Tuesday, January 5, 2016
We are predetermined to accept the illusion of free will.
Same Old Story, Chapter Eight: 2015, the eighth year since Wall Street killed the economy, was hard all around. Brazil fell into recession. China seems to be coming off the rails. Greece is far from over as are the wars in the Middle East. The eurozone is still together, more or less, but struggling with the basic idea of open borders. And in the US the recovery is still recovering. The global economy, according to the IMF, is the New Mediocre – which is more optimistic than those who see prolonged stagnation if not depression ahead. The Fed, they're just whistling past the graveyard. They hope. We in the US have done things we should not have done – the QE's and Wall Street bailouts – and have left undone those things we ought to have done – direct stimulus to the real economy, expansion of government programs and massive infrastructure investment to limit and prepare for global warming. The world is empty of demand. The cures are well known and carefully avoided, for fear of disturbing those at the top of the heap.
Say/Do: For over thirty years Big Oil downplayed the threat posed by global warming and paid others to deny it while it undertook measures to prepare its facilities for the inevitable challenges of increased temperatures and rising waters.
One Stop Shopping: In the UK Amazon will offer monthly installment payments to those spending more than £400 at one time. Payments can be spread over two, three or four years depending on the size of the purchase, with a 16.9% interest rate.
Echoes: Black Knight Financial reports that in October US house prices rose for the 42nd consecutive month, with prices now just 5% off their pre-crisis peak. Houses were not affordable then, aren't now.
The A List: The PMI Manufacturing Index for December reported “near stagnation in new orders” and that “backlog orders are contracting sharply”. The ISM Mfg Index, reported “the weakest conditions since July 2009”
The Fine Print, Just Fine: When the Census Bureau published its monthly construction spending report the interesting bit wasn't the actual report (down 0.4% m/m) but a footnote that admitted that all the construction spending data reported for the past decade was “erroneous”. We now return you to your regular programming.
A Little Less Gross: The Fed has cut its 'forecast' for 2015Q4 GDP in half, to 0.7%. It had previously cut it in half to 1.5%...
Defending the Indefensible: After the Saudis executed 47 people as part of a New Year's celebration, Carly Fiorina said, “Saudi Arabia is our ally, despite the fact that they don’t always behave in a way that we condone,” while “Iran is a real and present threat.” Ben Carson suggested that the nuclear deal with Iran had forced the Saudis to kill their own citizens and that “we need to stop doing silly things that promote these kinds of activities.” Saudi Arabia justifies the executions under Sharia law, exactly as their client ISIS does.
The Parting Shot:
Posted by Charles Kingsley Michaelson, III at 7:53 AM