Month: July 2014

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Pittance Pay

07/31/2014

Absent wage growth, it’s not possible to have sustained economy wide inflation. This is because it’s only increasing wages that allow people to continually pay more money for goods and services. If wages don’t rise, price for individual items can…

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Decent Data

07/30/2014

Today’s Q2 GDP estimate came in at 4%, better than expected. Moreover, the dismal -2.9% estimate of Q1 GDP was revised up to -2.1%. As for the underlying components, consumer spending increased at a 2.5% annualized rate, which is solid,…

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Monetary Matters

07/29/2014

While the Fed has been right to keep rates low because inflation has been totally benign for years, that doesn’t mean they will start raising rates at the right moment. They would much prefer to raise rates late and be…

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Buenos Bonds

07/28/2014

Should Argentina not pay its bondholders by Friday, it will default for the second time in 13 years. Argentina is paying investors who swapped their previously-defaulted bonds for new, less valuable bonds, but isn’t paying investors who refused the swap.…

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Pot Percentage

07/25/2014

The Friday File: Since recreational marijuana first became legal in Colorado on 1/1/14, an estimated 485,000 Coloradans, or 9% of the state’s population of 5.4 million, consume marijuana at least once a month. Of those 485,000 consumers, 30% or 145,500…

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House Holdings

07/24/2014

Prior to the recession, the average homeowner’s equity percentage in their home was 60%. That percentage is now 53.64% and has been rising steadily since bottoming out at 36.6% in Q1/09. This suggests we are quite close to fully recovering.…

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Strengthening Sales

07/23/2014

While existing home sales fell 2.3% in 6/14 to 5.04 million from 5.16 million a year earlier, don’t worry. Sales are at their highest level in eight months, and more importantly distressed sales are down from 15% of all sales…

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BRICS Banking

07/22/2014

Other than their collective animosity towards the World Bank and IMF, the five BRICS nations, despite having little in common, being geopolitical rivals, and disagreeing on fundamental issues, have created a Shanghai-based Development Bank. While undercapitalized, the Bank’s major role…

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Troubling Trade

07/21/2014

While the labor market, consumer spending, and capital expenditures are slowly improving, net exports are slightly weakening. When the Great Recession began, exports were flat while imports collapsed as our economy weakened much faster than the rest of the globe.…

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Alien Activity

07/18/2014

The Friday File: Since 1974, there have been almost 90,000 reported UFO sightings worldwide, most in the USA! Washington State is number one in sightings per capita (and number two in total sightings behind California) followed closely by Montana and…

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