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MOSLER'S LAW: There is no financial crisis so deep that a sufficiently large tax cut or spending increase cannot deal with it.

Archive for the 'Uncategorized' Category

4 Charts- with a lower propensity to spend the deficit needs to be higher

Posted by WARREN MOSLER on 8th June 2014


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PMI

Posted by WARREN MOSLER on 2nd June 2014

Still doesn’t look all that exciting…


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Ice Farm Weekly Update

Posted by WARREN MOSLER on 2nd June 2014

Ice Farm Weekly Summary

By: Michael W. Green

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Warsaw Conference Pictures

Posted by WARREN MOSLER on 27th May 2014

Warsaw Conference Pictures

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Honorary Degree commencement this Sunday

Posted by WARREN MOSLER on 14th May 2014

Honorary Degree

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Warsaw conference

Posted by WARREN MOSLER on 13th May 2014

>   
>   (email exchange)
>   
>   On May 13, 2014 12:31 PM, Mariusz wrote:
>   
>   Mr. Mosler,
>   
>    It’s official, your conference will take place on May 20th starting at 13:00 hrs in REGENT >   WARSAW HOTEL (formerly Hyatt) Belwederska 23, 00-761 Warsaw, Poland.
>   
>   We are still working on some promotional stuff and we’ll be keeping you posted .
>   
>   Regards
>   
>   Mariusz
>   

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That Confounding Mr. Market

Posted by WARREN MOSLER on 11th May 2014

That Confounding Mr. Market

By Gary Carmell

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Consumer credit

Posted by WARREN MOSLER on 7th May 2014

Keeps coming back to fiscal for me.

I see the year over year change going from up nicely to flattening/decelerating as the tax hikes, followed shortly after by the sequesters, took their toll. And with the federal deficit way down, that ‘spending more than income’ isn’t there to help offset the ever growing ‘demand leakages’, meaning we need that much more ‘borrowing to spend’ to grow, etc.

So far, with GDP tracking at about -.5 for q1 and +4.5 for q2, that’s about a +2% first half, down a lot from H2 2013, which I saw as higher than otherwise due to inventory building and ‘mysterious’ year end surges that had the appearance of spending ahead of expiring tax credits, etc.

So I see what’s happened (and worse) as consistent with my narrative, with the evidence looking more and more like the demand leakages may now be ‘winning the race.’

Which also explains the long bond coming down in yield??? ;)

Consumer Credit



Highlights
Credit card debt is not building, a plus for consumer wealth perhaps but a definite minus for store sales. Consumer credit did expand by a sharp $17.5 billion in March but, as has been the case since the 2008 financial meltdown, the gain is centered almost entirely in non-revolving credit which continues to get a boost from strong vehicle sales and the government’s acquisition of school loans from private lenders. Revolving credit is barely showing any life, up $1.1 billion following a decline of $2.7 billion in February.

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Auto stabilizers reduce the deficit until growth goes negative causing them to reverse

Posted by WARREN MOSLER on 20th April 2014


(chart from Roger Mitchell)

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small business optimism index

Posted by WARREN MOSLER on 9th April 2014

The post weather ‘bounce’ didn’t even reverse the prior month’s drop:


Highlights
There are signs of confidence in the small business optimism index which jumped 2.0 points to 93.4 to nearly reverse a 2.7 point downswing in February. The March gain is led by expectations for future sales and by plans to build inventories — both pointing to expectations of building strength. Of the 10 components, six are up in the month, two are unchanged, and only two are down. Unfortunately, of the two that are down one is hiring plans.

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March U.S. Auto Sales Were In Like A Lamb, Out Like A Lamb – Forbes

Posted by WARREN MOSLER on 31st March 2014

Not a lot of bounce back here yet:

March U.S. Auto Sales Were In Like A Lamb, Out Like A Lamb

By Jim Henry

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NFIB Small Business Optimism Index

Posted by WARREN MOSLER on 11th March 2014

Weather worse than expected.
;)

This is a lesser indicator that only matters if it goes up…
;)

NFIB Small Business Optimism Index

Highlights
The small business optimism index, which had been on a rebound, fell sharply in February, down 2.7 points to 91.4. A weakening in sales expectations pulled the index down the most followed by economic expectations and hiring plans.Respondents continue to reduce inventories and are reporting no more than limited pricing power.

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Bernanke out visiting friends…

Posted by WARREN MOSLER on 4th March 2014

Plus airfare, hotel, meals, airport limo, etc. ;):

Bernanke received at least $250,000 for his appearance at the financial conference staged by National Bank of Abu Dhabi, the UAE’s largest bank, according to sources familiar the matter. NBAD did not announce the fee.

Because of Abu Dhabi’s oil wealth, state-controlled NBAD prospered during the global crisis caused by Lehman’s collapse, taking market share from hard-hit U.S. and European banks.

Bernanke’s speaking fee is similar to one received by his predecessor Alan Greenspan for an Abu Dhabi speaking engagement in 2008, the sources said.

Greenspan embarked on a series of lucrative speeches after he stepped down, and Bernanke now appears to be doing the same. He is scheduled to speak at an event in South Africa on Wednesday and in Houston on Friday.

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Strapped Scientists Abandon Research and Studentst

Posted by WARREN MOSLER on 2nd March 2014

:(

Strapped Scientists Abandon Research and Students

Less money means less science, as shown by a Chronicle survey of more than 10,000 researchers.

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Business borrowing down 44% from Dec

Posted by WARREN MOSLER on 26th February 2014

Expiring tax cuts accelerated capex?

U.S. business borrowing for equipment rises in January: ELFA

Feb 25 (Reuters) — U.S. companies borrowed more in January to spend on capital investment, the Equipment Leasing and Finance Association (ELFA) said.

Companies signed up for $6 billion in new loans, leases and lines of credit last month, up 2 percent from a year earlier, but fell 44 percent from December, according to data from the ELFA.

“With fiscal pressures in Washington subsiding … and most major U.S. economic indicators showing positive signs, we are hopeful that these factors will help promote a favorable climate for continued investment in 2014 and beyond,” ELFA Chief Executive William Sutton said.

Washington-based ELFA, a trade association that reports economic activity for the $827 billion equipment finance sector, said credit approvals totaled 76.9 percent in January, down from 78.3 percent in December.

ELFA’s leasing and finance index measures the volume of commercial equipment financed in the United States. It is designed to complement the U.S. Commerce Department’s durable goods orders report, which it typically precedes by a few days.

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Portugal comments

Posted by WARREN MOSLER on 24th February 2014

From FT on Portugal, says it all:

The national statistics office noted worrying signs that domestic demand was contributing positively to growth in the last quarter for the first time since 2010. This may reflect the impact of previous cuts in public sector pay and pensions that were subsequently overturned by Portugals constitutional court. An over-reliance on the domestic market has been seen as one of Portugals structural weaknesses but exports are now driving the turnround.

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Dallas Fed chart (just weather)

Posted by WARREN MOSLER on 24th February 2014

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no income growth=no spending growth

Posted by WARREN MOSLER on 24th February 2014

CFOs signal fears of consumer spending slump

By Matt Clinch

February 20 (CNBC) — With wage rises failing to match the flickering signs of an upturn in the global economy, chief financial officers have told CNBC that a lack of consumer spending is a major fear for their companies.

CNBC asked 51 chief financial officers (CFO) from Europe and Asia who make up the CNBC CFO council to give their insight on the state of the world economy and conditions for doing business. Nearly half of the respondents ranked weakening consumer demand as their strongest concern for their business. No other risk factor even came close, with fears of a China slowdown receiving 16 percent for their highest ranked concern.

The results match a similar signal from CFOs in the America. In December, the U.S.-based members of the exclusive Global CFO Council ranked weakening consumer demand as one of biggest issues keeping them up at night.\

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G-20 delays making things worse until at least November

Posted by WARREN MOSLER on 23rd February 2014

The G-20 said it would “significantly raise global growth” without overtaxing national finance through measures to promote competition and increase investment, employment and trade.

As an initial step toward achieving the $2 trillion target, each country will present a comprehensive growth strategy to a summit of leaders scheduled for November in the Australian city of Brisbane.

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philly fed chart and details

Posted by WARREN MOSLER on 20th February 2014

Sending this around for another data point and as a reminder that the higher readings of a few months ago were used by the mainstream to support their growth forecasts.

Details

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