BloggingStocks http://www.bloggingstocks.com BloggingStocks http://www.blogsmithmedia.com/http://www.bloggingstocks.com/media/feedlogo.gif BloggingStocks http://www.bloggingstocks.com en-us Copyright 2012 Weblogs, Inc. The contents of this feed are available for non-commercial use only. Blogsmith http://www.blogsmith.com/<![CDATA[Martin Wolf: To Cut Debt We Must Borrow More]]>http://www.bloggingstocks.com/2010/09/29/martin-wolf-to-cut-debt-we-must-borrow-more/http://www.bloggingstocks.com/2010/09/29/martin-wolf-to-cut-debt-we-must-borrow-more/http://www.bloggingstocks.com/2010/09/29/martin-wolf-to-cut-debt-we-must-borrow-more/#commentsFiled under: ,

moneyFinancial Times columnist and economist Martin Wolf forwards the paradoxical, but nevertheless economically valid theory that "we can only cut debt by borrowing more."

Economic conservatives, including supply-side economics advocates and Tea Party backers, will no-doubt look aghast at the above, but investors should keep in mind that most of the conservative camp has shown concern primarily for: 1) cutting taxes and 2) cutting government spending -- not for the plight of the more than 15 million Americans without work. Now, if in the process of cutting taxes and spending U.S. unemployment goes to 15% or 20% -- which would likely be the consequence of spending cuts that reduce already low aggregate demand further -- so be it. In other words, if the free market says unemployment should be that high, then unemployment will rise. Just cut taxes and cut spending.

Continue reading Martin Wolf: To Cut Debt We Must Borrow More

Martin Wolf: To Cut Debt We Must Borrow More originally appeared on BloggingStocks on Wed, 29 Sep 2010 11:00:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>debtfeaturedfiscal policyGDPinthenewsMartin Wolfmonetary policyWed, 29 Sep 2010 11:00:00 EST<![CDATA[Is It Time for the U.S. to Remove Fiscal/Monetary Stimulus?]]>http://www.bloggingstocks.com/2010/01/05/is-it-time-for-the-u-s-to-remove-fiscal-monetary-stimulus/http://www.bloggingstocks.com/2010/01/05/is-it-time-for-the-u-s-to-remove-fiscal-monetary-stimulus/http://www.bloggingstocks.com/2010/01/05/is-it-time-for-the-u-s-to-remove-fiscal-monetary-stimulus/#commentsFiled under: ,

New York Times (NYT) Columnist Paul Krugman, among others, has pointed out that it's way too early to think in terms of ending fiscal/stimulus. The economic expansion has barely begun -- let alone achieved self-sustaining status -- and the premature withdrawal of stimulus increases the likelihood of a double-dip recession, Krugman said.

Further, the view from here argues that investors need to keep in mind that U.S. economic fundamentals have not placed the economy on a steady-growth track -- not yet. What we have is one quarter (Q3 2009) of GDP growth. That's it.

Continue reading Is It Time for the U.S. to Remove Fiscal/Monetary Stimulus?

Is It Time for the U.S. to Remove Fiscal/Monetary Stimulus? originally appeared on BloggingStocks on Tue, 05 Jan 2010 18:30:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>featuredfiscal policyFiscalPolicygrowthKrugmanstimulusTue, 05 Jan 2010 18:30:00 EST<![CDATA[If the U.S. economy strengthens, Fiscal Stimulus II may be shelved]]>http://www.bloggingstocks.com/2009/03/11/if-the-u-s-economy-strengthens-fiscal-stimulus-ii-may-be-shelv/http://www.bloggingstocks.com/2009/03/11/if-the-u-s-economy-strengthens-fiscal-stimulus-ii-may-be-shelv/http://www.bloggingstocks.com/2009/03/11/if-the-u-s-economy-strengthens-fiscal-stimulus-ii-may-be-shelv/#commentsFiled under: ,

In his column last week, New York Times (NYSE: NYT) columnist and Nobel Prize-winning economist Paul Krugman laid waste to those who argue that he's not critically assessing Obama administration programs. He offered a cogent critique of the U.S. Treasury's tardiness regarding the banking system fix.

Either temporarily nationalize those banks that are clogging the system, buy the toxic assets at unsubsidized prices, or announce some other market-valued removal plan to unclog the system, but let's put this train in motion, Krugman said, in so many words, to get to the root of the matter: We need to get credit flowing freely to facilitate commerce.

Continue reading If the U.S. economy strengthens, Fiscal Stimulus II may be shelved

If the U.S. economy strengthens, Fiscal Stimulus II may be shelved originally appeared on BloggingStocks on Wed, 11 Mar 2009 12:15:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>banking sectorCongressDemocratsfeaturedfiscal policyfiscal stimulus packageNew York Times op-edNewYorkTimesOp-edObama administrationPaul KrugmanRepublicanstoxic assetsU.S. economyWed, 11 Mar 2009 12:15:00 EST<![CDATA[House Republicans take page out of Hoover's 1930s play book with spending freeze plan]]>http://www.bloggingstocks.com/2009/03/09/house-republicans-take-page-out-of-hoovers-1930s-play-book-with/http://www.bloggingstocks.com/2009/03/09/house-republicans-take-page-out-of-hoovers-1930s-play-book-with/http://www.bloggingstocks.com/2009/03/09/house-republicans-take-page-out-of-hoovers-1930s-play-book-with/#commentsFiled under: ,

Readers of this space know that the emphasis is placed on the economic, on commerce, and business trends, with a general avoidance of goings-on inside the beltway.

However, the financial crisis (which spawned federal bank bail-out legislation) and the nation's pronounced recession (which requires fiscal stimulus to end), has meant that things occurring in Washington once again have great relevance for investors.

And one current D.C. development must be evaluated: the House Republican leadership's decision to seek a federal spending freeze for the fiscal 2010 federal budget, The AP reported.

Continue reading House Republicans take page out of Hoover's 1930s play book with spending freeze plan

House Republicans take page out of Hoover's 1930s play book with spending freeze plan originally appeared on BloggingStocks on Mon, 09 Mar 2009 13:10:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>FDRfederal budgetfiscal policyGreat DepressionHooverHouse RepublicansinthenewsNew Dealspending freezeU.S. economyMon, 09 Mar 2009 13:10:00 EST<![CDATA[Global economy will contract in 2009 for first time since World War II, World Bank says]]>http://www.bloggingstocks.com/2009/03/09/global-economy-will-contract-in-2009-for-first-time-since-world/http://www.bloggingstocks.com/2009/03/09/global-economy-will-contract-in-2009-for-first-time-since-world/http://www.bloggingstocks.com/2009/03/09/global-economy-will-contract-in-2009-for-first-time-since-world/#commentsFiled under: , , , ,

Investors received yet another indicator Monday that this is not your father's recession.

The global economy will likely contract in 2009 for the first time since World War II -- including a decline in trade - - the World Bank announced in its most recent report.

Continue reading Global economy will contract in 2009 for first time since World War II, World Bank says

Global economy will contract in 2009 for first time since World War II, World Bank says originally appeared on BloggingStocks on Mon, 09 Mar 2009 11:10:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>credit marketsemerging marketsfeaturedfiscal policyFiscalPolicygdpglobal economyglobalizationmonetary policyMonetaryPolicytradeWorld BankMon, 09 Mar 2009 11:10:00 EST<![CDATA[China seen passing second major stimulus package to jump-start economy]]>http://www.bloggingstocks.com/2009/03/04/china-seen-passing-second-major-stimulus-package-to-jump-start/http://www.bloggingstocks.com/2009/03/04/china-seen-passing-second-major-stimulus-package-to-jump-start/http://www.bloggingstocks.com/2009/03/04/china-seen-passing-second-major-stimulus-package-to-jump-start/#commentsFiled under: , , ,

China apparently will announce a new fiscal stimulus package in an attempt to jump-start growth in the world's third largest economy.

Chinese Premier Wen Jiabao is expected to announce "a new stimulus package" in his annual address to the nation's legislature, Li Deshui, ex-statistics bureau head told reporters in Beijing Wednesday, Bloomberg News reported.

Continue reading China seen passing second major stimulus package to jump-start economy

China seen passing second major stimulus package to jump-start economy originally appeared on BloggingStocks on Wed, 04 Mar 2009 11:20:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>emerging marketsfeaturedfiscal policyfiscal stimulusgdpglobal economytradeWed, 04 Mar 2009 11:20:00 EST<![CDATA[Socialism by any other name is probably a U.S. government program]]>http://www.bloggingstocks.com/2009/03/02/socialism-by-any-other-name-is-probably-a-u-s-government-progra/http://www.bloggingstocks.com/2009/03/02/socialism-by-any-other-name-is-probably-a-u-s-government-progra/http://www.bloggingstocks.com/2009/03/02/socialism-by-any-other-name-is-probably-a-u-s-government-progra/#commentsFiled under: , ,

Most investors know about the United States' anti-state political culture: in America it's private sector solution first, public sector solution second.

And, most also know that what state that does exist is anti-central government: it dates back to our federalist origination. We're even reluctant to call something 'central' for this reason: we have a central bank, but it's called the Federal Reserve, not the Central Reserve. And it's the Internal Revenue Service, not the Central Revenue Service.

Continue reading Socialism by any other name is probably a U.S. government program

Socialism by any other name is probably a U.S. government program originally appeared on BloggingStocks on Mon, 02 Mar 2009 14:35:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>aigbanking sectorbankscffederalismfiscal policyfnmfreinthenewsU.S. economyU.S. GovernmentU.S. TreasuryMon, 02 Mar 2009 14:35:00 EST<![CDATA[The fiscal stimulus plan: Where is the missing element that solved the Great Depression?]]>http://www.bloggingstocks.com/2009/02/17/the-fiscal-stimulus-plan-where-is-the-missing-element-that-solv/http://www.bloggingstocks.com/2009/02/17/the-fiscal-stimulus-plan-where-is-the-missing-element-that-solv/http://www.bloggingstocks.com/2009/02/17/the-fiscal-stimulus-plan-where-is-the-missing-element-that-solv/#commentsFiled under: , , , , , , ,

The most sweeping fiscal stimulus in a generation is about to be signed into law by President Obama. It amounts to $787 billion and includes tax incentives, infrastructure projects, renewable energy developments, and payment to state and local authorities.

However, investors appear to be skeptical as indicated by the performance of the markets today for a variety of reasons:

  • Some estimate that as much as 75% of the spending will not reach the economy until 2010.
  • There are questions as to how many jobs in the United States will actually be created.
  • People are uncertain as to how productive the spending bill will be and how much is actually just wasteful "pork."


Continue reading The fiscal stimulus plan: Where is the missing element that solved the Great Depression?

The fiscal stimulus plan: Where is the missing element that solved the Great Depression? originally appeared on BloggingStocks on Tue, 17 Feb 2009 16:39:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>defensefiscal policyfiscal stimulusFiscalPolicyFiscalStimulusFreePassgreat depressionGreatDepressionTue, 17 Feb 2009 16:39:00 EST<![CDATA[Where does the U.S. economy go from here?]]>http://www.bloggingstocks.com/2009/02/12/where-does-the-u-s-economy-go-from-here/http://www.bloggingstocks.com/2009/02/12/where-does-the-u-s-economy-go-from-here/http://www.bloggingstocks.com/2009/02/12/where-does-the-u-s-economy-go-from-here/#commentsFiled under: , , ,

The U.S.'s first fiscal stimulus package 'of size' since the recession's start has passed - - albeit in a modified form that decreased spending by about $140 billion over the original outline.

Further, the young President Barack Obama, like the young President John F. Kennedy, has learned that presidential honeymoons can be short inside the beltway, particularly if you have to trade policy to obtain votes both inside your party and among the loyal opposition.

Meanwhile, investors and the financial community more broader await the specifics pertaining to Obama administration's revised plan to stabilize the banking system, with the declining Dow discounting that even a successful plan will require months of systemic adjustment, and, of course, more public funds.

Continue reading Where does the U.S. economy go from here?

Where does the U.S. economy go from here? originally appeared on BloggingStocks on Thu, 12 Feb 2009 14:20:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>CongressDemocratsfiscal policygdpmonetary policyObama administrationRepublicansU.S. economyThu, 12 Feb 2009 14:20:00 EST<![CDATA[PIMCO says recession will deepen without more fiscal stimulus by nations]]>http://www.bloggingstocks.com/2009/02/12/pimco-says-recession-will-deepen-without-more-fiscal-stimulus-by/http://www.bloggingstocks.com/2009/02/12/pimco-says-recession-will-deepen-without-more-fiscal-stimulus-by/http://www.bloggingstocks.com/2009/02/12/pimco-says-recession-will-deepen-without-more-fiscal-stimulus-by/#commentsFiled under: , , , , , , , , , ,

The manager of the world's largest bond fund, PIMCO, has laid-out in unambiguous terms the problem facing the global economy in the quarters ahead: The U.S. and global recession will worsen -- with a "second wave" of turmoil -- unless governments increase fiscal stimulus and spending plans.

"The economic setback is still in its early stages," Koyo Ozeki, head of Asia-Pacific credit research at Pimco's Tokyo office, wrote in a report published on PIMCO's web site. "Any further decline in housing prices could accelerate the downturn, intensifying the pernicious feedback loop and possibly leading to a second wave in the financial crisis in the next six to 12 months."

Continue reading PIMCO says recession will deepen without more fiscal stimulus by nations

PIMCO says recession will deepen without more fiscal stimulus by nations originally appeared on BloggingStocks on Thu, 12 Feb 2009 11:50:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>emerging marketsEuropean Unionfeaturedfiscal policyfiscal stimulusgdpglobal economyglobalizationIMFJapanPIMCOU.S. economyU.s.EconomyThu, 12 Feb 2009 11:50:00 EST<![CDATA[Martin Wolf: If the U.S. dares to succeed, it will]]>http://www.bloggingstocks.com/2009/02/09/martin-wolf-if-the-u-s-dares-to-succeed-it-will/http://www.bloggingstocks.com/2009/02/09/martin-wolf-if-the-u-s-dares-to-succeed-it-will/http://www.bloggingstocks.com/2009/02/09/martin-wolf-if-the-u-s-dares-to-succeed-it-will/#commentsFiled under: , , ,

Financial Times columnist Martin Wolf reminds investors that, contrary to some views expressed in the United States, depressions are neither good for us, nor unavoidable.

Further, despite the recent year's many reverberations, the United States remains, Wolf argues (and the U.S. Central Intelligence Agency agrees), the world's preeminent economy in the global economic system it has created and promoted. Moreover, U.S. policy errors had much to do with the current crisis, even if aided by policy errors abroad. By extension, the healing and recovery starts in the U.S. -- with America as the leader of determined, globally-coordinated action.

Continue reading Martin Wolf: If the U.S. dares to succeed, it will

Martin Wolf: If the U.S. dares to succeed, it will originally appeared on BloggingStocks on Mon, 09 Feb 2009 17:20:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>bank bailoutfiscal policygdpMartin WolfObama administrationquantitative easingTARPU.S. economyMon, 09 Feb 2009 17:20:00 EST<![CDATA[Economists: Modify fiscal stimulus package, but pass it, pronto]]>http://www.bloggingstocks.com/2009/02/03/economists-modify-fiscal-stimulus-package-but-pass-it-pronto/http://www.bloggingstocks.com/2009/02/03/economists-modify-fiscal-stimulus-package-but-pass-it-pronto/http://www.bloggingstocks.com/2009/02/03/economists-modify-fiscal-stimulus-package-but-pass-it-pronto/#commentsFiled under: ,

Senate debate resumed Tuesday on the fiscal stimulus package, and as it did several economists offered their policy advice for the august members of the world's greatest deliberative body.

The biggest change should concern size, so says economist David H. Wang. "It's too small. A $900 billion plan is good, but the stimulus plans that most effectively increase GDP are ones that are large, and the bigger the package, the bigger bang you'll get for your buck, from a GDP standpoint," Wang said. Wang said he would add at least $300 billion in spending to the plan.

Continue reading Economists: Modify fiscal stimulus package, but pass it, pronto

Economists: Modify fiscal stimulus package, but pass it, pronto originally appeared on BloggingStocks on Tue, 03 Feb 2009 19:30:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>CongressDemocratsfiscal policyfiscal stimulus packagegdpObama administrationRepublicansU.S. economyTue, 03 Feb 2009 19:30:00 EST<![CDATA[NYT's Krugman: Here's a better bank rescue, for the taxpayer]]>http://www.bloggingstocks.com/2009/02/03/nyts-krugman-heres-a-better-bank-rescue-for-the-taxpayer/http://www.bloggingstocks.com/2009/02/03/nyts-krugman-heres-a-better-bank-rescue-for-the-taxpayer/http://www.bloggingstocks.com/2009/02/03/nyts-krugman-heres-a-better-bank-rescue-for-the-taxpayer/#commentsFiled under: ,

You have to appreciate the cleverness of this era's financial humor. (Note that I said, appreciate the cleverness, not love, or enjoy. That's because, depending on your perspective, the humor is either on-the-mark, or not that funny. But that is part of the subjective nature of humor.)

One joke making the rounds:

Question: What's the capital of Iceland?
Answer: $25.

Another: In the old days, banks lent money to people. These days, people lend money to banks.

New York Times (NYSE: NYT) columnist and Nobel Prize-winning economist Paul Krugman discusses bank capital and lending in his most recent column, and argues that the apparent likely Obama administration fix for the banking sector -- a combination of U.S. government purchase of toxic assets and guarantees against losses on other assets, each on terms favorable to the banks -- represents a lousy deal for the U.S. taxpayer, who'll end up "footing the bill for rescuing the banks."

Continue reading NYT's Krugman: Here's a better bank rescue, for the taxpayer

NYT's Krugman: Here's a better bank rescue, for the taxpayer originally appeared on BloggingStocks on Tue, 03 Feb 2009 19:00:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>bank bailoutbank rescuebanking sectorCongressDemocratsfeaturedfiscal policyKeynesianObama AdministrationPaul KrugmanRepublicanstoxic assetsTue, 03 Feb 2009 19:00:00 EST<![CDATA[Davos Recap: With castigation stage over, collaboration begins]]>http://www.bloggingstocks.com/2009/02/02/davos-recap-with-castigation-stage-over-collaboration-begins/http://www.bloggingstocks.com/2009/02/02/davos-recap-with-castigation-stage-over-collaboration-begins/http://www.bloggingstocks.com/2009/02/02/davos-recap-with-castigation-stage-over-collaboration-begins/#commentsFiled under: , , ,

The nutshell on the 2009 World Economic Forum held in Davos? It was a conference where nearly everyone agreed that the financial crisis started in and is primarily the result of U.S. policy errors, but agreed on little else after that.

Further, the Davos gathering produced almost no new insights regarding the nature of the crisis beyond what is already known: that excessive leverage throughout the system, arcane and in some cases Frankenstein-like derivatives, inadequate national-level financial regulation, and the collapse of demand, set in motion first the U.S. recession, then the credit crunch, then the global recession.

Continue reading Davos Recap: With castigation stage over, collaboration begins

Davos Recap: With castigation stage over, collaboration begins originally appeared on BloggingStocks on Mon, 02 Feb 2009 18:30:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>banking sectorBrazilChinaDavosE.U.fiscal policygdpJapanMexicomonetary policyRussiaU.S. economyWorld Economic ForumMon, 02 Feb 2009 18:30:00 EST<![CDATA[Stimulus plan's tax cut for foreign corporate earnings could inject $545 billion into U.S. economy]]>http://www.bloggingstocks.com/2009/01/29/stimulus-plans-tax-cut-for-foreign-corporate-earnings-could-inj/http://www.bloggingstocks.com/2009/01/29/stimulus-plans-tax-cut-for-foreign-corporate-earnings-could-inj/http://www.bloggingstocks.com/2009/01/29/stimulus-plans-tax-cut-for-foreign-corporate-earnings-could-inj/#commentsFiled under: , ,

Here's one tax cut/credit that Democrats and Republicans apparently agree on. Or, in Washingtonspeak, 'left has met right, so let's get this bill out the door.'

It appears the U.S. Senate is posed to add a provision to reduce taxes, at least temporarily, on corporate profits earned abroad. The Washington Post reported Thursday that further Senatorial changes could follow, and the Senate stimulus bill would have to be reconciled via a conference committee with a House version passed Wednesday, but the current Senate proposal would dramatically reduce taxes, from 35% to 5.25%, on foreign corporate profits repatriated to the United States.

Continue reading Stimulus plan's tax cut for foreign corporate earnings could inject $545 billion into U.S. economy

Stimulus plan's tax cut for foreign corporate earnings could inject $545 billion into U.S. economy originally appeared on BloggingStocks on Thu, 29 Jan 2009 17:40:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>Allen SinaiCongressDecision EconomicsDemocratsearningsfiscal policyfiscal stimulus packageforeign earningsgdpObama AdministrationRepublicansU.S. economyThu, 29 Jan 2009 17:40:00 EST<![CDATA[Senate likely to revise stimulus package after House approval]]>http://www.bloggingstocks.com/2009/01/29/senate-likely-to-revise-stimulus-package-after-house-approval/http://www.bloggingstocks.com/2009/01/29/senate-likely-to-revise-stimulus-package-after-house-approval/http://www.bloggingstocks.com/2009/01/29/senate-likely-to-revise-stimulus-package-after-house-approval/#commentsFiled under: ,

Following's Wednesday's 244-188 House vote -- one in which, despite President Obama's efforts to cultivate Republican ideas, every House Republican voted against it -- the focus on the stimulus package shifts to the Senate, where plan revisions are likely.

Assuming Senate passage, any differences between the two versions would have to be resolved in a conference committee.

Republicans are complaining that the bill has too many traditional Democratic-constituency-based programs and 'pork,' while some Democrats are concerned the bill does not contain enough spending - - in particular infrastructure spending, to create jobs the U.S. economy needs. The U.S. economy lost more than 2.6 million jobs in 2008 -- including 1 million in the past two months -- and the nation's unemployment rate has soared to 7.2%.

Continue reading Senate likely to revise stimulus package after House approval

Senate likely to revise stimulus package after House approval originally appeared on BloggingStocks on Thu, 29 Jan 2009 10:30:00 EST. Please see our terms for use of feeds.

Read | Permalink | Email this | Comments]]>CongressDemocratsfeaturedfiscal policyfiscal stimulus packageHouseObamaObama administrationRepublicansSenatetaxesThu, 29 Jan 2009 10:30:00 EST<![CDATA[U.S. budget deficit remains serviceable, provided U.S. economy grows ]]>http://www.bloggingstocks.com/2009/01/26/u-s-budget-deficit-remains-serviceable-provided-u-s-economy-g/http://www.bloggingstocks.com/2009/01/26/u-s-budget-deficit-remains-serviceable-provided-u-s-economy-g/http://www.bloggingstocks.com/2009/01/26/u-s-budget-deficit-remains-serviceable-provided-u-s-economy-g/#commentsFiled under: , , ,

One of the biggest misnomers in the current fiscal stimulus debate concerns the United States' ability to service its budget deficit and national debt (pdf).

Provided the fiscal stimulus package is passed, the national debt ceiling will increase to $12.1 trillion from the current $11.3 trillion.

Deficit approaching intolerable levels?

Economic conservatives, market absolutists, and the like argue that the annual budget deficit and national debt are approaching intolerable levels. In truth, what they're arguing against is a needed government intervention and New Deal-type spending required to jump-start the U.S. economy -- even if it means the economy will plunge into a deeper recession without the stimulus. It seems some economic conservatives would rather see the nation's economy suffer, than to violate one their flawed economic theories.

Continue reading U.S. budget deficit remains serviceable, provided U.S. economy grows

U.S. budget deficit remains serviceable, provided U.S. economy grows originally appeared on BloggingStocks on Mon, 26 Jan 2009 17:45:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>budget deficitfiscal policyfiscal stimulus packagegdpKeynesiansmonetaristsnational debtPaul KrugmanU.S. economyMon, 26 Jan 2009 17:45:00 EST<![CDATA[What happens if the U.S. enters a 'giddy growth' period?]]>http://www.bloggingstocks.com/2009/01/23/what-happens-if-the-u-s-enters-a-giddy-growth-period/http://www.bloggingstocks.com/2009/01/23/what-happens-if-the-u-s-enters-a-giddy-growth-period/http://www.bloggingstocks.com/2009/01/23/what-happens-if-the-u-s-enters-a-giddy-growth-period/#commentsFiled under: , ,

Readers of this space know that a preferred tactic, stemming from the graduate school years and schmoozing with economists and policy wonks is to 'take the other side in an argument' or 'argue the alternate point-of-view.'

Well, one argument forwarded by economic conservatives, market absolutists and others is that the proposed fiscal stimulus package will be 'inflationary' and that it 'won't stimulate the economy.'

Arguing to the contrary...

Economist Peter Dawson took up the above argument, but only because BloggingStocks required him to do so (Ah, the power of the press!).

"A stimulus package that's both inflationary and that won't stimulate the economy," Dawson said. "Hmm? The logic is a little curious here, because inflation implies that there's demand and economic growth, and a failure to stimulate the economy implies there's very little demand and hence very little or no economic growth. The conclusions contradict, so what do the economic conservatives say the stimulus is going create, demand or no demand? I'll leave it for them to clarify their argument."

Continue reading What happens if the U.S. enters a 'giddy growth' period?

What happens if the U.S. enters a 'giddy growth' period? originally appeared on BloggingStocks on Fri, 23 Jan 2009 17:45:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>cpifiscal policyfiscal stimulus packagegdpinflationmonetary policyU.S. economyFri, 23 Jan 2009 17:45:00 EST<![CDATA[U.S. infrastructure building will require some pruning, too]]>http://www.bloggingstocks.com/2009/01/21/u-s-infrastructure-building-will-require-some-pruning-too/http://www.bloggingstocks.com/2009/01/21/u-s-infrastructure-building-will-require-some-pruning-too/http://www.bloggingstocks.com/2009/01/21/u-s-infrastructure-building-will-require-some-pruning-too/#commentsFiled under: , , ,

New York Times (NYSE: NYT) columnist Thomas Friedman in his latest column and again Tuesday night on 'The Charlie Rose Show' returned to his theme of the U.S. effort at nation building.

Nation building, that is, at home. Friedman, among others, has underscored the need for the nation to begin, in a comprehensive way, to rebuild its dilapidated and/or outmoded infrastructure that includes its electric grid, highways, roads, bridges, mass transit systems, schools and other public buildings.

Further, one doesn't have to be a civil engineer or a mechanical engineer to see that the nation's infrastructure has been neglected, and while at times Friedman's discourses on the gleaming magnificence of yet another high tech airport in Asia can begin to grate, his overall conclusion regarding a period of pronounced underinvestment in U.S. public assets is valid.

'Action' is a two-edge sword

Friedman wants 'radical' action, i.e. bold action by President Obama to make up for lost time, infrastructure-wise, and he believes 'Obi 44' has a rare opportunity to act in a big way, given the economic crisis facing our nation, his high public approval rating, and the general desire of public officials across the spectrum to see him succeed.

Continue reading U.S. infrastructure building will require some pruning, too

U.S. infrastructure building will require some pruning, too originally appeared on BloggingStocks on Wed, 21 Jan 2009 18:06:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>CongressDemocratsfeaturedfederal budgetfiscal policyfiscal stimulus packagegdpinfrastructureObamaRepublicansThomas FriedmanU.S. economyWed, 21 Jan 2009 18:06:00 EST<![CDATA[Martin Wolf: U.S. fiscal stimulus is a necessary task, but not the only one]]>http://www.bloggingstocks.com/2009/01/14/martin-wolf-u-s-fiscal-stimulus-is-a-necessary-task-but-not-t/http://www.bloggingstocks.com/2009/01/14/martin-wolf-u-s-fiscal-stimulus-is-a-necessary-task-but-not-t/http://www.bloggingstocks.com/2009/01/14/martin-wolf-u-s-fiscal-stimulus-is-a-necessary-task-but-not-t/#commentsFiled under: , ,

Can the U.S. government run $1 trillion budget deficits for two, three years? Indeed it can, Financial Times columnist Martin Wolf argues, and the deficits can even be higher, for a while. After that, there's more work ahead.

The specter of $1 trillion budget deficits may be vociferously opposed by Republicans and other economic conservatives, but Wolf, in so many words, says what other choice does the United States have? What would be the alternative? Simultaneously raising taxes now to lower the deficit? Hardly prudent. Doing nothing? Another dreadful idea. So, it's prime the pump, or sit there at the well and await nothing.

Up ahead: two bigger tasks

What's more, Wolf sees two additional tasks (structural changes) that are just as important to the goal of U.S. economic recovery -- but that may be even harder to implement: removing toxic assets from the banking system and reducing the U.S.'s structural current account deficit (the trade deficit).

The first is the forced write-off of bad assets, fiscal recapitalization of the banks, or debt-for-equity tactic, and it should be done comprehensively and quickly. Slow, gradual bad-debt reduction is not the correct policy, Wolf argues, as it would delay the economic recovery.

Continue reading Martin Wolf: U.S. fiscal stimulus is a necessary task, but not the only one

Martin Wolf: U.S. fiscal stimulus is a necessary task, but not the only one originally appeared on BloggingStocks on Wed, 14 Jan 2009 17:00:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>bank sectorFedfiscal policyfiscal stimulus packagegdpimportsMartin Wolfmonetary policyquantitative easingtoxic assetstradetrade deficitU.S. economyWed, 14 Jan 2009 17:00:00 EST