Was the U.S. Employment Report Really Catastrophic?

By 2 Cents on July 8th, 2011 | Category: Economics | One comment
mushroom cloud

Investors have very short memories.

~Roman Abramovich

Today’s U.S. Nonfarm Payroll Report was a huge disappointment by any measure. Paraphrasing some reaction to it (mostly from economists who got it wrong):

catastrophic severely disappointing no redeeming qualities whatsoever Stop looking for the silver lining. There is none.

Now most of you know that I have a fairly bearish view on the economy due to the global debt burden. So I’m doing an I-told-you-so happy dance right now, right? Not so much. While I did add to my tiny HIX position today, I’ll be out of it again quickly if the market changes its mind, as it’s wont to do regularly.

Attention Deficit and Hyperbole

Why so sanguine in the face of data that is, by all accounts, unexpectedly and extremely negative? Because years of following the [...]

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2010 What Ifs

By 2 Cents on December 30th, 2009 | Category: Economics | 5 comments
2010 Economic What Ifs

Year’s end is neither an end nor a beginning but a going on, with all the wisdom that experience can instill in us.

~ Hal Borland

Yesterday we looked at some notes that I had made at the beginning of 2009. Today, we look at possible problem areas for 2010. Again, these are obviously not predictions, as I’m too chicken to stick my neck out on what I think will happen. Further, I don’t have any idea what will happen, nor do the thousands of pundits making their “here’s what ‘s going to happen in 2010 lists”. This is meant to be food for thought, and nothing more. (I don’t know about you, but I could use a little more of that kind of food rather than the calorie-filled sort I’ve indulged in over the past week!)

Debt:  I think this [...]

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Why You Should Care About Economics

By 2 Cents on December 28th, 2009 | Category: Economics | 2 comments
economics

An economist is an expert who will know tomorrow why the things he predicted yesterday didn’t happen today.

~ Laurence J. Peter (1919 – 1988)

Economics is often called “the dismal science” for its general lack of prediction accuracy. There are lots of other reasons financial experts and non-experts alike detest it. For most laypeople like you and I, it’s incomprehensible and just plain boring. I can understand all of those criticisms.

Still, there must be some value in it if thousands of people study it and governments make policy decisions based on it. Maybe it was never meant to be an exact science anyway. Maybe science itself isn’t always all that exact. After all, we can’t learn anything new without first making tons of potentially erroneous hypotheses.

What economists do best is report on general trends and that information is valuable to everyone. Now I’m not suggesting you [...]

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