Tag: jobs

Consumption taxes, inflation and low wage growth in Japan lead to recession

Consumption taxes, inflation and low wage growth in Japan lead to recession

If wages in Japan are stagnant, how is increasing inflation going to help wage earners afford a better stream of good and services? It won’t. Ultimately, what we need to see are policies which maintain wages for median and lower-income wage earners with the greatest marginal propensity to spend. Without this, in a demographically challenged and indebted private sector, so-called secular stagnation is almost a certainty.

More on the accelerating economies in the US and the UK

More on the accelerating economies in the US and the UK

I don’t have any links today, so I am going to go right into the daily piece here. Just 10 minutes ago, the US jobs numbers were released. Combined with the British composite PMI data earlier, the numbers present a rosy picture for the two economies. If the data continue like this, central bank governors will find it hard to keep the same level of policy accommodation in place.

Where are we in the economic cycle?

Where are we in the economic cycle?

This is an abbreviated post from our subscription series at Credit Writedowns Pro. After a number of years of stall speed growth, the US economy seems to be breaking out, even as the Fed has turned toward a tightening bias. As this cycle continues, we should not underestimate the ability of the US economy to continue moving forward. But we […]

The continued expansion in the US

The continued expansion in the US

Despite my concern over releveraging and increased household debt in the face of low wage growth, I believe the cyclical recovery in the US will remain intact for some time to come. The latest jobless claims numbers give a further boost to the economy.

Some things to consider if Spain leaves the Euro

Some things to consider if Spain leaves the Euro

By Michael Pettis It might seem almost churlish to wonder what would happen if Spain were to leave the euro. The official European position is that the battle of the euro has been pretty much won, and anyone who argues otherwise will be accused of being a euro hater, an Anglo-Saxon or, even worse, a writer for theFinancial Times. But […]

Why the ECB will become more activist in June

Why the ECB will become more activist in June

I am skipping the news links today to go right to the daily commentary. I want to continue my thoughts on what’s happening in Europe and why I think the ECB will become more activist. There are a number of policy options on the table for the ECB including continuing to stand pat. But given both what ECB board members are saying and what the Lisbon Treaty defines as the ECB’s mandate, I believe we are about to see a big shift in policy toward greater activism. I’ll explain why below.

US and European recoveries continue as China decelerates

US and European recoveries continue as China decelerates

The monthly employment situation summary for April 2014 was released by the US Bureau of Labor Statistics. And the headline numbers were terrific. The unemployment rate measured by the household survey fell to a cyclical low of 6.3%, below the Evans Rule threshold. Meanwhile, the establishment survey showed a net addition of 288,000 works to non-farm payrolls. The fact that […]