The Mess That Greenspan Made - Part 5

Outlooks, Education, and Income

From a recent item at Pew Research via this Wall Street Journal story today come the two related charts below that go a long way in explaining the rise of presidential candidate Donald Trump who, not long ago, proclaimed “I love the poorly educated”.

One would think that if you factor in the gargantuan student loan debt that now comes along with many of those college degrees and income gains shown above for the millennial set, those blue and gray curves would adjusted downward, probably by a lot.

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Tuesday Morning Links

MUST READS
China to post worst quarterly growth in 7 years – CNN/Money
Saudi Rating Cut for First Time at Fitch on Lower Oil Prices – Bloomberg
The 28 Classified Pages About Saudi Arabia and 9/11 That Obama Might Release – Slate
What tools does the Fed have left? Part 3: Helicopter money – Ben Bernanke’s Blog
BlackRock: This is the hidden danger in negative rates – MarketWatch
Former Fed Adviser, Activists Lay Out a Plan for Change at the Fed – WSJ
Olivier Blanchard eyes ugly ‘end game’ for Japan on debt spiral – Telegraph
Strengthening Yen Leaves Kuroda Facing More Radical Options – Bloomberg
Goldman Sachs to Pay Billions in Fines, but Nobody’s Going to Jail – Vice News
Hillary Clinton has a hilarious new 404 error page – The Week
Sanders and the Snapchat Liberals – Real Clear Politics
Trump’s support deeper than it looks – Politico
How Trump would change the Fed – MarketWatch

MARKETS/INVESTING
Stocks: 4 things to know before the open – CNN/Money
Gloomy start to results season hits shares – Reuters
Goldman warns of earnings triple whammy – USA Today
Chinese Stocks Decline as Premier Li Flags Pressures on Economy – Bloomberg
Accounting Magic 101: This Is How Alcoa Just “Beat” Consensus EPS -Zero Hedge
What the Military Can Teach Us About Investing – Fortune Financial
Hedge Funds Abandoning Dollar’s Biggest Bull Run in a Generation – Bloomberg
Gold climbs as dollar sinks to near 8-month low – Reuters
Silver Bullion Surges 8% In 6 Days To Over $16 Per Ounce – GoldCore
Monday mad rush for gold stocks – Mining.com

ECONOMY/WORLD/HOUSING/BANKING
Income inequality is chipping away at Americans’ life expectancy – Vox
The Global Economy Didn’t Change Last Year, Views of QE Did – Alhambra Partners
Soaring air fares nudge inflation away from near-zero levels – Telegraph
Puerto Rico Aims to Appease Congress With New Debt Proposal – NY Times
China’s growth to decline to 6.7% this year: World Bank – CNBC
Brazil congressional committee recommends impeaching Rousseff – Reuters
Can Ottawa do anything to cool down the housing market? – CTV News
China steps up crackdown on underground banks – regulator – Reuters
Obama Is ‘Pleased’ With Yellen as Economy Shows Signs of Slowing – Bloomberg

 

Fun with Hillary

Saturday Night Live lampoons Democratic front-runner for president Hillary Clinton…

I don’t know about you, but I’m not looking forward to four years of comedic takes on any of the current presidential candidates, though, if you had to rank the prospects strictly by their entertainment value, it would probably go Trump, Cruz, Clinton, and Sanders.

As any Daily Show fan could attest, Trump is the gift to comedians that just keeps on giving (though, admittedly, the idea of President Trump isn’t as funny as it was nine months ago), whereas the other three are more challenging (and not nearly as funny).

Monday Morning Links

MUST READS
Germany Takes Aim at the European Central Bank – Spiegel
Schäuble: Time Is Near to End Central Banks’ Easy-Money Policies – WSJ
Negative rates could fuel fresh ‘boom and bust’, IMF warns – Telegraph
Panama Furor Rumbles Into Week Two as Global Pressure Mounts – Bloomberg
How a US president and JP Morgan made Panama into a tax haven – Guardian
Obesity Is Now a Bigger Global Problem Than Hunger – Fiscal Times
Cruz, Trump prepare mass-money arms race in California – Politico
The Boston Globe imagined covering a President Donald Trump – Vox
Bernie Sanders Is Even Less Competitive Than He Appears – Five Thirty Eight
Janet Yellen disagrees with Bernie Sanders – CNN/Money
Bernie and the Big Banks – Robert Reich
Bubble Economy or Not? – Credit Bubble Bulletin
Rounding the Bubble’s Edge – Hussman Funds

MARKETS/INVESTING
Stocks: 4 things to know before the open – CNN/Money
The Strange Case of the Missing Crisis – Wall Street Jounral
U.S. banks’ dismal first quarter may spell trouble for 2016 – Reuters
Bill Gross: Why Interest Rates Must Rise – Barron’s
Wall Street hope: 1Q profits to mark trough – USA Today
Reports of Oil Rally’s Death Premature as Inventories Decline – Bloomberg
Why beating lowered earnings expectations won’t help stocks soar – MarketWatch
Rate outlook helps gold to highest in almost three weeks – Reuters
Wishes Aside, Gold Is Going To Fly – Capitalist Exploits

ECONOMY/WORLD/HOUSING/BANKING
Why no economic boost from lower oil prices? – Econbrowser
Minimum-Wage Test: Guess Which States Lost Retail Jobs Since 2014 – IBD
China Consumer Inflation Pick Up Continues in March on Food Prices – Bloomberg
China Newspaper: Great Firewall Necessary to Keep Out Western Propaganda – WSJ
Tentative Ceasefire Begins in Yemen Amid Threats and Fighting – Vice News
Tsipras demonises IMF to rally troops for bailout sacrifices – Reuters
There’s a surge in the amount of money in circulation in India – Quartz
Team Obama is setting us up for another housing-market collapse – NY Post
Can central banks make 3 major mistakes in a row and stay independent? – mainly macro
Yellen will regret slow pace of rate hikes, top forecaster says – MarketWatch

 

Yellen: “Not a bubble economy”

It’s hard (for someone like me at least) not to think that Ms. Yellen’s opening comments in the video below will come back to haunt her someday:

This is an economy on a solid course – not a bubble economy…

It could be right up there with Greenspan’s “irrational exuberance” comments back when they could have cooled the late-1990s internet/stock market bubble and, of course, Bernanke’s assurance that “troubles in the subprime sector on the broader housing market will be limited” (and not “limited to planet earth” as Jim Grant once quipped).

It doesn’t appear there are any similar offerings for Volcker.

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