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Remarkable!

November 14th, 2013 · No Comments

Remarkable stories from the web in a new, easier format.

Andrew Huszar, a former Federal Reserve employee who executed QE, has written a Wall Street Journal op-ed apologizing for the “unprecedented shopping spree.”

Fed Official Sorry About QE – Business Insider

He tweeted these stories last night, and they get to the core economic challenge of the moment.

Two Tweets From Nouriel Roubini Explain The Core Problem In The Economy Right Now – Business Insider

So here’s what’s happened since the monster rally and ensuing 20% correction: a whole lot of nothing. Less than nothing. Both the Nikkei 225 and the USD/JPY cross have been consolidating for over six months in a symmetrical triangle with well-defined converging trendlines. Here is what they look like (not a coincidence they’re mirror images):

Bear Argument For Japanese Stock Market

But what makes American culture different from the countries immigrants are leaving?

Foreigners Share What They Can’t Believe About America – Business Insider

History demonstrates that excessive private-sector borrowing plays a greater role than fiscal profligacy in generating financial instability. However, when the credit boom collapses, the government’s capacity to alleviate the downturn is limited by the prevailing level of public debt.

Private and public debt in crises: 1870 to now | vox

It was all looking so good for the euro zone for a while, with a return to economic growth and increasing manufacturing activity appearing to herald a recovery after a year and a half of recession. But now analysts warn that the euro zone could be returning to the bad old days.

Is the euro zone already running out of good news?

When the CEO of the company suggests that investors shouldn’t run up his company’s share price so much, you might expect alarmed shareholders to dump some stock. But when the company is Netflix (NFLX), even the short sellers don’t really take you seriously.

What Would It Take To Scare Netflix Shareholders?

But Gary Shilling, president of A. Gary Shilling & Co., a financial research and money portfolio management firm, will have none of that. He’s been a bond market bull for over 30 years and tells The Daily Ticker that Treasury yields are heading lower–to under 2% for the 10-year and under 3% for the 30-year.

Forget the Fed, Interest Rates Are Heading Lower, Shilling Says | Daily Ticker – Yahoo Finance

With its shares tumbling 18% on the day of the release and ultimately closing out the week 21% lower, I think this is what’s called in polite circles as an “overreaction.”

Does Fuel Systems Solutions’ Bloodletting Represent Opportunity?

While declining costs for everything from gasoline to coffee can be good news for consumers, disinflation makes it harder for borrowers to pay off debts and businesses to boost profits. The greater danger comes when disinflation turns into deflation, which leads households to delay purchases in anticipation of even lower prices and companies to postpone investment and hiring as demand for their products dries up.

Central Banks Risk Asset Bubbles in Battle With Deflation Danger – Bloomberg

Conventional batteries take so long to charge that they cannot efficiently store braking energy. But now graphene supercapacitors that store almost as much but charge in just 16 seconds could do the job instead.

Graphene Supercapacitors Ready For Electric Vehicle Energy Storage, Say Korean Engineers | MIT Technology Review

Despite a weak job market for recent graduates, workers with a bachelor’s degree still earn almost twice as much as high school graduates. College might be more expensive than ever, but a degree is worth about $365,000 over a lifetime, after defraying all the direct and indirect costs of going to school. This is a higher payoff than in any other advanced nation

Rethinking the Rise of Inequality – NYTimes.com

You buy a desk on Craigslist for $200. When you bring it home, it almost fits through your door, but not quite. So you begin to dismantle it a little, just to squeeze it in. Behind one of the drawers, you find a plastic bag. You hope it’s not cocaine, because that might take a touch of explaining. Instead, when you open it, you discover money. When you have finished counting the money, you have counted $98,000.

Man buys cheap desk on Craigslist, finds $98,000 inside | Technically Incorrect – CNET News

Shadow banking is arguably as much an endogenous response mechanism to an under-banked area of the economy as it is a silo for risk and instability. In fact, if risk and instability end up concentrating in the shadow banking area it’s only because more conventional forms of banking have left those areas behind.

Les Misérables banking | FT Alphaville

A recurring theme in economics blogs, particularly those that tend to be disparaging of mainstream Keynesian theory, is that Keynesians like to be New Keynesian (NK) when talking about theory, but Old Keynesian (OK) when talking about policy.

mainly macro: How to be a New Keynesian and an Old Keynesian at the same time

Then it became necessary to unwind these imbalances, with much moralizing from the Germans to the effect that others should be able to do what they did. But Germany operated in a highly favorable external environment, with fairly high inflation in southern Europe allowing it to make big gains in competitiveness — in effect, internal devaluation — without needing deflation. Unfortunately, Spain isn’t being offered the same kind of chance.

Europe’s (Low) Inflation Problem – NYTimes.com

Snapchat — a company with no revenues that currently targets young people — apparently got an offer from Facebook for $3 billion that does have a revenue stream but is worried about losing young people.

Digitopoly | Now for some jaw droppingly bad analysis …

Displays featuring “backplanes” of IGZO transistors should make it possible for tablets and TVs to have much higher-resolution displays while consuming significantly less power.

New iPad Has Higher-Performing Transistors Running Its Pixels | MIT Technology Review

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