President Obama's Proposal on health care "reform" is a far reaching plan that will cause financial havoc to the health care system specifically and to the economy in general. It, along with the plans passed by the Senate and the House, are so invasive that we will be forever mired in bureaucratic control of this most important segment of our lives. Think of the movie "Brazil."
We are told we are in recovery. We are told we are not having deflation. We are told a lot of things but the facts seem to keep working against Messrs. Bernanke, Summers, and Geithner. The latest core CPI belie their Keynesian beliefs.
Ben Bernanke knows that the Fed's exit strategy is flawed, so he keeps thinking up new schemes to sop up "excess reserves" from the banking system. The latest is to allow money market funds by Treasuries directly from the Fed. Will this idea work? Will it positively impact the dollar? Will the Fed start draining the pond soon?
Why gridlock is good for investors. The government claims that because Washington D.C. was practically shut down by Snowmageddon we taxpayers were losing $100 million per day from lost productivity of federal employees. Then Evan Bayh announced he will not run for re-election as senator from Indiana because the lack of bipartisanship between Democrats and Republicans resulted in legislative gridlock ("the peoples' work is not getting done").
Here is a recent conversation (argument) that I, the not-famous Econophile, had with the famous Martin Wolf, the much lauded and highly awarded dean of economics writers and chief economics correspondent for the Financial Times. This time I take him on for what I thought was a pointless article about Germany and the Greeks. Win, lose, or draw?
The final part (III) of Econophile's analysis of the economy in 2010. Today, "The Consequences" -- deleveraging, inflation/deflation, recovery, and what to expect in 2010.
For good reason the G-7 held their meeting last week in one of the remotest places on the planet. No protesters, no hordes of nasty press, just good fun doing useless things with their fellow co-conspirators.
This is the first report of a series of 3 reports on the state of the economy as we enter 2010. Part II will appear Wednesday, and Part III will be posted on Thursday. Econophile, as usual, has a different take.
It's very hard to tell if this increase in employment is real, a temporary bump from stimulus, or a fiction arising from incorrect assumptions used by the BLS. Here's how to read the numbers.
5.7% GDP growth for Q4 2009 is a phantom. Understand that a normal part of the business cycle is to replenish shelves when retailers realize that 90% (or 84%, depending on what you believe) of Americans are working and buy some stuff. But the fundamentals are still bad. It's just the foam off the stimulus brew.
President Obama seems to be tone deaf and his State of the Union address was revealing. His rambling speech continued his theme of Big State control on the one hand yet preaching bipartisanship and fiscal responsibility on the other. This administration and the Democratic leadership is marching us toward European-style welfare socialism and seem incapable of compromise.
China has created a new housing bubble. Here are some excellent reports on what the bubble looks like and some ominous glimpses on how it may end. Like all bubbles it will burst and the economic fallout will impact China's economy and the U.S.'s. The frenzy indicates that the blow-up will occur soon.
The U.S. and Japan face similar economic problems and they are trying to solve them in the same way: fiscal and monetary stimulus. The comparison is eerily similar. It hasn't worked for Japan and it won't work for the U.S. Japan just received a downgrade warning from S&P over their credit rating and the U.S. is not far behind.
