The Mess That Greenspan Made - Part 415

Wednesday Morning Links

MUST READS
Romney edges Santorum in Iowa caucuses – MarketWatch
MF Global sold assets to Goldman before collapse – Reuters
Market rally a harbinger of things to come – Globe & Mail
Fed Shows Rate Forecasts, Boosts Transparency – Bloomberg
China mulls plans to boost domestic consumption – Reuters
China finds huge violations in audit on local debt – Channel News Asia
Greece Urgently Requests Clarity on Bailout Deal – Spiegel
JPMorgan sued for $95 million over mortgage securities – Reuters
Wall Street’s Big Swingers Get the Biggest Breaks – Bloomberg
Gross’s bond fund bleeds $1.4B in December – Reuters
Towards the Paranormal – Gross, Pimco
The Right Kind of Hope – Hussman Funds

MARKETS/INVESTING
Oil retracing on no new Middle East news – IBT
Gold eases as euro falls but consumers step in – Reuters
January Effect Could Help Keep Bid in Stocks – CNBC
Against Euro and Yen, Dollar Defied Reality – WSJ
Obama Official: “We’re Going to Kill the Dollar” – BER
Oil prices spike 4% on Iran supply threats – CNN/Money
Negativity In Gold Reaches Epic Levels – JS MineSet
Indian gold purchases collapse in Nov, Dec – Mineweb
Gartman as Gold Tops $1,600: ‘I Missed the Lows’ – CNBC
Gold Bulls Driven By Emotions – WSJ

ECONOMY/WORLD/HOUSING/BANKING
Personal finance: A layaway to save – Economist
Crowding Out and Hyper-Inflation Watch – EconBrowser
NBC’s Super Bowl ads sell out at record prices – CNN/Money
Tracking the Unreported (15.6%) Unemployed – Real Clear Markets
Euro zone inflation eases, boosts rate cut expectations – Reuters
Greece’s Least Bad Option Looks to Be Internal Devaluation – Bloomberg
China Home Prices Slide Amid Reserve-Ratio Speculation – Bloomberg
First-time buyers depend on parents to secure a home – NJ Biz
Housing’s Huge Supply and Demand Imbalance – CNBC
North Dakota oil boom fuels real estate sales in Arizona – USA Today
Futile: Thank you for contacting the New York Fed – Lars Schall
Economists React: Fed Moves to ‘Alleviate Uncertainty’ – WSJ

 

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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