tag:blogger.com,1999:blog-6616959642391988608.post621338433524702840..comments2024-03-28T00:18:25.641-07:00Comments on Calafia Beach Pundit: Dr. Copper says the fever has broken (3)Scott Grannishttp://www.blogger.com/profile/14028519647946868684noreply@blogger.comBlogger13125tag:blogger.com,1999:blog-6616959642391988608.post-11525811079885316292009-08-07T10:38:13.776-07:002009-08-07T10:38:13.776-07:00And I would add that funds are not broke. Equity p...And I would add that funds are not broke. Equity prices have rebounded significantly from their lows. The S&P 500 is now up 50% since early March! Corporate bond prices have rebounded significantly. Global equity markets are up significantly. Household net worth has increased by trillions of dollars in the past several months. Construction is no longer falling and should be rising. Things areScott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-31382243377181327362009-08-07T10:31:05.026-07:002009-08-07T10:31:05.026-07:00CDLIC: The feelings expressed in the quote are typ...CDLIC: The feelings expressed in the quote are typical of the despair that sets in at the bottom of a recession. I don't know exactly where the jobs are going to come from, but I do know that all the important indicators are pointing to the fact that we have seen the bottom in the business cycle.<br /><br />It might help to view things in a stylized manner. Last year the threat of a collapse Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-16662177604224355842009-08-07T10:18:52.662-07:002009-08-07T10:18:52.662-07:00Scott,
Yesterday I sent your Mid-Year Forecast Re...Scott,<br /><br />Yesterday I sent your Mid-Year Forecast Review (July 14, 2009) to my mailing list; I titled it 'Scott's Economic Predictions for '09 Right On....Contrary to the Naysayers'. One of my recipients responded with the following:<br /><br />"Scott wrote: 'Growth: the economy is going to recover sooner than the market expects.'<br />Here, I continue to CDLIChttps://www.blogger.com/profile/01216074401236580903noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-5880374670848752332009-08-04T19:52:06.765-07:002009-08-04T19:52:06.765-07:00Public: I have been an active critic of the Fed, a...Public: I have been an active critic of the Fed, and I think they have made some monumental errors in the past 10-15 years. I have warned that what they are doing now has a very good chance of creating higher than expected inflation. But I have also noted that to date there are no clear signs that hyperinflation or even double digit inflation is in our future. <br /><br />Regardless, I continue Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-4351004350733609772009-08-04T19:47:33.033-07:002009-08-04T19:47:33.033-07:00Kelvin: I would never expect the Baltic Dry Index ...Kelvin: I would never expect the Baltic Dry Index to rise forever. As it is, it is still 375% above its low of last year. That is huge. And consider also that new shipping capacity has been added this year and prices are still way up.Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-16293251815462563942009-08-04T18:27:06.191-07:002009-08-04T18:27:06.191-07:00Did you notice the Dry Bulk Index has been coming ...Did you notice the Dry Bulk Index has been coming down and it could not go higher than the previous high?<br /><br />This worries me.Unknownhttps://www.blogger.com/profile/02798277240041244209noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-13878696806183678452009-08-04T14:54:23.064-07:002009-08-04T14:54:23.064-07:00Your assumption is that the bears are not fully ta...Your assumption is that the bears are not fully taking advantage of Fed policy as well. <br /><br />On the contrary, I went long EM local, external, real return and commodities + non$ for currency exposure in April of this year. All of these bets have paid off. Do I think this is good for the US long term, not for a minute. <br /><br />Timing of exit will be paramount when this ship returns to Public Libraryhttps://www.blogger.com/profile/00017383928897945054noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-14687638045133802832009-08-04T13:42:46.507-07:002009-08-04T13:42:46.507-07:00If you define growth to be a rising GDP you are ce...If you define growth to be a rising GDP you are certainly right. But when monetary inflation is unleashed, it raises the measured nominal and so-called real GDP without doing anything positive for most economic participants. Besides that, the GDP is impacted by government spending -- which also doesn't do anything positive for most people. <br /><br />So, yes I agree that the GDP will rise. Tom Burgerhttps://www.blogger.com/profile/01484696976692382802noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-34666515421693727412009-08-04T13:23:18.097-07:002009-08-04T13:23:18.097-07:00A final thought: maybe normal growth is impossible...A final thought: maybe normal growth is impossible, but we can still have growth, and I believe the economy is already growing.Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-51444765165131143182009-08-04T13:22:17.965-07:002009-08-04T13:22:17.965-07:00There's an important point to note about the F...There's an important point to note about the Fed's liquidity additions. Almost all of the increase in reserves is still sitting unused at the Fed in the form of excess reserves. That money has never gotten into circulation, in a sense. What has happened is that the Fed has bought a lot of Treasuries and MBS, but the money that paid for them has not been used to expand the money supply. SoScott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-8010054310032725712009-08-04T13:18:34.325-07:002009-08-04T13:18:34.325-07:00Scott:
Yes, I agree that there are many uncertain...Scott:<br /><br />Yes, I agree that there are many uncertainties and that the actual outcome depends on decisions that are yet to be made. <br /><br />What the Fed and the government have already done, however, guarantees significant capital consumption, according to Austrian theories that I believe. The only question is where the damage will show up.<br /><br />The Fed has never before let looseTom Burgerhttps://www.blogger.com/profile/01484696976692382802noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-23584362171991411652009-08-04T12:38:19.955-07:002009-08-04T12:38:19.955-07:00Tom: I note a lot of "ifs" in your comme...Tom: I note a lot of "ifs" in your comment. You are obviously assuming that all the things that are still up in the air will come down on the wrong side. I think the market is doing the same. What if the Fed manages to withdraw liquidity in a timely fashion? What if Obama's decline in popularity keeps his hands tied? What if growing voter resentment of big government finds an outletScott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-69849363044661261152009-08-04T12:10:50.953-07:002009-08-04T12:10:50.953-07:00Love your optimism, Scott, and truly hope you are ...Love your optimism, Scott, and truly hope you are right. Can't help but notice, though, that what was left of the free markets in the 1930s couldn't overcome the government nonsense of that era. <br /><br />Now we have totally unconstrained spending by government and the Fed because there isn't even the pretense that dollars mean something. If the Fed leaves interest rates near zero Tom Burgerhttps://www.blogger.com/profile/01484696976692382802noreply@blogger.com