford to miss a major rally. So, they're inclined to take chances. But is this rally worth betting on?
[Read more...]Kan’s Election: Should We Expect A Weaker Japanese Yen?
June 10, 2010 By Leave a Comment
On Monday, June 8, Naoto Kan formally became the prime minister of Japan. The former finance minister took the reigns from Yukio Hatoyama, who stepped down last week following popular outcry over a U.S. air base.
With Prime Minister Kan in office, good vibrations are beginning to surface. Political leaders have backed the former finance minister, voting by an overwhelming majority in the weekend election. Of the 477 lawmakers voting, 313 voted in favor of Kan. The public is also widely supportive of their new leader. Since the election, Kan's Democratic Party of Japan administration has garnered a 44% approval rating in public opinion polls. The figure is a vast improvement from the less than 20% enthusiasm witnessed under Hatoyama's government.
[Read more...]Consumers Saving to Save the US Economy
June 1, 2010 By Leave a Comment
Markets were closed in America yesterday. But theres still reckoning to do. So, were on the job as usual.
As predicted in this space, Americans have gone back to saving.
Youll recall that household spending increased earlier this year despite flat or falling income. Top economic pundits hallucinated that the correction was over. They said the private sector was not de-leveraging after all. Instead, households were going back to their own spendthrift habits.
[Read more...]
The “Road to Serfdom?
The stock market still has further to fall to catch up with the slowing economy. US GDP will keep decelerating – likely approaching a zero percent growth rate by 2011 – for the following reasons:
1. The long-term trend back towards consumer frugality and higher savings rates remains in full force. This will dampen consumer spending.
[Read more...]