News and Information on the Economy
Below are individual articles regarding the economy and it's affect on your investments. We've added a brief introduction to each article to help you find what you're looking for. We believe you'll find a tremendous amount of useful information and trading insights contained in these articles. Bookmark this page and check back often because we are constantly adding new material.
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The Prospects For a Further Greek Default - Is Greece on the verge of another default? In short, yes. While the total debt involved may not seem like much to get excited over, there is a potential time-bomb hiding in Greece's balance sheet. To read the article, click the following link: Greek Default
How We Can Interpret New Unemployment Numbers - By looking at national unemployment numbers, it's easy to feel optimistic. In terms of the percentage of unemployment, things have not been this good in a long time. In fact, the figures for the final month of 2011 are the lowest since the early months of 2009. While they have a way to go before US workers see unemployment drop to the pre-recession levels of 2006 and early 2007, we certainly seem to be headed in the right direction. To read the article, click the following link: New Unemployment Numbers
Introduction to Burgernomics - The "Big Mac Index" was first introduced by Pam Woodall in an issue of The Economist, published in September 1986. Today it's still widely considered an informal measure of purchasing power parity between two currencies by comparing the cost of the Big Mac in any two countries. To read the article, click the following link: Burgernomics
Things Learned from the Republican Party Debate - The republicans really don't get enough credit - this bunch in particular. They are a wily bunch, and they all seem to be very up front and straight shooters. In fact, that was the common theme for me for the republican debate that took place in early December. To read the article, click the following link: Republican Party Debate
U.S. Debt To Exceed Size Of Economy This Year - As it appears, debt problems of the U.S. are getting worse by the day. Reports from the U.S. Treasury say that the national debt is expected to outgrow the size of the economy this year. This is the first time U.S. will encounter this infamous distinction. To read the article, click the following link: U.S. Debt
Think a Lower Trade Deficit Is Bullish For the Stock Market? - Over the past 30 years, hundreds of articles -- you can find them on the web -- have featured comments from economists about the worrisome nature of the U.S. trade deficit. It seems to be a reasonable thing to worry about. But has it been correct to assume throughout this time that an expanding trade deficit impacts the economy negatively? To read the article, click the following link: Trade Deficit
How The Fed Sets Interest Rates - When people refer to the interest rates the Fed controls, they are usually talking about the Federal Funds Rate. This is the rate banks charge each other for overnight loans that are kept at the Federal Reserve. The Fed influences this interest rate using open market operations, in which it buys or sells government securities to banks. When the Fed sells securities, it takes money out of the banking system. However, when it buys them back, it puts money into the banking system. To read the article, click the following link: Interest Rate Fed
Understanding the Fed - Despite so much focus on the policies of the Fed, its operations remain somewhat of a mystery to most investors -- in no smaller measure, due to their complexity. We'll help you in your understanding of the Fed. To read the article, click the following link: Understanding the Fed
What is the Federal Reserve? - Many of us don't truly understand the role of the Federal Reserve and how it affects the markets. So, we're going to answer the question, "What is the Federal Reserve?" To read the article, click the following link: What is the Federal Reserve?
Deflation: The Trend That's Become Too Obvious To Ignore - As the biggest credit bubble in history continues to shrink, consumer prices have stayed flat over the past several months, meaning there is no sign of inflation to come, despite growing commitments from the U.S. government. So what's keeping inflation at bay, given all the stimulus money promised? The answer: Deflation -- an overwhelming urge for consumers to liquidate their assets for cash. And this new economic phase is finally becoming too obvious to ignore, as explained in recent commentary from the world's largest technical analysis firm. To read the article, click the following link: Credit Bubble
Efficient Market Hypothesis: R.I.P. - Of all the belief systems of Wall Street, few can claim the devoted following of the Efficient Market Hypothesis, the idea that stock prices adhere to the same laws of supply-and-demand that govern retail products. Once coined the theoretical "Parthenon" of economics, this notion has consistently endured the test of time ----- until now. To read the article, click the following link: Efficient Market Hypothesis
Deflation: First Step, Understand It - "Fed's Bullard Raises Specter of Japanese-Style Deflation?," read a July 29 Washington Post headline. There are still steps you can take if deflation is indeed in our future. The first step is to understand what it is. So we've put together a special, free, 60-page Club EWI resource, "The Guide to Understanding Deflation: Robert Prechter's most important warnings about deflation." To read the article, click the following link: What is Deflation?
The Economic Crisis No One Saw Coming: A Convenient Untruth - The single most convenient untruth about the 2008 (and counting) financial crisis is that it was unforeseen. For two years policymakers have insisted "There was no way to know ahead of time" that the liquidity boom would come to a screeching halt. Yet even as the mainstream authorities failed to detect the economic earthquake moving below their own feet, somebody did "notice" well in advance. That person was EWI's Bob Prechter. To read the article, click the following link: Economic Crisis 2010
Quadrillion Dollar Debt: 'Day of Reckoning' Looms - Right now, world debt statistics are frightening. A thousand trillion in debt can't be wished away or swept under the rug. No one can "forgive" the debt. The consequences of unwinding this debt could be as massive as the dollar figure itself. To read the article, click the following link: World Debt Statistics
Understanding Robert Prechter's 'Slope of Hope' - According to polls, economists are virtually unanimous in the view that the “Great Recession” is over and a recovery is in progress, even though “full employment will take time,” etc. Yet mortgage writing has just plunged to a new low for the cycle, and housing starts and permits just had their biggest percentage monthly drop since January 1991, which was at the end of a Primary-degree recession. But the latest “recession” supposedly ended a year ago. How can housing activity make new lows this far into a recovery? To read the article, click the following link: Deflationary Depression
What Makes Deflation Likely in 2010? - Deflation is suddenly in the news again in 2010. It's a good moment to catch up on a few definitions, as well as strategies on how to beat this rare economic condition. To read the article, click the following link: Deflation 2010
The Federal Reserve Does NOT Control the Market - As the world's leading stock markets continue to play stomach-hockey with investors via one triple-digit turn after another, the mainstream community takes solace in this core belief: No matter how uncertain things become, the Federal Reserve can at any moment swoop in to set the economy right. To read the article, click the following link: Monetary Policy
Signs of Deflation You Might Not be Able to See Clearly - The Fed and the government quite effectively advertise their efforts to inflate the supply of money and credit. But deflationary forces, to most eyes, are invisible. This article will point some of them out, and tell you how to protect yourself. To read the article, click the following link: Deflationary
The Stock Market is Saturated with Paradox - Everything the stock market does is saturated with paradox. Once you get used to the world of socionomic causality, the irony and paradox melt away, and everything makes perfect sense. To read the article, click the following link: Socionomics
Secrets of the Federal Reserve - Understanding popular myths about the Federal Reserve bank. How you can use the secrets of the Federal Reserve Bank to improve your investment and trading success. To read the article, click the following link: Fed Secrets
Deflating a Common Myth About Inflation - There is a common thought that inflation is the biggest obstacle facing our economy and traders should be wary of it. However, we'll show that to be a myth, and deflation should be the real concern for the stock market. To read the article, click the following link: Inflation and Deflation
Why Economic Forecasts Often Fail - The markets of today may not resemble the markets of tomorrow. Keep in mind the concept of dramatic change. This cannot be over-emphasized and bears repeating: Major change is not an occasional occurrence throughout history; paradoxically, it's the only constant. To read the article, click the following link: Economic Forecasting
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