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

To: yard_man who wrote (26096)	3/21/2005 2:45:44 PM
From: Roads End	Read Replies (1) \| Respond to of 116555

Victory was declared on a flight deck more than a year ago. The focus is a feeding tube and No One Left Behind, especially if you have the ability to think.

To: yard_man who wrote (26096)	3/21/2005 3:48:44 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

Mogambo Guru ....... ....... This brings up your homework assignment for tonight. I want you to perform a spreadsheet analysis that assumes that your income is slashed by five percent. You must now make cuts in discretionary spending to balance your budget. Detail these cuts in spending to achieve a balanced budget under the new paradigm of lower purchasing power. Then, for the next year, take another five percent loss of income. Again detail the cuts to achieve a balanced budget. Then the third year, take another five percent loss of income. Detail those spending cuts, too. And the fourth and the fifth and the sixth year do the same thing. And then you'll notice, which I call The Mogambo Moment Of Enlightenment (TMMOE), that the price of inflation is measured in the aggregate price of happiness lost. And the sheer tonnage of lost happiness accumulates, year after year, as prices rise year after year, and it adds up and up, and pretty soon you realize that life ain't fun anymore, and all your money goes to pay for necessities, and they, as I said, ain't fun. ..... When Alan Greenspan took office in 1987, the national debt stood at $2.3 trillion. Now it is over $7.4 trillion. John Myers of Outstanding Investments never says it in so many words, but that is a LOT of money. But he does allow, "Currently Uncle Sam is carrying around a debt of $7.4 trillion. It is almost impossible to really understand just how big $7,400 billion is. But to put it into some perspective consider the following about America's federal debt: It is twice the value of all the oil beneath the sands of Sandi Arabia. It is larger than the combined GDP of Germany, France, England and Canada. It is 15 times more than the value of all the gold that has ever been mined since the dawn of mankind." This is all thanks for Alan Greenspan and the Federal Reserve. Bill Fleckenstein calls Alan Greenspan, "The most incompetent and irresponsible Fed chairman in the history of the world." I say the same thing, only with more obscenities and at a higher volume. Regards, The Mogambo Guru for The Daily Reckoning dailyreckoning.com

To: yard_man who wrote (26096)	3/21/2005 4:22:53 PM
From: mishedlo	Respond to of 116555

BoE´s Barker suggests UK labour market may not be as tight as estimated Monday, March 21, 2005 8:45:52 PM afxpress.com BoE's Barker suggests UK labour market may not be as tight as estimated WASHINGTON (AFX) - A leading Bank of England policy-maker suggested today that the UK labour market may not be as tight as generally perceived and suggested that it is possible that low UK inflation could be related to a productivity renaissance in the economy Kate Barker, a member of the rate-setting Monetary Policy Committee, told an audience here that the evidence of productivity gains is building but "cannot yet support optimism similar to that of the US in the mid-1990s". The productivity improvements seen recently could just be a product of a cyclical rise in the economy, Barker said in a speech to the National Association of Business Economics Policy Conference "However, over the coming quarters it will be necessary to look hard at this question, and remain open to the possibility of a structural improvement," said Barker, who was last year re-appointed by the Chancellor of the Exchequer Gordon Brown to a second three-year term on the committee "A different reason to reconsider the judgement about the present and prospective supply capacity of the economy is the possibility that the recent rise in average hours worked suggests a stronger trend in hours, and that the labour market is not quite as tight as presently estimated," Barker added The MPC has grown increasingly concerned in recent months about the increasing tightness in the labour market and the potential this has to stoke up wages that could put upward pressures on the central bank's 2.0 pct inflation target Barker also dismissed suggestions that the MPC should target asset prices when setting interest rates A shift to targeting asset prices might result in significant changes in interest rates away from the level which would be appropriate to achieve the inflation target, she said "This is likely to create uncertainty about what the aims of monetary policy are and lead to volatile inflation expectations," Barker said In addition, Barker said there may be perfectly good reasons why equilibrium house prices may have risen even though they are at historically high levels relative to incomes She said the equilibrium may have increased due to lower interest rates reducing the initial cost of a mortgage, low long-term real interest rates, an inadequate supply of new build and an increased use of housing as a savings vehicle for pensions. She conceded that there are other factors indicating a housing bubble, such as increased private buying of housing for letting and parents using equity from their own homes to assist children with deposits "So it would also not be clear what scale of adjustment in house prices monetary policy should seek to achieve," she said. The MPC has been urged by a number of commentators to raise interest rates at upcoming meetings to check a revival in house prices. The latest surveys into the sector suggest that house prices are picking up again following the winter lull Since Nov 2003, the MPC has raised its key repo rate by a quarter point on five occasions to 4.75 pct in an attempt to rein in inflationary pressures stemming from rampant consumer demand and above-trend economic growth However, it has kept interest rates on hold since last August as evidence emerged that higher borrowing costs were taking their toll