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Tales of housing woe in the UK

The Guardian has a brilliant piece out today about how widespread the housing bubble’s downdraft has become. We’re not talking just the South east here but idyllic countryside villages like Ely just north of Cambridge. This should highlight how widespread price and transaction declines are in the UK. The piece […]

Cash versus accrual accounting

This article speaks for itself. Bill for taxpayers swells by trillionsDeficit far bigger than government estimate By Dennis CauchonUSA TODAY The federal government’s long-term financial obligations grew by $2.5 trillion last year, a reflection of the mushrooming cost of Medicare and Social Security benefits as more baby boomers reach retirement. […]

Election means big government and higher taxes

This past week, I attended an Investment luncheon to hear Greg Valliere, the chief political strategist with the Stanford Washington Research Group. He had a number of important things to say regarding the economic implications of political decision-making in Washington and of this year’s U.S. presidential election. I agree with […]

Recession ‘95% likely’ in Britain

I’d say that the UK is looking a lot like the U.S. looked a year or so ago, with high consumer debt loads and high property prices. What’s the likelihood of recession. A near certainty. “Over to the strategy team at Legal and General. They’ve charted a ‘heat map’ of […]

Chart of the day: Mortgage to Growth Gap

Chart of the day: Mortgage to Growth Gap

I started tracking an odd statistic that I made up in the aftermath of the last recession called the ‘Mortgage to Growth Gap’ (MGG). At the time, a lot of pundits I respected where saying that American consumers were spending right through the recession in a way that hadn’t happened […]

Student Loans: New Credit Crunch Casualty

Student Loans: New Credit Crunch Casualty

The credit crunch has claimed the heads of many a financial market since it was prematurely marked as ‘contained’ to subprime loans. These markets include jumbo mortgage loans, Collateralized Debt Obligations (CDOs), asset backed securities, High Yield bonds, SIVs, the inter-bank market, commercial paper, money market funds, and the auction […]

Subprime housing bubble timeline

Wikipedia has a great entry on the subprime housing bubble for anyone who wants a primer on the bubble and a subprime housing bubble timeline. Follow the link here. This a pretty comprehensive entry with some pretty heady stuff and a lot of good bits of information like: A timeline […]

The Fed is on the easy money trip

Caroline Baum was asking in her column today: “How can a 2 percent funds rate be appropriately calibrated to promote moderating inflation when inflation is currently rising at almost 4 percent?” The answer: it can’t. The Fed is all about easy money. Look, we have a huge debt problem in […]

Chart of the day: Savings Rate

Chart of the day: Savings Rate

The United States has gone from saving an average of 8-10% of income for decades to zero or negative savings today. If you look at this chart of 12-month rolling average monthly data, it looks like people actually saved more as inflation increased in the 1960s and 1970s. Then, the […]

Are the government’s numbers for real?

A great article on the website Safe Haven asks the important question: Can you trust the government’s data. I had the same question in a post called “Last week’s GDP numbers.” Here’s what Michael Pento has to say in his article: The following graphs show G.D.P. growth rates using the […]

Spanish economy slowing fast

A leading Spansh newspaper, ABC, reported today that Spanish growth is decelerating quickly. According to the paper, year-on-year growth slowed from 3.5% to 2.7% while quarter-on-quarter, growth was only 0.3% versus 0.8% in the previous quarter. The article goes on to say that construction spending has been hampering both growth […]