Europe shambles as Greek fire spreads

April 29, 2010

Europe desperately needs to get out in front of its solvency problem, Greek edition; not because it is right, not even because it will work in the long term, but to stem rapid and costly contagion through financial markets to other weak links in the euro zone, not least to banks.

Stop worrying and love emerging markets

April 27, 2010

Better growth, less debt and what is shaping up to be a very nice little supply and demand mismatch make emerging markets very attractive relative to the developed world.

Taxing spoils of the financial sector

April 22, 2010

If you want less of something, tax it.

That truism is often used as an argument against a tax on profits, or health benefits, or employment, but in the case of the rents extracted from the economy by the financial services industry here’s hoping it proves more of a promise than a threat.

Don’t bank on clients to punish Goldman

April 20, 2010

So remind me, why will clients continue to do business with Goldman Sachs?

I know, it is a stupid question; investors and corporations will continue to do business with Goldman even after the bank has been charged with an alleged fraud for the same reasons they always have: because they hope, like every gambler, to beat stacked odds and because they flatter themselves that they are not the sucker at the table.

Bank lending and profits; a costly divergence

April 13, 2010

Don’t count on the profitability of the financial services sector as a leading indicator of anything. Well, anything other than financial services compensation.

Deflation pressure not just from housing

April 8, 2010

It will take more than a recovery in housing to reignite inflation in the U.S. economy, a state of play that argues for the continued threat of deflation and a Federal Reserve that is pinned to the mat, unable, even if willing, to raise interest rates.

Deflation pressure not just from housing

April 8, 2010

It will take more than a recovery in housing to reignite inflation in the U.S. economy, a state of play that argues for the continued threat of deflation and a Federal Reserve that is pinned to the mat, unable, even if willing, to raise interest rates.

Nice job, pity about falling wages

April 6, 2010

It was the strongest U.S. employment report in three years and yet just beneath the surface was plenty of evidence that inflation pressure from the labor market is more of a fond hope than a real threat.

Nice job, pity about falling wages

April 6, 2010

It was the strongest U.S. employment report in three years and yet just beneath the surface was plenty of evidence that inflation pressure from the labor market is more of a fond hope than a real threat.

The Age of Frugality takes a holiday

April 1, 2010

That whole Age of Frugality thing didn’t last long, did it?

U.S. real personal consumption grew in February at a respectable 0.3 percent clip, the fifth straight such monthly rise, a fact widely greeted as news that the recovery is on course. The fly in this tasty soup, however, is income, which in real terms didn’t increase at all, not even by one tenth of a percent.