Hi Guys,
Happy Easter to one and all.
Tomorrow, we’ll likely be in the trenches trying to outwit the nasty, murky, misty, messy market.
Here’s a Link to a Bruce Springsteen song that might help you navigate the uncertain road ahead with courage and convection:
It’s a terrific song from an outstanding album. If you are interested, the work is from Springsteen’s “Live in Dublin” DVD.
If you enjoyed the piece, you just might also like his “American Land” tribute song. This version is with his standard E Street band. Here is a Link to that energetic music:
I hope these songs inspired you just a little. Springsteen is one of my favorites. I’m sure you did not sleep during their playing.
Best Regards.
Comments
You're absolutely right! Thanks for the correction. Springsteen truly does rock. His songs often tell stories that teach valuable lessons.
Sorry for the error. Yet another example of faulty memory.
Best Wishes.
There will be volatility, things may be lousy for a while, but ultimately, you have a situation where they will come back if the market drops because I don't think they're willing to have a situation where you have multiple QEs, ZIRP and then when it appears the economy still isn't great, they go "oh well" and let things fall as they may. They'll never admit that all of the financial engineering didn't add up to something ultimately sustainable (that the training wheels can be taken off.)
Do they WANT to raise rates? Sure, they want it to appear as if things have reached that point but I think ultimately they know things have not. If they raise a little bit ultimately to just bring it back down again, I think that's a pretty lousy indicator and not exactly great for credibility, either.
It's bad enough that we're still at ZIRP at this point but people like that the punch bowl is still there so they don't really question it (and if they do, you're a "doomer" or "too negative"), to raise rates a little and then ultimately have to bring them back down when the economic reaction to a little rate hike is not good will just bring more clarity as to where things really are at this point. If the Fed has, in fact, painted itself into a corner, I suppose my concern is that ZIRP and QE are not the end of the tools.
The idea of getting 4% on a CD again already seemed very far away, but as the days go by, it just seems further and further in the distance.
Serious stuff! Very serious macroeconomic stuff indeed. My original post was intended as relief from the worrisome economic situation, but I really appreciate your post that transports us back into the trenches. Your posts are always thoughtful and thoughtfully developed.
To date, the various QE attempts have failed and ZIRP has not moved the needle, yet. I’m sure the Keyesians among us would argue for another more powerful QE effort; they always argue that the programs are never fully funded.
My interpretation is that they mostly fail because of the inefficiencies buried within the programs themselves. To extrapolate my argument to a ridiculous extreme, a new QE would not be committed to a north-south oil pipeline, but rather to hire long distance individual oil bucket carriers to reduce the persistent unemployment problem. Now that’s a nightmarish picture.
Note that I’m not prepared to toss-in the towel yet on ZIRP. Part of the problem is attitude and another part is perception. Words aside, the present Administration is not business friendly with its mountainous regulations, and the investing population properly perceives the disconnect. Things must change and will change because government intervention changes.
Of course, all this is speculation. Notwithstanding economists best efforts, experimental Economics is not like formulaic Physics. Irrefutable laws do not persist in economics because folks’ emotions always enter the equation in an unpredictable way.
Keyesian economic works sometimes and Austrian economics work sometimes. Both have enjoyed successes and suffered failures. Given the current failure of the Keyesian school, it just might be time to allow the Austrian school to have a swing at the ball (an acknowledgement to the start of the baseball season).
I’m sure you are familiar with the work, but Henry Hazlett’s “Economics in One Lesson” is a terrific introduction to the Austrian school. I highly recommend this short, breezy volume.
I know everyone is busy studying market conditions, so here are a couple of Links produced by Amanda Johnson that entertainingly summarize the first two chapters in Hazlitt’s classic:
https://Vimeo.com/67444799
https://Vimeo.com/67580521
EDIT: I don't understand why the Links are not registering on site. If you are interested you can access the Links by searching for " Amanda Johnson economics in one lesson videos". That's how I located her fun summaries. Ignore Edit comment. Seems to be working now after I capitalized the "Vimeo" portion of the address.
Please take time to give these short videos a look-see. There are a host of other chapter videos. They’re actually fun. They might even get you to thinking about short term/long term tradeoffs and local/global tradeoffs. Hazlitt would endorse those considerations. So do I.
Best Wishes.
Right-wing codespeak for "we need a ruling oligarchy, not a democracy".
oligarchy
a small group of people having control of a country, organization, or institution : the ruling oligarchy of
militarybusiness men aroundthe presidentCongress.• a state governed by such a group : the English aristocratic oligarchy of the 19th century.
• government by such a group.
democracy
a system of government by the whole population or all the eligible members of a state, typically through elected representatives : capitalism and democracy are ascendant in the third world.
• a state governed in such a way : a multiparty democracy.
• control of an organization or group by the majority of its members : the intended extension of industrial democracy.
• the practice or principles of social equality : demands for greater democracy.
Thank you for your post, I'll take a look at the videos.
"Note that I’m not prepared to toss-in the towel yet on ZIRP. Part of the problem is attitude and another part is perception. Words aside, the present Administration is not business friendly with its mountainous regulations, and the investing population properly perceives the disconnect. Things must change and will change because government intervention changes."
I think - to some degree - that confidence lost after the financial crisis is nowhere back to near what it was. I think a lot of people - and to some degree corporations/institutions - are making short-term decisions instead of long-term ones.
I'll disagree a bit about this administration - if anything, I think they've catered much more to the interests of business than looked after the needs of the masses. That's resulted in record stock buybacks, which keeps shareholders happy but doesn't build factories or the like. You have enormous activity in financial assets, but the broad economy is not reaching takeoff speed - if anything, it's starting to visibly slow down again.
I seriously doubt that any of his fans ever cared one diddley-squat about the quality of his voice. For all I know he may or may not be even a half-assed guitar player. However, he quite successfully put the two together to compose music that reaches across and speaks to many generations. Go to one of his concerts. It's an event like no other and you will never ever forget it. Heck, watch one on DVD. He works for it. He put in the time way beyond NJ doing what he loved. It shows.
Have you seen 'The New Jersey Shore' on MTV? That explains a lot along with the proximity to NYC.