The Asian Housing Bubble Burst
by C.P. Chandrasekhar and Jayati Ghosh, Triple Crisis[This article first appeared in Hindu Business Line.]
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Everyone knows the role played by housing bubbles in the pre-crisis booms that ended in spectacular crashes in the United States in 2008, as well as in other countries like the UK and Ireland, and then Spain. But many commentators still persist in seeing this as more of a developed economy problem, which is less likely to become a concern in developing countries where excess demand for housing remains an issue. In fact, however, it is just as possible for debt-driven private consumption bubbles to burst in developing countries - and several developing country financial crises have resulted from precisely that in the past. The experience of the Asian financial crisis in 1997-98, in which excess private indebtedness played a big role in causing the crisis in South Korea and Thailand, had provided a salutary lesson to most of developing Asia in the subsequent decade.
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What We Read Today 07 August 2013
Econintersect: Click Read more >> below graphic to see today's list.
The top of today's reading list reports about the prospects for Fiscal Cliff 2014 ........ and the last article covers the record high for the Chinese yuan vs. the U.S. dollar.
More Young Americans Than Ever Live With Their Parents
by Felix Richter, Statista.com
According to new figures released by the Pew Research Centre, more young Americans than ever live with their parents. In 2012, a staggering 56 percent of Americans aged between 18 and 24 lived at home with their parents, a five percent increase on 2007's figure.
Among those aged 25 to 31, the percentage living with parents was, somewhat unsurprisingly, substantially lower. Still, between 2007 and 2011, this increased from 14 percent to 17 percent, before dropping slightly to 16 percent in 2012.
Markets Taking Siesta As Volume Drops Off
Midday Market Commentary For 08-07-2013
By noon, yawn, the market was losing volume and the, yawn, the HFT computers were melting the numbers up - yawn! Time to take a nap, nothing is happening. Markets are moving sideways in a tight narrow band along with the $VIX at 13.58.
Summertime blues are here but don't get caught napping.
The Resident: Hacker Faces 10 Years, Rapists Only Two Iin Steubenville
What kind of crap is going on in out justice system? The NSA can hack into our systems but the hacker who provided information to convict the rapist may get 10 years. The US government has made it clear; raping is ok and hacking is not.
Markets Gap Down On Heavy Volume
Opening Market Commentary For 08-07-2013
Premarket was down -0.20% indicating an negative market was at hand with few low rated financials to be reported this morning.
Markets opened down where the SP500 reached 1689 off 8 points from yesterday's closing. Also as expected, the BTFD folks jumped in and melted the averages back up to where the SP500 at 1695, was off 2 points from last night. Then the roller coaster ride began as the indices started to melt downward under significant relatively heavy red volume.
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Nonfinancial Leverage NFCI Again Deteriorates Slightly w/e 02 August 2013
The Nonfinancial leverage subindex of the National Financial Conditions Index increased slightly (less good) this week but still remains well inside of economic expansion territory. Econintersect focuses on non-financial tools to monitor the economy.
This index remains on a "less good" trend line, and is believed to be a good forward indicator a recession is coming. A value above zero is a recession warning.
Superstorm Sandy Stimulating the Region's Economy
by Jaison R. Abel, Jason Bram, Richard Deitz, James Orr, Kaivan K. Sattar, and Eric Stern - Liberty Street Economics, Federal Reserve Bank of New York
The New York metro region's recovery from Superstorm Sandy is well under way. Spending on restoration and rebuilding activities following a natural disaster is a potentially powerful economic stimulus to the affected area. Indeed, money from outside the region-in the form of federal aid and private insurance payments-flowing to the damaged areas in the region gives a temporary boost to economic activity. But does this mean that Sandy-along with the federal aid and insurance payouts associated with it-was actually good for the region's economy?
Terminal Velocity (17) 'Don't Tell Me, Show Me'
Written by Adam Whitehead, KeySignals.com
In Terminal Velocity (16) '
Show and Tell' it was suggested that the Fed may wish to do what the Israelis recommend; and show rather than tell. We suggested that:
'The Fed has once again talked itself into a corner. The Israelis have developed a pragmatic approach to decision making, in which they say 'Don't tell me, show me'. A Fed Policy that shows and doesn't tell, may well be the best way to go. Unfortunately, the Fed only tells; but it will be forced to show soon.'
Facebook Finally Returned to its IPO Price
by Felix Richter, Statista.com
Monday morning (05 August 2013), shortly after markets had opened, Facebook's stock finally passed its IPO price for the first time since the company's initial public offering on May 18th of last year. The stock briefly traded above $38 before falling back down and closing at $36.80.
Comex Gold Explained
Written by Miguel Perez-Santalla, Bullion Vault
A primer on how physical gold stocks are held for Comex contracts, and what stock changes mean...
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There has been a lot of misinformation recently about Comex warehouse gold stocks.
Most notably, there's confusion about how this year's sharp drop in the quantity of gold bullion held in Comex warehouses might point to some looming shortage of metal to settle gold futures contracts, or even signal an outright default by sellers to buyers.
Rajan is New Governor of Reserve Bank of India
Econintersect: University of Chicago professor Raghuram Rajan has been named the new head of the Reserve Bank of India for a three-year term. He succeeds Duvvuri Subbarao who has held the position for the past five years.
Investing.com: Technical Analysis 06 August 2013
Investing.com Technical Analysis (as of Tue, 06 August 2013 05:00pm EDT)
by Investing.com Staff, Investing.com
Below, technical overviews and analysis for key stock indices, commodities and
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currency pairs, based on market activity at the end of the 06 August 2013 U.S. session. This information is a comprehensive summary derived from simple and exponential moving averages along with key technical indicators shown for specific time intervals.
Infographic of the Day: Men vs. Women's View on Savings
Everyone would love to be more financially stable and save more of their hard earn money. However, when it comes to finances, there maybe a difference in how men and women view their savings and debt. This infographic takes a look at how men and women view their financial status today versus a year ago.
Labor Force Participation Rate Versus Unemployment Rate
by Andreas Hornstein and Karl Rhodes, Federal Reserve Bank of Richmond
The labor force participation rate has been falling since 2000, a trend that accelerated somewhat during the 2007-09 recession. Some economists and journalists have questioned whether recent improvements in the labor market will cause non-participants to re-enter the labor force at a faster rate, thus offsetting job growth and impeding further declines in the unemployment rate. But recent worker-flow research suggests that this scenario is unlikely.
Amazon vs. Goldcorp: The Stock I Would Buy
Written by Michael Lombardi, Profit Confidential
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Carlo and I went to high school together about 30 years ago. We remained friends after we left school even though we went our separate ways. Our common thread is that we are both entrepreneurs running our own businesses. After years of not seeing each other, last night we spent a couple of hours together discussing the economy and investing.
Carlo's complaint last night, which is characteristic of many investors today, was that he worked hard all his life, watching what he spent and saved.
The Gradual Decline of The Washington Post
by Felix Richter, Statista.com
The Washington Post, the seventh largest daily newspaper in the United States and one of the country's most renowned publications, is being sold to Amazon.com founder and CEO Jeff Bezos, in a $250 million all-cash deal that surprised the media industry on Monday afternoon. Just this weekend, the New York Times Company had announced the sale of The Boston Globe, making Bezos' acquisition of The Washington Post the second large-scale newspaper deal in the past few days.
Everyone knows the role played by housing bubbles in the pre-crisis booms that ended in spectacular crashes in the United States in 2008, as well as in other countries like the UK and Ireland, and then Spain. But many commentators still persist in seeing this as more of a developed economy problem, which is less likely to become a concern in developing countries where excess demand for housing remains an issue. In fact, however, it is just as possible for debt-driven private consumption bubbles to burst in developing countries - and several developing country financial crises have resulted from precisely that in the past. The experience of the Asian financial crisis in 1997-98, in which excess private indebtedness played a big role in causing the crisis in South Korea and Thailand, had provided a salutary lesson to most of developing Asia in the subsequent decade.
There has been a lot of misinformation recently about Comex warehouse gold stocks.
currency pairs, based on market activity at the end of the 06 August 2013 U.S. session. This information is a comprehensive summary derived from simple and exponential moving averages along with key technical indicators shown for specific time intervals.
Carlo and I went to high school together about 30 years ago. We remained friends after we left school even though we went our separate ways. Our common thread is that we are both entrepreneurs running our own businesses. After years of not seeing each other, last night we spent a couple of hours together discussing the economy and investing.