2012 January 03 | timiacono.com

ISM Manufacturing Index Still Improving

Given all the recent better-than-expected reports on the U.S. economy, it shouldn’t be too surprising to see the ISM manufacturing index at a six-month high, up from 52.7 in November to 53.9 in December with a strong reading for leading indicators.

The new orders component rose from 56.7 to 57.7 and the drawdown in backlog orders improved, up from 45 to 48 while employment, production, imports, and exports gained.

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Not Understanding Krugman on Debt

It is not entirely clear which is more entertaining this morning – re-reading Paul Krugman’s “Nobody Understands Debt” commentary from yesterday’s New York Times, in which he ignores the flight to safety from the eurozone over the last half of 2011 while arguing that low Treasury yields are a vote of confidence in the dual U.S. policies of record deficit spending and record money printing (the latter also helping to push bond prices up and yields down) … or the many retorts to his recent offering:

I’ve not read through all of these yet and my guess is the third item on the list above might express agreement with Krugman, though the fourth one probably does not.

There are no doubt lots more where these came from and, to be fair, there are probably an equal number of positive reactions as there are negative ones (just have a look at some of the comments on the original commentary). I suppose we’ll be hearing a lot more about the nation’s debt as the election season heats up…

The Farmland Boom in Iowa

After today, we won’t be hearing much about Iowa anymore as aspiring presidential candidates pack up and leave town following today’s caucuses, but, this NBC report on the farmland boom there puts things in a slightly different perspective than you may have heard after listening to talking heads on MSNBC and Fox News for the last few months.

Visit msnbc.com for breaking news, world news, and news about the economy

There are some pretty impressive statistics associated with the boom – per acre prices in Iowa up over 30 percent from last year and, across the entire Midwest, up about 25 percent … and you thought the real estate bubble was over.

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Tuesday Morning Links

MUST READS
Greece warns on euro exit if bailout not signed – BBC
2012 could be the year Germany lets the euro die – Telegraph
Eurozone: Why does the crisis linger, deepen and spread? – Wall Street Pit
Germany and Europe Both Expect a Tough 2012 – Spiegel
World’s Biggest Economies Face $7.6 Trillion Debt – Bloomberg
Analysis: Asia’s double-edged currency sword – Reuters
Hu: West Is Trying to Divide China by Using Cultural Weapons – Bloomberg
Iranian currency slides under latest U.S. sanctions – Washington Post
Wall Street’s 2011 Predictions – How’d They Do? – Reformed Broker
The Ultimate 2012 Investment Predictions & Outlook List – PragCap
The Debtwatch Manifesto – Steve Keen’s Debtwatch
Mistakes and How To Deal With Them – Krugman, NY Times
Krugman v. Krugman – Marginal Revolution

MARKETS/INVESTING
Oil jumps to $101 amid rising Iran tensions – AP
Gold rises in line with recovery of euro – Reuters
Stocks in 2012: Up, up, but not away – CNN/Money
Major Asset Classes 2011 Performance – Capital Spectator
How market fares in January’s of election years – MarketWatch
A Major Divergence: Buy Miners and Sell Bullion – Peter Brandt
Dollar Demise Exaggerated after 13% Gain Since 2008 – Bloomberg
Gold could go to $1,200-$1,300/oz – Jim Rogers – Mineweb
Why Gold Will Likely Go Nowhere In 2012 – Seeking Alpha
What is gold telling us? – MarketWatch

ECONOMY/WORLD/HOUSING/BANKING
New year’s surprise for the economy? – MarketWatch
For 2012, Signs Point to Tepid Consumer Spending – NY Times
Rethinking the Growth Imperative – Rogoff, Project Syndicate
Germany’s unemployment rate at record low in December – BBC
Nigerians Stop Gas Stations From Selling Fuel – Fox News
Iceland: Success through failure – Zero Hedge
The Decline and Fall of the Euro? – Gros, Project Syndicate
S. Korea manufacturing shrinks most in 3 years – Reuters
A different boom in Iowa: Real estate prices soar for farmland – MSNBC
Will the Fed Raise Rates Soon? – Crossing Wall Street
What is Modern Money Theory? – Credit Writedowns
The Austrian Theory of Money – Mises

 
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