The desire of lenders to lend and of borrowers to borrow has shriveled dramatically. The conventional economic thinking about interest rates, lending and borrowing goes like this: When money is cheap, people and banks are more inclined to borrow and lend, respectively. The money is used to expand businesses and make purchases, resulting in economic [...]
Deflation Watch
Originally published by Bloomberg on June 7, 2013 Read the original article.
The global deflationary trend described in Conquer the Crash is evident in the eastern European country of Ukraine. The nation’s economy has contracted for the past 7 months. A June 7 Bloomberg article also reports that “Ukraine’s economy shrank 1.3 percent in the first quarter from a year earlier as demand waned for the country’s [...]
In Ernest Hemingway’s classic novel The Sun Also Rises, a piece of dialogue goes like this: “How did you go bankrupt?” “Two ways. Gradually, then suddenly.” That scenario is unfolding in many U.S. states and cities today. Municipalities have borrowed and spent for decades. A substantial number are going broke. Despite signs of economic recovery, [...]
The economy has been sluggish for five years. There’s no shortage of chatter about “why,” yet few observers mention deflation. One exception is a hedge fund manager who spoke up at the recent Milken Institute Global Conference. The presentation by Dan Arbess, a partner at Perella Weinberg and chief investment officer at PWP Xerion Funds, [...]
Nothing short of a complete overhaul will get the U.S. economic engine purring again. The financial mechanics have been trying to get that engine firing on all cylinders for five years now. They’ve used every tool at their disposal. Yet the engine continues to sputter. Data ranging from employment to retail sales and manufacturing weakened [...]
In a time of economic turmoil, what you know can be as important as what you have. Your possessions can decline in value or be lost altogether, but your knowledge cannot be taken away. You can use what you know to protect what you have. Evidence suggests that many Americans fail to grasp this basic [...]
