Richard Nixon: 1971 Annual Message to the Congress on the State of the Union

I have highlighted some of the state of the union addresses by Herbert Hoover in the past because I see the Great depression as a time with certain parallels to the present economic hardship. Let’s look at the 1970s instead now.

Here’s Richard Nixon from 1971, with what was considered a conservative agenda in 1971 based on balancing the federal budget and rolling back centralised governance. However, regarding details, Nixon proposes small government ideas on welfare reform and big government ideas in almost all other aspects of his State of the Union Address.

I have bolded what I consider the most important parts

Doug Casey on the Coming War with Iran

It could just be saber rattling during an election year, but Western powers have been provoking Iran for years now – two decades, really. I just saw another report proclaiming that Iran is likely to attack the US, which is about as absurd as the allegations Bush made about Iraq bombing the US, when he fomented that invasion. It’s starting to look rather serious at this point, so I do think the odds favor actual fighting in the not-too-distant future

[PREMIUM] More on the Fed – Obama stimulus plan

My last weekly said the hand-in-hand Fed activism and fiscal activism via Obama’s mortgage proposal is bullish. Let me add a bit of colour here

Monetary and Fiscal Policy for Sovereign Currencies

This week we begin a new topic: functional finance. This will occupy us for the next several blog posts. Today we will lay out Abba Lerner’s approach to policy

My comments on MMT’s job guarantee idea

Over the holidays, a debate broke out in the blogosphere about the so-called job guarantee idea that the MMT folks have bandied about. I call this controversial idea “Unemployment Insurance for the 21st Century”, something I first addressed in 2009, based on a post by Randall Wray.

My view: a job guarantee will never happen in the US unless we have a deep Depression like the one that began in 1929. Politically, this idea is a non-starter on this side of the Atlantic

News Links: Osborne to Fund Infrastructure Projects as UK Retail Sales Fall

News links for 28 November

Bill Gross and Larry Fink on the economy

Bloomberg Television has another great set of interviews to see, this time with Larry Fink of BlackRock and Bill Gross of PIMCO. The two sat down with Bloomberg Television’s Erik Schatzker for an exclusive conversation at an alumni event hosted by UCLA Anderson School of Management (I guess both are UCLA alums; I almost went there myself).

They covered a huge range of topics in the interview from the US supercommittee to Occupy Wall Street to the European Sovereign Debt Crisis and on down the line. Very good stuff

Videos below

China: Continued Boom or Bursting Bubble?

In a February 2010 Casey Report article titled Is China’s Recovery a Fraud?, my thesis was the $2.1 trillion stimulus package rolled out by Chinese authorities after the 2008/2009 financial crash was leading to enormous malinvestment. As with all monetary and fiscal stimuli, however, the initial high is always followed by a hangover

Bruce Bartlett wants the Fed to target nominal GDP

I don’t see stimulus though, neither fiscal or significant monetary stimulus either. So that leaves me predicting slowing without policy stimulus until recession hits, at which point the loss of demand will blow the deficit out even more. And then we will have to see what the political appetite for policy responses will be since the banking system and the economy will both be under enormous stress much as they were in 2008-

A Tale of Two Speeches

Dollar continues to firm amid choppy market conditions; US futures point to modest decline. President Obama announces bigger package than expected; fiscal stimulus may be USD supportive. China’s CPI report shows that inflation has likely peaked; Mexico’s minutes may mark a dovish shift

Hoover’s Great Depression

An excerpt from the August 1932 Republican Nomination Acceptance Speech by Herbert Hoover and commentary about his policy choices and ours today

Roach on the Zombie American Consumer and Debt Forgiveness

I doubt we are going to see wide scale debt forgiveness until defaults and debt deflation have taken center stage. But this is something to consider as it was an approach used during the Great Depression