Tag Archives: fiscal stimulus

While the global inflation picture remains fixed at firmly normal (as in, disinflationary), US retail sales by contrast have been highly abnormal. You’d think given that, the consumer price part of the economic equation would, well, equate eventually price-wise. Consumers are spending, prices should be heading upward at a noticeable rate. To begin with, consumer spending – as pictured by the Census Bureau – was obviously boosted during January by the previous...

Europeans are growing more downbeat again. While ostensibly many are more worried about a new set of restrictions due to (even more overreactions about) COVID, that’s only part of the problem. The bigger factor, economically speaking, is that Europe’s economy has barely moved, or at most not moved near enough, off the bottom. To interrupt now what has already proved to be a seriously impaired rebound should get people thinking more realistically about 2021. Once...

There are three things the markets have going for them right now, and none of them have anything to do with the Federal Reserve. More and more conditions resemble the early thirties in that respect, meaning no respect for monetary powers. This isn’t to say we are repeating the Great Depression, only that the paths available to the system to use in order to climb out of this mess have similarly narrowed. That’s what’s ultimately going to matter the most, not what...

The Economics textbook says that when faced with a downturn, the central bank turns to easing and the central government starts borrowing and spending. This combined “stimulus” approach will fill in the troughs without shaving off the peaks; at least according to neo-Keynesian doctrine. The point is to raise what these Economists call aggregate demand. If everyday folks don’t want to spend – because a lot of them can’t – then the government will spend on their...

It had been 55 months, nearly five years since China’s vast and troubled industrial sector had seen growth better than 8%. Not since the first sparks of the rising dollar, Euro$ #3’s worst, had Industrial Production been better than that mark. What used to be a floor had seemingly become an unbreakable ceiling over this past half a decade. According to Chinese estimates, IP in March 2019 was 8.5% more than it was in...