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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: zonder who wrote (13718)	10/20/2004 5:11:37 AM
From: mishedlo	Read Replies (2) \| Respond to of 116555

It depends on what ones definition of inflation is. I was referring to price action. So yes we can easily see price going one way for producers and another way for consumers. If one is using a definition related to the supply of money, you are of course correct. Personally I hete these terms because they are used differently by everyone. Inflation, deflation, stagflation. The first two people use with regards to price action or regards to money supply and the third deals with neither of those but with falling profits and rising interest rates and of course there are probably 5 variations of all of these with people using one definition one day and something else the next day. So you tell me. what is inflation? Mish

To: zonder who wrote (13718)	10/20/2004 5:25:53 AM
From: mishedlo	Respond to of 116555

UK Sept mortgage lending records first yr-on-yr fall since Oct 2000 Wednesday, October 20, 2004 8:57:47 AM afxpress.com LONDON (AFX) - UK mortgage lending fell for the second month running in September to 25.4 bln stg, recording its first year-on-year fall since October, according to data revealed by the Council of Mortgage Lenders. In August gross mortgage lending was at 26.5 bln stg. In addition, the value of loans for house purchases slumped to 11.2 bln stg from 12.8 bln stg in Aug. The latest figure is the lowest since February which is traditionally a quiet month. Notably, only 44 pct of total lending went to house purchases, down from 47 pct the previous month. The number of loans for house purchase fell to 99,000 from 110,000 in August. The latest figure is also the lowest since February. "All the latest lending data reinforces evidence that the expected slowdown in the housing market is materialising. Remortgaging is holding up, but house purchase lending is slowing markedly," CML Director General Michael Coogan said "It looks as if inflationary pressure arising from the housing market itself has now dramatically reduced," he added

To: zonder who wrote (13718)	10/20/2004 5:30:24 AM
From: mishedlo	Respond to of 116555

UK Sept PSNCR widens to 10.75 bln stg vs 8.5 bln; highest ever Sept UPDATE [Zonder - got an opinion as to how this affects interest rates in the UK? What about the currency itself? It would seem to me to be negative but the pound is rallying at least vs the US$ - mish] Wednesday, October 20, 2004 9:04:30 AM afxpress.com (Updating to add analyst comment) LONDON (AFX) - Measures of government borrowing worsened in September from a year earlier, with the public sector net cash requirement rising to 10.755 bln stg compared with an 8.539 bln stg requirement in the same month a year ago, according to provisional estimates from National Statistics The September requirement was the highest ever September reading since records began in 1984 and was well above expectations of a requirement of 7.6 bln stg HBOS economist Mark Miller said the figures were surprisingly high, coming in well above consensus, though he noted that it is still too early in the year to be able to say whether or not the government will meet its forecasts for public sector finances "But after the improvements seen in recent months, today's number will shake that confidence a bit," he said He added that the rise reflects the government's continued increase in spending, while receipts, although they have been improved recently, may not have been as high as expected this time round NS said the main factor behind the increase in Sept was a 7.5 pct rise in government expenditure from a year earlier, which was not sufficiently offset by a 4.8 pct rise in receipts In August, there was a cash requirement of 3.231 bln stg, revised from the provisional estimate of 3.26 bln stg In the half fiscal year to date, the PSNCR was 18.6 bln stg, down from 22.3 bln at the same point a year ago Public sector net borrowing, the government's preferred measure of the public sector's financial position, also came in well above forecasts at 4.848 bln stg, up from 2.466 bln stg in September 2003. Analysts had expected a PSNB of around 3.2 bln stg The PSNB is also the highest September reading since records began in 1993 In the half fiscal year to date, PSNB stood at 22.8 bln stg, slightly up on last year's figure of 22.1 bln stg Chancellor of the Exchequer Gordon Brown has forecast a public sector net cash requirement of 34.5 bln stg in the fiscal year 2004/5, and public sector net borrowing of 32.9 bln stg A number of analysts believe there could be tax rises early in the next parliament if the government is to meet its golden rule of balancing the budget, excluding investment spending, over the economic cycle

To: zonder who wrote (13718)	10/20/2004 5:40:04 AM
From: mishedlo	Respond to of 116555

BoE MPC voted unanimously to leave repo rate at 4.75 pct at Oct 7 meeting [any commenst on the discussion? mish] Wednesday, October 20, 2004 8:53:19 AM afxpress.com LONDON (AFX) - The Bank of England's rate-setting Monetary Policy Committee voted unanimously to leave its key repo rate unchanged at 4.75 pct at its last meeting on Oct 7, the central bank said today Minutes of the meeting showed that the nine-member panel did not discuss the possibility of another quarter-point hike amid faltering economic growth and moderating house price inflation However, the MPC noted the inflationary impact of a falling pound as well as the pick-up in broad money growth "Members concluded that no change in the repo was appropriate this month," the minutes said "While the impact of the latest data on output and demand would probably be on the downside in the near term, financial market developments, and in particular the fall in the exchange rate, would be supportive," they went on The MPC said next month's quarterly Inflation Report, in which the central bank publishes its economic projections, would help to assess the outlook for inflation In August's Inflation Report, the central bank predicted that economic growth would be between 3.0-3.5 pct both this and next year However, weak economic data in recent weeks has convinced a number of Bank watchers that next year's prediction will be revised downwards In the minutes, the MPC noted signs that "output had been growing less strongly in the third quarter than previously expected" It also noted "several puzzles" in the current economy, in particular the apparent tightness of the labour market and modest pay pressures, and between gradually accelerating broad money and nominal GDP, and low and stable consumer price inflation "These issues added to the outlook for inflation, and the Committee would be able to consider them further during the November Inflation Report round," the MPC said A raft of weak economic data has cemented market expectations that the central bank will keep the cost of borrowing unchanged at next month's meeting too. Analysts think the MPC will hold off from raising interest rates again given lacklustre economic growth, a slowdown in the housing market and news that consumer price inflation in September fell to 1.1 pct, way below the 2.0 pct target They also said that faltering growth in the global economy may likely tilt the balance in favour of unchanged interest rates Though the MPC said activity growth in the US and Japan would pick up from the slower rates in the second quarter, it noted that US economic indicators were mixed and perhaps less buoyant than expected Meanwhile, the MPC said it expected the euro area outside Germany to maintain growth around its trend rate, and added that the prospects for non-Japan Asia looked strong It said the further rise in the oil price was "unlikely to persist in full", but added that there were "substantial risks" to the outlook

To: zonder who wrote (13718)	10/20/2004 6:02:48 AM
From: mishedlo	Respond to of 116555

Buba revises down German Aug manufacturing orders to down 1.7 pct vs July Wednesday, October 20, 2004 9:53:10 AM afxpress.com FRANKFURT (AFX) - The Bundesbank said it has revised downwards German manufacturing orders for August to a seasonally adjusted decrease of 1.7 pct month-on-month from the initial figure of 1.5 pct as published by the Economy and Labour Ministry earlier this month. Economists had forecast on average a drop of 0.7 pct month-on-month. In July, manufacturing orders rose 2.8 pct from June

To: zonder who wrote (13718)	10/20/2004 6:07:55 AM
From: mishedlo	Respond to of 116555

Japan oil trade body chief says crude may hit 60 usd/bbl - Wednesday, October 20, 2004 9:51:01 AM afxpress.com (Updating with more details, quotes) TOKYO (AFX) - Fumiaki Watari, the chairman of the Petroleum Association of Japan, said global crude oil prices could hit 60 usd per barrel due to speculative buying, but will then slide back to 45 usd a barrel by the year-end "Rising oil prices are speculative, and could hit 60 usd briefly. But I expect they will fall back to 45 usd per barrel by the end of the year," said Watari, who is also president of Nippon Oil Corp, the largest oil refiner in Japan Watari, speaking at a news conference, said worries over geopolitical risk, such as possible terrorist attacks on oil production sites, OPEC's supply capacity and reduced production facilities in US, have helped push prices excessively higher. "(Oil prices) are a typical target for speculators, such as hedge funds, because of excess volatility," Watari said Watari said the current oil price level included additional "premiums" of some 10 usd per barrel and therefore "the appropriate price should be some 45 usd." Overnight, crude oil futures for November delivery fell to a low of 52.59 usd a barrel on the New York Mercantile Exchange, before closing at 53.29 The chairman indicated that political stability in Iraq is needed to ease worries over global supply Watari also said rising demand from China, which grew 15.2 pct this year, has contributed to a rise in prices "Compared with China's average (annual) growth in demand of some 6 pct for the past five years, this looks so remarkable," he said.

To: zonder who wrote (13718)	10/20/2004 6:12:50 AM
From: mishedlo	Respond to of 116555

Short Sterling interest rates curve inverted out to June 06 now Not by much, but definite inversion Mish futuresource.com

To: zonder who wrote (13718)	10/20/2004 10:10:40 AM
From: Lee Lichterman III	Read Replies (1) \| Respond to of 116555

Sure they are both possible. The definitions for both are actually different. Inflation/dis-inflation are monetary terms in regards to how much currency is needed/produced. You could have inflation as too many worthless dollars are in circulation driving up prices of physical goods. Deflation is more in regards to GDP and it going negative. Thus we could have inflation in prices while GDP growth goes negative. Good Luck, Lee