Archive for the ‘Money’ category

Blooming recoveries

July 8, 2010

This isn’t your father’s stimulus.

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Understanding just how Harry Potter lost money

July 6, 2010

How a billion dollars bleeds red.  Interesting post on the business of movie making.

Dow 1,000?

July 6, 2010

This is making the rounds today

The U.S. Will Default in the Foreseeable Future

July 6, 2010

So says Niall Ferguson.  It is like the speeding train analogy.  The question is not if but when.  The US may be the last domino to fall, but the Keynesian program offers many configurations along the way but only one destination.

The Austerity Debate with a Twist: An Italian Economist says Austerity will stoke growth

July 6, 2010

So here’s how the arguments usually go: 1) Austerity (cut government spending/raise taxes) reduces debt and deficits but increases unemployment and (2) stimulus (increase the money supply/increase governmental borrowing and spending) creates jobs and GDP growth but comes with a heavy pricetag in terms of debt and deficits.  The stereotypes say that conservatives are in the first camp; liberals are in the latter.

Then along comes the Italian:  Alberto Alesina says there is a third way.  If it sounds too much like having your cake and eating it too, I’m right there with you.  But given that no one else has any idea what to do (really they don’t) and belt tightening–despite the unabashed Keynesian apoplexy of folks like Paul Krugman–intuitively seems like the grown up way to handle the runaway monetary situation, I say we give it a shot.

The New Depression? Depressing stagnation at best

July 5, 2010

The Brits think so, calling 2010 a lot like 1932.  Voices of reason generally are calling for austerity measures to avoid a Greek debt spiral, while others (not counting the crackpot Krugman) insist that any belt-tightening must be accompanied by “ultra-loose” monetary policy.  I am not an economist.  And to point out now that monetary policy has been too loose for years (it has been) is not constructive.  We’re in the mess now.  We’ve had 70 some odd years to analyze, dissect and learn from the Depression–and no one has a clue.  I’m hearing from some quarters that we are at a stand or fall watershed moment in America, where failure means civil war.  Elsewhere we read of the end of the road for our financial system, spelling the end of our country as we know it.  But there are Pollyannas still out there.

I don’t have the answer.  But I do have a prediction:  our economy and markets are set for long term stagnation if our government continues on its current decision making course.  Things simply will not recover as we, especially those of us who entered the job market in the 1990s, think of recovery.  There are too many weights pinning us down, and there are more governmental tent pegs headed our way.  And this is best case.  Add in an exogenous event, most likely a bad one (e.g., terrorist attack on U.S. soil, Middle East conflagration, nuclear attack, etc.), and worst case scenario could be really really bad.

God knows we need strong wise leaders to rise up.  These are troubled times indeed.

Beware the Death Cross–

July 2, 2010

The Golden Cross and the Death Cross have been hot topics this week.  Here’s some hype from CNBC on the matter.