Relevant and even prescient commentary on news, politics and the economy.

ECB policy is tightening – has been for some time

Update: Nouriel Roubini front pages this post on Euromonitor here. The ECB dove in and hiked its policy rate by 25 basis points to 1.25%. I had the pleasure of listening to Wolfgang Munchau on Thursday, and he reiterated what I reluctantly understood: the ECB’s strict inflation target is ridiculously simple for such a complex […]

Germany is competitive on a relative basis as measured by productivity, standard of living or prices

The point of this article is to demonstrate that Germany has enjoyed increased ‘competitiveness’ as measured by productivity levels and relative prices. But the clarity of Germany’s ‘competitiveness’ cannot be established by using German data in the form of a black box – a bird’s-eye view of the region is the only way to see […]

Guest Post: The RJS Aggregator – Government deficits and MMT

Introduction: Here’s another timely compilation of economic commentary by Rj from the Global Glass Onion. His thread highlights a recent interchange between straight Keynesian economists, Paul Krugman, for example, and Modern Monetary Theorists (MMT), like Jamie Galbraith, Bill Mitchell, Randy Wray, and Warren Mosler. I’ll add just one link to The RJS Aggregator today. At […]

Greece is not Argentina

I politely disagree with the conclusions of the article written by my Angry Bear colleague, Kash, where he envisages Greece defaulting in 2011 similarly to Argentina in 2001. I do agree, that the macroeconomic initial conditions in Greece scream default (actually, if you focus just on the measurable factors, like the current account, debt levels, […]

Guest Post: "RJS Analysis – Japanese Disaster Impact"

RJS had been a long-time commenter at my blog, News N Economics, and has joined Angry Bear’s thread of comments. RJS runs his own blog, Global Glass Onion, where he publishes a weekly newsletter encompassing news from around the world for his readership. Collaborating with Dan, we asked RJS to make a similar contribution to […]

Europe’s industrial new orders: 3 very different stories

Spain vs. Germany vs. UK: production trends showing holes in some growth stories Eurostat reports new orders for January: In January 2011 compared with December 2010, the euro area1 (EA17) industrial new orders index2 rose by 0.1%. In December 20103 the index grew by 2.7%. In the EU271, new orders increased by 0.2% in January […]

It’s not structural unemployment, it’s the corporate saving glut

Mark Thoma rightly points out the hypocrisy of the deficit hawks’ intent to cut spending while approving military spending in the same sentence. Ryan Avent furthers the dicussion by stating that Washington has used the ‘dire fiscal’ rhetoric to sell short-term cuts that were unwarranted, given that the fiscal problems are structural in nature. Me, […]

It’s lonely at the top: now it’s up to the Bank of Japan to hold the yen down

Wow, FX space is totally rattled this week: the yen hit 76.25 against the dollar at the end of the day on March 16 and has since rebounded to current levels 80.90 (1:50pm in NY on 3/18). What happened over this time span? Mass speculation on yen appreciation due to earthquake-related repatriation, followed by technical […]

Q4 2010 Flow of Funds: Household leverage down, wealth effect dead, and equities surge

The Federal Reserve released the Q4 2010 Flow of Funds Accounts for the US. On the household balance sheet, net worth (total assets minus total liabilities) was estimated at $56.8 trillion, which is up $2.1 trillion over the quarter. Notably, household net worth has increased $6.4 trillion since the recession’s end (Q2 2009). Moreover, personal […]