Goolsbee

"There Is No Other End Than A Bad One... It's A Mathematical Certainty"

When we see guys like Bernie Sanders get visibly angry at guys like Alan Greenspan it behooves all of us to go beyond the entertainment of it or some prima facie agreement and to truly understand why the anger is justified. If we were to all take the responsibility to understand the lifeblood of our American existence i.e. the economy, we will most certainly be moved to remove not only the policymakers but the system that together serve only those at the top of the economic food chain and at a cost to the rest of us. When we do we will be asking why in the hell is no one yelling at Janet Yellen??

The Unfaithful Departed: Meet The People Who Bailed On The Obama Administration

Friday's latest resignation of yet another former Obama administration faithful - that of White House press secretary Jay Carney - got us thinking: how many people have jumped off the USS Obamic? The answer is, in short, a lot. Below is a list (by no means complete) of the most prominent officials and advisors who have quietly exited the Obama administration stage left over the past 6 years.

Scotiabank Warns "Treasuries Will Have A Difficult Time Going Down A Lot In The Near-Term"

"On the one hand and in a stable state, tapering should lead to a gradual ‘normalization’ of yield levels – which mean that the 10 year should (assuming no crisis) ‘gradually’ trades toward nominal GDP minus some liquidity premium. However, ... should concerns build that global growth and inflationary expectations begin to drop too much (either due to Fed Taper or Geo-events), then Treasury values will recalibrate and yields could drop precipitously to 2.5%. If things got really bad, yields could fall quite a bit further."

Chicago Fed Crushes Recovery Dreams In 2 Tweets

Some joked that the Chicago Fed's Twitter account must have been hacked buyt it turns out that is not entirely true. Following Esther George's "renegade" comments last night, Austan Goolsbee was unleashed by Fed's Evans to lay down some ugly truthiness in 140-character-world. The results - in these 2 tweets - say everything about the level of excessive optimism that remains in our new normal world...

Guest Post: Why Reforms Won't Work

The list of public/private institutions that desperately need structural reform is long: the Pentagon, healthcare (a.k.a. sickcare), Social Security, the complex mish-mash of programs that make up the Welfare State, the 73,000 page tax code, public pensions and the financial sector, to name just the top few. Regardless of the need for reform, it isn't going to happen for these structural reasons.

Frontrunning: January 17

  • Obama's Gun Curbs Face a Slog in Congress (BBG)
  • Euro Area Seen Stalling as Draghi’s Pessimism Shared (BBG)
  • China Begins to Lose Edge as World's Factory Floor (WSJ)
  • EU Car Sales Slump (WSJ)
  • Fed Concerned About Overheated Markets Amid Record Bond-Buying (BBG)
  • Australia Posts Worst Back-to-Back Job Growth Since ’97 (BBG)
  • Abe Currency Policy Stokes Gaffe Risk as Amari Roils Yen (BBG)
  • Japan Opposition Party Won’t Back BOJ Officials for Governor (BBG)
  • Fed Reports Point to Subdued Economic Growth (WSJ)
  • China Set to Exit Slowdown by Boosting Infrastructure (BBG)
  • Greece not out of woods, must stick to reforms: finance minister (Reuters)
  • Russian Rate Debate Flares Up as Cabinet Seeks Growth (BBG)

Guest Post: Start Your Own Financial Media Channel with This Template

You've probably noticed the cookie-cutter format of most financial media "news": a few key "buzz words" (fiscal cliff, Bush tax cuts, etc.) are inserted into conventional contexts, and this is passed off as either "reporting" or "commentary" depending on the number of pundits sourced. Correspondent Frank M. kindly passed along a template that is "officially deny its existence" secret within the mainstream media. With this template, you could launch your own financial media channel, ready to compete with the big boys. Heck, you could hire some cheap overseas labor to make a few Skype calls to "the usual suspects," for-hire academics, hedge fund gurus, etc. and actually attribute the fluff to a real person.

Is William Cohan Right That Wall Street "Regulation" Has To First And Foremost Curb Greed?

Now that the world is covered in at least $707 trillion in assorted unregulated Over the Counter derivatives (as of June 30, the most recent number is easily tens of trillions greater) and with at least one JPMorgan prop|non-prop trader exposed to having a ~$100 billion notional position in some IG-related index trade, pundits, always eager to score political brownie points, are starting to ruminate over ways to put the half alive/half dead cat back into the box. Unfortunately they are about 20 years too late: with the world literally covered in various levered bets all of which demand hundreds of billions in variation margin on a daily basis, the second the one bank at the nexus of the derivative bubble (ahem JPMorgan) starts keeling over, it will once again be "the end of the world as we know it" unless said bank is immediately bailed out. Again.

Disapproval Of Obama's Handling Of The Economy Hits Record

In case anyone was wondering why Goolsbee was the latest sacrifice at the altar of public discontent with Obama's economic "policies" here it is: "Americans' disapproval of how President Barack Obama is handling the economy and its growing budget deficit has reached new highs amid broad frustration over the slow pace of economic recovery, according to a Washington Post-ABC New poll released on Tuesday. The ratings Obama's approval rating bounced to 56 immediately after bin Laden was killed last month. Fifty-nine percent, a new high, gave Obama negative marks for his handling of the economy, up from 55 percent a month earlier. Obama's approval rating on the deficit issue hit a new low of 33 percent, down 6 points since April. The state of the economy poses a huge challenge for the president, whose re-election in 2012 may depend on his ability to convince voters that his economic policies have been successful." Unfortunately Goolsbee's departure means that the one sacrificial lamb left in the Obama economic circle (now that Mark Zandi seems a shoo in for at least one position on Obama's staff), Tim Geithner, will be kept in Obama's back pocket until QE 3 (which will come - Obama has nothing else left up his sleeve) proves to be an abysmal failure and be fired once the Fed's balance sheet hits about $4 trillion, roughly $1.3 trillion higher than where it is now.

Frontrunning: June 7

  • Rogoff - The global fallout of a eurozone collapse (FT)
  • Europe’s Banks Too Fragile to Afford Greek Default (Bloomberg)
  • Geithner Wants Global Rules on Derivatives (WSJ)
  • Low Yields on Treasury Debt No Guarantee Financial Crisis Won’t Hit U.S. (Bloomberg)
  • Debt crisis and IMF to dominate Obama, Merkel talks (Reuters)
  • Lehman Brokerage Gets $2 Billion From Barclays (Bloomberg)
  • Obama’s Chief Economist Goolsbee Is Said to Consider Return to Teaching (Bloomberg)
  • Hong Kong Banks’ Mortgage Rate Increases Taking Steam Out of Housing Boom (Bloomberg)