by James

The financial world is neatly dividing into two camps. One camp thinks that governments, are running into fiscal risks, where future growth increasingly struggles to cover rapidly rising debt burdens. It calls for retrenchment and rebalancing before the panic-ridden onset of Credit Crisis II, which it fears will be all the more catastrophic because it [...]

by Gregory

Q3 GDP growth first release is the most expected number this week. First, there is no doubt that the reading will be positive putting an end to 3 consecutive quarters of negative real GDP growth. Psychologically speaking, this should be a sigh of relief to the markets and even possibly lift  its mood.  But, to which extent? This [...]

by James

The Russian equity market has soared a remarkable 100 percent since January. At the same time, investors may have noticed a curious silence from the nation’s once-raucous investment management community. Considering how the RTS Index fell in 2008, this newfound discretion is welcome. What is the outlook for the market for the remainder of the [...]

by James

Finally the official stress test results are out. Yippee! I’ve made my views clear on several occasions, it seems to me that the only thing the stress tests really demonstrated was the power of the financial sector’s lobby group.  Considering how clear an example Japan represents of how desperately important it is to clean out [...]

by Markus

Some impulses for the weekend. What if … … the economy comes to a full halt even worse than now? Over six in ten Americans (latest Times survey) think that someone in their household will lose their job in the next year. That means six in ten people won’t buy anything other than basics. … [...]

by Markus

Some add-on thoughts to yesterday´s article of Martin Wolf (Financial Times “Japan’s lessons for a world of balance-sheet deflation”) about balance sheet recessions. In summer 2008 Richard Koo, Chief economist at the Nomura Research Institute, published “The Holy Grail of Macroeconomics”, the updated edition of an earlier publication about balance sheet recessions. His empirical analysis [...]

by Gregory

On Monday, the NBER committee determined that a peak in economic activity occurred in the U.S. economy in December 2007. The peak marks the end of the expansion that began in November 2001 and the beginning of a recession. The expansion lasted 73 months; the previous expansion of the 1990s lasted 120 months. The committee [...]

by James

The near 20% bull market of recent days not withstanding, equity markets are down around the globe, reflecting a financial market shock the likes of which has rarely been seen. Economies are reeling in response, meriting further nervousness about equity market perspectives. On many ratios, equities look cheap, but the prospect of a global recession [...]