Visar inlägg från juni, 2019

Hur det kommer sig att det är 40 grader varmt i Spanien och Schweiz.

It is the Jet Stream, Stupid. Därom intet i den annars utmärkta artikel i SvD. Det kräver väl en förklaring att en något högre grad av temperaturen ger   40 grader varmt i Spanien och Schweiz. The Omega-Shaped Jet Stream Responsible for Europe’s Heatwave Det kunde man ana av väderkartan i Rapport i maj 2010. A learned friend informed me that Rossby waves help transfer heat from the tropics toward the poles and cold air toward the tropics in an  attempt to return atmosphere to balance. They also help locate the jet stream and mark out the track of surface low pressure systems.  The slow motion of these waves often results in fairly long, persistent weather patterns. Artikel i SvD

Gary Becker, Economics and Sociology

Nobel laureate, the late Gary Becker, reflected on his college studies: “I began to lose interest in economics . . . because it did not seem to deal with important social problems. I contemplated transferring to sociology, but found that subject too difficult.” Tim Harford FT 28 June 2019

Why The US Has No High-Speed Rail

The Omega-Shaped Jet Stream Responsible for Europe’s Heatwave

France braces for 40C heatwave.  In parts of northeastern Spain the heat is expected to reach 45C on Friday. Germany and Italy are still below 40C. The exceptionally hot air has blown in from the Sahara. When an omega-shaped wave is present on the jet stream which arcs over Europe, warm dry air from southern Europe and Africa can be pulled north, pushing temperatures higher than normal. Global Warming Is Messing with the Jet Stream. That Means More Extreme Weather. Allt Du behöver veta om vädret och The Jet Stream

Professor Jacob Sundberg och tidsandan

Tidsandans kraft är stor. När 68-vänstern härjade som mest och bl a krävde att studenterna skulle bestämma kursinnehållet på universiteten hamnade professorn i Allmän Rättslära vid Stockholms Universitet i blåsväder. Många inom den dåvarande universitetsledningen torde så här i efterhand ha mycket att fråga sig om varför de föll undan. Här en inlaga från en av hans elever för begrundande. Hä r en länk till Professor Sundbergs site för vilken jag har äran att i många år ha varit web-master.

The ruling Lega and Five Star parties strip the central bank of its sacrosanct status

The governor and deputy would be appointed by the prime minister and other officials by the Italian Camera and Senate in secret votes. The European Central Bank is certain to treat the initiative with suspicion. Independence of the national central banks is obligatory under EU treaty law. Ambrose Evans-Pritchard 21 June 2019

Varmast blir det i Spanien, stora delar av Frankrike, Tyskland, Tjeckien, Polen och Österrike.

Kombinationen av en haltande storm över Atlanten och högtryck över Centraleuropa får varm luft från Afrika att spridas i Europa.  SvT 22 juni 2019 AccuWeather said cities from Madrid to Berlin, including Paris, Brussels and Frankfurt, were likely to experience a “multi-day heatwave” in the first half of the week, with similar temperatures of 32C or above expected further east later in Bucharest, Vienna, Budapest, Belgrade and Sofia.

The dollar is of course over-valued.

The Federal Reserve’s broad dollar index reached a 17-year high in early June.  The manufacturing trade deficit has ballooned to $900bn. The eurozone is chief global parasite. It has been sucking demand out of the global economy with current account surpluses of €300bn to €400bn. Germany’s current account surplus of 8.5pc of GDP. Ambrose 19 June 2019

Stocks are now offering the best selling opportunity in 10 years, thanks to the Fed

They’re right. It is different this time. It’s worse. Much, much worse. Debt is higher than ever, be it corporate debt, government debt or global central banks’ balance sheets.  Limited ammunition to deal with a new recession, wealth inequality, the social divisions and political extremes, and now trillion-dollar deficits — everything points to a more fragile system.  On paper, low interest rates keep it all afloat, but the context is as ugly as it gets. Here we are, with the great collapse unfolding in front of us.  Sven Henrich MarketWatch June 20, 2019

Sadly, the eurozone has not learned the debt lessons of Versailles, or heeded the warnings of John Maynard Keynes.

Although the creditor-debtor cards have been reshuffled since 1919, the game remains the same. Creditors want their pound of flesh, and debtors want to avoid giving it.  Debtors want their debts forgiven, while creditors fret about “moral hazard” and ignore the destabilizing, contagious effects of making debtor countries poorer.  By raising taxes and cutting public spending, Germany generated the required surplus to meet its annual debt payments between 1929 and 1931, but at the cost of intensifying the slump.  The German economy shrank by 25%, and unemployment soared to 35%. The policy of “fulfillment” under Chancellor Heinrich Brüning paved the way for Adolf Hitler, who simply repudiated the debt. Today’s debt charade in the eurozone has many parallels with post-World War I Europe. Robert Skidelsky Project Syndicate 20 June 2019 The tragedy of the interwar years in Germany was that the Social Democrats - then the world’s foremost socialist party -  became fatally tai


Från SAF:s sida möttes förslaget med betydande skepsis och bland yngre funktionärer med direkta motangrepp. Detta resulterade dock först år 1978 i ett mer organiserat motstånd genom publicerandet av pamfletten "Fritt näringsliv eller fondsocialism" författad av SAF-tjänstemannen Danne Nordling. Efter långa och hårda interna duster och genom avgörande insatser av personer som Curt Nicolin, Sture Eskilsson, Olof Ljunggren, Ulf Laurin och (inte minst) Janerik Larsson så kom näringslivet fram till att avbryta allt förhandlande om löntagarfonder. Näringslivet sa nej. Punkt och slut.  Wudar Andersson SvD 2011-06-12  I efterhand kan striden om löntagarfonderna te sig som ett tydligt upplinjerat slagfält - på ena sidan arbetarrörelsen, på den andra näringslivet och de borgerliga partierna. Så enkel var verkligheten inte på den tiden det begav sig. - Inom såväl näringslivet som de borgerliga partierna var meningarn

Lysande artikel. Swedbank är banken i sin tredje stora kris på 30 år.

Hoppet står nu till en före detta statsminister. Det här är berättelsen om hur en svensk folkbank hamnade i en internationell härva av misstänkt penningtvätt. Birgitta Forsberg SvD Näringsliv 2019-06-17           Swedbank (Sparbanken och Föreningsbanken)

Africa to propel world’s population towards 10bn by 2050

Sub-Saharan Africa’s population is set to double over the next 30 years, adding an additional 1bn people The trend is exemplified by Nigeria, whose population has already surged from 95m in 1990 to 201m this year.  Nigeria’s population is set to double again to more than 400m by 2050, when it will have overtaken the US as the world’s third most inhabited country. FT 17 June 2019 9.7 billion on Earth by 2050, but growth rate slowing,  says new UN population report Min första artikel i en stor tidning Vad gör vi åt befolkningsexplosionen? Rolf Englund Svenska Dagbladet, Fritt Forum (dåtidens Brännpunkt) 4/8 1967

Ms. Warren and Donald Trump agree on at least one thing: America’s currency problems are hurting workers.

Overseas currency manipulation by central governments made American exports more expensive all over the world.  And it made products manufactured in China and other countries cheaper in comparison. It’s the primary reason America’s trade deficit soared over the last 20 years, wiping out almost five million manufacturing jobs, roughly 90,000 factories and the livelihood of  thousands of the nation’s farmers . Robert E. Scott, Senior economist with the Economic Policy Institute Policy Center NYT June 16, 2019 Economic Policy Institute US Dollar

Open letter responding to a series of essays by Ray Dalio, part 2

Dear Ray, Keeping rates too low for too long in the current cycle brought massive capital misallocation.  It resulted in the financialization of a significant part of the business world, in the US and elsewhere.  The rules now reward management, not for generating revenue, but to drive up the price of the share price, thus making their options and stock grants more valuable. Artificially low rates created the housing bubble, exacerbated by regulatory failure and reinforced by a morally bankrupt financial system. John Mauldin 14 June 2019 Ray Dalio, founder of Bridgewater Associates, and MMT

Washington can pull the plug on Hong Kong's economic model at any moment

Once this line is crossed, the US will cease to recognise the territory as an independent member of the World Trade Organisation.  It will cut off access to sensitive technologies. Hong Kong will be subject to the same painful tariffs faced by exporters from mainland China. Ambrose 16 June 2019

Why the next bear market could shave 35% off the Dow

What about the Cyclically-Adjusted P/E ratio (or CAPE) that was made famous by Yale University finance professor (and Nobel laureate) Robert Shiller?  CAPE currently is extremely high (30.2, versus an average of 15.8 since 1871), Mark Hulbert MarketWatch June 14, 2019  Robert Shiller

Italy and France debt

The problem for Emmanuel Macron as he fans the flames of a no-deal Brexit is that his banks own a large chunk of Italy’s debt through subsidiaries.  Total French exposure is 12 times French GDP, six times its exposure to Greece in 2010. Ambrose Telegraph 14 June 2019 - Den stora risken var att Grekland skulle utlösa en kris i italienska, franska och tyska banker.  Nu finns i praktiken en EU-garanti för de utestående grekiska statsobligationerna. Anders Borg, TT, SvD papper 22 februari 2012

Hur kommer det sig att Ben Bernanke som var en erkänd expert på Den stora depressionen 1929 inte såg krisen komma?

Det är för att i hans ekonomiska modell så existerar ingen ”kreditdriven efterfrågan”. Han avfärdade professor Irving Fischers kreditbaserade förklaring av Den stora depressionen  Professor Steve Keen med flera SvD 13 juni 2019 Bernanke Hyman Minsky - Economics may be dismal, but it is not a science

Martin Feldstein, economist, 1939-2019

 Feldstein in 1997 published what swiftly became a notorious commentary on the idea of the European single currency for Foreign Affairs. In it, he argued that the creation of a single currency could lead to intra-European disputes: “conflicts over economic policies and interference with national sovereignty could reinforce longstanding animosities based on history, nationality, and religion”. Martin Wolf FT 12 June 2017 The crisis in the eurozone is the result of France’s persistent pursuit of the “European project,”  the goal of political unification that began after World War II when two leading French politicians,  Jean Monnet and Robert Schuman, proposed the creation of a United States of Europe . Martin Feldstein, 27 May 2012 Europas politiker har slagit in på en ekonomisk kurs som ser ut att leda mot sammanbrott.   Konsekvenserna riskerar att bli dramatiska. Huvudargumentet för en europeisk valuta var att den skulle gör

Stagflation is not good for the stock market


The next president of the ECB might determine whether there is a eurozone, perhaps an EU, at the end of the term in 2027.

It is possible for Germany to have full employment and a budget surplus because Germany has been running a huge current account surplus.  That would have been far more difficult if Germany had not been inside the eurozone: a floating Deutsche Mark would surely have appreciated hugely, Germany would now be in deflation Martin Wolf FT 11 June 2019

Ray Dalio, founder of Bridgewater Associates, and MMT

Ray Dalio is the thoughtful, somewhat controversial founder of the world’s largest hedge fund, Bridgewater Associates, which he started in 1975.  “Ray Dalio is really, really wrong.” In that essay he basically endorses Modern Monetary Theory (MMT).  Coming from someone of Ray’s stature, and knowing that others like Bill Gross are beginning to endorse MMT either obliquely or directly, I found myself wanting to shout, “Stop! This is dangerous!” John Mauldin 7 June 2019 Ray Dalio, founder of Bridgewater Associates, says that unconventional monetary policies may be required as traditional policy stumbles. MarketWatch 2 May 2019

Breakdown of society

Om civilisationen kollapsar t ex 2050 kommer allt inte att vara som vanligt 2049, tänkte jag och googlade Breakdown of society.  Jag fann raskt artiklar hos BBC och New Scientist. Arnold Toynbee in his 12-volume magnum opus A Study of History - an exploration of the rise and fall of 28 different civilisations. You might also like: How Western civilisation could collapse The perils of short-termism: Civilisation’s greatest threat What are the biggest threats to humanity? BBC Future - The long view of humanity Luke Kemp 19 February 2019 AH, the good old days, when predictions that “the end is nigh” were seen only on sandwich boards, and the doom-mongers who carried them were easy enough to ignore. If only things had stayed so simple. New Scientist is the world’s most popular weekly science and technology magazine. Its website, app and print editions cover i

How Matteo Salvini could blow up the eurozone

A curious thing happened in the Italian parliament last week. The chamber of deputies voted unanimously in favour of a motion to introduce a parallel currency in Italy — the so-called mini-BOTs. Wolfgang Münchau FT 9 June 2019

Civilisationen kan kollapsa 2050 – ska vi bry oss?

Orden från Chris Barrie, tidigare överbefälhavare i Australien, är brutala.  Det finns en ”verklig risk att mänskligt liv på jorden är på väg mot utrotning, på det mest fruktansvärda sätt”, skriver han i inledningen till en rapport som spritts som en löpeld i världens medier de senaste dagarna. Vidare kommer den globala matproduktionen att sjunka med en femtedel, Amazonas ekosystem kollapsa och permafrosten smälta. Så fortsätter det. Jetströmmen kommer att destabiliseras. - The destabilisation of the Jet Stream has very significantly affected the intensity and geographical distribution of the Asian and West African monsoons and, together with the further slowing of the Gulf  Stream, is impinging on life support systems in Europe. -  Some poorer nations and regions, which lack capacity to provide artificially-cooled environments  for their populations, become unviable. Peter Alestig SvD 2019-06-07 Allt Du behöver veta om vädret och The Jet Stream Väderkartan är kon

US has been running overall trade deficits since 1976

The US deficit peaked at 5.5% of GDP in 2006, but usually amounts to around 3% of GDP. China’s current-account surplus down from nearly 10% to 1% of GDP over the past decade. Zhu Min Project Syndicate  Jan 22, 2019 Zhu Min, a former deputy managing director of the International Monetary Fund,  is Chair of the National Institute of Financial Research at Tsinghua University, Beijing. 

Jugoslavien var det som EU vill bli - en ekonomisk, politisk och monetär union

"ever closer union" - The United States of Europe Federalisterna, Jugoslavien, Annika Ström Melin och Göran Persson

Target2 credits have reached €920bn - and Italy

Bond purchases by the ECB under its quantitative easing scheme have exacerbated the imbalances, effectively becoming a disguised conduit for capital flight from Italy. The Bank of Italy’s Target2 liabilities on the other side of the ledger have climbed to €481bn.   Ambrose Evans-Pritchard 4 June 2019 Target 2 Italy

US Current Account deficit

Martin Wolf FT 4 June 2019

What does €2.6tn buy you? If you’re after inflation, the answer is not much.

The reason is that no matter how much radical support central banks provide, banks will not want to lend and companies will not want to borrow, instead preferring to rebuild their battered balance sheets. Inflation Targeting and Financial Stability by Michael Heise FT 3 June 2019 Did inflation targeting fail?  How can it have gone so wrong?

The Trump Bump from 2140 to 2940 on the S&P 500 will go down in history as the greatest spree of central bank induced "irrational exuberance" ever.

David Stockman May 31st, 2019