The Mess That Greenspan Made - Part 20

Thursday Morning Links

MUST READS
Dollar’s Rise Causes Pain Abroad – WSJ
ECB holds rates, Draghi on stimulus next – Globe & Mail
BOE keeps interest rates on hold in December – Telegraph
Polls: Japan ruling party landslide in coming vote – AP
Energy Junk-Debt Deals Postponed as Falling Oil Saps Demand – Bloomberg
Happy Holidays From the Saudis and Shale Oil – Real Clear Markets
Racial Divide: The Tragedy of America’s First Black President – Spiegel
Putin Vows to Punish Speculators Pushing Down Ruble’s Value – Bloomberg
Putin says foes hope to dismember Russia; rouble falls as he speaks – Reuters
JPMorgan Hired Trader Who Knew How to Game Electric Markets – Wall Street On Parade
Fall of the Bond King: How Gross Lost Empire as Pimco Cracked – Bloomberg
Poor Black Friday Sales Aren’t What’s Holding Back the Economy – e21

MARKETS/INVESTING
Europe stocks steady ahead of ECB, China surges – AP
Russia, energy stocks smack emerging markets funds – USA Today
Why Are Stocks Thriving Amid Global Gloom? – Investors.com
S&P 500 Snapshot: 48th Record Close of 2014 – Adviser Perspectives
Extreme oil bears gamble on $40 crude – Financial Times
Bond Yields Near 18-Month Low Before ECB Decision – Bloomberg
Gold eases back towards $1,200/oz ahead of ECB meeting – Reuters
CHART: Gold now looks very expensive vs oil – Mining.com
Shanghai Gold Trade Passes Record as China Seeks More Sway – Bloomberg
Eurosystem Increasing Allocated Official Gold Reserves – Bullionstar

ECONOMY/WORLD/HOUSING/BANKING
The Canny Case for Canning Keynes? – Bloomberg
Unsteady Incomes Keep Millions Behind on Bills – NY Times
Xi’s Cultural Revolution Is Doomed to Fail – Bloomberg
Brazil Doubles Pace of Rate Increase to Meet Inflation Vow – Bloomberg
British agency raises economic growth forecasts for 2014, 2015 – xinhuanet
Stamp duty reform triggers panic buying of high-end London homes – Telegraph
Millennials to Dominate the Housing Market Next Year – Main Street
Millennials avoiding the housing market – KIMT.com
Bank of Canada worried about household debt – FP
Easy come, easy go – Washington Examiner

 

Running to Stand Still

It’s that time of the year again when families all across the country are grappling with the increased cost of health insurance during open enrollment (our premiums rose about 20 percent, necessitating a change in plan with higher deductibles, etc.).

This WSJ story looks at where spending has increased and decreased in recent years (much of which is due to prices that are rising or falling) and, not surprisingly, it has become increasingly difficult for many families to make ends meet.

Importantly, a 25 percent gain over six or seven years is an inflation rate of only 4 percent, but this has come at a time when wage gains have been only a fraction of that or much less for those who have transitioned to lower paying jobs since the last boom went bust.

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Wednesday Morning Links

MUST READS
Abe Shouldn’t Make His Mentor’s Mistakes – Bloomberg
Brent rebounds above $71 in turbulent oil market – Reuters
Oil futures slightly higher but markets remain jittery – MarketWatch
Russia Recession Signs Mount as Central Bank Stems Ruble Losses – Bloomberg
Oil Plunge: Who on Wall Street Got it Right? – Fox Business News
Uncertainty in Washington Poses Long List of Economic Perils – NY Times
Americans get failing grades in retirement knowledge – USA Today
Canadians’ debt mountain tops $1.5-trillion, and that’s not including mortgages – FP
The Truth Behind The Swiss Gold Referendum Escapes The Mainstream Media – Forbes
Deficit Spending And Money Printing: A German Point Of View – Zero Hedge
Five reasons why markets are heading for a crash – Telegraph
The Return of Currency Wars – Roubini, Project Syndicate

MARKETS/INVESTING
Stocks: 4 things to know before the open – CNN/Money
Brave speculators score on energy stock – USA Today
Note to investors: Stop being so lazy! – CNN/Money
Stocks are expensive, but here’s why 2015 could feed the bull – MarketWatch
Treasury Yields Extend Advance Versus G-7 Peers as Economy Grows – Bloomberg
Gold above $1,200/oz on investor repositioning, firm oil – Reuters
What Investors Can Learn from Sprott’s Shift from Resources – Gold Investing
Gold in ‘no-man’s land’, needs fresh catalysts – Bulliondesk
RBI chief says govt will review gold import norms – Reuters

ECONOMY/WORLD/HOUSING/BANKING
Long-term unemployment after the Great Recession – voxeu
Bank of China forecasts 7.2% GDP growth for 2015 – China Daily
Autumn Statement: Osborne says UK ‘on path to prosperity’ – BBC
If deflation is so terrible, why are Spain, Greece growing? – MarketWatch
More pressure for the ECB: Producer prices slide most in a year – MarketWatch
The Economist explains why the Ukrainian economy is in deep trouble – Economist
China’s Housing Market Still Struggling After the Interest Rate Cut – Forbes
Job, Income Gains to Propel Top 10 Housing Markets – U.S. News
B-Dud Explains The Fed’s Economic Coup – Contra Corner
Fischer’s Circle – Alhambra Partners

 

Hoarders

Future historians will no doubt have some fun with 20th and 21st century Americans’ propensity to buy stuff that they really don’t need with money they don’t have and then go store it in some shed. Businessweek recounts the dramatic increase in self-storage capacity in this story today, from which the graphic below was drawn.

While much of this is no doubt temporary storage due to life changes (divorce, relocation, etc.) much of it is likely akin to people who mindlessly pay the minimum balance on their credit cards every month, not really thinking about how this sort of thing adds up over the long haul, and, like banks, storage companies are more than happy to take their money.

© 2010-2011 The Mess That Greenspan Made