Global Market Commentary, Analysis and Investments
Warning: serious thinking here…
Big rally yesterday. The Dow was up 274 points. Gold went up very slightly and still closed below $1,200.
What gives? A big change in direction? It’s probably nothing. Markets don’t go up or down all in one straight move. They play with investors like a cat with a mouse. They tempt him into bear markets and scare him away when prices are rising. They shake his courage at bottoms and addle his brains at tops.
[Read more...]Oh my…oh my…
Locusts…earthquakes…tornadoes… What next? Fire and Brimstone!
There’s a plague of locusts eating crops in Australia…
Earthquakes are becoming more common…after devastating quakes hit Haiti and then Chili.
“We could definitely feel it in Buenos Aires,” said our friends. “It was very unsettling. The heavy blinds we have up outside began smacking against the house as if there were a wind storm. But there wasn’t any wind.”
[Read more...]Markets proved they could still fall yesterday. After having rallied for 15 of the previous 18 sessions, we were beginning to wonder if it were still possible…
In an interesting turn of events, investors actually succumbed to the harsh economic realities of the day. There’s no telling how long this momentary lapse of unreason may last, of course, but we’ll take what we can get while we can get it.
[Read more...]“When you visit India…and I suppose it is true when you visit China or Brazil too…you don’t even notice at first…it’s not so much a thought…but more like a feeling…”
We were explaining to colleagues why it’s the end of the world as we have known it.
[Read more...]In the US, producer prices fell in February, more than expected. Core inflation was barely positive. That is not just a US trend. In Europe, price increases have fallen to the lowest level in 11 years. Japan is experiencing the biggest price drops in many years.
This sounds like a D-word to us…disinflation, almost deflation.
[Read more...]“I can’t stand it anymore. I have to say something. You act like you actually want a depression. What’s wrong with you?”
The above letter came from a dear reader who has missed the point. We are as generous and warm…as caring and sharing…as anyone outside a mental institution. We only want the best for our fellow countrymen…really.
[Read more...]A while back, our colleague, Chris Mayer, employed a wonderful analogy to illustrate the passage of time from the roaring twenties through to the dustbowl thirties. The former decade, Chris explained, was captured in essence by F. Scott Fitzgerald’s The Great Gatsby. It was a period ripe with wild speculation, fueled by an explosion in EZ money, and of reckless excesses in general. (If any of this sounds familiar, you can probably already guess the point at which Chris was driving.)
[Read more...]The depression is alive and well!
Unemployment claims just came in higher than expected.
And new house sales in January were at their lowest ever. Pundits were quick to blame the snow. But sales were off even in areas that had better-than-usual weather.
Household income has gone nowhere in 10 years. Stocks have suffered a lost decade too. And now Ben Bernanke says we’d better be careful…because the recovery ain’t no sure thing.
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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.
[Read more...]