There was a rosy picture painted for the U.S. dollar, earnings and the economy at large at Dow Jones Indexes‘ 2010 Global Economic Outlook today. Analysts predicted a rebound in global economic activity.  Kevin Logan, an independent global economist, said by the middle of this year, estimates for global GDP growth in 2010 are likely to be double what they were in the middle of 2009.  Analysts said that the dollar would start out the year weak, with a recovery sometime in mid-2010.

Continue reading ‘Recovery in 2010?’ »

It’s that time again, when all of the pundits and analysts weigh in with their predictions for the new year, and, as we leave “the aughts” behind, the new decade. The past two weeks have been chockablock with best of/worst of ‘09 lists, events of the year, people of the year, etc. (Time magazine’s choice for Person of the Year for 2009, Fed Chairman Ben Bernanke, actually ties in very nicely with Futures’ January Markets piece, “Interest rate policy: Under pressure.”) The consensus among many pundits is that the coming decade HAS to be better than the one we’re leaving behind. Continue reading ‘Drama ahead in 2010?’ »

Goldman Sachs’ holiday partying spirit was once again dimmed this year by a Grinch called the economy. Like last year, Goldman’s holiday party was cancelled, but this year, there’s a new twist. According to the Business Insider, Goldman Sachs employees are not allowed to organize private Christmas parties for the firm’s employees at their own homes, even if no firm money goes to pay for them. This Gawker story says that Goldman employees are basically not allowed to party in groups of 12 or more. Continue reading ‘Ain’t no party like a Goldman party’ »

In his speech before the Economic Club of New York yesterday, Fed Chairman Ben Bernanke expressed some conflicting  thoughts about  dollar policy. He said that the Fed is “attentive to the implications of changes in the value of the dollar.” At the same time, Bernanke reiterated his stance that economic conditions will warrant low levels of the Fed funds rate “for an extended period.” So it appears the Fed will maintain its low interest rate policy, which, in theory, could keep the dollar weak. This seems like a contradiction in terms.

Continue reading ‘Dollar paradox’ »

In this morning’s forex report, Andrew Wilkinson predicted that today’s statement by the Federal Open Market Committee (FOMC) would “convey an unchanged message in which they see a patchy economic recovery warranting an extended period of easy monetary policy.” He was right, as the FOMC said it would maintain the Fed funds rate at 0 to 0.25% and that economic conditions “are likely to warrant exceptionally low levels of the Federal funds rate for an extended period.”

Continue reading ‘Staying the course’ »

As the dollar continues its massive losing streak, the last place you would expect to see it is in the “best” column on any “best/worst” style list. But that’s exactly where it falls on Casey Research’s new report on the economy, “The Good, Bad, and Ugly: Year-End 2009.” Casey Research lists the U.S. dollar under “The Good” column because the dollar is the reserve currency of banks around the world. Continue reading ‘Good, bad, mostly ugly’ »

Are there really ”green shoots” of economic recovery? Some economists are wondering if the reports of housing market recovery by Wall Street and the Administration are real or imaginary. John Williams of Shadow Government Statistics argues that the 11% gain for new houses sold in June (following May’s 2.4% gain) was not statistically meaningful. He says that what we’re experiencing is a case of bottom bouncing, with the average rate of homes sold in the last eight months 70% less than 2004 and 2005 levels. He adds that “current year-to-year contractions reflect only a plateauing of housing activity at historic lows, not an upturn or turnaround in economic activity.” The economists we spoke to for our Mid-Year Economic Outlook said that the housing outlook was still very anemic and cited the huge amount of unsold homes and inadequate stimulus plans as a drag on the housing market. For now, it seems, talk of recovery in the housing sector doesn’t have a very solid foundation.

Most of the experts we interviewed for our July Markets Story, “Economic Recovery: Running on Empty” painted the economic picture as bleak, but predicted a possible recovery, albeit closer to 2010. In the meantime, interest rates are set to go up, inflation is on the rise, and the jobs outlook for the rest of the year is, according to the analysts we spoke to, either “awful” or “lousy”…take your pick. While making the overarching case to add gold and silver to your portfolio, Louis James, senior editor at Casey Research, uses another colorful anecdote to describe the economy: a zombie wearing lipstick.

Continue reading ‘Zombie economy’ »

Federal Reserve Chairman Ben Bernanke is providing some answers (sort of) about the current worldwide state of economic turmoil. Today USA Today published a conversation with Bernanke ahead of his speech on the economy at Moorehouse College.

Continue reading ‘Speechifying’ »

Guess which country comes out of the financial crisis looking like the smartest place on earth? It’s Canada, eh! Newsweek’s Fareed Zakaria wrote this insightful column on Canada’s savvy financial regulation vs. the not-so-savvy (to put it mildly) regulation coming out of the United States and Britain.

Zakaria points out that Canada is the only industrialized nation to not face a single bank failure, not to mention government intervention and bailouts, in the financial or mortgage sectors. Also, he mentions that the World Economic Forum ranked Canada’s banking system the healthiest in the world, miles ahead of the U.S. (40th) and  Britain (44th). Canada’s common-sense approach to regulation has helped its banks grow instead of flounder in the midst of the financial crisis. Continue reading ‘Oh Canada’ »