Reflections on Obama Press Conference
November 24, 2008
An effort was made to reassure the world that the incoming administration will begin work on crafting plans to restore growth today, but the reality is that 57 days remain before power is transferred. That’s a very long time for a crisis that moving so fast. The goal of creating 2.5 million new and/or saved […] More
Currency Markets in the News
More Evidence of an Intensifying Economic Downturn in Euroland
November 24, 2008
Late last week came news of a 3.9-point decline in Euroland’s November composite PMI to record low of 39.7 and an even worse reading of 36.2 in manufacturing versus 54.1 in November 2007. Word also surfaced that construction output sank 1.3% in September. Four more adverse statistics were reported from the common currency area today. […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Citigroup Gets $306 Billion Government Bailout
November 24, 2008
Stocks rallied in Europe and closed 2.7% higher in Japan in response to a rescue of Citigroup, sending a signal there will not be more Lehmans. The British Ftse (+4.0%), Paris Cac (+3.9%) and German Dax (+3.0%) are each sharply higher. Citigroup will issue $27 bn of preferred shares to the government, which in turn […] More
Larry's Blog
When Does a Recession Become a Depression?
November 24, 2008
Recessions and depressions are each parts of the business cycle when demand, production, and employment are contracting. Depressions are considerably more severe. Economists do not agree on objective quantifiable criteria for deciding when a recession is bad enough to constitute a depression. The United States has experienced 32 business cycle downturns since 1857. Six of […] More
Larry's Blog
The Geithner Appointment
November 24, 2008
News that President-Elect Obama will reportedly appoint Tim Geithner, New York Fed President, to be Treasury Secretary has received very favorable reviews for the most part. Geithner has good relationships with Obama, Henry Paulson, Ben Bernanke, Henry Kissenger, Robert Rubin, and Larry Summers. His specialty is crisis management. Geithner represents continuity and will not need […] More
Larry's Blog
Next Week
November 21, 2008
Households will be in the spotlight of U.S. data during the week of Thanksgiving. House price indices from OFHEO and Case-Shiller, as well as existing and new home sales, will provide a reality check on the housing sector. Measures of consumer sentiment arrive from both the Conference Board and University of Michigan. Personal income and […] More
New Overnight Developments Abroad - Daily Update
Weekly Foreign Exchange Insights: November 21st
November 21, 2008
With one notable exception, this past week in foreign exchange was pretty much a carbon copy of the prior week. The yen continued its advance against just about all other currencies including the dollar. The U.S. currency posted sharp further gains against many emerging market currencies and commodity-sensitive currencies. Chinese officials kept the yuan steady […] More
Canadian Consumer Price Inflation Fell to 2.6% in October from 3.4% in September
November 21, 2008
On-year CPI inflation of 3.4% in both September and 3Q08 gave way to a 2.6% in October, as the seasonally adjusted index fell 0.5% and the unadjusted index tumbled by 1.0% in month-on-month terms. In the three months between July and October, the so-called headline (all items) CPI slid 1.4% at a seasonally adjusted annual […] More
Central Bank Watch
Bank of Japan Resists Cutting Rates
November 21, 2008
As expected, the Bank of Japan did not reduce its 0.3% rate target for overnight money, but a released statement painted a bleak picture with recession persisting for some time. Officials moreover identified downside price and growth risks associated with the pessimistic baseline forecast. The assessment of exports was downgraded, for instance, to “decreasing” from […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Counter-Trend Day in Markets
November 21, 2008
Stocks rose from multiyear lows in Europe and Asia. The yen and dollar are softer. Sovereign bond yields climbed in North America and Europe. Oil is firmer. The Nikkei advanced 2.7%. Stocks rose 2.9% in Hong Kong, 1.9% in Australia, 5.8% in South Korea, 5.5% in India, 3.0% in Singapore, 0.9% in Britain and 0.6% […] More
