New York Times
Who said economics can’t be fun?! How is it not absolutely brilliant that in the face of a collapsing shale oil industry – or at least, for the moment, of its financing model -, and the worst week for the Dow since 2011, the Thomson Reuters/UofMichigan consumer sentiment index shows American consumers are more optimistic than they’ve been in 8 years, and that “more consumers volunteered good news than bad news than in any month since 1984?? 1984! How does one trump that as a contrarian signal? And that I don’t mean to sound funny: that is serious.
The New York Times is the paper of Paul Krugman and the Federal Reserve and central banks. It rarely has a critical word to say about central banks and the current fiat monetary system. Conversely, it rarely has a positive word to say about gold. The article suggests a realisation that currency wars are set to intensify with gold again becoming an important monetary and geo-political asset.
In our own era, the Fed prints excess dollars without concern that they be redeemable in gold. Which means that our capital misallocation is extensive and long-term, our recessions are long and deep, our growth trend is shallow, and our complacency about how right we are in contrast to the benighted past is callow and pitiable.
This weekend's reading list is a collection of articles discussing the good, the bad and the ugly of the dive in crude oil prices.
In a world in which neither the Fed, nor the sellside (Goldman was forecasting $100 oil for years to come as recently as October 29), and certainly not tenured economists have any idea what lies beyond the next corner, perhaps the best place to look for financial answers are Hollywood celebrities such as Jessica Alba. So, in our pursuit of truth, financial answers and the Hollywood way, we give you... Jessica Alba.
- Shale operaters Goodrich, Oasis Petroleum cut spending for 2015 as oil slides (Reuters)
- Greece to hold elections in January if president vote fails (Reuters)
- Norway’s Shock Rate Cut Drives Krone to Lowest Since 2009 (BBG)
- ‘Severe Downturn’ Threatening Norway, Central Bank Governor Says (BBG)
- Russia’s Fifth Rate Increase Fails to Halt Ruble Slide to Record (BBG)
- SNB Says Deflation Risks Increased as Franc Cap Maintained (BBG)
- China eases bank lending restrictions, PBOC targets 10 trillion yuan in loans for 2014 (Reuters)
- Mobius Says China’s Bull Market Is Just Getting Started (BBG)
- How Wal-Mart Made Its Crumbling China Business Look So Good for So Long (BBG)
Corruption and lack of ethics is now endemic to American life and the economy.
In what we are confident everyone will find to be absolutely shocking news, moments ago the Senate Torture report was released. The key finding, hold on to your hats, is that the CIA "misled" Congress. As for the timing of the release, which takes place at the same time as Jonathan Gruber (Ph.D) is being grilled in the House, it is hardly a coincidence that Obama does everything in his power to deflect attention to what took place under the Bush administration, commenting that "torture techniques did significant damage to America’s standing” in the world. So what did the droning of thousands of innocent civilians do to the same "standing"?
Wall Street has for some time attempted to put taxpayers on the hook for its derivatives trades. A previous attempt failed, but now Wall Street is trying to sneak it into a bill needed to keep the government running. You can’t make this stuff up.
When no lesser establishmentarian than Obama's former chief economist Jared Bernstein called for an end to the US Dollar's reserve status, it raised a few eyebrows, but as the WSJ recently noted, the voices discussing how the burden of being the world's reserve currency harms America, more than just Vladimir Putin is paying attention. While some argue that “no other global currency is ready to replace the U.S. dollar.” That is true of other paper and credit currencies, but the world’s monetary authorities still hold nearly 900 million ounces of gold, which is enough to restore, at the appropriate parity, the classical gold standard: the least imperfect monetary system of history.
Did you know that the rate of suicide is highest during this time of the year and that 45 percent of all Americans dread the Christmas season? We are constantly being told that Christmas is the happiest time of the year, but mental health professionals tell us that the exact opposite is true. For large numbers of Americans, the period between Thanksgiving and Christmas is filled with stress, anxiety, loneliness and family squabbles. And for most people, the reality of the holidays never even comes close to matching up with the glittering ideal portrayed in movies and on television...
Nobel Prize Winning Economists, Federal Reserve Chair and Other Top Experts: War Is BAD for the Economy
- DAX’s ‘Brilliant’ Run Sends Red Flag as German Index Tops Record (BBG)
- U.S. military warned of possible Islamic State attacks at home: report (Reuters)
- Russia Faces First Recession Since 2009 as Banks Add to Oil Pain (BBG)
- Dodgy Home Appraisals Are Making a Comeback (WSJ)
- U.S. Corporate Bond Sales Pass $1.5 Trillion for Annual Record (BBG)
- Basic Costs Squeeze Families (WSJ)
- China Orders Stricter Checks on Local Debt as Sales Surge (BBG)
- Draghi Powerless on ECB Path Toward QE Without Reforms (BBG)
The scripted quality of the Ferguson events seemed as formally predictable as an 1856 minstrel show, and the parallel is worth reflecting on because the nation appears determined to explode again in some kind of a civil war — bearing in mind Karl Marx’s advisory that “history repeats, first as tragedy, then farce.” As is the case with many show-biz extravaganza’s of our time the script had many authors. A week after the grand jury decision and the riot that followed, the Michael Brown incident is already disappearing down the national memory hole. Why? Mainly because anyway you cut it Michael Brown was a poor candidate for martyrdom.
- Moody’s Downgrades Japan’s Credit Rating (WSJ)
- China Factory Gauge Drops as Shutdowns Add to Slowdown (BBG)
- Euro zone factory growth stalls in November as new orders sink (Reuters)
- Espírito Santo Faces Money-Laundering Investigations (WSJ)
- Oil at $40 Possible as Market Transforms Caracas to Iran (BBG)
- Hong Kong warns protesters not to return after clashes close government HQ (Reuters)
- Bond Secrets Decoded 9,539 Miles From Wall Street in Lot (BBG)
- Ruble Rally Turns to Rout as Fortunes Tied to Sinking Oil (BBG)
- Loans Made in Blink as Banks, Funds Vie for LendingClub Clients (BBG)