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luni, 8 iunie 2015

This week's top Pins

Take a look at what's popular on Pinterest this week!
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Hi Hari,

Take a look at what's popular on Pinterest this week!

See more top Pins

Chicken and avocado burritos

Tobias Fichtel

Food

Redbook's Strong Sexy You 21-Day Challenge - do it!

Fetii Fa'atau

workout and trai...

Exercise smarter not harder with this intense 5-Minute Pilates for ...

Miss Fabulous

Fitness

These are the best cookies in the world!!!! We shall ...

S'mores Bars - these are so delicious! Like a cookie ...

Gina B

Dessert Recipes

Southwest Pepper Jack Salad with Creamy Avocado Salsa Dressing will ...

CL LC

Salad

Gluten Free Grilled Shrimp with Roasted Garlic-Cilantro Sauce. Easy and ...

Maria Giron

cuisine

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Seth's Blog : High resolution is not the same as accurate

High resolution is not the same as accurate

Should you visit a college before you decide to go there?

Well, a one-hour personal visit is certainly visceral and emotional and it feels real. But it's also based on the weather, on the route you took to school, on the few people you met or the one class you visited.

None of this is correlated to what the four-year experience is actually like, or what the degree or experience is worth over the lifetime of a career.

By analogy, everything from how angry that last customer was on the phone to precisely how many degrees it is outside right now are not nearly as accurate indicators as we make them out to be.

You don't need an electron microscope to figure out if a ball is round. (In fact, it will almost certainly tell you something less than useful.)*

Too much resolution stops giving you information and becomes merely noise, which actually gets in the way of the accuracy you seek.

*[If you were able to shrink the Earth to the size of a billiard ball, it would be the roundest sphere ever created. Hard to believe this if you live near the edge of the Grand Canyon.]

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duminică, 7 iunie 2015

Mish's Global Economic Trend Analysis

New Housing Crisis in the Making? If So, What's the Solution?

Posted: 07 Jun 2015 12:59 PM PDT

Home ownership rates are sinking and demographics are part of the reason. But does that constitute a new housing crisis?

The Wall Street Journal writer Nick Timiraos makes the case in New Housing Crisis Looms as Fewer Renters Can Afford to Own.

Last decade's housing crisis has given way to a new one in which many families lack the incomes or savings needed to buy homes, creating a surge of renters and a shortage of affordable housing.

The latest crisis looks very different from the subprime mania of the early 2000s, but it does share one trait: Policy makers in Washington appear either unaware or unwilling to do much about it.

The U.S. homeownership rate is now below where it stood 20 years ago when President Bill Clinton launched a national campaign to encourage more Americans to buy homes. Conventional wisdom says the rate, now at 63.7%, is leveling off to where it was for decades before the housing-market peak.

But this is probably wrong, according to research from the Urban Institute, which predicts homeownership will continue to slip for at least the next 15 years.

Demographics tell the story. The Urban Institute researchers predict that more than 3 in 4 new households this decade, and 7 of 8 in the next, will be formed by minorities. These new households—nearly half of which will be Hispanic—have lower incomes, less wealth and lower homeownership rates than the U.S. average.

The declines reflect a surge of new renter households, which is boosting rents. Together with tougher mortgage-qualification rules, this will leave households stuck between homes they can't qualify to purchase and rentals they can't afford, says Ron Terwilliger, who spent two decades running Trammell Crow Residential, one of the nation's largest apartment developers.

As rental households devote a greater share of their income to rent, families could face greater challenges in saving for a down payment. This could restrain a housing market that has failed to provide any real lift to the economy in the current expansion.

What's to be done? Given budget pressures, it may not be realistic to expect the government to spend any more money on housing than it already does. Thus, the focus now should be on reallocating what is already committed, says Mr. Terwilliger, a Republican, who this month will formally launch a foundation designed to start these conversations. His goal is legislation after the 2016 election that realigns housing policy with the shifting dynamics.

Breaks for Apartment Builders

Given that Terwilliger spent two decades as one of the nation's largest apartment developers the answer should be easy to figure out. He wants to end tax breaks for home ownership to subsidize new home owners and "free up funds for the rental side".

His complaint: 75% of the housing tax breaks go to the top 20% of individuals. That is hardly shocking given the top 20% buy the most expensive homes and therefore pay the most in interest.

Timiraos, buys all Terwilliger's nonsense hook line and sinker, finishing the WSJ article with "Politically, none of this will be easy . Some will say it's a zero-sum game—helping renters at the expense of owners. Not so, says Mr. Terwilliger. If renters can't ever become homeowners, who will buy those homes when today's homeowners need to sell?"

Housing Crisis Past and Present

The 2015 housing crisis was caused the same way as the one in 2007: Interference by the Fed, by Congress, by local officials wanting to create affordable housing.

Terwilliger wants a combination of affordable housing and affordable renting. Lovely.

Driving up home ownership rates is guaranteed to do one thing: drive up prices.

Fannie Mae, Freddie Mac, and hundreds of other government programs culminating with president Bush's "Ownership Society" all contributed to make housing unaffordable.

The government has no business promoting one form of living over another.

Self-Correcting Problem

Terwilliger ends with the question "If renters can't ever become homeowners, who will buy those homes when today's homeowners need to sell?"

The answer should be obvious: Prices will fall until there is a pool of buyers!

In the wake of the great financial crisis, home prices actually fell to the point of being affordable. Few seemed happy with the result. The Fed wanted to prevent deflation and in the greatest financial experiment in history unleashed round after round of QE.

Asset prices recovered, but wages didn't. As a result, homes are once again unaffordable.

Does Terwilliger want affordable housing or not?

If government and the Fed got out of the way, there would be no problem. Instead, Terwilliger wants the government to "do something".

I suggest the government and the Fed have done far too much already.

Solution is Undoing

Instead of promoting something, a process that has failed every time, how about undoing everything that contributed to the mess.

My proposal

Eliminate Fannie Mae
Eliminate Freddie Mac
Eliminate the FHA
Eliminate rent controls
Eliminate itemized deductions and replace with a flat tax

That's the real solution to the problem, not more self-serving affordable housing nonsense from people with a vested interest in promoting something for their own benefit.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Seth's Blog : Holding the umbrella

Holding the umbrella

Harry Truman talked about where the buck stops.

For every project, for every organization that lasts, someone is holding the umbrella.

She's the one on the hook if things don't go well. She's the one who doesn't walk away from a problem, even if the office is closed. Most important, the person holding the umbrella decides what to do next.

It's fun to work on a successful project, and thrilling to invent, create and connect. But the real work comes when it's your turn to hold the umbrella.

It's entirely possible that you've let other people seduce you into believing that it's not yet your turn. Ignore them. There are lots of umbrellas just waiting for someone to hold them.

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sâmbătă, 6 iunie 2015

Mish's Global Economic Trend Analysis

Request Denied: Juncker Spurns Tsipras Request for Meeting; Exterminated from Within

Posted: 06 Jun 2015 11:57 AM PDT

Recap of Recent Greek Events

On Friday, Greek prime minister Alexis Tsipras cancelled a with eurozone officials in Brussels. He returned to Athens to address outrage from within his own party.

Tsipras then blasted the latest deal offer made by Jean-Claude Juncker in a rant to the Greek parliament. Tsipras said he was "unpleasantly surprised" by the proposal put forward by the International Monetary Fund, European Central Bank and European Commission during his visit to Brussels for talks with commission head Jean-Claude Juncker.

"I would like to believe that this proposal was an unfortunate moment for Europe, or at least a bad negotiating trick, and will very soon be withdrawn by the same people who thought it up," he said.

After blasting Juncker's deal, Tsipras picked up the phone and made a call to Russian President Vladimir Putin. They agree to meet in two weeks at the St. Petersburg International Economic Forum.

Greece also missed a debt payment to the IMF on Friday. That did not constitute default because IMF rules allow multiple payments within a month to be bundled on the last due date. That trick was last used by Zambia in the 1980s.

Exterminated from Within

Greek energy minister, Panagiotis Lafazanis, ruled out a deal stating "I do not think that Syriza will accept for the country and its people to be exterminated inside the eurozone. A third consecutive austerity loan programme will be the most destructive option possible for Greece."

For a more detailed recap of Friday's events, please see Tsipras Talks With Putin; Energy Minister Rules Out Deal; Wordsmithing Extraordinaire; 16 Tons.

Juncker Spurns Tsipras Meeting

Given all the above, it's no wonder that today Juncker Spurns Tsipras Meeting.

Alexis Tsipras, the Greek prime minister, asked to meet Jean-Claude Juncker on Saturday but was spurned by the European Commission president rankled by the Greek leader's denunciation of his efforts to broker a bailout deal.

According to a senior official with a Group of Seven delegation, which began gathering in southern Germany on Saturday ahead of a two-day summit of the leaders of the seven leading industrialised powers that begins Sunday, Mr Juncker believed Mr Tsipras' speech in parliament left little to discuss.

"Unless he seriously addresses the issues, there's no reason to meet," said the G7 official.

The G7 official said Greece's creditors were taken by surprise both by Mr Tsipras' outright dismissal of their offer in his parliamentary address as well as a decision to delay a €300m loan repayment owed to the IMF last Friday.

Mr Juncker's rejection of a meeting with Mr Tsipras returns the bailout talks to a point of stalemate just a week after creditors believed the talks were making progress for the first time in nearly four months.

Many officials believe a deal to release €7.2bn in desperately-needed bailout aid needs to be reached ahead of a June 18 meeting of eurozone finance ministers so that Athens has enough time to implement an agreed set of economic reforms in order to get the rescue funds before the bailout expires at the end of the month.

Best Friend and Advocate?

The European Commission, and particularly Mr Juncker, have long seen themselves as Greece's strongest advocate at the creditors' table, frequently clashing with the more hardline views of the IMF and the German finance ministry.

Mr Tsipras' speech Friday was the second time his government has publicly spurned Commission efforts, however. In February, Yanis Varoufakis, the charismatic Greek finance minister, publicly revealed Pierre Moscovici, Mr Juncker's economic commissioner, had been quietly attempting to broker a compromise deal to extend Greece's bailout without Mr Dijsselbloem's knowledge.

With "advocates" like Juncker, who needs enemies?

Curiously, Greek officials deny Tsipras asked for a meeting today with Juncker, stating Greece's differences now lie with Berlin, not Mr Juncker in Brussels.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Seth's Blog : The Debate Channel

The Debate Channel

Watching the US candidates hustle and squirm about the upcoming debates shows a fascinating generational media shift, one that impacts all of us.

In this case, the system has announced that only the top 10 candidates in the polls get invited, which means that more than a handful won't make the cut, which of course feels like doom.

But TV isn't in charge any more. We each own our own TV broadcasting network—anyone who wants to put on a show, can.

If I were crazy enough to be running, I'd organize my own debate, challenging one or two of my competitors to an hour-long conversation, and then post it online. Even better, I'd challenge one of the candidates from the other party and have a substantive conversation. Bernie Sanders debating [pick your candidate]. It elevates both sides because each person had the guts to address the issues, to go head to head, to speak up and make a case.

The Debate Channel can't be far behind. No grandstanding, with chess clocks provided for fairness, no wasted time on moderators, merely conversations, some of which can't help but go viral and get ratings that would, in aggregate, compete with the TV variety.

Can you imagine a musician today who only performed on TV when asked to by Jimmy Fallon? No music videos, no online work...

And the rest of us? We can have our own debates. Debate patent trolling or which kind of activity tracker is best. Two brand managers or engineers arguing for their particular cloud solution. Or debate sous vide vs. grilling, your freelance skills vs. someone else's...

The game theory is clear: In a competition among many players, when two or three care enough and are brave enough to debate, everyone else becomes 'everyone else'.

The magic is the open nature of a billion-channel universe. The organization with an FCC license is no longer in charge, debates aren't something that happen to you, they're something you can choose to do.

Pick yourself.

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vineri, 5 iunie 2015

Mish's Global Economic Trend Analysis

Tsipras Talks With Putin; Energy Minister Rules Out Deal; Wordsmithing Extraordinaire; 16 Tons
Durable Goods Charts Seven Ways
Solid Jobs Report: Labor Force +397K, Establishment +280K Jobs, Employment +272K, Unemployment +125K, Unemployment Rate +0.1%
Another Twist in Greece

Tsipras Talks With Putin; Energy Minister Rules Out Deal; Wordsmithing Extraordinaire; 16 Tons

Posted: 05 Jun 2015 12:38 PM PDT

Greek prime minister Alexis Tsipras keeps hinting that a "deal is close" while publicly trashing every deal offer.

One seriously has to wonder if this is purposeful gamesmanship to string the Troika along and encourage the ECB to keep liquidity in place so that Greek citizens can pull their money out of the banks.

The more simple possibility is everyone truly believes the other side is likely to cave in at any moment.

Tsipras Won't Agree to Irrational Proposals

Repeating similar rants of the past, Tsipras said today: Greece will Not Consent to Irrational Proposals.

Greece cannot accept the "irrational" proposal made this week by the institutions overseeing its bailout, Prime Minister Alexis Tsipras said during an emergency Parliament session Friday, adding that any deal must also include some form of debt relief.

His speech came the morning after a surprise announcement that Greece would defer an IMF payment due Friday, and would instead bundle all four installments due in June — a total of 1.6 billion euros — into one payment at the end of the month.

Addressing lawmakers for the first time on the course of his government's troubled four-month negotiations with Greece's international lenders, Tsipras said he was "unpleasantly surprised" by the proposal put forward by the International Monetary Fund, European Central Bank and European Commission during his visit to Brussels for talks with commission head Jean-Claude Juncker.

"I would like to believe that this proposal was an unfortunate moment for Europe, or at least a bad negotiating trick, and will very soon be withdrawn by the same people who thought it up," he said.

Still, he said, he believes a deal is now closer than ever.

Wordsmithing Extraordinaire

Is it remotely possible Tsipras actually believed a better deal was going to be handed to him?

I strongly doubt it.

Please note that Tsipras did not say "he believed the deal will soon be withdrawn". He said he would "like to believe it will soon be withdrawn", a completely different meaning altogether.

What about his statement a "deal is now closer than ever"?

Quite possibly, that's technically true. If the deal was a mile away before, and there was an inch of progress today, the deal could indeed be "closer than ever" but at the same time "not close at all".

I am still amused at yesterday's wordsmanship.

Thursday morning, when asked by reporters whether Friday's installment would be made, the Greek prime minister replied: "Don't worry about that."

Thursday afternoon, we learned Athens to Delay IMF Repayment.

Of course "Don't worry about that" is quite different than "yes".

A skillful politician frequently appears to say something significant without saying anything at all. These last two days prove that Tsipras is a wordsmith master.

There is technically not a single lie in any of the above statements. That's a remarkable achievement for any politician, especially one under the gun, both foreign and domestic.

Energy Minister Rules Out Deal

Lending credence to the theory that a deal is closer, yet not close at all, Greek Energy Minister Rules Out Deal with Creditors Who Want 'Pound of Flesh'.

The divisions within Greece's government were laid bare on Friday when a senior minister ruled out any agreement with the country's creditors, accusing them of demanding a "pound of flesh".

Panagiotis Lafazanis, the minister for energy and the environment, told the Telegraph that Russia might be an alternative source of "substantial financial" benefits to Greece, stressing there was no possible "convergence" between "our government and the institutions".

Promising to oppose a deal, Mr Lafazanis said: "I do not think that Syriza will accept for the country and its people to be exterminated inside the eurozone. A third consecutive austerity loan programme will be the most destructive option possible for Greece."

Mr Lafazanis, a former Communist, believes that enough is enough. Any possible agreement would, he argues, force Syriza to break its election promise to end austerity. He wants Mr Tsipras to end the negotiations and, if necessary, default on Greece's debts – or even leave the euro.

As for the chances of Mr Tsipras reaching a deal, Mr Lafazanis said: "It is obvious that given their demands, there can be no convergence between our government and the institutions."

Athens Looks to Moscow

Does the above rant sound like a deal is close? I think not. And what about Russia?

Please consider Putin holds phone call with Tsipras, agrees to meet in 2 weeks in Russia.

Russian President Vladimir Putin has held a telephone talk with Greek Prime Minister Alexis Tsipras on Friday. They have discussed Russian gas supplies via Turkish Stream and agreed to meet at the St. Petersburg International Economic Forum in mid-June.

"Practical steps were discussed to implement agreements reached during the recent working visit of Alexis Tsipras to Russia, particularly the planned construction of the gas transport infrastructure across the territory of Turkey and Greece," the press service said.

The talks with the Russian president came hours before the Greek prime minister is due to address the country's parliament about the EU proposal.

Another Day Older and Deeper in Debt

In spite of (or because of) the above wordsmithing, we still do not know whom, if anyone is bluffing.

All we know for sure is that if a deal is worked out, Greece will sell its soul to the "company store" better known as Troika.

I offer this musical tribute.

Link if video does not play: Tennessee Ernie Ford Sings 16 Tons

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Durable Goods Charts Seven Ways

Posted: 05 Jun 2015 10:25 AM PDT

Reader Tim Wallace sent a series of four charts on durable goods components. Each chart compares April of this year to April in prior years.

Durable Goods Shipments

click on any chart for sharper image

This is the first time since 2008 that April year-over-year shipments are down.

Durable Goods New Orders

This is the first time since 2008 that year-over-year new orders in April declined. New orders rose above the pre-recession high but are now slightly below the 2007 high.

Durable Goods Unfilled Orders

Unfilled orders keep climbing. They are at a record high.

Durable Goods Inventory

Durable goods inventory is near a record high.

The above charts show nominal prices, not adjusted for inflation. Adjusted for inflation, shipments and new orders are well below pre-recession levels.

Over time, shipments and orders should match unless there are cancellations.

Unfilled orders are a reflection on aircraft orders that have a very long lead time and are subject to cancellation. Here is a chart I created in Fred that explains unfilled orders.

Unfilled Orders Breakdown

Blue - Unfilled Orders Total
Green - Unfilled Transportation Orders
Red - Unfilled Orders Excluding Transportation

Unfilled orders except for transportation are meandering along.

New orders is the primary story.

To weed out the possibility that April of 2015 was some sort of outlier, let's look at some seasonally adjusted growth charts.

Durable Goods New Orders Percent Change From Year Ago

Durable Goods New Orders Excluding Transportation Percent Change From Year Ago

Durable goods orders are a volatile series, in large part due to huge transportation orders but conditions have been weak ever since November of 2014.

Durable Goods Growth From Year Ago

November 2014: -0.61%
December 2014: -0.77%
January 2015: +3.19%
February 2015: -3.24%
March 2015: -0.70%
April 2015: -2.80%

Durable Goods Growth From Year Ago Excluding Transportation

November 2014: +4.33%
December 2014: +5.63%
January 2015: +1.81%
February 2015: -0.44%
March 2015: -1.97%
April 2015: -1.63%

Excluding transportation, the numbers look better. Yet even excluding transportation, year-over-year new orders have been very weak all year.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Solid Jobs Report: Labor Force +397K, Establishment +280K Jobs, Employment +272K, Unemployment +125K, Unemployment Rate +0.1%

Posted: 05 Jun 2015 09:07 AM PDT

Initial Reaction

Today's job report (for May) showed good numbers for the labor force, establishment jobs, and household employment. In contrast to April, this month's report was not marred by huge growth in part-time employment.

Household survey employment rose by 272,000 while unemployment rose by 125,000. That means more people actively seek jobs. They are back in the labor force. As a result, the unemployment rate rose by 0.1% to 5.5%.

Let's take a look at all the key numbers.

BLS Jobs Statistics at a Glance

Nonfarm Payroll: +280,000 - Establishment Survey
Employment: +272,000 - Household Survey
Unemployment: +125,000 - Household Survey
Involuntary Part-Time Work: +72,000 - Household Survey
Voluntary Part-Time Work: -95,000 - Household Survey
Baseline Unemployment Rate: +0.1 to 5.5% - Household Survey
U-6 unemployment: +0.0 to 10.8% - Household Survey
Civilian Non-institutional Population: +189,000
Civilian Labor Force: +397,000 - Household Survey
Not in Labor Force: -208,000 - Household Survey
Participation Rate: +0.1 to 62.9 - Household Survey

March 2015 Employment Report

Please consider the Bureau of Labor Statistics (BLS) Current Employment Report.

Total nonfarm payroll employment increased by 280,000 in May, and the unemployment rate was essentially unchanged at 5.5 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in professional and business services, leisure and hospitality, and health care. Mining employment continued to decline.

Unemployment Rate - Seasonally Adjusted

Nonfarm Employment

Click on Any Chart in this Report to See a Sharper Image

Nonfarm Employment Change from Previous Month by Job Type

Hours and Wages

Average weekly hours of all private employees was flat at 34.5 hours. Average weekly hours of all private service-providing employees was flat at 33.4 hours.

Average hourly earnings of production and non-supervisory private workers rose $0.06 at $20.97. Average hourly earnings of production and non-supervisory private service-providing employees rose $0.06 at $20.77.

For discussion of income distribution, please see What's "Really" Behind Gross Inequalities In Income Distribution?

Birth Death Model

Starting January 2014, I dropped the Birth/Death Model charts from this report. For those who follow the numbers, I retain this caution: Do not subtract the reported Birth-Death number from the reported headline number. That approach is statistically invalid. Should anything interesting arise in the Birth/Death numbers, I will add the charts back.

Table 15 BLS Alternate Measures of Unemployment

click on chart for sharper image

Table A-15 is where one can find a better approximation of what the unemployment rate really is.

Notice I said "better" approximation not to be confused with "good" approximation.

The official unemployment rate is 5.5%. However, if you start counting all the people who want a job but gave up, all the people with part-time jobs that want a full-time job, all the people who dropped off the unemployment rolls because their unemployment benefits ran out, etc., you get a closer picture of what the unemployment rate is. That number is in the last row labeled U-6.

U-6 is much higher at 10.8%. Both numbers would be way higher still, were it not for millions dropping out of the labor force over the past few years.

Some of those dropping out of the labor force retired because they wanted to retire. The rest is disability fraud, forced retirement, discouraged workers, and kids moving back home because they cannot find a job.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Another Twist in Greece

Posted: 05 Jun 2015 12:24 AM PDT

Greek prime minister Alexis Tsipras was confident just yesterday of working out a deal with the Troika.

Thursday morning, when asked by reporters whether Friday's installment would be made, the Greek prime minister replied: "Don't worry about that."

Thursday afternoon, we learned Athens to Delay IMF Repayment.

Of course "Don't worry about that" is quite different than "yes".

Grounded by Dissent

Friday morning we learned Alexis Tsipras Grounded by Dissent from Within Syriza.

After four hours of discussions with EU leaders in Brussels on Wednesday night, Alexis Tsipras was planning to return on Friday in hopes of at last sealing a bailout deal with creditors.

But the Greek prime minister has been grounded by a torrent of anger and resistance from his Syriza party. Instead of flying to Brussels, he will on Friday be appealing to a restive parliament in Athens with his government — and the country's financial future — on the line.

"The overwhelming sentiment in the [Syriza] parliamentary group will be one of rejection," Antonis Kamaras, a Greek political commentator, said of the bailout terms being offered by creditors. "It's hard to see how the leadership can prevail."

Mr Tsipras had called Wednesday's talks "constructive and friendly." But a senior Greek official said the International Monetary Fund, which was not represented at the meeting, had imposed new conditions that had not been tackled in earlier negotiations in Brussels.

Sitting in a cramped office at party headquarters, Alecos Kalyvas, Syriza's economic strategy chief, captured the mood of the party's mainstream. Greece faced big problems and "time was running out", he said, but he "cannot accept" more pensions reductions, energy price rises and public sector job cuts.

Asked if a deal would be reached before the current bailout extension runs out at the end of June, Mr Kalyvas responded: "I'm optimistic but only moderately."

Before Mr Tsipras flew back from Brussels, members of Syriza's extreme left faction urged him to call an immediate general election if the talks resulted in an ultimatum from bailout monitors.

John Milios, the party's previous economic strategy chief and leader of a new far-left faction, the Red Network, called for Greece to halt payments to the IMF and impose capital controls.

Panayotis Lafazanis, the hardline energy minister and official leader of the Left Platform, insisted that electricity prices would remain unchanged and that impoverished households would continue to be supplied with free electricity.

"This agreement isn't in compliance with Syriza's progressive platform and it's not going to happen," Mr Lafazanis said. "We're a government of principle and we won't be responsible for doing such great damage to the country."

What's the Game?

Ever since Alexis Tsipras won the Greek election and appointed finance minister Yanis Varoufakis, an expert who wrote a book on game theory, it's been extremely difficult to determine who is bluffing and who isn't.

Heck, it's very difficult to determine what most of the players really want. German chancellor Angela Merkel is one notable exception. She wants Greece in the eurozone, but not if it costs her too many political points. How many points is too many? Ask Merkel, but she won't tell you.

Does Alexis Tsipras want Greece out of the eurozone?

The possible answers are yes, no, yes provided he can blame the Troika, yes provided his party goes along, yes provided he can stay in power, etc.

The only way to know if anyone wants a deal is if there is a deal.

If Tsipras' goal all along was to default and place the blame elsewhere, he played his hand masterfully well. He can blame the Troika, Germany, his own party, or coalition partners. And months of delays gave everyone a chance to pull deposits from Greek banks.

On that note I have a strong recommendation: If you have money in Greek banks, you are begging for a haircut. Get your money out of Greek banks immediately, and keep it out even if a deal is announced.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

luni, 8 iunie 2015

This week's top Pins

Seth's Blog : High resolution is not the same as accurate

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Mish's Global Economic Trend Analysis

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sâmbătă, 6 iunie 2015

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Mish's Global Economic Trend Analysis

Seth's Blog : The Debate Channel

The Debate Channel

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