INNOVATION: America has a Structural Problem
by ilene - September 10th, 2010 1:30 am
This is a terrific article (yellow highlighting mine), courtesy of Gordon T. Long, The Tipping Point - Ilene
America has a Structural Problem
It’s a STRUCTURAL problem not a CYCLICAL problem!
It’s a DEMAND problem not a SUPPLY problem!
I gave President Barrack Obama six months to roll-out his doomed Keynesian policies, twelve months to discover they were flawed and eighteen months to realize that the solution to America’s problems must lie within a different economic framework. I had hoped by the end of twenty-four months to see new policies closer to an Austrian economic philosophy emerge. I was wrong.
Though, even the Wall Street Journal recently featured an article on the re-emergence of the Austrian School of Economic philosophy, it would appear that President Obama’s administration still neither gets it, nor I am afraid ever will. Key defections by his leading economic advisors, talk of the need for QE II and a Stimulus II, and a political collapse in public confidence suggests a growing awareness that Keynesian policies are not working, as many predicted they wouldn’t. Obama’s exciting rhetoric of Hope and Change has left myself and the majority of recent polled Americans disillusioned and disappointed. What I see the administration failing to grasp is twofold:
I-America has a Structural problem, not a cyclical business cycle problem. Though the cyclical business cycle was greatly worsened by the financial crisis, I would argue that the structural problem facing the US is actually a contributor to what caused the financial crisis.
…
 Twitter
|
LinkedIn
|
 del.icio.us
|
|
ROSENBERG: WE ARE IN A CLASSIC TOPPING FORMATION
by ilene - February 19th, 2010 4:47 pm
ROSENBERG: WE ARE IN A CLASSIC TOPPING FORMATION
Courtesy of The Pragmatic Capitalist
In a note to clients this morning David Rosenberg made an interesting comparison of today’s
“So what does the current backdrop resemble in a modern-day sense? The summer and fall of 2007. Think about it. The S&P
500 has been jerking around on either side of 1,100 for five months now. The 10-year note yield has jumped 20 basis points from the nearby low with hardly any reason outside of negative technicals.Go back to that period between May and October of 2007, and the S&P was just above or just below the 1,500 mark for over five months. Many didn’t know it then, and we should all be taking it into consideration now, but we were in a classic topping formation. Back then, as is the case today, the bond market was getting hit hard with the 10-year note yield surging 50bps, to 5.2%, and the universe of economists and strategists completely bearish on the Treasury market at just the wrong time. What goes around comes around.”
My initial reaction is to say, “this is pure datamining” but with the reflation trade, lack of regulation, rinsing and repeating of failed Keynesian policies, and the overall non-resolution of the credit crisis causes it’s fairly safe to say that we have officially returned to the status quo. Whether this is 2007 or 1992 is unclear in my opinion. What I do know is that we have resolved none of the problems that caused the credit crisis. Whether we are walking the edge of the cliff or on the launching pad of the next bull market remains uncertain. What is certain is that the Fed’s boom/bust policies are well intact and the U.S. economy will continue along its flawed path of bubbles = prosperity.
|
Twitter
|
LinkedIn
|
del.icio.us
|
|
German
Spanish
French
Italian
Portuguese
Japanese
Korean
Russian
Chinese
Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW.