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Recession
Parafras (?) of Tom Lehrer
Recession in 2007?
Greenspan's recession comment opened the floodgates for the use of the "r word."
John H. Makin, 21/3 2007
Over the past 20 years, governments built regulatory systems to avoid credit problems at one bank becoming systemic.
These systems succeeded, but only by shifting risks elsewhere. A measure of this failure is that the instances of emergency rate cuts have become no less frequent. Think of 1987, 1989-92, 1995, 1998 and 2001-03. Today, the principal avenues of systemic risk are via investment losses, not bank runs. The example from Japan in the 1980s and emerging Asia in the 1990s is that large and widespread investment losses will lead to big reductions in consumption and investment.
Avinash Persaud, Financial Times 16/8 2007
No economic expansion has relied more on credit and leverage than the one we have been experiencing since 2001.
But it was always a matter of when, not if, this liquidity-driven bull market would run out of steam.
David Rosenberg, chief North America economist at Merrill Lynch, Financial Times, August 16 2007
We could see the first consumer recession in 17 years in the first-half of 2008. The consumer is likely to take the brunt of the impact from the depressed wealth effect that comes from lower home and equity prices. Our worst-case scenario paints a picture of a perfect storm for consumers: a $130bn tax from petrol at $4 per gallon, a combined $3200bn in lost home values and equity portfolios.
In our opinion the Fed will cut interest rates sooner than the consensus and markets currently expect – if economic weakness continues and the financial market jitters are sustained.
Economist Paul Kasriel at the Northern Trust has come up with
a recession indicator that has called six consecutive recessions with no misses
and no false positives dating back to 1962.
Michael Shedlock 30/3 2007
Interest rates, Recession or Depression?
Aubie Baltin 2007-04-05
Highly recommended
A Temporary Power Outage
Wall Street remains caught in a tizzy over a power outage in the credit markets.
But Main Street is in fine economic shape, according to the latest reports out of Washington.
Lawrence Kudlow 15/8 2007
"Economist, author, and Kudlow & Company guest Jerry Bowyer's recent op-ed on the supposed housing crisis.
More about the Hedge funds and "the supposed housing crisis"
Turn off the nightly Larry Kudlow sis-boom-bah routine and utilize your own ability to see through the lunacy.
Click here