Financial Times (November 16)
“This week, the consequences of the eurozone’s misguided policies were brought home to the politicians overseeing them.” Millions of workers went on strike just as the area fell back into recession. “The eurozone theology of austerity by all is doing its predictable beggar-thy-neighbour work…. This economic and political damage was caused by a wrong-headed morality tale that attributed the debt crisis to fiscal indiscipline, when in reality profligacy was a sin most promiscuously practised by private lenders and borrowers.”
Tags: Debt crisis, Economy, eurozone, Recession, Strike
Financial Times (November 11)
According to preliminary figures released by Japan’s Cabinet Office, the domestic economy contracted by 0.9% during the July to September period, amid falling exports and dwindling stimulus from rebuilding efforts. “As many economic indicators have deteriorated further since September, it seems likely that the country has entered its fifth technical recession – two consecutive quarters of contraction – of the past 15 years.”
Tags: Cabinet Office, Economy, Exports, Japan, Rebuilding, Recession, Stimulus
The Economist (October 6)
“For investors around the world, the recovery seems assured. The MSCI global share index has risen almost 10% since July. The credit for this largely goes to central bankers.” This is not, however, a time for overconfidence. “As long as politicians in the world’s big three economies continue to dither, another global recession is possible.”
Tags: Central bankers, Economy, Investors, MSCI, Politicians, Recession, Recovery
Wall Street Journal (April 8)
As a group, S&P companies have gained efficiency while rebounding to pre-recession levels. “S&P 500 companies have become more efficient—and more productive. In 2007, the companies generated an average of $378,000 in revenue for every employee on their payrolls. Last year, that figure rose to $420,000.” These same companies have also increased capital expenditures, reduced debt and increased cash on hand.
As a group, S&P companies have gained efficiency while rebounding to pre-recession levels. “S&P 500 companies have become more efficient—and more productive. In 2007, the companies generated an average of $378,000 in revenue for every employee on their payrolls. Last year, that figure rose to $420,000.” These same companies have also increased capital expenditures, reduced debt and increased cash on hand.
Tags: CAPEX, Cash, Debt, Efficiency, Productivity, Recession, S&P
Financial Times (February 23, 2012)Financial Times (February 23, 2012)
“Japan has somehow managed to creep by with its problems untouched.” Will Japan’s “happy depression” end as the Greek crisis settles down? Jim O’Neil of Goldman Sachs believes there’s reason to worry. “Japan’s outstanding debt to gross domestic product stands at a whopping 230 per cent and makes Greece’s latest 120 per cent by 2020 target seem like a picnic by comparison.”“Japan has somehow managed to creep by with its problems untouched.” Will Japan’s “happy depression” end as the Greek crisis settles down? Jim O’Neil of Goldman Sachs believes there’s reason to worry. “Japan’s outstanding debt to gross domestic product stands at a whopping 230 per cent and makes Greece’s latest 120 per cent by 2020 target seem like a picnic by comparison.”
Washington Post (September 27)
“If Europe goes bankrupt, taking the rest of the world down with it, it won’t be for a lack of ideas about how to fix the continent’s sovereign-debt mess.” Yet, Germany has applied the brake to any number of fixes. It looks like the price for this inaction will be “a brutal, global recession.” Hopefully, Europe’s leaders can still avert this by demonstrating “clearly and convincingly that they have a plan for restructuring insolvent countries (e.g., Greece) while shoring up salvageable ones (e.g., Italy and Spain).”
The New York Times (July 30)
Just when “the economy needs more spending,” everyone is focused on the debt limit and spending cuts. “The premature budget tightening of 1937… reignited the Depression,” and increasingly we look posed to make the same mistakes. The Times does not argue for unlimited spending. “Budget cuts are unavoidable — but they are not urgent. With the economy weak and interest rates low, austerity makes no sense.”
New York Times (July 15)
The U.S. keeps “blundering toward recession” and haggling over the debt limit is only part of the problem. The deficit is a serious, but not immediate, problem. “It can be solved over time, with spending cuts and tax increases, as the economy recovers.” The immediate problem is job creation. “It is time for the government to step up. If it doesn’t, the weakening economy is bound to become even weaker.”
Wall Street Journal (July 9)
Unemployment is a lagging indicator. That is perhaps “the best that can be said for yesterday’s June jobs report.”Just18,000 new jobs were created and the jobless rate increased to 9.2%. If employment is about to turn the corner, it will be none too soon. “In this recovery we are still seven million jobs below peak employment in 2008.”
Tags: Jobs, Recession, U.S., Unemployment
Wall Street Journal (May 20)
Japan is back in recession and the problem is bigger than the quake. “The earthquake wrought considerable damage, but Japan was ailing months earlier.” GDP data for the last quarter of 2010 was revised downward from a slight contraction of 0.3% to a pronounced contraction of 0.8%. Politicians should be especially wary of measures, such as hiking the consumption tax, which might further dampen consumer spending. “Japan doesn’t have to suffer another lost decade. But it will unless the effort to rebuild earthquake- and tsunami-ravaged areas is accompanied by an effort to rebuild broken confidence.”
