Tag: Economy

Contributor Post Created with Sketch. The “R Word” Is Here and Now

 

recessionAs politicos focused on South Carolina and Nevada, my company was running a weekend roundtable for business owners, where we train and break bread with real people facing real challenges due to the real economy. These people aren’t statistics. They aren’t categorized or sliced and diced into compartments that make up an axis on some government chart. The employees they have laid off don’t consider themselves as U3, U6, or U12. They are real people with real families and real bills.

It is not news that many sophisticated business owners consider the “recovery” weak, at best, and think the economy is most likely in recession. While the equity markets bounce around like a beach ball in the stands of a sporting event, the real fundamentals are causing pause for even the most bullish among us. Now Bloomberg Business reports that recession is already here in several states.

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Contributor Post Created with Sketch. Member Post

 

Are we having fun yet? This morning I spent time trying to get a sense of who thinks the new year financial route will turn around or, as some bears are calling for: “S&P could plunge 75% to 550”. The phone calls with clients and industry friends felt like that moment Roy Scheider said “we’re gonna need a […]

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Something about this Yahoo story rubs me the wrong way. Online retail giant Amazon said on Thursday it will donate the profits from the online purchase of a tune released by the far-right anti-migrant PEGIDA movement to refugees in Germany. [….] More

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What distinguishes product discounts that undercut the developer/publisher from discounts which improve developer revenue or at least benefit the retailer without cutting into developer profits? When Amazon puts a product on sale, whose cut is that discount taken from? Not all sales are the same, of course. But how often does a retailer reduce or […]

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Contributor Post Created with Sketch. Liftoff at Last

 

shutterstock_273355862In a move more hinted, heralded and harkened than the Christmas birth, the Federal Reserve finally moved on raising the Fed funds rate. It had talked about this for months, with Yellen and friends deciding in September to hold off after indicating to the market it would move then. As I wrote then, the Fed blinked in the face of pressure from global market.

When the Fed chooses to hold off on a rate increase it had telegraphed a month ago, it is saying its information is that the economy is worse than you think. When confidence is dented and GDP falls, the Fed will congratulate itself. When the economy turns around next, the Fed will say it wants to raise rates, and China will get the vapors again, and the blinking returns.

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Contributor Post Created with Sketch. GOP Not Yet There on Growth

 

shutterstock_76996180The singular economic issue of our time is the quest for more rapid economic growth. In the past century the American economy grew at roughly 3.5 percent per year. That included huge booms and even worse busts, such as the Great Depression.

But over the past 15 years that growth has slumped to roughly 2 percent per annum. This has put average Americans in a cranky mood. They want change.

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Contributor Post Created with Sketch. Are Democratic Presidents Really Better for the Economy Than Republican Ones?

 

HillaryClintonPartisans are likely to focus on these stats in Paul Krugman’s latest column: Since 1947, “the economy grew, on average, 4.35 percent per year [under Democrats]; under Republicans, only 2.54 percent.”

To his credit, Krugman does not make strong claims about the superiority of Democratic economic management (though he does mock current GOP policy proposals). Neither does the 2014 study, from where those numbers come, “Presidents and the U.S. Economy: An Econometric Exploration.” The study’s authors, Alan Blinder and Mark Watson, sort of give it the old ¯\_(ツ)_/¯:

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Promoted from the Ricochet Member Feed by Editors Created with Sketch. Driverless Trucks in Australian Mining. Now What?

 

013505-robot-trucks-pilbaraThe Financial Times reports that the world’s second-largest mining company, Rio Tinto, has begun incorporating driverless trucks into its fleet. The anointed expert for this article says not to worry:

Dr Boehl said embracing technology could create more interesting jobs while making lower-skilled positions obsolete.

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Contributor Post Created with Sketch. US Recession Dead Ahead?

 
Hedgeye.com
Hedgeye.com

Shorter: Absolutely, without a doubt.

Longer: Absolutely, without a doubt. But when?

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The first Friday of most every month is widely followed in markets because the Bureau of Labor Statistics releases the Employment Situation report including private non-farm payrolls used to measure job creation. Additionally, other scrutinized statistics include employed population, unemployed, civilian labor force, unemployment rate, part-time, over time, etc. The report is the most widely followed and […]

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Promoted from the Ricochet Member Feed by Editors Created with Sketch. Working to Death

 

labor force participaion

It’s easy to be dismissive of the mindless cheerleading in the mainstream media as they crow about the ever-decreasing unemployment rate when it is obvious to anyone who has contact with the world outside of the Wall-Street-to-Washington Axis that the U.S. employment situation is not healthy. I’ve pointed out previously that, though U3 unemployment continues its bizarre march down, the labor force participation rate has never improved during this “economic recovery” and remains at multi-decade lows. Upon further reflection, and after witnessing yet another septuagenarian bag my groceries this week, I think I may have been overly simplistic and harsh when discussing the job market before. There are Americans who are finding themselves working more and more these days: the elderly.

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I sent the following to clients this morning regarding this afternoon’s FOMC announcement. Good Morning, More

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Canada is having a federal election on October 19th, and current predictions show the New Democratic Party (NDP) winning. This would make its leader, Thomas Mulcair, Canada’s next Prime Minister. In this post, I’d like to take a look at his economic plan, with a specific critique from my own experience.  More

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Contributor Post Created with Sketch. Is Rhetoric Wrecking Our Economy?

 

Sen. Bernie SandersSticks and stones may break our bones, but there’s good reason to believe words are destroying economic growth.

The usual vital signs we look at to judge economic health are all over the place and don’t exactly paint a positive picture. The unemployment rate is down, but a lot, if not the majority, of that is being caused by a shrinking labor force participation rate. The economy is technically growing, but the growth rates are abysmal. The stock market is way up, at record levels, but much of that is likely being caused by the near-zero interest rates spurred on by the Fed. In effect, we’re not witnessing a surging stock market; we’re just looking at the inflation we expected from easy money policies manifesting itself on Wall Street instead of Main Street. Forget the formal indicators though. The American people are telling us, in survey after survey, that things haven’t improved much, if at all, from the “Great Recession” of 2007-2008. All in all, we’re far from out of the woods. What gives?

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Contributor Post Created with Sketch. Member Post

 

Seven years from the crisis, we now live in a world that is swimming in debt. Central banks globally have taken a page from the Federal Reserve and have printed trillions. China has borrowed from itself and built entire ghost towns full of high rise condos and office buildings that are 99% empty. To slow their stock […]

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How’s your golf score William Devane? As the news focuses entirely on Donald Trump today’s debates, there is a global commodity price collapse occurring under our feet. The fault lines can be found in China’s slowdown and Iran as it looks increasingly likely Iran will be coming on stream selling up to a million barrels of oil a […]

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(The title is courtesy of Billy Joel, from Allentown on The Nylon Curtain (1982)– https://www.youtube.com/watch?v=BHnJp0oyOxs) It’s been a little more than a month since Uninstallation Day (my previous installment in this series). I was hoping to have good news to report, but although I have some promising developments, I’m still on my unintentional extended vacation… 8^) More

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The Wage War   More

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Promoted from the Ricochet Member Feed by Editors Created with Sketch. U3 Unicorns Puking Rainbow Recoveries

 

unicorn

Do you ever feel a bit of a disconnect between the continuous media reports that the economy is doing awesome (here, here, and here to name a few) and how much it feels like the economy, to use a technical term, sucks outside of the stock market? Well, you’re not alone, and a couple of basic charts will validate your feelings. This is not data produced in the depths of my basement while I replace the tinfoil around my head. These are government-reported numbers on the health of the labor market. I call your attention to the time period during which the media was harping on the theme of, “It’s the economy, stupid!” and our recent “awesome recovery.”

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