Blogs

Hype and Profits Surround the Carbon Conversation

Al Gore and David Blood are principals at Generation Investment Management (GIM).  They warned in the Oct 30 WSJ of upcoming peril in carbon assets in part because of looming market-share losses to “already competitive” renewable technologies.  

A Good September in Economic News

September proved to be a good month for US Industrial Production (manufacturing, mining, and electricity generation).  The index increased 0.57% from August, which was both better than average and the best September performance in four years.  Our rate-of-change analysis shows that the annual growth rate should be picking up from today’s 2.4% as we move through the last three months of data for 2013.

Germany on the Go

German firms, blue-chip and middle-sized, are looking outside of Germany when considering investment spending in the coming year.  According to a Wall St. Journal survey, 15% planned on increasing spending in Germany; 54% said they were looking to emerging markets or the U.S. 

Canada and Free Markets

Canada and the European Union are on track to ratify a free-trade deal in 2015.  Leaders in both countries expect the deal to be approved without a lot of resistance.  The deal, called CETA, would eliminate tariffs on goods and provide for greater access of services both ways across the Atlantic.  Some regulatory dismantling would also occur.  Free trade with less regulation in Canada and the EU – that’s great news if you are a cheerleader for the free market. 

The Big Deal About The Deal

I am as happy as you are that the US Congress and the president reached a deal that allowed the debt ceiling to be temporarily dealt with and the government to be temporarily funded.  I am also happy that the political theater did not last more than three weeks, which is what we anticipated.

 So is this a big deal?  No, it is not.  You know as well as I do that all they did was to kick the can down the road, again.  This will buy Congress enough time to work out a more or less semi-functional solution that will not fundamentally change anything.&nbs

Thoughts on the Debt Ceiling Drama

It seems we and the bond market were right, and the Congress of the US will not allow a crisis to develop over the debt ceiling. I never thought they would as the backlash in next  year's election was bound to be severe.  So the budget battle will rage and the political theater will continue.

Housing and the Shutdown

A news article last week purported that the housing industry recovery was threatened by the government shutdown because it would cause delays in mortgage approvals.  Such delays would only temporarily disrupt a housing recovery trend, not squelch it, if the economic fundamentals underpinning the ascent in housing are real and durable.  It is not like your business or mine where a lack of responsiveness sends customers to competitors.  Fannie and Freddie have the ho

It Does Not Pay to be Young and Single (for Insurance)

According to the US Census Bureau, the median income of a single male and female (never married) between the ages of 25 and 34 is $31,489 and $26,233, respectively.  The wage discrepancy based on sex is a subject for another day.  The take home pay would be reasonably estimated at $27,163 annually for men and $21,021 for woman.

A Government Shutdown from an Economist’s Viewpoint

The US government appears to be headed to a shutdown, and the White House has assured us that this is bad for the economy and that prior shutdowns have disrupted the economy.  That got me to wondering, so I went and took a look.  The last shut downs were in November 14 to 19, 1995 and December 16, 1995 to January 06, 1996.  Bill Clinton was in office and presiding over a growing economy.  The Republicans controlled Congress. 

So what happened in the economy? 

Affordable Health Care?

Americans were told in 2009 that the proposed health care reform would cost around $900 billion over 10 years.  The Congressional Budget Office has done a new analysis now that we are on the cusp of implementation.  Their new estimate is that the cost to taxpayers (my distinction and very different from Americans) will be double what we were told.  Taxpayers will be shelling out $1.8 trillion over 10 years. 

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