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Household debt versus wage growth in the United States
The economic and business paradigm in place in the United States is predicated on a secular increase in household debt that I believe will not last through another cyclical downturn without serious deleveraging. The reason we saw…
News: 2014-06-11
Since I missed links yesterday, here are 30 instead of the usual 20. Starting on Friday, I will be on holiday and won’t be able to post at the normal times. I do intend to write though. So expect posts!
Ireland's 10-year borrowing costs…
Some thoughts on the new Internet bubble
Going back to my comments from yesterday about the utility of macro, I want to talk a bit about credit excesses and valuation manias. The overall gist here is that manias are endemic to our system because psychology plays a big part in…
How economics has failed us
The title of this piece is a bit provocative but what follows is not intended to be a hit piece on the field of economics, rather I am going to use two recent articles on economics’ failure as a jumping off point for thinking about this…
News: 2014-06-09
Because of the lack of links on Friday, I have 10 more than usual today.
BBC News - Japan growth data revised upwards
Time to end use of commodities for credit in China | South China Morning Post
Why employers prefer retirees who don’t…
This was the most easing Draghi could get and still achieve unanimity
This is a brief update to my last member post from this morning. Just reviewing what the ECB has done here, we see them taking four out of the five easing measures I outlined in May.
The ECB could lower rates. Check
The ECB could allow…
The ECB easing decision could lead to a major break with Germans on policy
Summary
The ECB did the expected this morning and lowered interest rates enough to send bank deposit rates at the ECB into negative territory. The ECB also met market expectations with an additional easing measure by implementing an LTRO…