August, 2011
U.S. Justified in Seeking to Block AT&T, T-Mobile Merger
The Justice Department is correct to be concerned about the potential anti-competitive effects of a merger between ATT and T-Mobile. Such a merger would threaten the viability of Sprint-arguably the more aggressive of the top three wireless carriers in introducing new technology-and solidify the grip of two legacy Bell companies.
Decaying Household Wealth
Consumer Confidence had its biggest point drop since October, 2008. The Conference Board Index came in 44.5 from a revised reading of 59.2. Consumer spending from yesterday’s report showed an increase in purchases for the month of July.
Jobs Report Will Offer Little Evidence Washington’s Policies Lifting Economy
Friday, forecasters expect the Labor Department to report the economy added only 67,000 jobs in August-my estimate is 63,000. Either would be much less than the 130,000 the economy must create each month to stay even with adult population growth.
August 29, 2011
Dow Jones Industrial Average continues last week’s rally, on news of increase in consumer spending in the month of July. Consumer spending rose 0.8%, the biggest gain since February. Spending was mostly in auto purchases and utilities. It is interesting to note that the increase in spending was due to Americans dipping into their savings [...]
Economic Impact of Hurricane Irene – Updated
Although, initially a Category 1 hurricane and now only a tropical storm, Irene is testing flood-level records in New York City and in much of the Northeast, raising casualty loss estimates to $20 billion. Two days of lost economic activity, over a period of a week, is almost certain, and adds another $20 billion. Longer [...]
Economic Impact of Hurricane Irene
Early estimates of the direct damage caused by Hurricane Irene are in the range of $7 billion. Add to those the loss of about one or two days economic activity, spread over a week across 25 percent of the economy, and an initial estimate of the losses imposed by Irene is about $25 to $30 [...]
Now it is up to the Politicians
In a much anticipated speech by Bernanke in Jackson Hole today, the Fed Chairman said that he is optimistic about future growth and ruled out QE III at the moment. Dow Jones Industrial Average slumped over 200 points initially but regained the loss during the rest of the day and ended up with a gain [...]
Showdown in Jackson Hole Tomorrow
Kansas City’s Federal Reserve President Hoenig said today, at an interview, that the Fed has done all it can do on the monetary side to revive the economy, a sentiment which I have shared in the past. Hoenig, along with Dallas’s Fed President Fisher, expressed the fact that monetary policy can’t be expected as a [...]
All Eyes on Bernanke
The Dow Jones Industrial Average gained almost 500 points this week in anticipation of another round of Fed stimulus. The world is waiting for Bernanke to make some type of announcement at the Jackson Hole conference. Money flowed out of gold and U.S. treasuries as investors waited for QE III. Gold retreated over $150 per [...]
The Dirty S Word
The definition of recession is a significant decline in economic activity lasting more than a few months. The technical definition is two consecutive negative GDP. The Fed’s policy since the 2008 recession has been to avoid a second recession in the economy. QE I, QE II and possibly QE III are extreme measures by the [...]
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