Economische aanraders: Veren of Lood biedt u op zondag wekelijks een inkijkje in (minstens) 10 belangrijke of informatieve artikelen en interviews die de voorafgaande 7 dagen op economisch terrein verschenen op onafhankelijke sites.


De kop is de link naar het oorspronkelijke artikel, waarvan de samenvatting of de eerste (twee) alinea’s hier gegeven worden.

Sinds december 2015 nemen we ook een paar extra links op naar artikelen die minder specialistische kennis vereisen. Deze met *** gemerkte artikelen zijn ons inziens ook interessant voor lezers met weinig basiskennis van economie.

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The global financial cycle: Closer to an anticlimax than a juggernaut – Andrew Rose
14 augustus
Policymakers in small countries fear the ‘global financial cycle’ that is apparently driven by US fundamentals. This column argues, in contrast, that 25 years of financial data show that the global financial cycle has explained at most a quarter of the variation in capital flows in these countries. This result gives more wiggle room for small-economy policymakers, but it also means they cannot realistically blame the global financial cycle for domestic economic problems.
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So When Will China’s Debt Bubble Finally Blow Up? – Wolf Richter
17 aygustus
The upside is fake stability. The downside is too ugly to contemplate.
Corporate debt in China has soared to $18 trillion, or 169% of GDP, the largest pile of corporate debt in the world, according to the worried Bank for International Settlements. The OECD has warned about it earlier this year. The New York Fed warned about this debt boom in February and that it could lead to a “financial crisis,” but that authorities have many tools to control it.
The IMF regularly warns about China’s corporate debt, broken-record-like, and did so again a few days ago, lambasting the authorities for their reluctance to tamp down on the growth of debt. The “current trajectory,” it said, “could eventually lead to a sharp adjustment.”
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Missing growth: How imputation and creative destruction affect TFP measurement – Philippe Aghion, Antonin Bergeaud, Timo Boppart, Peter Klenow, Huiyu Li
16 augustus
Slowing growth of total factor productivity has led some to suggest that the world is running out of ideas for innovation. This column suggests that the way output is measured is vital to assessing this, and quantifies the role of imputation in output measurement bias. By differentiating between truly ‘new’ and incumbent products, it finds missing growth in the US economy. Accounting for this missing growth will allow statistical offices to improve their methodology and more readily recognise the ready availability of new ideas, but also has implications for optimal growth and inflation targeting policies.
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***Why Cryptocurrencies Will Never Be Safe Havens – Mark Spitznagel
14 augustus
Every further new high in the price of Bitcoin brings ever more claims that it is destined to become the preeminent safe haven investment of the modern age — the new gold.
But there’s no getting around the fact that Bitcoin is essentially a speculative investment in a new technology, specifically the blockchain. Think of the blockchain, very basically, as layers of independent electronic security that encapsulate a cryptocurrency and keep it frozen in time and space — like layers of amber around a fly. This is what makes a cryptocurrency “crypto.”
That’s not to say that the price of Bitcoin cannot make further (and further…) new highs. After all, that is what speculative bubbles do (until they don’t).
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Are We Already in Recession? – Charles Hugh Smith
14 augustus
If we stop counting zombies, we’re already in recession.
How shocked would you be if it was announced that the U.S. had just entered a recession, that is, a period in which gross domestic product (GDP) declines (when adjusted for inflation) for two or more quarters?
Would you really be surprised to discover that the eight-year long “recovery,” the weakest on record, had finally rolled over into recession?
Anyone with even a passing acquaintance with the statistical pulse of the real-world economy knows the numbers are softening.
— Auto/light truck sales: either down or off a cliff, depending on how much lipstick has been applied to the pig.
— Restaurant/dining sales: down.
— Tax receipts: down.
— Retail sales: flat, stagnant or down, depending on the sector and if the numbers have been adjusted for inflation/loss of purchasing power.
— Rents in high-rent regions: finally softening after years of relentless increases.
— Consumer debt: hitting new highs.
— Corporate profits: stripped of gimmickry, stagnant or down.
Those who study recessions know that employment often tops out just before the economy rolls over into recession. Strong employment is the last gasp of an expansionary phase.
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***Cashing Out of Unicorns Gets Hard – Wolf Richter
18 augustus
Until shares can be sold, “valuations” remain fake wealth.
With Friends like these…
Goldman Sachs’ hedge fund, Goldman Sachs Investment Partners, has offloaded over $75 million of Spotify shares, or “less than half” of its stake, in recent weeks, Sky News “has learnt” from “insiders.” This is peculiar because the Swedish music streaming service is preparing to list its shares on the New York Stock Exchange at a valuation of $13 billion, and confusingly, Goldman Sachs is one of the three investment banks that are advising Spotify on this “direct listing.”
A source told Sky News that Goldman Sachs had “practical reasons to sell a small stake.”
So what does Goldman Sachs know that others don’t?
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Why Is The Fed Raising Interest Rates As Fast As It Is? – Barkley Rosser
15 augustus
I have a theory that at least some people at the Fed are supporting interest rate increases not because they are worried about incipient inflation that must be nipped in the bud in advance under a regime of inflation targeting, but because they are looking over the horizon and worrying about a possible recession in the not-too-distant future, and they want to be able to have interest rates high enough that they can then engage in lowering them as a stimulative policy tool under the circumstances. If they are too low, then extraordinary measures will need to be used, and some of those measures may not be available in the future.
This theory is based on nothing solid at all, nothing. I think that those who may be thinking this (and my likely candidate(s) would be people at the very top) are constrained in speaking openly due both to the current institutional arrangement of consensus decisionmaking within an established inflation targeting system with a 2% inflation target, not to mention pressure not to talk about possible future dangers. The current line is that the economy is doing well, and certainly it is on the standard measures of unemployment and inflation, even if the former could be better and wages could be rising more rapidly. Indeed, it is this good performance that is supposedly underlying the moves to raise interest rates and possibly “normalize” the balance sheet (which I doubt there will be too much action on). But my theory is that for some of them it is a matter of trying to “normalize” on interest rates as well while the possibility of normalizing is possible, while the economy is doing fairly well and one can raise them without obviously slowing things down noticeably, so that indeed there will be the ability to lower them again in the future when necessary.
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How Central Banking Increased Inequality – Louis Rouanet
15 augustus
Although today high levels of inequality in the United States remain a pressing concern for a large swath of the population, monetary policy and credit expansion are rarely mentioned as a likely source of rising wealth and income inequality. Focusing almost exclusively on consumer price inflation, many economists have overlooked the redistributive effects of money creation through other channels. One of these channels is asset price inflation and the growth of the financial sector.
The rise in income inequality over the past 30 years has to a significant extent been the product of monetary policies fueling a series of asset price bubbles. Whenever the market booms, the share of income going to those at the very top increases. When the boom goes bust, that share drops somewhat, but then it comes roaring back even higher with the next asset bubble.
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Why We’re Doomed: Our Economy’s Toxic Inequality – Charles Hugh Smith
16 augustus
Anyone who thinks our toxic financial system is stable is delusional.
Why are we doomed? Those consuming over-amped “news” feeds may be tempted to answer the culture wars, nuclear war with North Korea or the Trump Presidency.
The one guaranteed source of doom is our broken financial system, which is visible in this chart of income inequality from the New York Times: Our Broken Economy, in One Simple Chart.
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US Asset Bubbles Crack as Frantic China “Restricts” Outbound Investments – Wolf Richter
20 augistus
What happens to prices when the biggest, reckless buyer walks away?
China’s State Council has issued guidelines on what Chinese companies can and cannot acquire overseas. The purpose is to “promote healthy growth of overseas investment and prevent risks.” These risks would be that the $18 trillion of Chinese corporate debt will balloon further, though much of this debt is already going bad, and that it will blow up, triggering a spectacular financial crisis. This is to be avoided.
So Chinese companies have been given priorities, and their efforts to invest in overseas commercial real estate – such as office towers and apartment buildings – in hotels, and in Hollywood will be axed.
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Lord Rothschild: “Share Prices Are At Unprecedented Levels, This Is Not A Time To Add Risk” – Tyler Durden
19 augustus
One year ago, the financial world was abuzz when the bond manager of what was once the world’s biggest bond fund had a dire prediction about how “all of this” will end (spoiler: not well).
Two months later, it was the turn of another financial icon – if from a vastly different legacy and pedigree – that of Rothschild Investment Trust Chairman himself, Lord Jacob Rothschild, who echoed Bill Gross with an unexpectedly gloomy warning in his 2016 half-year financial report, saying that central bankers are continuing “what is surely the greatest experiment in monetary policy in the history of the world. We are therefore in uncharted waters and it is impossible to predict the unintended consequences of very low interest rates, with some 30% of global government debt at negative yields, combined with quantitative easing on a massive scale.”
His outlook was just as gloomy: “the geo-political situation has deteriorated with the UK having voted to leave the European Union, the presidential election in the US in November is likely to be unusually fraught, while the situation in China remains opaque and the slowing down of economic growth will surely lead to problems. Conflict in the Middle East continues and is unlikely to be resolved for many years. We have already felt the consequences of this in France, Germany and the USA in terrorist attacks.”
One year later, the scion of the most (in)famous name in all of finance, is back and in his latest letter to RIT Capital Partners investors, Lord Jacob Rotschild has released what is perhaps his gloomiest outlook ever; here are the highlights:
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Do Seasonal Adjustments Help Identify Business Cycles? – Frank Shostak
17 augustus
Various statistics that governments produce on a regular basis carry the label “seasonally adjusted”. What is the meaning of this label? According to popular thinking the data that is observed over time (labelled as time series) is determined by four factors, which are:

The trend factor
The cyclical factor
The seasonal factor
The irregular factor

It is accepted that the trend determines the general direction of the data over time, while the cyclical factor causes movements that are related to the business cycle. The influence of seasons like winter, spring, summer and autumn and various holidays is conveyed by the seasonal factor. The irregular factor depicts the effect of various irregular events. It is held that the interplay of these four factors generates the final data.
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“The Dreaded Phase 4”: What Happens When Credit Spreads Finally Rise – Tyler Durden
19 augustus
With investors, traders, analysts and pundits focused on the chaos in the White House, and the daily barrage of escalating geopolitical and social news, whether terrorist attacks in Europe or clashes in inner America, the market is finally starting to notice as Friday’s last hour sell-off demonstrated. And yet, according to one of the best minds on Wall Street today, Citi’s Matt King, what traders should be far more concerned about, is not who is in the Oval Office or how bombastic the war of words between the US and North Korea may be on any given day, but rather what central banks are preparing to unleash in the coming months. To underscore this, two weeks ago, King made a stark warning when he summarized that we are now more reliant on central banks banks holding markets together than ever before:
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