Last night, President Obama took a victory lap for his economic achievements while in office. With the 2016 Presidential Election fast approaching, this was one of the final chances the President will have to try and divert attention away from Hillary’s “trustworthiness” problem following continued revelations surrounding Benghazi, email scandals and the Clinton Foundation which is now under investigation by the IRS.The question is whether the majority of the voting public will agree with the President’s message? Let’s take a look at some charts...
A good, old-fashioned, pre-1929 depression (like the short-lived, eleven-month depression in 1920-1921, before the days of “modern” central banking and “enlightened” Keynesian intervention “cures”) is the only tonic that can clear out the malinvestment built up since the beginning of the fiat money era.
One place which fails to corroborate the narrative of a "recovering economy" are the monthly Gallup surveys, and especially the most recent one released earlier today. At -17, this reading is tied for the worst economic confidence reading recorded in the last few years, and suggests that Americans' take on the economy is getting worse, not better.
Two years into the global oil-price collapse, it seems unlikely that prices will return to sustained levels above $70 per barrel any time soon or perhaps, ever. That is because the global economy is exhausted. The current oil-price rally is over and prices are heading toward $40 per barrel. Oil has been re-valued to affordable levels based on the real value of money. The market now accepts the erroneous producer claims of profitability below the cost of production and has adjusted expectations accordingly. Be careful of what you ask for.
Norges Bank continues to hold rates at .5%, signaling an upward bias but willing to cut if needed, depending on unforeseen external shocks like BREXIT. In my opinion, they really don’t know what to do while the country heads for stagflation (simultaneous rising unemployment and inflation). They are in a “damned if they do and damned if they don’t situation.”
As of July 8th, Pokemon Go was being used for an average of 43 minutes, 23 seconds a day, higher than Whatsapp, Instagram, Snapchat, and Messenger. At this rate, Pokemon could soon surpass the undisputed attention hog - Facebook.
The long-term decline in median income, amplified in 2016 by the biggest drop in weekly earnings in history, puts the lie to the pretense of self-sustaining recovery.Average people don’t have enough discretionary income to sustain expanded economic activity.
Waa! It’s not fair! We baby boomers were told that if we worked hard and saved, we could spend the last quarter of our lives living comfortably and free from financial worries. Our parents told us. Our employers told us. Even the government told us. But now that we are reaching retirement age, the promise is beginning to feel like a fraud.
"We’re following the European model which is to maintain the status quo: Don’t let competition damage or disrupt existing businesses. The politics of fairness create anti competitiveness...What we really need is the politics of hope: Let’s figure out how to make it easier to start a business."
Had a sinking feeling about the economy of late? It may not be your imagination. Economic indicators have flashed yellow for much of 2016, and the latest jobs report shows further depletion of the work force and a dearth of job creation. That trend, says one major bank, may be attributable to President Barack Obama’s signature legislation.
There is another cycle here that is much more influential on the current market dynamic and should be much easier to spot.When the Fed talks up the economy and promises rate increases, the dollar usually rallies. When the dollar rallies, U.S. multi-national corporate profits take a hit, and the market falls. When the market falls, economic confidence falls and puts pressure on the Fed to maintain easy policy.This is a loop that the Fed does not have the stomach to break.
The Department of Labor says initial jobless claims for the last week were 264k, better than expected and falling back towards best in 42 year lows. The Federal Reserve says Labor Market Conditions are deteriorating at the fastest rate since 2009. The Bureau of Labor Statistics said last week that nonfarm payrolls rose just 38k, the worst since 2010... So who is right?