Mish's Global Economic Trend Analysis |
- Italy Faces 2-Year Recession says IMF; European Recession Neither Mild Nor Short
- Mish on Capital Account Live TV: Discussion of Money Supply, Inflation, the Fed, SOPA; GOP Chairman Shelves Stop Online Piracy Act - A Triumph for Whom?
- Time to Concede Home "Ownership" is a Fraud; Fixing the "Un-Real Estate Mess"
Italy Faces 2-Year Recession says IMF; European Recession Neither Mild Nor Short Posted: 20 Jan 2012 12:34 PM PST Slowly but surely global growth estimates have been ratcheted down. Courtesy of Google Translate from an Italian news site, please consider IMF estimates two years of recession for Italy Deep red for the Italian economy in the next two years. Against the background of a global recovery stalled, slowed by the crisis in the eurozone in particular, Italy is preparing to reach out to two years of recession in 2012 and 2013. The cold shower comes from the International Monetary Fund put in hand as usual to their predictions gave a general scissor kick to the estimates of growth around the world.European Recession Neither Mild Nor Short Notice how the estimate from Europe went from growth to a "mild recession". The recession will not be mild in Italy (the third largest Eurozone country), Spain, Portugal, or Greece. In that group all but Italy face sure depression and Italy is likely headed there. For further discussion, please see Money Supply Figures Suggests Italy Headed Into Depression; Non-Performing Spanish Loans Hit 134 Billion Euros, 7.51% of All Loans, Highest in 17 Years; Eurozone Unemployment Charts. Combined with slowing in China, a recession in Australia, and a recession in the UK, the odds that Germany bucks the trend are extremely slim. The odds are high the US enters a recession as well. Thus I expect the IMF to lower growth estimates again soon. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List |
Posted: 20 Jan 2012 08:37 AM PST On Thursday I had the pleasure of doing another segment on Capital Account with Lauren Lyster. I come in at about the 3:45 minute mark for much of the rest of the 30 minute session. Link if video does not play: SOPA's War on the Financial Blogosphere, Mark-to-Market and Depression Economics with Mish I had fun doing this and may be back next week. SOPA Dead (for Now) By the way, thanks to silicon valley companies including Google and Facebook, as well as vast majority of bloggers who were well out in front of this issue, The Hill reports GOP chairman shelves Stop Online Piracy Act. House Judiciary Committee Chairman Lamar Smith (R-Texas) announced on Friday that he will postpone consideration of his Stop Online Piracy Act (SOPA) until there is wider agreement on the controversial legislation.Triumph for the Little Guys This was a triumph "for" the little guys (bloggers and alternate news sources). It was also a triumph for justice and common sense (as well as defense of freedom of speech). I would like to report this was a triumph "by" the little guys but unfortunately it wasn't. When campaign contributions stop from Google and other big money corporations, politicians listen. This was one set of big donors (media giants) vs. another set of big donors (internet companies). Lamar Smith vowed to revisit the issue. "It is clear that we need to revisit the approach on how best to address the problem of foreign thieves that steal and sell American inventions and products." Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List |
Time to Concede Home "Ownership" is a Fraud; Fixing the "Un-Real Estate Mess" Posted: 20 Jan 2012 12:54 AM PST Every week someone sends me an idea on how to fix various housing problems. Many want home prices to stop falling and many others want to bail out homeowners because banks were bailed out (as if two wrongs make a right). Others want to stop foreclosures even though the very best thing for most of the people in trouble would be to shed the albatross by walking away. The one thing they all have in common is a misguided proposal to bailout someone at the expense of someone else (typically the government but few figure out the government means taxpayers). I have long-stated the best thing to do is nothing. Indeed if nothing is done, home prices will drop low enough that investors will want to buy them. Delays in foreclosures only serve to delay the housing recovery. Fixing the "Un-Real Estate Mess" Last week I received a different kind of proposal that merits a much closer look than all of the various bailout proposals I have seen to date. My friend "BC" writes ... Hello MishMy friend "HB" replied to "BC" ... I absolutely agree, except I would also allow banks to be middlemen between savers and borrowers, i.e., allow them to lend out savings that have a fixed term for a corresponding fixed term. That way no new deposit money would be created.Libertarian Approach Under the conditions outlined above, home prices would be very stable. Some might question how that would fit in with a libertarian approach. I have an answer: In a free market there would not be a Fannie Mae, a Freddie Mac, a HUD, or an FHA. More importantly, fractional reserve lending would be outlawed as fraud, and there would be no Fed. Perhaps some lenders would be willing to make loans longer than 10 years, but not many. I would not stop those who did. Rather than a set of rules that "BC" proposed, a free market left on its own accord would gravitate to a set of workable procedures, probably very close to what "BC" suggested. Long-Term Solution In light of the above, the required solution is to
One presidential candidate has those views. That person is Ron Paul. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List |
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