Salient to Investors: Fareed Zakaria said: The Economist says Connecticut bankrolls the weaker states in America: 5% of their GDP over the last 20 years has been net income transfers to states like Mississippi and Alabama. Allen Cooperman says the nuclear deal will only take Iran from 2 months away
READ MORE... →Salient to Investors: Gary Shilling writes: The pessimistic economic theories are wrong. Weak growth will NOT last forever despite the Reinhart-Rogoff findings that the economy contracts at a 0.1 percent annual rate when government debt exceeds 90 percent of GDP. In the late 1970s and early 1980s many economists presumed
READ MORE... →Salient to Investors: Caroline Baum writes: The bad idea that the Fed could “fix” things faster with more inflation keeps popping up in academic circles: Kenneth Rogoff of Harvard in December 2008, followed by Greg Mankiw of Harvard, Olivier Blanchard at the IMF in 2010. Noah Smith advocates inflation of
READ MORE... →Salient to Investors: Kenneth Rogoff at Harvard said: Janet Yellen and Lawrence Summers qualify to replace Bernanke because of their dovishness about placing too much weight on stable inflation when unemployment is far above its longer-run level. Aggressive monetary stimulus is needed, even at the cost of moderate price increases, because with weak
READ MORE... →Salient to Investors: Carmen Reinhart and Kenneth Rogoff at Harvard acknowledged on April 17 that they had inadvertently left some data out of their calculations in “Growth in a Time of Debt”, but the error did not change their basic findings that countries with public debt in excess of 90 percent of GDP suffered measurably
READ MORE... →Salient to Investors: Brett Arends writes: It is not clear if high debt levels lead to slower growth, or result from slower growth, or that the two have only a loose connection, but we cannot borrow and print money indefinitely with no consequences whatsoever. Rogoff and Reinhart got their math
READ MORE... →Salient to Investors: Paul Krugman writes: Keynesian economics is close to a TKO over austerian economics, whose predictions about the real world failed completely and supporting academic research has turned out to be riddled with flaws. The two main studies supporting austerity – Alesina/Ardagna and Reinhart/Rogoff – were criticised almost as
READ MORE... →Salient to Investors: The median economist estimated unemployment in the euro region rose for a fifth month to 11.9 percent, the highest jobless rate since records began in 1995, while German unemployment held steady at 6.9 percent. The median economist expects the euro-area economy to decline 0.4 percent in Q4 2012, annual inflation
READ MORE... →Salient to Investors: Ken Rogoff at Harvard says: The global economy is growing more slowly than everybody wants – The improving US is one of the bright spots with only 2% growth. China is slowing, India slowing dramatically. US trend growth rate is 2.5%. Need 4%-5% growth for a sustained period to
READ MORE... →Salient to Investors: Investors can’t get enough government securities even though rising debt loads are blamed for curbing global growth. For the first time since 2008, all 26 markets tracked by Bloomberg and the EFFAS are poised to generate positive returns on an annual basis. Governments are getting a handle
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