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Canadian housing hits the wall
Canada is one of the last bubble markets to hit the wall. Buoyed by the commodities boom in the west, Canada looked set to keep on an upward path even while its largest trading partner, the U.S. had already started to see a bust. But,…
What if a large US regional bank goes to the wall?
I fully anticipate this will happen, so the question becomes: what will the Fed do?The FDIC stepped in at two banks over the weekend, 1st National Bank of Nevada and First Heritage Bank. These banks failed as a result of construction loans…
The Big Mac Index
"The Economist" has developed the Big Mac Index as a way to determine if currencies are overvalued or undervalued. The thought is that a McDonald's Big Mac being pretty much the same everywhere around the world, one should expect the cost…
Recession while GDP is growing?
Given my recent prediction for a positive GDP number in Q2 for the U.S. and after another positive number from Q1, how could I maintain that the U.S. is in recession?It's simple. The commonly-held version of recession is misguided. Most…
Ten predictions for 2008
With 2008 now half over, it's obvious that the global economy has lurched to the downside. While many have remained unrealistically optimistic about the workout of the present credit crisis, downside risks have been the determining factors…
The divergence of US worker and corporate interests
In reading about profit increases of some U.S. multinationals due to robust overseas business and the weak dollar, while the U.S. economy faces a protracted downturn, it has occurred to me that the divergence between U.S. worker and…
Chart of the day: debt’s diminishing marginal return
After the United States started its 'Guns and Butter' exercise under President Johnson and eventually de-linked from gold in 1971, its economy has become ever more leverage- and debt-propelled. Interestingly, the result has been a…
News Round-Up: 26 Jul 2008 – weekend edition
Lean Times in a Town of Billionaires - Deal BookUK economic growth slows sharply - BBC NewsOttawa rejects Air Canada layoff waiver request - National PostEurozone mortgage lending at record low - FTJapan inflation accelerates - FTInvestors…
FDIC steps in at two more failed banks
1st National Bank of Nevada and First Heritage Bank, operating in Nevada, Arizona and California were taken over by the FDIC on Friday. They always wait until Friday night to do their business. This marks the first FDIC closure action…
US Airways says speculators caused oil price rise
I received a note from U.S. Airways in my inbox today asking me to contact my Congressman to stop those evil speculators from causing oil prices to rise. Last time I checked, U.S. Airways is an airline, not a consumer advocacy group.Dear…