Heard that before? We all have. But there’s no one in ear shot. And thinking that there might be is the key to the problem.
The administration wasted our money. Stimulus did nothing (aside from union payback). Most of us who can read knew it wouldn’t.
Fed emergency measures, Q4 ‘08, were proper. Spoiled, Bernanke has continued with discretionary monetary policy making. The Fed is rarely any good at that. That failed as it sparked commodity price escalation, which in turn sparked central bank braking offshore. Combine that with tragedy in Japan and we have a modest world slowdown.
No what? We will look to the US and China for extraction. First, China’s domestic appetite will play a large part in resuscitation of the global economy.
China’s trade surplus print for May was far less than expected (more Imports). It fits with the "new" China we have highlighted earlier, one which finally is looking to its consumer, allowing the Yuan to strengthen at least some vs the $, thus not importing all the inflation Bernanke has created and killing their consumer.
Next, if the Fed leaves things well enough alone and if the administration refrains from scaring employers, we can look for a reasonable pace of expansion into year end.
Equity prices, the earlier beneficiary of the Fed’s Ponzi scheme, are returning to fair value. This means that they will continue to fall off over the near term, then, once grounded, will move well into year end.
Bond prices will erode, yields higher as normal pressures apply.
These are both good things, indicating a repair of the wounds left by planners on an economy which will do
just fine if left alone.
Robert Craven
The administration wasted our money. Stimulus did nothing (aside from union payback). Most of us who can read knew it wouldn’t.
Fed emergency measures, Q4 ‘08, were proper. Spoiled, Bernanke has continued with discretionary monetary policy making. The Fed is rarely any good at that. That failed as it sparked commodity price escalation, which in turn sparked central bank braking offshore. Combine that with tragedy in Japan and we have a modest world slowdown.
No what? We will look to the US and China for extraction. First, China’s domestic appetite will play a large part in resuscitation of the global economy.
China’s trade surplus print for May was far less than expected (more Imports). It fits with the "new" China we have highlighted earlier, one which finally is looking to its consumer, allowing the Yuan to strengthen at least some vs the $, thus not importing all the inflation Bernanke has created and killing their consumer.
Next, if the Fed leaves things well enough alone and if the administration refrains from scaring employers, we can look for a reasonable pace of expansion into year end.
Equity prices, the earlier beneficiary of the Fed’s Ponzi scheme, are returning to fair value. This means that they will continue to fall off over the near term, then, once grounded, will move well into year end.
Bond prices will erode, yields higher as normal pressures apply.
These are both good things, indicating a repair of the wounds left by planners on an economy which will do
just fine if left alone.
Robert Craven
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