December is a month where families mostly turn their focus within, and economic analysts turn their focus outward to make projections for the coming New Year. Before we discuss the utility of these projections, let’s focus on the global headwinds that will challenge policy makers looking to sculpt economic recovery from an ugly lump of [...]
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Thoughts On Leadership and The European Debt Crisis
Leadership is the delicate balance between the constraints of reality and possibilities, if one were to make the optimum or nearly optimum set of decisions. As it relates to debt, the constraint is a rule that says you can reduce private debt, and you can reduce public debt, and you can even run a trade [...]
The Perils Of Debt And The Absence Of Leadership, No Matter What Language You Speak
The Eurozone debt has been one of the root causes of excessive market volatility since July 2011, even though the scope of the problems have been known for the better part of two years. With the exception of a handful of economists, until recently the popular belief was that debt problems in smaller nations like [...]
S&P Throws All Americans Under The Bus Yet Again While Sending A Message to Congress.
David Beers, head of sovereign ratings at S&P defended the actions of his firm saying, “we take our responsibilities very seriously and if at the end of our analysis the committee concludes that a rating isn’t where we believe it should be, it’s our duty to make that call.” Okay, I can respect that fact, [...]
Special Update on Greece courtesy of Deutsche Banks’s Jim Reid
Deutsche Bank credit strategist Jim Reid has been on fire lately with his assessment of the Greece situation. In his latest note he offers what’s perhaps the most compelling comparison yet between Greece and Lehman: It’s difficult to continually kick the can down the road when the can is breaking up in front of your [...]
Double Bogey In This Balance Sheet Recession
Much is written, albeit off cue, as it relates to the future health of the U.S. Economy in 2011 and beyond. There are of course countless highly intelligent and experienced analysts and strategists who seem to have debated every angle of well known structural headwinds from the Japanese earthquake and its effect on vital supply [...]
Perception is everything… Or Is It?
A disturbing disconnect has recently developed between the perception of the US economy and what many data sources tell us is the reality. The perception is of course that the stock market rally, which began in March of 2009, was justified in the fact that the economy while fragile, was certainly on a clear path [...]
“Funny Farm” the appropriately titled 1988 film which starred Chevy Chase is being played out on Wall Street starring Ben Bernanke.
Chevy Chase plays Andy Farmer, a sportswriter who quits his job and buys a house in the country, where he plans to write a novel. The movie takes us through all four seasons in the small town of Redbud, Vermont, but it ends during the holidays when the Farmers’ charming Cape Cod is decorated with [...]
Bernanke Confused By The Magic?
A magician knows creating the illusion of something happening will cause the brain to believe what the eyes are seeing is in fact happening, so goes the phrase seeing is believing. The headline parallel from illusory magic to the Federal Reserve lies in the tools of monetary and fiscal policy that the Fed wields in [...]
Did Fed Chair Bernanke Lie to America on 60 Minutes?
The answer to the question is technically no but substantively yes. There was much speculation before and has been even more speculation afterward as to why the fed chair “really” chose to appear on 60 Minutes. Bernanke emphatically stated that current actions by the Fed will not stimulate inflation because the Fed is in fact [...]