japan20000

GDP Manipulation? You Should Consider Shorting the Market

your presentation of GDP calculation is oversimplified to the point of being plain wrong. For example, if the gov. spending does not lead to increased output, then inventories get depleted and they go into GDP c calculation (why did you omit them again?) The effect of prices is also stripped away from GDP. If gov. spending is useless, it will only drive up the prices and will not increase GDP (will only cause redistribution). ET CETERA
The equation is just an easier way to calculate the gross domestic PRODUCT, instead of sending officers to count shoes, tanks, and haircuts made and done in the country

No Chance of Inflation Anytime Soon

this article is full of wrong numbers, not just wrong but miles off:
1) the average house price in the USA is just abovr 200k now (existing, 259k new), and it was past 150k , not 100k, in 2001, and peaked at 270k in 2006 (existing)
2) according to IMF, in 2008, US economy was 14.2 trillion vs. 4.4 trillion for China, which is not 20% at all. China has overtaken Japan as the 2nd largest economy and Germany as exporter (just about, depending how you count it). It certainly drives incremental demand.

The Diminishing Impact of Debt on U.S. Economic Growth

1) there is no reason extrapolating that graph with a straight line - you do it in a math class in a respectful school, and you fail the class
2) the (gross) dept/GDP ratio will grow simply as a result of the ever increasing division of labour.
So, no bomb going off in 2015

Is the Bullishness Really Justified?

why is your lower bound connects a bunch or minima and the upper bound only 2 recent maxima? Extrapolate these two line to see this is absurd

Can Commodities Decouple from Stocks?

it is common knowledge that commodities have beta>1. If you believe stocks will go down, ask yourself why they go down and who buys commodities.

Gold Should More than Double in Next 6 Months

yes and as a result of the global warming the temperature will go down to -70 million degrees.
This is not serious at all. Gold is protection against small movements in inflation. Today, an ounze's 1000 or so $ can buy you a lot of things in the nearest WalMart -and cloth and food and some furniture. If we had a collapse of the magnitude it has been feared, that ounze will buy you a few loaves of bread. That would have to be a big collapse, but you get the idea.
If the economy on the contrary, resumes growing, then where is a case for gold? salary-driven inflation? supply driven? Capacity utilization is 70ish % and a pool of unemployed are waiting to work for less if necessary.
Maybe SA should impose a cap on this rambling or something.

What Drives Commodity Prices

"we can be certain that the “dilution” of the U.S. currency (by over 20% per year) must be translated directly into higher commodity prices"
this is wrong. The knew money that was pumped into the system was not a give out to companies who consume commodities, nor was it a give out to workers who will drive the demand. The new money seems to go mostly to offset liabilities due to financial engineering.
To say that commodities will eventually go up is trivia. Can you project the price dynamics with this arguments? Not at all.

Martin Weiss: A Depression Is Unavoidable

this makes no sense. He complains that the economy becomes more and more government driven, and then tells us to sell everything including hard assets. Where have you seen prices going down in a government driven economy? are you out of your mind or are you just stuck with a bunch of short positions?

On Elephants and Tea Parties

''The vast majority of bailout and stimulus dollars have gone to the financial system to encourage lending and borrowing rather than to the real economy''
and how is the gov supposed to put the money into the real economy? By hiring loan officers? And what is 'real economy' anyway? That's dangerous piece of bs in itself. A bank is not a real economy? Then why the accounting dept. of an automaker would be real economy? Is that automaker a real economy when it makes autos that are suddenly not satisfying the needs of the society in terms of transportation?
Ok, many people who read this forum will understand. But this sort of crap is also told the public at large and alas .. it wont. That's why this is dangerous.

Ben Bernanke Will Bring Back the 70s Inflationary Economy

US are lucky they have FRS as a semi-private institution. This means it operates to a larger extent in the interest of business, as compared to other central banks. The argument that it is gratuitous for the Fed to enforce rates instead of the market sounds nice but breaks against the fact that it is not the market that prints M1.
Some comments here rightfully and trivially point out that the problem boils down to the necessity of redistributing productive resources ("We produce too few high-quality competitive products the rest of world likes to buy from us"). There is political friction to that. Inflation eases that friction.
Let's not forget that a successful strategy is one that will let as many people as possible produce as many goods and services as possible that satisfy our needs in the best possible way. Stable prices and currency are factors, not goals.

The Delusions of Greenspan's Self Defense

you are wrong; you want a scape goat. If Fed created a bubble in the economy, that it must be some strange sort of bubble they forgot to define yet amidst all the accusations: I fail to see a bubble when GDP growth peaked at 4+ % in 2005. If you look at a longer term trend, there was no exceptional growth any of the Greenspan years.
On the other hand it is pretty clear there was a housing bubble. Fed does set the (short term) rate for all the economy, it has no control over long-term borrowing rates in specific industries, at least it didn't then. So we are talking about mis allocation of resources - you should be directing your wrath at the Congress and others who for political reasons were encouraging channeling of money into real estate and were otherwise distorting the resource allocation with fiscal policy.

Indians Are Selling Gold - Is Their Thinking Right?

you could have bin a bit more subtle ...
If it is that clear to you where the stocks go, I hope you have shorted them as much as you could.
And why not predict $50000 per once. At least you will be the only one to say in 200 years 'told u so!'

Japan: Decline of a Safe Haven

where on earth did your hear of the japanese stock market to be a safe heaven? And how did it crash less if it is 60% from its peak in July 2007? It is still 80% down from its peak of about 40k in 1989. What have you been smoking? It is understandably a more volatile exchange because it is hugely leveraged to the outside. Tokyo has traditionally traded with higher multiples.
The currency market is a totally different thing because of a number of issues that other markets do not have. There you could attach the safe heaven label to the yen... in certain periods.

Economy Watch: What if Stocks Were Priced in Gold?

how has the ratio of industrial use of gold to overall god changes over that period of time? If it grew, this analysis doesn't hold, because all of a sudden a lot of gold will not be in demand.
In 1981, how many tons were consumed by electronics industry compared to 2008? If we have a recession, that gold will not be bought and will be up for buys, as it probably is now

It's Good to Be the World's Reserve Currency

It is surprising to see little discussion about what ultimately backs a currency. That would be the economic output and the ability to secure it in the future. And I do not remember seeing on this post more broad considerations such as the fact the Americans have all possible natural resources under their feet, which cannot be said about Europe, and they have ONE 300-million-people market in which they can be put to use (as opposed to Europe that is reminiscent of feudal times in this respect). They also have an army to protect that economy and its external markets and suppliers. Does UK have any of this? Does Europe have any of this?