Big Step Toward US Energy Independence
Obama's Department of Energy approval of liquified natural gas exports from Freeport to Japan and EU
16 minutes ago
Archive for July, 2006
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Why a Fed Pause or Even An Easing Will Not Prevent the Coming U.S. Recession
It is now clear that the Fed is in panic mode about the risks of a U.S. recession; they hoped to get a soft landing but, obviously, the Three Ugly Bears that I have been warning about since last fall – high oil prices, a slumping housing and rising inflation leading to higher short and [...]
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Dismal GDP Report: U.S. Is on Its Way to a Recession by Year End
The U.S. Q2 GDP growth figure was an awful and dismal 2.5%, well below the 5.6% of Q1. In June I predicted a Q2 growth rate of 2.5% when the delusional market expectation was still at 3.2% (I admit some luck in getting the point estimate right, even if my out-of-consensus argument was that the [...]
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Why China Will Surprise Investors and Will Soon Have Another Step Revaluation of the RMB…
With the anniversary of the July 2005 RMB 2.1% revaluation just passed the big buzz is what will China do next. The conventional wisdom is that: China will not do another step revaluation of the RMB: afterall as high as an authority as their Premier Wen Jiabao has recently firmly publicly denied the possibility of [...]
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Google News Barometer on Recession and Stagflation Risks…and A Few Simple Questions to Chairman Bernanke…
It is hard to predict with certainty whether the U.S. and global economy will suffer of serious stagflation or even a recession (my bearish views are fleshed out in my recent blogs here and here). I have been arguing that those risks are large and rising; and I have recently argued that the probability of [...]
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My WSJ Econoblog on China is Out…and My Bet That the RMB Will Be Revalued Soon…
My Wall Street Journal Econoblog exchange with David Altig on China and its currency policy is out and available for free here. Last July, when China moved its parity by 2.1%, David (an economist at the Cleveland Fed and high quality blogger) and I had a WSJ Econoblog discussion on the implications of this move. [...]
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Inflation and Fed Policy: All the Way to a 6% Fed Funds Rate
Bernanke and his fellow governors are desperate to find a good reason to pause or stop their Fed Funds tigthening cycle. And markets today cheered the signal coming from Bernanke that the Fed is close to pause. Today the Chairman made the sensible point that monetary policy works with lags and, thus, one should keep [...]
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A Coming Recession in the U.S. Economy? Certainly There is Now a Much Higher Risk of One…
I have so far been somehow cautious in my bearish call for the U.S. economy. My pessimistic views have been far from the consensus of a 3.5% US growth moderating to 3% in H2: I have argued that the U.S. will slow down to an annualized growth rate of 2% by Q4 of this year. [...]
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My views on the global economy and markets in writing, by audio and by video…
I have recently elaborated my views on U.S. and global economic growth and inflation (Stagflation-Lite) and their implications for financial markets in writing, by audio and by video…and even in a powerpoint format (see here and here…) First, I fleshed out in writing my Stagflation-Lite scenario and call for the U.S. and global economy in [...]
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U.S. Employment Report Consistent with Stagflation-Lite Scenario
Today’s employment report is consistent with my Stagflation-Lite call for the U.S. economy: job creation was well below expectations and pretty dismal in absolute terms (121,000 in June and only 108,000 average per month in Q2); three months in a row of sub-standard employment growth are consistent with my call of a Q2 growth rate [...]
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The Hog Cycle in Oil Prices…All the Way to $100 a Barrel
Today, Robert Feldman of Morgan Stanley had an interesting oped in the FT on how the oil market follows a “hog cycle”, a well known phenomenon in basic microeconomics. Essentially, short-run inelastic supply and demand for oil and the delayed effect of high prices on new exploration, investment and production imply that spikes in demand [...]
