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  • Has Greece Hit The Wall? [View article]
    Thank you for your very thorough reply. I guess in the end we shall see...
    Mar 11, 2015. 06:05 PM | Likes Like |Link to Comment
  • Has Greece Hit The Wall? [View article]
    By the way, I realize I've been semantically lazy here since missing a payment is defaulting. I meant to say Greece would claim not to be *repudiating* its debt...they would acknowledge it in some theoretical long term. Also, by remaining in the EU, I meant remaining on the Euro.

    Is there a mechanism by which the EU can prevent this. Even if there is one, do they use it?
    Mar 10, 2015. 09:55 PM | Likes Like |Link to Comment
  • Has Greece Hit The Wall? [View article]
    Possibly naive question. Yet, I haven't seen it discussed anywhere. Suppose Greece says "We have no intention of defaulting on our debts--we just won't be making any payments right now. We don't need to borrow anymore, thank you for the offer, because as long as we don't make any payments we are all right. Of course we will remain in the EU as a sign of solidarity and our promise to pay these debts just as soon as we can."

    Then, they never make another payment again.

    What is the mechanism to force them out of the EU?
    Mar 10, 2015. 07:18 PM | Likes Like |Link to Comment
  • Too Many Houses, Too Much House [View article]
    I think some of your points are contradictory. If young people are moving back in with mom and dad, then that's against the thesis of "too much house". If they aren't moving back in, then that's against the thesis of "too many houses". Granting there was "too much house" and "too many houses" at the top of the bubble, and we may not have worked our way through all of that oversupply, there isn't much new here.

    Meanwhile, '07 is 6 years ago. Those who haven't defaulted by now probably aren't going to, and may even have paid their way into the black. Most of the blood that's going to be lost on houses is already in the street.
    Aug 19, 2013. 05:46 AM | 5 Likes Like |Link to Comment
  • Fed fears send stocks sharply lower; Dow -225, Nasdaq -63 [View news story]
    You have a point here, that it's a false black/white choice, but if you actually know what the market has priced in you stand to make a bazillion bucks. As the taper starts, interest rates will rise. If that is "priced in" then the markets need not fall. If it isn't, then they do. What is priced in is practically the whole question.
    Aug 17, 2013. 09:22 PM | Likes Like |Link to Comment
  • Fed fears send stocks sharply lower; Dow -225, Nasdaq -63 [View news story]
    If the Fed does taper...

    Don't you mean when? Because either the Fed tapers at some point, or else it never, ever does. And since this consequence is seemingly unavoidable, it's better to take it now.
    Aug 15, 2013. 07:55 PM | 1 Like Like |Link to Comment
  • Market recap: Stocks trimmed the worst of their losses as various Fed officials tried to downplay taper fears but remained broadly lower, with declining issues clobbering advancers seven to one, amid rising Treasury yields and a possible cash crunch in China. Treasury prices reversed off early lows, with the 10-year yield finishing at 2.54% after earlier pushing ~2.66%, but that's still up 35 bps from last Tuesday. [View news story]
    Gentlemen, I put it to you that this is about China, Europe, and overvaluation of almost every asset, in the context of the Fed promising to stop giving away $85 billion a month in free money.
    Jun 24, 2013. 08:49 PM | 2 Likes Like |Link to Comment
  • The Birth Of The Lithium Millionaires [View article]
    Gasoline is better. Whoever heard of a 750 horsepower V12 fuel cell?!
    Jun 21, 2013. 03:50 PM | 1 Like Like |Link to Comment
  • Should Investors Be Scared Witless? [View article]

    You said the relationship between stock multiples and bond rates is curvilinear, other economists haven't replicated your results, but you'd share the data. Have you done an article on this? Sounds interesting.
    Jun 21, 2013. 07:01 AM | 2 Likes Like |Link to Comment
  • Markets Revert To Common Sense [View article]
    But problems are normal. Even big ones. For example, first half of last century saw WWI, Great Depression, WWII, all in 30 years! Our problems are small compared to that.
    Jun 21, 2013. 06:47 AM | 2 Likes Like |Link to Comment
  • The Financial Markets Freak Out When The Fed Hints That It May Slow Down The Injections [View article]
    Good article, but I wonder what do you think the DOW is actually worth if QE went to zero tomorrow. Not what would happen, but what's it worth? In particular, if it fell 3,000 points, that would be little more than what it gained in the past 18 months. What's it worth?
    Jun 20, 2013. 06:44 AM | 1 Like Like |Link to Comment
  • Gold Bugs And Conspiracists: Stop Doubting The CPI [View article]
    It's difficult to roll your own stats, because vendors are deceiving you too. Try to buy half a gallon of ice cream. You can't because now it's 1.75 quarts. The price is the same for the box, but the box contains less product. Try to buy a pound of smoked sausage. It went to 15 oz, to 14 oz, and now it's 13 oz for named brands, but the same old price. Have you noticed the 1.5 liter soda bottles in the stores lately? Same price, but less product. Ask yourself why they'd do that? I think it amounts to's harder to notice a price change when you buy in different quantities week to week. Of course, they aren't outright lying, since it's right on the box, but you have to pay close attention. Prices are rising faster than is being reported. It's not hyperinflation, but its not 2%. And, as the new theorists are pointing out, the classicists have overestimated inflation so far because they forgot about velocity of money--well, fine, but lets hope the new theorists haven't forgotten it either, because if it happens to pick up, then suddenly the classicists start to be long term right after all.
    Jun 17, 2013. 01:07 PM | Likes Like |Link to Comment
  • Orders For Gold Go Unfilled In Asia [View article]
    No conspiracy is needed. Just as there was none the last time the bank system collapses. All that is needed is to let people sell something on the promise they'll buy it later if they have to. They may even mean it at the time. When they can't, they can't despite all good intentions. I have no idea what is really going on here, and very few people actually do, but it's a good bet there's more chits out there for delivery of gold than actual gold to cover them. When that unwinds, it most likely unwinds badly.
    Jun 15, 2013. 01:13 PM | Likes Like |Link to Comment
  • The Guardian of London has posted a copy of a "top secret" court order instructing Verizon (VZ) to provide the U.S. National Security Agency (NSA) with records of all calls made within the U.S. or originating in the U.S., through July 19, 2013. The accompanying article says the order went into effect on April 25 affecting millions of Verizon customers. In the exclusive article, the Guardian says that it is likely, though unknown, that other U.S. carriers are also affected. [View news story]
    "In the digital era, privacy must be a priority. Is it just me, or is secret blanket surveillance obscenely outrageous?" -- Al Gore

    When I can quote Al Gore in complete agreement, it's a pretty good sign that there isn't much doubt left in the room.
    Jun 6, 2013. 07:18 AM | 4 Likes Like |Link to Comment
  • Big Wednesday Wipe Out [View article]
    Boy, me too! If ole Ben would just stay out of this...oh, wait...the market would be below 10K if ole Ben stayed out of it.
    Jun 5, 2013. 10:18 PM | Likes Like |Link to Comment