Morning Reading

by | Jun 18, 2017 | Culture, Economy, Keith, Politics | 0 comments

A few articles and posts from this week that are worth your time to read:

Charles Hugh Smith ask “Can We See a Bubble If We’re Inside the Bubble?”– “We want this time to be different so badly, we can almost taste it.”

James Kunstler posted “Things To Come” – “Quite a bit of that wealth was extracted from asset-stripping the rest of America where financialization was absent, kind of a national distress sale of the fly-over places and the people in them. That dynamic, of course, produced the phenomenon of President Donald Trump, the distilled essence of all the economic distress “out there” and the rage it entailed. The people of Ohio, Indiana, and Wisconsin were left holding a big bag of nothing and they certainly noticed what had been done to them, though they had no idea what to do about it, except maybe try to escape the moment-by-moment pain of their ruined lives with powerful drugs.”
Ray Keating wrote “All Uncertainty from Washington Is Not Created Equal” – “As Knight wrote, “The fact is that while a single situation involving a known risk may be regarded as ‘uncertain,’ this uncertainty is easily converted into effective certainty; for in a considerable number of such cases the results become predictable in accordance with the laws of chance, and the error in such prediction approaches zero as the number of cases is increased.” Meanwhile, a “true uncertainty” is a “form of uncertainty not susceptible to measurement.””
Lance Roberts posted “US Jobs Market: Much Worse Than Official Data Suggests” – “President Trump ran on a campaign that repeatedly touted “jobs, jobs, jobs.” His emphasis on jobs creation and bringing employment back to America struck a chord with voters. Trump’s election in itself contradicts the popular narrative that the US jobs market is tight and robust.”
Pedro Nicolaci da Costa “The Fed’s plan to shrink its giant balance sheet dodges the market’s most pressing question” – “The Federal Reserve’s detailed plan for reducing its balance sheet likely starting later this year, presented alongside this week’s interest rate hike, was a bit of obfuscation via transparency.

There was a ton of information, but none of it answered the central question on the minds of investors and bond traders: What will be the balance sheet’s ultimate size?”

Jonathan Garber observed “A predictor with a perfect track record on the American economy is moving closer to signaling a recession” – “An inversion would most likely be a signal that a recession is imminent. An inverted yield curve has a perfect track record of predicting recessions.”
Danielle DiMartino Booth eloquently produced “Housing in America: Movin’ on Up” – “This should be welcome news for renters. (Do you sense a however coming your way?) However, the vast majority of new construction in recent years has been in luxury units. That helps explain why half of would-be renters cannot afford to set out on their own – that $1,300-plus monthly pill is too big to swallow based on the affordability standard of 30 percent of income.

That’s assuming, mind you, you draw a decent salary. According to a recent report detailed in the Washington Post, no city in America has low enough rents on two-bedroom apartments for someone earning minimum wage to call home. All of 12 counties nationwide boast rents low enough for minimum-wage earners to let, that is if they can confine their belongings into a one-bedroom unit.”