Government spending comes at a cost in the future. The effects of the rest of the economy are likely to hit much sooner. The bottom line- the recession or depression will have a lasting and negative effect on growth for years to come.
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Employment rose by 1.8 million in July, nearly in line with the economic consensus. However, looking below the headlines the report was not nearly as strong as it seems.
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A CNBC article states the Fed is expected to make a major commitment to ramping up inflation. While the Fed may want inflation, their very actions continue to be deflationary.
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Markets are more fragile today because of a hovering Fed parent, shielding investors from every hazard. The second and third-order effects continue to evolve, but the volatility in the first quarter offered a glimpse of disturbing possibilities.
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Could a universal basic income could permanently make U.S. economy trillions of dollars larger. While such socialistic policies sound great in theory, history, and data, show it isn’t the economic savior it is touted to be.
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Roughly 130 million people are receiving some form of pandemic aid. Those with no pay or little pay will be hammered this week as benefits run out.
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Consumers play an important role in driving economic growth. Can they recover and bail out the economy?
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Despite the surging stock market from the March lows, trillions in liquidity support from the Fed, retirement confidence declined.
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Lacy Hunt at Hoisington Management explains the deflationary consequences of the current global situation in its Second Quarter 2020 Review. Hunt commented on the four economic challenges central bankers face in a globally synchronized recession.
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Many renters who were in the market to buy a home pre-Covid just threw in the towel. 43% of prospective home buyers who said they changed their plans quoted economic uncertainty as the top reason for doing so, followed by loss of income as the second most cited reason.
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Since the onset of the pandemic, the Fed has entered into the most aggressive monetary campaign in history. Now, the Fed is trapped in QE and can’t allow rates to rise ever again.
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There are 1 million restaurants across the U.S. with 70% of them run by small businesses owners. Small business is failing due to the COVID crisis.
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If you haven’t heard of Modern Monetary Theory, or “MMT,” you will soon. If you recently lost your job due to the economic shutdown, and received a stimulus check, you are already a beneficiary of it.
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If you haven’t heard of Modern Monetary Theory, or “MMT,” you will soon. If you recently lost your job due to the economic shutdown, and received a stimulus check, you are already a beneficiary of it.
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In March, it appeared as if the bubble had finally popped. However, the Fed’s quick response and massive monetary interventions ceased the asset bubble’s deflation and reinflated it.
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While the release of the retail sales report was stronger than expectations, the bounce will be difficult to maintain as consumers are tapped out, facing high unemployment and a slow recovery.
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Retail sales surged in May but manufacturing is another story. The Fed’s Industrial Production and Capacity Utilization puts a big negative spotlight on the emerging V-shaped recovery thesis.
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“There is a ‘Great Divide’ happening between the near ‘depressionary’ economy versus a surging bull market in stocks. Given the relationship between the two, they both can’t be right.”
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Often it is stated viewing something in hindsight is like having 20/20 vision. In this case, expectations of a “V-shaped” economic recovery will likely leave everyone disappointed.
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Speculators are dumping gold, which may actually be bullish. This judging from futures and alleged jewelry demand, the price of gold ought to be falling. But it isn’t.
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The novel COVID-19 virus has driven the world economy into the deepest recession since the Great Depression and is transforming the U.S. in a new economy. -Part 2
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The Chicago Fed National Activity Index crashes by most on record. It is a broad composite of 85-subcomponents and is the most important economic number. It also says much about the stock market.
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Initial jobless claims for the week ending May 23 were 2,123,000. That’s the 10th-week claims topped 2-million and is a key indicator about the economy.
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Don’t worry. The Fed has belts and suspenders. The Fed’s balance sheet is approaching $7 trillion dollars. This is what Bernanke meant by suspenders.
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The economy won’t soon return to normal.Numerous chain reaction ripple impacts will delay the economic recovery and the Fed is now in “panic mode.”
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Currently, the Fed is injecting liquidity into the markets and economy at a record pace. While liquidity does have positive short-term benefits, is the Fed walking into a trap?
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The novel COVID-19 virus has driven the world economy into the deepest recession since the Great Depression and is transforming the U.S. in a new economy.
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If the Fed really does follow the market, then negative rates are almost assured. However, even though the market pared back bets on negative interest rates, questions still persist.
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There are two different types of “recessionary” events that occur throughout history. “Business cycle” recessions, and “event-driven” recessions. Is it possible the Fed over-reacted to a natural disaster?
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Jeremy Siegel, will likely be proved wrong about the end of the “40-year bond bull” market. History suggests it likely has quite a long way as the U.S. become more like Japan over time.
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