Consumer confidence is up.  The rate of unemployment is down.  Today’s weekly jobless claims have dropped below 400 thousand for four straight weeks.  The PMI shows manufacturing is up.  Now, pending home sales are at a 19-month high. Make no mistake:  the U.S. economy is puny, but it is improving.  The greatest threat to our … Continue reading Connect the Dots

The U.S. stock market has been pleasantly snoozing along over the holiday season, but was rudely awakened yesterday, and the Dow dropped 140 points.  You don’t need to ask who woke up our market so rudely, as you already know all bad news comes from Europe. Even though there was good European news that interest rates paid … Continue reading The Joy of Flatness

One of the benefits (maybe the only benefit?) of having a childless Christmas is time to read, and I spent this one studying Currency Wars:  The Making of the Next Global Crisis by James Rickards. It is not an easy read and is dense with historical detail.  We tend to think of WWI and WWII … Continue reading A Bored Santa Claus

The media hyped a contest over the payroll tax extension as a Herculean battle between Republicans and the President.  I saw it more as a struggle between the Republicans and the Tea Party. And, did it really matter anyway?  This two-month extension is trivial in comparison to the battle this summer over the debt ceiling, … Continue reading Republicans vs Whom?

Today’s economic data was mixed but generally encouraging.  Weekly jobless claims were better than expected for the third straight week.  Even better, the number of workers on continuing claims dropped from 3.63 million to 3.55 million.  (Of course, that number could drop for the wrong reason, if the current legislative impasse is not broken by … Continue reading Today’s Data Dump

Monday, the Dow was up over 300 points.  Yesterday, it was flat.  Today, it looks to gain about 40 points at the open.  Yea–the market has changed direction and will be moving back up??  No–as discussed last week, the trading volume or number of shares bought/sold is so low this week and next, that daily … Continue reading Waiting for Santa . . .

The Wall Street Journal ran a front-page article yesterday that is guaranteed to enrage both the “Occupy Wall Street” movement and the Tea Party.  It describes how hedge funds routinely prowl the hall of Congress to gain advance knowledge about the many thousands of new laws and regulations produced every year.  Based on what they learn during … Continue reading Information = Money

Years ago in the Army, I can remember straddling my bunk, methodically taking apart my M-14 rifle and then re-assembling it . . . blind-folded . . . with a buddy counting off the seconds.  It was not unlike watching the Europeans wrestle with their financial crisis.  They are trying to fend off the bond … Continue reading Building a Bazooka

In preparing my annual forecast for Inside Business, I predict the European Central Bank will be forced to engage in quantitative easing in order to end the crisis.  This means they will buy any and all bonds issued by European governments, just like our Fed bought all bonds issued by our Treasury. The new head … Continue reading Hmmmmm . . .

It has been fashionable to malign the media for many years.  While generalizations are usually wrong, my perspective is different.  Ignoring the obvious extremes of Fox, MSNBC, and HDNet, I find the majority of media to be well-meaning but hapless in the face of increasing complexity. As an example, last night about 10PM, I was … Continue reading Media Observation

At a Christmas party last night, I was amused when a good friend and loyal reader reminded me that I once said that I expected a “rip-your-face-off” recovery, whenever it happens.  That comment does reflect my belief that the U.S. stock market has become entirely headline-driven and does not reflect the underlying U.S. economy, which … Continue reading

Last year, I made my second visit to China.  Readers will recall my interest in the very different cultural attitude toward disagreement.  We think it is shameful for a person to suffer-in-silence.  They think it is shameful for a person to disagree-in-public. The greatest fear of the Chinese government is not the U.S. Their greatest fear … Continue reading Checking on China