A delightful picture of Trinity Church, located at Broadway & Wall Street.
Another Thursday morning, another coffee time linkfest!
Ambrose Evans-Pritchard on the death of paper money Telegraph
(Reflections) The men who ended the Goldman war NYT
Bill Gross: deleveraging in a world fraught with declining world population growth rates CNN/Fortune
Arguments for a second half slowdown Calculated Risk
Thoughts on Equilibrium Analysis Rajiv Sethi
The Belgian Mess Naked Capitalism
That’s six! Have a profitable day everyone!
“Sunset in the Canyons” An affectionate and dramatic shot of my beautiful city.
It’s our Wednesday midweek linkfest! Pour yourselves some coffee, pull up your iPad, and let’s go!
Daniel Indiviglio wonders about whether (hyper) rational consumers really exist Atlantic Business
The fiscal multiplier effect debate rages on unabated WSJ and also FT
The political genius of supply-side economics Martin Wolf
Does a Federal debt default sound like a good idea to you? Good, because it isn’t. Capitalgainsandgames
“Systemic risk” theory gains in stature as a way to prevent the next bubble Washington Post
We had to burn the Euro, in order to save it Reserved Place
OK folks, that’s six. Now go forth, take no prisoners, and have a profitable day!
A magnificent sunset taken from 9th Street in Brooklyn, by the endlessly talented Joe Holmes
Click to view a larger version
I’m pleased bring you this week’s “Outside The Box” newsletter from John Mauldin. For newcomers and regular readers alike, please read John’s introduction, bio, and subscription information here
With grateful thanks to John Mauldin: JohnMauldin@InvestorsInsight.com.
Before we get into today’s Outside the Box I want to clear up a few ideas from this weekend’s letter. There have been posts on various websites equating my piece on deflation with Paul Krugman. They say I am advocating kicking the can down the road and not reducing the deficit.
Wrong. What I have been trying to point out for several years is that we have no good choices. We are down to bad and very bad choices. The very bad choice (leading to disastrous – think Greece) is to continue to run massive deficits. The merely bad choice is to reduce the deficits gradually over time. As I try to point out, reducing the deficits has consequences in the short term. It WILL affect GDP in the short term. Krugman and the neo-Keynesians are right about that. To deny that is to ignore basic arithmetic.
I am not for kicking the can down the road. Not to begin to deal with the deficits, and soon, risks an even worse problem. But – and this is a big but – I don’t want to stomp on the can, either.
Now, let’s get into this week’s Outside the Box. I offer you a very intriguing essay by those friendly guys from Bedlam Asset Management in London. They argue that Belgium’s sovereign debt should be suspect, and is the country that could be a “sleeper” problem. This is a very interesting read, with a lot of history. It is not too long and very interesting. Enjoy. (www.bedlamplc.com)
Your thinking sovereign debt is the biggest bubble of all analyst,
John Mauldin, Editor
Outside the Box
Running through a minefield, backwards
Part II – farewell Flanonia?
The last issue concentrated on sure sovereign default by Greece, Spain and Portugal – partly due to hopeless economic numbers but more because of various ‘soft’ issues. For, just as the numbers in a company’s balance sheet theoretically provide all that is required to understand and value it, the reality is that squishy issues, such as the quality of management, staff morale or even simple luck can make a mockery of these numbers. Part I also emphasised the futility of gnawing at the bone of the de facto bankruptcy of these three countries. Backward looking investment never makes money; better surely to recognise the sovereign default cycle has further to go, and so spend time identifying the next unexpected candidate.
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A good Tuesday morning to everyone. Here’s some stuff for you to read over your morning coffee:
There’s no substitute for cash in a disaster Aleph
Filtering noise in order to make reasonable investment decisions Ivanhoff Capital
Too bad not to fail American Scholar
“Economic activity consists of sustainable patterns of specialization and trade” Econlog
Investors seek currency safe heavens Reuters
Economists have no clue how deflation works in practice! WSJ
That’s six. Have a profitable day everyone!
With thanks to Boston.com‘s “Big Picture” series looking at Stormy skies, a wonderful photograph of multiple lightning strikes in New York City,
I’m pleased bring you this week’s weekly E-Letter from John Mauldin. For newcomers and regular readers alike, please read John’s introduction, bio, and subscription information here
In this issue:
Some Thoughts on Deflation
The Super-Trend Puzzle
The Elements of Deflation
Maine, New York, Turks and Caicos, and Europe
The debate over whether we are in for inflation or deflation was alive and well at the Agora Symposium in Vancouver this this week. It seems that not everyone is ready to join the deflation-first, then-inflation camp I am currently resident in. So in this week’s letter we look at some of the causes of deflation, the elements of deflation, if you will, and see if they are in ascendancy. For equity investors, this is an important question because, historically, periods of deflation have not been kind to stock markets. Let’s come at this week’s letter from the side, and see if we can sneak up on some answers.
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