General Motors is proof that slashing wages isn’t the ticket to profitability
German and Japanese auto manufacturers succeed despite sticking to a high-wage model.
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Browsing Tag
capital investment
More on the meltdown in oil (and a cut in oil capex)
We're getting to the point now where something very bad is going to happen. Someone is losing his shirt in the oil markets right now. And the question is whether that somebody impacts the US oil sector and oil capital expenditures.
As I…
The US-Chinese trade war and a slowing global economy
1 Big Thing: Escalating trade war
In today's daily post, I want to put the US - China trade war front and center and ask whether it matters to growth.
The news, of course, is that US President Trump slapped tariffs on $200 billion worth of…
Beijing’s Three Options: Unemployment, Debt, or Wealth Transfers
China’s debt problems have emerged so much more rapidly and severely this year than in the past that a growing number of analysts believe that this may be the year that China’s economy breaks. There is no question that China will have a…
GDPNow still near 4%, showing Q2 likely to be a monster quarter
The Fed is likely to continue to talk up the US economy. And I believe markets will react. With the yield curve at 32 basis points spread between 2- and 1-year Treasuries, we still have scope for further curve flattening.
Tesla fighting to show it’s the 2018 version of Amazon circa 2001
We're in the midst of another technology bubble. And Tesla has benefitted greatly. When this bubble pops, where will Tesla be?
Why shares in companies like Tesla are going to zero
I am using Tesla as an example here more than anything. I am not about to delve into Tesla's loss-making operations and make a case against the stock specifically. But I do want to highlight the 'bubble' that Tesla represents.
What the tension in the oil market means
As we await the US jobs data, it bears remembering that oil is a big wildcard both on in terms of consumption and investment. Right now, oil is plunging, down as much as $14 a barrel for the Brent variant and $17 a barrel for WTI since…
Underconsumption and the end of excess demand
Yesterday’s post on the failure of Japan’s monetary policy experiment drew some favourable commentary from a prominent macroeconomist that I want to run by you. The gist of his insight is that we have long been living in an age of an excess…
Monetary policy is at the end of the line
The last few days have made clear that monetary policy is having less and less impact as time goes along.In particular, the latest salvos from the Bank of Japan smack of desperation, as if BOJ Governor Kuroda has decided to throw everything…