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Oct 12, 2011
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Rebellious echoes

By Martin Hutchinson
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The Occupy Wall Street protesters may not know much about Coxey’s Army. But like the current demonstrations, Jacob Coxey’s 1894 March on Washington occurred after a period of economic turmoil that increased inequality and followed a crash of the financial system. Mr. Coxey failed, but his demands of stimulus spending and printing money became the standard response to recessions. Occupy Wall Street should be so lucky.

Oct 7, 2011

BREAKINGVIEWS: U.S. jobs data confirm economy is muddling along

(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)

By Martin Hutchinson

NEW YORK (Reuters Breakingviews) – It looks as though the U.S. economy is muddling along rather than relapsing into recession. The jobs increase of 103,000 in September beat expectations but wasn’t enough to cut long-term unemployment, which increased. Still, alongside positive manufacturing data, it suggests the outlook is for slow, patchy growth, not a double-dip.

Oct 7, 2011

Apple effect far greater than $350 bln market cap

(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)

By Martin Hutchinson

NEW YORK (Reuters Breakingviews) – Steve Jobs leaves behind a company with a huge $350 billion market capitalization, but it is actually much bigger than that. Apple, which Jobs co-founded and ran through most of its history, has changed the world several times.

Oct 4, 2011
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U.S debt jubilee would not rev up growth

By Martin Hutchinson
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Good ends do not justify bad means. That philosophical observation applies to proposals for a big American debt jubilee which are now doing the rounds. The idea is to slash U.S. consumer debts –- an admirable aim for an overleveraged nation. Household debt is still 90 percent of GDP, down only modestly from the 2008 peak of 100 percent. But even bank-haters should recognize that this cure would be worse than the disease.

Sep 28, 2011
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Stock market crash more likely than new recession

By Martin Hutchinson
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The U.S. stock market may be ahead of the economy. That suggests a crash is more likely than a “double-dip” recession.

Sep 22, 2011

Bernanke’s twist may not be much to shout about

(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)

By Martin Hutchinson

NEW YORK (Reuters Breakingviews) – The Federal Reserve is reviving a 1961 tactic to reduce long-term interest rates, then dubbed Operation Twist. The new iteration is four times heftier than the original as a percentage of GDP. It adds to Fed balance sheet risk and to price pressures; more helpfully, it could somewhat boost small business lending.

Sep 9, 2011
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Only Drachmaization can save Greece and euro

By Martin Hutchinson
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Regional comparisons suggest Greek living standards have risen far beyond productivity since it joined the European Union, making austerity inadequate to rebalance the economy. Drachmaization would allow market forces to set Greek wage levels, induce other indebted EU members to reform without EU prodding and thus solidify the euro.

Sep 8, 2011
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Canada’s economy hampered by troubled neighbor

By Martin Hutchinson
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Canada’s economic comfort is suffering at the hands of its troubled southern neighbor. The Bank of Canada on Wednesday stopped raising interest rates at 1 percent, largely because of deteriorating U.S. conditions. That’s a pity — Canada would benefit from rates above inflation. But sluggishness and policy wrangling south of the border sap growth and make the Loonie less competitive.

Sep 2, 2011
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Big zero on U.S. jobs a boost to policy activists

By Martin Hutchinson
The author is a Reuters Breakingviews columnist. The opinions expressed are his own. The U.S. economy added no jobs in August. For believers, that provides fresh impetus for stimulus, both fiscal and monetary. Neither has much credibility based on recent history. But even proponents of such efforts must know the 9.1 percent jobless rate won’t come down in a hurry.

 

The details of Friday’s employment report were marginally positive, although the downward jobs revisions for June and July were disquieting. Private sector employment was affected by a strike at Verizon, which caused 45,000 temporary job losses. Adding those back, the private sector gained 62,000 jobs. Still, the trend is sluggish, workforce participation is significantly down over the past year, and long-term unemployment remains worse than in any post-war recession.

Aug 31, 2011
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Gold miners no longer leveraged play on the metal

By Martin Hutchinson
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Gold miners’ shares are a damped rather than leveraged play on gold — at least from evidence this year. The yellow metal’s price is up more than a quarter since December 31, but mining shares are roughly flat. Australia and Peru recently showed how governments grab more when commodity prices rise, while operating costs go up with prices, too. Moreover, mining investors tend to discount spikes in the price of gold as merely temporary, offering little uplift to the miners’ value.

    • About Martin

      "Martin Hutchinson is a Reuters Breakingviews columnist and writes about emerging markets, particularly in Latin America, and monetary and macroeconomic issues. He is a former merchant/investment banker with 27 years of experience."
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