President Obama has now become a professional economist, because like most professional economists his unemployment forecast was wrong. The May unemployment data clearly reveals a flattening of the economy.
This article is a look at the US's recovery, Europe's recovery, Asia's (China) recovery, and how they all tie together. While US manufacturing has been improving, mainly because of exports, it is also flattening out. Ditto almost everywhere else. This is a sign of what's coming.
A new study shows that anyone with a smattering of economics is more likely to be a Republican than a Democrat. That's not saying much, but it does show that Democrats are more likely to be ignorant of economics.
Why would BP take on a risky venture like drilling in 5,000' of water without adequate safeguards? I understand that BP may turn out to be incompetent relative to its peers. But they are a public company and as such they are responsible to shareholders and creditors. Why indeed. Here's a hint: their after tax earnings in Q1 were $6.1 billion and the economic damages liability cap was $75 million.
It is obvious that the government's policies to revive the economy are not working. As soon as the stimulus money runs out, we will see GDP backtrack. Instead of trying the same failed policies over again we should try something new. That is, deleveraging the economy. Until that happens the economy will stagnate. (See: Japan) Here are some proposals that will allow the economy to recover, quickly.
David Wessel of the Wall Street Journal laments the fact that Mr. and Ms. America wrongfully scorn the bailouts of Wall Street. He believes the bailouts saved the world. I think Mr. and Ms. America have it right.
Remember the Bushism, "fool me once, shame on -- shame on you. Fool me -- you can't get fooled again." The National Association For Business Economics just came out with their latest forecasts for the economy. That's what brought up the old saying, "Fool me once, shame on you; fool me twice, shame on me" that George W. so magnificently bumbled.
The Fed is in for a big surprise when they realize that "excess capacity" has nothing to do with inflation. Their latest policy is founded on this concept. These pre-'Copernican' Fed economists need to understand that they create inflation. Perhaps they should just look at these charts. Good luck when they try to sell their toxic assets.
They key to recovery is debt: there is still too much of it. The Obama Administration's attempts to reinflate the housing market is causing massive distortions in that market and the data proves it. There is so much government manipulation of the housing market that much of the old risk still exists and they are creating new risks that are damaging the economy's ability to recover. Are you ready for a "bust-bust" cycle?
The problem with Greece is George Papandreou and his socialist party. For years they have been looting the country by transferring capital from the producers to government employees, national health care, and the unions. They've been borrowing to pay for it ever since capitalists found ways to hide capital from confiscation. Now he blames "speculators" for Greece's problems. He has no shame and he will take Greece and the eurozone down.
What do you think those bankers with perfect trading days in Q1 did with all the money they made? As Eli Broad said, "No one wants paper money — they want art.” This is the Fed's gift to these bankers.
Isn't $145 billion to save these relics enough? Why don't we ask instead: What good do they do? and, What was their role in causing the crisis? Get rid of Fannie and Freddie.
