February 15 links: European recession

Markets:

Greece 2 Year 5 Year 10 Year
Portugal 2 Year 5 Year 10 Year
Ireland 2 Year 5 Year 10 Year
Spain 2 Year 5 Year 10 Year
Italy 2 Year 5 Year 10 Year
Belgium 2 Year 5 Year 10 Year
France 2 Year 5 Year 10 Year
Germany 2 Year 5 Year 10 Year

United States

Europe
  • ECB’s trillion euro bet. Vox
  • Bad to worse in Greece. Zero Hedge
  • Does Germany want Greece to default? CNBC
  • Industrial production hammered in Dec QTR. FT

Local:

  • CUA doesn’t raise/ Peter Martin Borrowing is back!
  • The Campaign for National Ignorance goes up a notch.
  • Hollowing out. The Cupboard McKibbin making more sense
  • Swan makes sense in defense on productivity. AFR You can see the hand of Stutchbury in this debate. But Swan is right, IR is one small dimension of productivity gains.
  • ANZ offers 7% note. The Cupboard
  • The RBA’s BankWest rescue. Michael West exposing Invisopower!

Comments

  1. Two different articles both on Bloomy at the same time:

    “Greece Struggles to Win Bailout as Europe Doubts Mount”

    and

    “U.S. Stocks Pare Losses on Greece Optimism”

  2. “But I do know this: with inflation under control, if the Reserve Bank sees unemployment drifting up it will cut interest rates further to encourage borrowing and spending and thus foster faster growth in employment.”

    From the NCFI. Why do these people have such faith that interest rate reductions will continue to work in Australia when there are so many examples of where they have failed? And do they just not get the concept of debt saturation?

    • I don’t get it – has Gittins lost his senses? He never used to be this bad. It’s almost as if he is cheerleading a real CFNI.

      Let’s take the following example from Gittins:

      “””
      Consider this. One day you pick up a newspaper and on page five you read a small story saying employment grew by 10,000 last month, leaving the rate of unemployment unchanged at 5.2 per cent. A couple of days later, every time you turn on the car radio or look on the internet, then settle down at home to watch the evening news, you’re told about the car company that’s announced its intention to lay off 350 workers. The next day the big news is that a bank intends to lay off 1000 workers.
      “””

      Er, in theory, yes, but that just hasn’t happened in our economy. In fact, we LOST 100 jobs over the course of 2011, and 2012 is full of news of lay-offs, continuing weak retail figures, and anaemic debt growth.

      So, even if 10k magical jobs are created in one month in 2012, chances are that 15k jobs will be lost the following month.

      Surely Gittins must be now taking the piss, and just parroting a Fairfax editorial line? I mean, just look at the following:

      “””
      You’d need the steel-trap mind of an economist to say to yourself…
      “””

      • I don’t get it – has Gittins lost his senses? He never used to be this bad
        .
        He is suffering from the baby boomer disease – “It is difficult to get a baby boomer to understand something, when his ponzi retirement scheme of selling off investment properties at inflated prices, depends upon his not understanding it!”

      • I agree. When I created The Distillery at BS I awarded him top honours for economic commentary for the year. He was creative and interesting.

        This ignorance is bliss stuff is bizarre.

        Perhaps some form of reverse Macrobation is occurring in which the more we expose his short comings the more attached to them he becomes?

    • And yet our debt it is all due to our high land costs, not the other way around. I’d say that 1 penny may have dropped but there are still 99 to go for Kohler.

      “Australia’s household debt as a percentage of disposable income has been stuck at 150 per cent – the highest in the world – for about five years. Twenty years ago it was 50 per cent. In other countries it has come down, albeit painfully. Interest paid as a percentage of income has doubled in 20 years.

      And the underlying cause of this is the high price of land in Australia. It is one of the mostly sparsely populated nations on earth, yet the cost of land is among the highest in the world, crippling the citizens with massive debts and leading to hugely profitable banks.

      The combination of rising population, a lack of arable land and artificial restrictions on residential development in cities has led to a six-fold rise in the median house price since 1986, from $93,000 to $550,000 now. Over the same period, average household incomes have risen 3.5 times.”

      • There was less land in 1986 than now. Australia has shrunk by 83% in 26 years.

        Easy credit has nothing to do with it.

        Drive from Mackay to Melbourne along the coastal plain, if you live, you’ll notice no spare land, totally built out.

        Pick any shitty little town in the middle of nowhere. A town with no industry and a shrinking population. Prices are 5x times because of a shrinking Australia.

  3. We have the best ever US retail sales (in total value) in Nov, Dec and January. We are above pre-GFC values… with unemployment rate above 8%.