Archive for February 2016

The Friday File: Americans will spend $19.7 billion on Valentine’s Day, up from $18.9 billion last year and slightly higher than the GDP of Haiti. Of those celebrating Valentine’s Day, men will invest $196.39; women $99.87. The most popular gifts given by men are flowers and candy. Women are most likely to give candy and…

With fear and volatility pervasive, financial markets are stymieing central banks. In Japan, where the economy probably shrank in Q4, and where 10-year bond yields are negative as a result of negative interest rates having been recently introduced in an effort to further weaken the yen, the yen is at a 16 month high vs.…

While most stock market declines are false alarms when it comes to predicting recessions, when the market declines by 20% or more, watch out. In the past 50 years there have been seven such declines. The worst three, 1973, 2001 and 2007 were followed by recessions. Of the remaining four, in 1969 and 1981 recessions…

Despite a record 27.3 million Hispanics being eligible to vote in the fall elections, and almost half being Millennials, Hispanic influence will be muted. In 2012, just 37% of Hispanic Millennials eligible to vote voted, and over half of all eligible Hispanic voters live in California, New York and Texas, non-battleground states. It will be…

While down from December, January’s 151,000 new jobs was solid! The labor force participation rate rose to 62.7%, 0.3 points above the September low, and its best showing since 5/15; for those 25-55 the LFPR is up 0.5 points since September! Moreover, the unemployment rate fell to 4.9%, manufacturing added the most jobs in over…

The Friday File: With a prediction rate of 82%, a level any economist would be proud of, and a streak of perfection dating back to 2009, the Super Bowl Predictor is not to be taken lightly, despite having not a shred of intellectual validity. The SBP states that if an original NFL team or a…

To reduce corporate inversions, where US firms buy foreign firms to reduce taxes, in 9/14 the Treasury attempted to curb such deals by making them more difficult. That said, in the 16 months since 9/14 there have been 12 corporate inversions, about as many as occurred in the 16 months prior to the more stringent…

With manufacturing weak, services weakening, inflation non-existent, credit spreads widening, the long end of the yield curve not rising, and central banks in Europe, Japan and China all actively easing, the Fed will almost certainly not raise rates in March. The earliest they will boost the fed funds rate is June. It’s not that the…

Despite weak economic growth throughout the developed world, the only institutions trying to fix things are central banks. And while they can do a great deal, they cannot permanently boost economic growth via increased infrastructure spending or by passing tax, labor, education or immigration reforms. That is a job for legislatures and they are all…

The Saudis won’t reduce oil production, Iraqi output rose by 900,000 bbl/day last year with output likely to continue to increase in 2016, and Iranian output is set to surge by at least 600,000 bbl/day. Add to that weakening global growth led by China and the strengthening dollar, both of which crimp demand, and it…