On Why The Doomsayers Are Wrong And Other Links
Must-reads
- Why the Doomsayers Are Wrong – WSJ.com
- The New Doom: A Second Wave of Economic Pessimism Spreading Outside Wonkdom | The New York Observer
The Usual Fare
- Hitzewelle: Bauernpräsident sieht höhere Lebensmittelpreise – WELT ONLINE
- BBC News – Eurozone production grows for third straight month
- Interest rate hikes: Thailand joins in | beyondbrics | FT.com
- Remember When We Were All Supposed To Quit Facebook? – Tech Crunch
- Stuart Taylor Jr. – Supreme immodesty: Why the justices play politics
- Hussman Funds – Wall Street Earnings Expectations Ignore Economic Divergences
- Eurozone break-up would boost Ireland’s economy – Independent.ie
- Slashdot Your Rights Online Story | Chile First To Approve Net Neutrality Law
- Obscure book by British adviser becomes cult hit after Warren Buffett tip – Telegraph
- In Bizarre Ruling, Maryland Court Denies ML-Implode.com Anti-SLAPP Motion Against Downpayment Launderer : The Implode-o-Meter Blog
- FT.com – Obama faces growing credibility crisis
- F*ck Yeah! Court Strikes Down FCC Rule Against Unscripted Expletives – The Consumerist
- More disappointing signs of Mexico’s lagging recovery | beyondbrics | FT.com
Tabloid Distractions
That WSJ article on “Why the Doomsayers are Wrong” was worthless, in my opinion. Of course, I’m a doomsayer. Still, “The Fed on Hold” argument seems ludicrous. The Fed is on hold because the economy stinks. Here’s an excerpt:
“2. The Fed on hold
Investors have been incorrectly trying to anticipate when the Federal Reserve will start raising interest rates for months now. At the start of 2010, The Wall Street Journal’s survey of economists showed that most anticipated the Fed would start boosting rates in September.
That’s almost unthinkable today. Indeed, J.P. Morgan Chase recently changed its forecast to push the first rate move to the end of 2011, from April 2011. That means excessively low interest rates will remain a positive force for both the economy and the stock market for an extended period.”
Do I need to explain why this is ridiculous?
You know, Dan, I am one of those doomsayers too! After all, this site IS called Credit Writedowns – not exactly uplifting. But, I like to throw in a few articles that take a different view to keep us honest. If we don’t look at things from that angle, we’ll miss some of the data.
On the Fed, I’d agree the Fed’s on hold. But it seems a lot more unpredictable as to what they are going to do. The political pressure is mounting from both sides and that puts the Fed in an awkward position. My sense is they will err on the side of less liquidity but keep rates low.
Absolutely, I’m glad to see the contrarian references (contrary to the doom and gloom inclination).
Also, I agree about the Fed. Whatever they do will be reactive more than it will drive the markets, in my opinion. For a couple of years (2007-2008), the Fed lowered interest rates as the economy slowed. The market always jumped at the prospect of interest rate declines, but the downward trend was the ultimate market driver, not the Fed’s actions which attempted to moderate the basic trend. I foresee more of the same…