[Premium] India will be worse than China

When I listed my Ten Surprises for 2012 in January I predicted that China would have a hard landing, defined as quarterly growth below 5% annualised by the end of this year. But I also said that India would be worse than China. And it is this combination that makes me more concerned about the global growth slowdown in emerging markets than the crisis in Europe. This is a big, big story but no one is talking about it because Europe is sucking up all of the air

Revisiting predictions on China on debt, growth and crisis

In 2006 I started making a number of predictions based on what I thought was the necessary and logical development of China’s growth model. Some of these predictions seemed fairly outlandish, especially to China analysts – Chinese and foreign – who had very little knowledge of economic history or other developing countries, but many of them so far have turned out quite well.

As more and more analysts are beginning to understand the constraints of the Chinese growth model I think it might be useful to list some of these predictions to get a sense of what might be still to come. Perhaps my bet with The Economist has caused me to throw caution to the winds, since a smart economist never makes his predictions explicit, but here they are

[Premium] Tracking My List of Ten Surprises for 2012

I thought now would be a good time to see how my ten surprises for 2012 are tracking as we are nearly a third of the way through the year. I posted these as my first weekly newsletter and these are events that have 1-in-3 odds of happening but which I believe have a more than 50 percent likelihood of occurring in

Samuelson Flunked Bernanke

The forecasting proficiency of central bankers is a topical issue. At least, a friend asked if I could help with a list of Federal Reserve Chairman Ben S. Bernanke’s predictions. The list stops in 2008, although he has been no more accurate since then. I sent the list to a few others. To those lucky recipients, I attached Paul Samuelson’s opinion of Ben S. Bernanke. It is the response (below) of one correspondent to Samuelson’s statement that is most telling

[Premium] Daily Commentary: On The Global Growth Slowdown

This daily commentary is a bronze level post. Today, my comments go to warning signs in the economic data about the global economy slowing down. Lots of links on this topic as well

[Premium] More on my prediction of margin compression in the US and how Apple fits in

This weekly newsletter is a gold-level post and follows up on my prediction early last month about 2012 being a period of margin compression in US companies, threatening the rally in stocks and mandating a rotation in investment style or sector weighting

What were big-time pundits saying just as stocks were bottoming in March 2009?

Faber, Buffett and Grantham were bullish as stocks reached their financial crisis nadir

2012: The Year We All Learn To Live Dangerously

Thus the road ahead looks clear, if somewhat flat. The Euro Area’s two largest economies look set to escape “the worst of the worst”, but remain dependent on factors outside their control, in the US, in China, and in the Emerging Market world as a whole, all of whom could in their turn be badly affected by the impact on risk sentiment of any unfortunate “accident” in the Eurozone itself. Most of these issues are unlikely to go away any time in the foreseeable future, which is why I think 2012 will be marked as the year we learnt to live with the world we have, and stop dreaming about another one, which has long since ceased to exist

[Premium] Biggest highlights from Barron’s Roundtable

Here are the comments I found the most interesting from the first part of this year’s Barron’s Investing Roundtable interview which was published today

The Bifurcated Society

There is less mobility in the work force because the computers are not simply displacing jobs, they are taking out the middle. Because they take out the middle, it is a lot harder to pursue the American dream by working your way up the ladder

[Premium] Forecasting recession in Germany

While Germany has done well of late, it was crushed by the downturn in 2008 and has an economy highly levered to external macro shocks since exports is a very large percentage of German GDP. German macro economists are forecasting recession for

The Fed’s definition of “clarity” is not like yours or mine

Each member will be asked to give a number for what they think the interest rate will be at the end of this year, the end of next few years and also in the long run. Won’t it be confusing to have 12 different predictions for this