Category Archives: Economic fundamentals

The BLS Jobs Report Covering November 2012: Hollow Gains

By Hugh, who is a long-time commenter at Naked Capitalism. Originally published at Corrente.

I suspect that the Bureau of Labor Statistics report covering November 2012 will be heralded as a solid report, but as usual there are a lot of negatives behind the headline numbers. Seasonally adjusted, 146,000 jobs were added to the economy and the unemployment rate dropped two-tenths of a percent to 7.7%. For those of you who are conspiratorially minded, after upward revisions in the months preceding the election, last month’s jobs number was cut by 33,000 and September’s 16,000.

Citi Cuts 11,000 Jobs Rather Than Lower Pay, Illustrating Rentier Capitalism in Operation

Citi is a particularly blatant example of a way of operating that has become endemic in American business: when things get tough, throw as many employees as possible under the bus, and use that to maintain or even increase the pay of the top echelon.

Is There a Case for Optimism About the Eurozone?

I know, we don’t generally do optimism here at Naked Capitalism. And truth be told, I’m having trouble accepting the Financial Times’ John Dizard’s argument that things are going to get better in the Eurozone. Admittedly, John has a taste for investing on the wild side: he’s typically recommending exotic trades in his weekly column. But his argument isn’t based on catching a near-term trading bounce; it’s based on…..fundamentals.

Marshall Auerback: Even a Deal on the Budget is Bad for the American Economy

Yves here. One of the frustrating aspects of the Great Catfood Debate is that it boils down to not whether, but how much, catfood you get in your future. Marshall Auerback explains why any of the proposed outcomes to the budget negotiations will slow growth and possibly produce a recession.

Why Greece is a Model of Economic Mismanagement

By Delusional Economics, who is determined to cleanse the daily flow of vested interests propaganda to produce a balanced counterpoint. Cross posted from MacroBusiness.

Today I thought it was timely to have another look at the Greek economy from a sectoral balance perspective which will hopefully provide some clarity on exactly what we are seeing in Greece, but just as importantly also provide some broader context to the likely outcomes for other Eurozone periphery nations with similar economic dynamics.

Corporate Bond Bubble Inflating?

At least in the US, a series of attention-getting stories, Sandy, then the elections, then the immediate roll right into fiscal cliff gamesmanship, followed by the Patreaus/Allen scandal, have made finance news seem comparatively dull, even though the stock market is in a swoon thanks to the engineered fiscal cliff nailbiter And Europe keeps looking more and more jaundiced by the day.

The Economist has taken note of the fact that the normally staid corporate bond market is looking a bit frothy.

Modern Money & Public Purpose: Yanis Varoufakis and Marshall Auerback on the Eurozone Crisis

One of the reasons the public knows little about economics is that most economists are lousy speakers. Part of that is their reliance on jargon, which is often shamanistic, designed to obscure rather than communicate. But the other reason is that a lot of economists don’t bother to try to be engaging.

The remarks by Yanis Varoufakis and Marshall Auerback are informative and lively, if ultimately pretty grim. The comments at YouTube are extremely positive.

Greeks Get Time but Not Money

Yves here. This post by Delusional Economics continues with his cataloguing of the slide of the Eurozone into an economic and political abyss. What is striking is the contrast between his matter of fact tone (which at this point is fully warranted, these self destructive actions have become depressingly routine) and the horror of what is happening, that millions of people are faced with desperation and are prepared to take desperate measures in retaliation.

On the Decline and (Maybe) Fall of Venture Capital

Roughly eight years ago, I had lunch with an ex-McKinsey colleague who had started a venture capital firm. His partners were raising a second fund. He was leaving. I wish I had taken notes, but his message was that the industry did not work.

Questioning Health Care Cost/Budget Fearmongering: Consumer Revolt Against Prescription Drug Costs Already Underway

As we discussed last weekend, two Federal Reserve Board economists shot gaping holes the CBO’s health care cost increase assumptions in CBO’s long term fiscal forecasts. As technical as this sounds, these long-term cost increase assumptions are the big driver of the much ballyhooed deficit explosion. And as the Fed economists’ paper discussed in considerable detail, the CBO’s assumptions on the rate of increase look indefensibly aggressive, which in turn means the hysteria about entitlements eating the economy deserves far more scrutiny than it is getting.

Some evidence on the pressures against health care cost trees growing to the sky comes in a new post by Wolf Richter.

Mr. Market Makes His Displeasure Known, and Wall Street Says it Needs Its Pony

Now even though, as Ben Walsh contends, market moves are often just noise, a downshift of over 2% in the S&P on the day after a Presidential election is being ascribed meaning by market touts, and therefore, by golly, it does mean something.

Quelle Surprise! QE Zombifies Economies

Nobody has wanted to heed the lesson of post bubble Japan until way too late.

Europe’s Extremism Gambit

By Delusional Economics, who is determined to cleanse the daily flow of vested interests propaganda to produce a balanced counterpoint. Cross posted from http://www.macrobusiness.com.au/2012/10/eggs-and-veal-at-the-eu-summit/“>MacroBusiness.

I’ve spoken previously that apart from the economic and social fallout from the European financial crisis, the other major issue I see is the loss of political capital on both sides of the economic divide.

Econ4 Discusses Jobs and Job Creation

Econ4 has released the first video in its series, The Bottom Line. This offering debunks the propaganda that tax cuts for the wealthy create jobs.