Majoring in the Minors: Economic Realities and Phantom Diversions
In this commentary, we will discuss examples of how misguided policies and debates focus the public’s attention to minor issues, with the result being that the causes are not addressed, and hence the economic pain to be excruciating as years goes by. We will start...
Smoking Mirrors and Angelic Demons: Assessing the Prospects of 2013, Part I
The renewal of the swap lines among the major central banks was a footnote for the financial markets and for the financial publications in the last couple of days. However, and as we have pointed out in the past, it is one of the most crucial lines that has sustained...
Could we Start Experiencing a Normalization of Dislocation? An Assessment of Risks
In the last few days, some reports have been circulated - by prominent Wall Street banks –which tell us that things will return to normal in 2013. With all due respect we disagree with such an assessment for the following four fundamental reasons: First, the total...
A Falsis Principiis Proficisci: Do we Plan for the Future by Setting Forth the Wrong Principles?
We have all faced situations where everything is about politics. Unfortunately, it seems that we have not learned yet that while everything is politics, politics is not everything. The EU this week tried to “solve” the impending crisis. All that it accomplished was to...
The Chastising of the Markets: The Slippery Slope of Declining Confidence
About ten days ago Germany reported its latest deterioration in business climate. German companies expressed significant dissatisfaction with current business conditions. Most probably they have start comprehending that the disintegration of the Euro may have...
Corporate Cash in Balance Sheets: What Does the Story Imply?
Corporate buybacks are used to return cash to stockholders. Moreover without committing to higher dividends they boost earnings per share, and anchor the spread of equity dispersion. In times when companies do not expect significant growth and the prospects of...
The EU and the Amazing Act of Shooting Slower than its Shadow: Twenty One Eurogroup Meetings Later, Where is the Substance?
There are two opposing forces that are taking place in the EU. One pushes for greater political and economic integration, the other for greater disintegration. At the same time secession forces are aspired from Spain (Catalonia), Italy (Venice), U.K. (Scotland), and...
The Markets and Zeno’s Dilemma: Transcending the Complexity of Transfinite Policies
The markets’ developments in the last few months may resemble Zeno’s paradox. According to it, the flight of an arrow signifies the impossibility of change or motion. At any given moment of an arrow’s flight the latter is where it is or where it is not. If it happens...
The Ecosystem of Money: The Placebo Remedy to the Growth Dilemma
Let me be pretty blunt in this commentary. Growth is stalling almost everywhere due to the gargantuan amount of debt (public and private). Central banks have been exploiting their balance sheets, applying placebo treatments to their sick economies. These treatments...
A Note on China and India: The Pacific and the 21st Century Dilemma of “Buddenbrooks”
Thomas Mann was the recipient of the Nobel Prize in Literature in 1929. His novel titled Buddenbrooks has been credited for such success. The novel chronicles the decline of a German bourgeois family. In a similar fashion recent signs of significant slowdown in China...
