The Mess That Greenspan Made - Part 11

Wednesday Morning Links

MUST READS
Ferguson on edge awaiting grand jury – Reuters
Keystone XL pipeline bill fails in the Senate – Vox
Russia and Venezuela to fight low oil price – DW
Russia warns of military assault on the east – AP
Kurds say West not providing enough arms to defeat ISIS – Reuters
Federal Private-Pension Safety Net Running $62 Billion Deficit – WSJ
CBO study shows ‘the rich’ pay almost everybody’s share of taxes – AEI
Marijuana Entrepreneurs Should Follow Joseph Kennedy’s Example – reason.com
Lenders say ‘out of control’ interest in new subprime products – Scotsman
Where Do Poverty and Inequality in the U.S. Overlap? – WSJ
What Blows Up First? Part 5: Shale Oil Junk Bonds – Dollar Collapse
Media “Shocked” by Japan’s GDP Fiasco? – Wolf Street

MARKETS/INVESTING
Stocks turn higher in Europe ahead of Fed minutes – AP
Gold vs. Stocks: The 10-Year Winner Is… – WSJ
The latest M&A boom is going to end badly – MarketWatch
Five things to do now if you’re near retirement – USA Today
Treasuries Drop Before Fed Minutes May Signal Economic Optimism – Bloomberg
Gold retreats from near 3-week high ahead of Fed minutes – Reuters
Silver Physical Demand Forecast to Drop 6.7% in ’14: GFMS – Bloomberg
Australia exports two-thirds of gold mine supply to China – SRSrocco Report
India readies draconian gold import rules – Mining.com
Gold mining equities pop – Mineweb

ECONOMY/WORLD/HOUSING/BANKING
The ultra wealthy get $2 trillion wealthier – CNN/Money
Economists: Inflation Measure ‘Distorted,’ a ‘Statistical Quirk’ – WSJ
Deflation and the markets: Trends in low places – Economist
Americans recognize slow economic recovery – YouGov
Abe’s Tax Decision a Mixed Blessing for Central Bank — BOJ Watch – WSJ
Putin Said to Stun Advisers by Backing Corruption Crackdown – Bloomberg
Housing bubble? Turns out we might need all those condos and houses – FP
American Dream homes: Prices in 10 cities – CNN/Money
Yellen Should Not Let Wages Be Her Guide – Manhattan Institute
Yellen Inherits Greenspan’s Conundrum as Long Rates Sink – Bloomberg

 

Why Bretton Woods Ended

… or at least one of the major reasons why the “gold-backed U.S. dollar” post-World War II monetary system met with a speedy demise in 1971 after the U.S. government embarked on a “guns and butter” spending spree back in the 1960s.

Courtesy of Nick Laird at Sharelynx who once again has managed to produce a chart that says more than words could ever say about the evolving global monetary system that, lately, appears to be getting a little unstable.

Tuesday Morning Links

MUST READS
Japan’s Warning to the World – Bloomberg
Japan’s Abe calls snap election, puts off tax hike – AP
‘Godfather’ of Abenomics: Japan’s sales tax hike must be delayed – Telegraph
As Japan Falls Into Recession, Europe Looks to Avoid It – NY Times
NATO sees ’serious military buildup’ in Ukraine – Reuters
The Fed Needs Governors Who Aren’t Wall Street Insiders – WSJ
Democracts Alienate Millennials: Young Liberals Look Longingly at Rand Paul – reason.com
Stockman And Stiglitz On Crony Capitalism: Agreements & Disagreements. – Contra Corner
Americans Still Have NO CLUE About How Much Inequality We Have – Washington’s Blog
When Piketty Argued for Income Redistribution, He Changed Economics – Fiscal Times
The Bloody History of Money, From Ancient Rome to ISIS – The Atlantic
Obamacare’s Approval at Lowest Rating on Record – Fiscal Times

MARKETS/INVESTING
Japan leads world markets higher on stimulus hopes – AP
Greenspan Conundrum Risk Rising for Fed as BOJ, ECB Add Stimulus – Bloomberg
Hong Kong, China stocks ease on profit-taking after stock connect launch – Reuters
Five charts show how stock repurchases boost prices – MarketWatch
Flash Boys Raising Volatility in Wild New Treasury Market – Bloomberg
Gold gains 1.5 pct to 2-1/2 week high as dollar softens – Reuters
India Precious Metals Import Explodes In October – BullionStar
Gold bounces back above $1 200 – will it jump higher? – Mineweb
How Much Earmarked Gold Holds The Federal Reserve? – GoldSilverWorlds
Swiss yes vote won’t really boost gold price – Mining.com

ECONOMY/WORLD/HOUSING/BANKING
More aging parents move in with their kids – MarketWatch
Long-term Unemployment a Sign of Slack, NY Fed Economists Say – WSJ
The US doesn’t have any debatable recessions. That’s about to change – Money Illusion
‘Red Warning Lights’ Are Flashing On Global Economy, David Cameron Says – WSJ
UK inflation rate rises to 1.3% in October – BBC
Reforming China’s Commanding Heights – Project Syndicate
Old foreclosure debt coming back to haunt former homeowners – CNN/Money
Fed Dual Mandates Clash as Jobless Drop Vies With Inflation – Bloomberg
Fed Inflation Barometer Tumbles To Lowest Since 2008 – Zero Hedge
The Risks to the Inflation Outlook – San Francisco Fed

 

The Japanese are Turning Japanese

In case you hadn’t heard about Japan’s horrific third quarter GDP numbers, the chart below via this BBC report should aid in understanding why the financial world is again baffled by the failure of central bank largess to impact the real economy in the desired fashion.

Analysts were expecting a growth rate of +2 percent and what they got was -2 percent, surprisingly fitting the widely accepted definition of a recession (two consecutive quarters of contraction). This sort of thing seems to happen a lot in Japan.

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