Prieur’s readings (November 21, 2009)

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This post provides links to a number of interesting articles I have read over the past few days that you may also enjoy.

• Jim Jubak (MSN Money): 3-step strategy for a twitchy market, November 19, 2009.
Many investors are deeply suspicious of the 60% run-up in stocks this year and are itching to sell. But then what? Here’s how to take some gains now while setting up a profitable 2010.

• Randall Forsyth (Barron’s): Treasury yield plunge sends warning, November 20, 2009.
Collapse in note yields suggests economic distress will keep Fed on hold well into 2010 or beyond.

• Gordon Chang (Forbes): When in doubt, blame Bernanke, November 19, 2009.
According to Liu Mingkang, China’s chief bank regulator, low American interest rates and the falling dollar have “seriously affected global asset prices, fueled speculation in stock and property markets and created new, real and insurmountable risks to the recovery of the global economy, especially emerging-market economies”. Does Liu have a point? Of course.

• The Economist: Stemming the tide, November 19, 2009.
Unprecedented levels of government debt may require radical solutions.

Reading break:

Considering the short-term technical picture of the US dollar, Adam Hewison (INO.com) provides valuable insight with a short analysis. Click here to access the presentation.

• Mark Trumbull (The Christian Science Monitor): Does US need a second stimulus to create jobs?
With the economy still in rough shape, calls mount for extra infusions of federal money. But critics say the first stimulus hasn’t created the jobs it was supposed to.

• David Streitfeld (The New York Times): With F.H.A. help, easy loans in expensive areas, November 19, 2009.
In its efforts to prop up a shattered housing market, the government is greatly extending its traditional support of real estate, including guaranteeing the mortgages of middle-class and even upper-class buyers against default.

• Mish Shedlock (Mish’s Global Economic Trend Analysis): Ron Paul, Alan Grayson audit the Fed Bill approved in house finance committee, November 20, 2009.
The Bill to audit Federal Reserve passes key hurdle. Chalk up a rare victory for the little guy (and the nation itself).

• Carmen Reinhart and Kenneth Rogoff (Harvard): This time is different – panoramic view of eight centuries of financial crises, April 2008.
This paper offers a “panoramic” analysis of the history of financial crises dating from England’s fourteenth-century default to the current United States sub-prime financial crisis. Our study is based on a new dataset that spans all regions. It incorporates important credit episodes seldom covered in the literature, including for example, defaults in India and China.

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1 comment to Prieur’s readings (November 21, 2009)

  • Frank Lotrario

    I read many articles that state that 70% of the US GDP is made up of consumer spending. I also know that consumers have been accumulating massive amounts of debt over the past 25-30 years. This debt accumulation (credit cards, home equity loans, etc. ) obviously had to help fuel the recoveries from past recessions. Can you or anyone else offer any research showing if there were significant increases in consumer debt after previous recessions going back 25-30 years ? Wouldn´t this be a good indicator to give us an idea of how quickly we will be able to recover from this recession ? If consumer debt was a significant factor in helping us recover from previous recessions, this recovery is going to be slow and long because that money is no long available to most households. I hope someone can pass on some charts or research. It would be very helpful and appreciated !!!!…………FL

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