ShareThe data released this morning by the U.S. Department of Commerce’s Bureau of Economic Analysis on personal income somehow managed to show weakness in income and consumption as well as savings.  I see this as proof that Americans are not saving and hence not deleveraging, but they are also so income constrained that their consumption [...]

ShareWhen it comes to the housing meltdowns in the richest economies, the US has been matched only by Spain, Ireland and the UK. All four countries have seen spectacular losses of wealth in the housing sector over the last two years.
The response by all four governments was to apply as much stimulus as they reasonably [...]

ShareLast year at this time I posted “The Economy’s Four Horsemen,” which described macro cause and effect leading into and out of recessions.  When looking at income, spending, output and employment, it is income which is the steer variable going into a downturn.  Year-on-year changes in income precede changes in spending, output, employment and recession. [...]

My very first post on this blog was in March and it was titled “The Economy Is Definitely In Recession.” Back then, this seemed like a stretch for a lot of people, but today the National Bureau of Economic Research (NBER), which makes the official recession call for the U.S., determined that the recession began in December 2007.

ShareYesterday, I laid out some of my general thinking on the business cycle and the economy. Obviously, understanding the business cycle is important to economic forecasting and is, therefore, central to personal financial planning, general investing and business planning.
Over the next few weeks, I will chart out a panoply of data sets for the [...]

ShareNow that policy makers worldwide have finally stepped in to stop the bleeding, we have had a relief rally of monumental proportions. Most global indices were deep into oversold territory, meaning that there was lots of pent-up demand for a turn to the upside. A big rally to the upside was baked into [...]

ShareTom Toles is absolutely terrific. He captures the mood of the day so well in his cartoons, that it really puts paid to the aphorism that a picture is worth a thousand words.
SourceTom Toles Cartoons, Washington Post

Apparently, a new market of peer-to-peer lending has popped up , where banks are no longer a part of the lending proposition. Loans are made directly peer-to-peer. Whether this is a reaction to tight credit or some weird new innovation due to the Internet, I don’t know. Call me conservative, but it doesn’t sound like an attractive proposition for individual lenders.

ShareHere’s an interesting statistic from the OCRegister in California. What are the twenty wealthiest cities in the United States? Pleasanton, CA tops the list with a median household income of $113,345. See the chart below for the other 19. I counted nine in California, five in Texas and two in the [...]

ShareI’ve been thinking a lot about unrealized gains and their effect on the global economy. if you remember, I wrote a few weeks ago about a new debit card that lets people tap the money from their 401(k) plan. I think these cards are a bad idea. I don’t like them because [...]