Disqus - Latest Comments for enh124

Re: Consumer credit down, but does it show deleveraging?

Pangea Joel — Sun, 08 Nov 2009 10:58:59 -0000

Hours worked has declined by ~5% annually, and presumably that translates into lower income, but GDP doesn't reflect that. in fact, GDP could still be positive while hours and income decline, ie higher productivity.

Isn't it possible to get credit card credit balances related to income?
And if not, couldn't we use concrete proxies? Say high-end retail store credit cards or AmEx for wealthy and gas cards
and home mortgage debt related to income?
For housing, it should be easy to get data for mortgage debt amounts for different price classes of homes, which we could infer roughly correlates to income levels.
And maybe similarly for car notes.

Re: Consumer credit down, but does it show deleveraging?

enh124 — Sun, 08 Nov 2009 10:57:40 -0000

key word 'healthy.' I certainly don't see continued high leverage as healthy. It does sow the seeds for more pain to come.

Re: Consumer credit down, but does it show deleveraging?

enh124 — Sun, 08 Nov 2009 08:35:12 -0000

credit to personal income would do about the same thing, yes. But, Debt to GDP is a more generally recognized statistic.

Getting credit by class would indeed be revealing, but that data is not available.

Re: Consumer credit down, but does it show deleveraging?

enh124 — Sun, 08 Nov 2009 08:26:57 -0000

yes. I will change that.

Re: Intent and motive

enh124 — Fri, 06 Nov 2009 19:47:34 -0000

You're not reading the post accurately: "how or whether to vote" covers
what you are saying.

Re: Rosenberg: “the mother of all jobless recoveries”

enh124 — Fri, 06 Nov 2009 16:40:25 -0000

Of course it is. It points to systemic problems that are being papered over with short-term solutions.

Re: Comprehensive unemployment rate is 17.5%

enh124 — Fri, 06 Nov 2009 14:20:48 -0000

Also, my headline should tell you I see the labor market as weak. But again, in context, this is not a negative surprise.

Re: Comprehensive unemployment rate is 17.5%

enh124 — Fri, 06 Nov 2009 14:19:49 -0000

I'm sorry it read as positive spin. I did not intend it that way.

I get what you're saying, haris. And I know this: the fact that labor market participation is decreasing is a sign of economic weakness - not strength.

My last paragraph is a reflection of how I see the data in context: this is not a game-changer. The labor market is weak, but not deteriorating. It can still be this weak and yet the economy can show a statistical recovery.

Re: The coming collapse of the municipal bond market

enh124 — Thu, 05 Nov 2009 11:19:05 -0000

My general take here is not so much one of shorting an index (as I don't give specific investment advice) but of being aware of what you have in your portfolio.

For example, are the munis in your portfolio general revenue bonds or ones secured with income streams from specific projects? And what does that mean about likely cash flow in a period of distress?

As I see it, not all bonds are equal and that should lead to a relative value play if and when muni distress occurs.

Re: News from around the web: 2009-11-05

enh124 — Thu, 05 Nov 2009 09:56:50 -0000

That is the hope, isn't it?

Re: Fed to keep “exceptionally low levels of the federal funds rate for an extended period.”

enh124 — Wed, 04 Nov 2009 20:50:36 -0000

I'm interested to see how this will translate into consumer credit. Definitely something to watch given the still very low savings rate.

Re: Wood warns of correction, says “key variable in the West is government policy”

enh124 — Tue, 03 Nov 2009 14:19:20 -0000

Stevie, you know your Americanisms pretty darn well.

Re: Bullish data, recoveries, crashes and the psychology of forecasting redux

enh124 — Mon, 02 Nov 2009 21:58:15 -0000

On the economic/financial side: A major spike in oil prices, a collapse OR spike in the U.S. dollar, longer-term double digit unemployment, stock market crash. On the political side: War or realized nuclear ambitions in Iran. These are probably the most well-known exogenous events that are risks.

Re: US personal income data shows for September shows pullback

HWad964 — Sat, 31 Oct 2009 23:22:20 -0000

Thanks for clarifying, Ed.

Re: The choice is between increasing or decreasing aggregate demand

enh124 — Fri, 30 Oct 2009 14:02:37 -0000

Yes, that's why I originally swapped the two mentally. Poor choice of colors.

Re: Simon Johnson’s testimony expunged from Congressional records

enh124 — Fri, 30 Oct 2009 13:40:40 -0000

It's definitely more trick than treat this year. I too had expected more fundamental change. But when Obama picked Geithner and Summers, I knew where this was headed.

Re: US personal income data shows for September shows pullback

enh124 — Fri, 30 Oct 2009 13:38:27 -0000

I definitely mean that in a bad way because it takes us back to the asset-based model which is unsustainable.

Re: The choice is between increasing or decreasing aggregate demand

enh124 — Thu, 29 Oct 2009 07:05:10 -0000

I am actually thinking most about financial services when I think of overcapacity

Re: On so-called bureaucrats in Washington and the morality of capitalism

LavrentiBeria — Wed, 28 Oct 2009 17:44:05 -0000

It seems to me that the whole energy behind objections to the unholy alliance of "bankster", on the one hand, and "political contribution whore" on the other is moral. It certainly can't be
questions of legality that principally inform the complaints - God knows, law in this country is almost the antithesis of morality - although legal questions may be involved coincidentally. Rather the responses go to an innate perception of right and wrong that is written on one's heart, something that faith identifies as "conscience". It is here that one grasps the propriety of the use of the term "bankster" or "filth" when referring to politicians that sell their votes for political contributions. And that because these scum, acting as they almost habitually do precisely as banksters and filth, make of themselves and ARE banksters and filth. One might properly even think of the matter ontologically, I suppose; one is what one does. Frankly, I think you'd benefit feeling free enough to call a spade a spade in this connection, Ed. If it smell like a bankster and it looks like a bankster, be sure, its a bankster.

Re: The choice is between increasing or decreasing aggregate demand

WalterW — Wed, 28 Oct 2009 16:51:44 -0000

Eh, and as I resumed reading, I ran into another one:
"What we want to know is how we get back to the green circle over time" - that would again be the RED circle... :)

Maybe better change the graph after all, somehow it really doesn't feel right to keep trying to move to red; I'd prefer go to where the grass is greener!

Re: The choice is between increasing or decreasing aggregate demand

enh124 — Wed, 28 Oct 2009 16:27:13 -0000

That's right. Thanks for catching that (I was mentally thinking green good, red bad)

Re: On so-called bureaucrats in Washington and the morality of capitalism

enh124 — Wed, 28 Oct 2009 16:25:55 -0000

Lavrenti,

I am not agonizing one iota. I am subtly -- perhaps too subtly -- saying that we live in a society in which greed is glorified (something antithetical to thousands of years of Indo-European moral attitudes). You are one of the few who acknowledges this and acknowledges this as a major reason we are in the fix we are today. The fact that there have been no other comments on this is telling.

Re: The choice is between increasing or decreasing aggregate demand

Goldilocksisableachblond — Wed, 28 Oct 2009 16:18:08 -0000

Understood , and I agree in general with the points you made.

I just think too many people fail to grasp that inflation , as measured , often doesn't reflect the reality on the ground for the masses. The top 10% of earners , who receive around half of all income , won't be severely impacted by high oil prices , and they're not the ones currently buried in debt.

The rest , already on knife's edge , would be impacted. Rising oil would mean higher gasoline , heating & electric , imported food and drugs , etc. All necessitities and , together , a substantial part of middle-class budgets.

Dollar depreciation , absent immediate action to address the distorted income distribution , will make the crisis worse well before the export-related job increases that result from depreciation will begin to make it better.

Increasing gov't debt or a depreciating currency are not the problems , per se , they're just tools to implement policies. It's the policies that are the problem.

The solutions are out there , they're just not being discussed.

Re: The choice is between increasing or decreasing aggregate demand

enh124 — Wed, 28 Oct 2009 15:39:44 -0000

Remember, I am making a statement of fact, not one of position. The question was whether QE is inflationary. It is not when the demand for credit is low.

I have posted plenty of times saying I think quantitative easing is not a good policy - asset bubbles and commodity prices being a major reason why.

Re: Hayek: “I am not only against inflation but I am also against deflation.”

StilesBC — Wed, 28 Oct 2009 09:31:16 -0000

Ugh. "Exchange Controls" "Capital Controls" "Global Clearing House (Central Bank)" Yada, yada, yada.

More communist style central planning if you ask me. Only global this time and enforceable not by one's own democratically elected government, but some opaque global body. That's worse than what we have.

This solves none of the problems inherent in unbacked lending and does nothing to turn the issuance of currency over to the free-market. I would violently oppose this.

I had thought better of the Post Keynesians (Minsky, Schumpeter). Davidson sounds more like Keynes on steroids.