What rabble-rousers, economists (those banished from the mainstream media), and bloggers have hammered on for years, a study by the San Francisco Fed finally confesses: Quantitative Easing didn’t do a heck of a lot of good for the real economy. The timing of the study is impeccable: the nearing end of QE – and the market mayhem it might cause.
Cracks In China’s Construction Bubble (But It’s Not Going To End)
by Wolf Richter • • Comments Off on Cracks In China’s Construction Bubble (But It’s Not Going To End)
China’s phenomenal construction bubble, driven by local governments that must keep their economies growing, no matter what the costs, and funded by state-owned megabanks, has led to an equally phenomenal misallocation of capital, overbuilding, waste, ghost cities, empty shopping malls, and now an epidemic of shuttered luxury department stores.
Why I’m Deeply Worried About Japan – And Why Betting On The Collapse Of JGBs Is A Horrible Idea
by Wolf Richter • • Comments Off on Why I’m Deeply Worried About Japan – And Why Betting On The Collapse Of JGBs Is A Horrible Idea
You don’t seem to “think Abenomics is working,” a reader wrote, followed by tough questions and a comparison to Kyle Bass, who has been betting on a “full-blown Japan crisis.” It got me thinking. I’m attached to Japan. What started in 1996 has turned into a complex relationship. But now that Abenomics is the religion of salvation, I’m even more worried.
“Yes We Scan” (Everything)
by Wolf Richter • • Comments Off on “Yes We Scan” (Everything)
Trouble In Junk Bond Lala-Land
by Wolf Richter • • Comments Off on Trouble In Junk Bond Lala-Land
Private Equity firms have seen this coming for months. They’re positioning themselves for it. In April, Leon Black, CEO of Apollo Global Management, explained it this way to an incredulous world: “We’re selling everything that’s not nailed down.” Now they’re setting records – but someone will end up holding the bag.
NSA Pricked The “Cloud” Bubble For US Tech Companies
by Wolf Richter • • Comments Off on NSA Pricked The “Cloud” Bubble For US Tech Companies
The cloud is a growth industry. And a religion in Silicon Valley: you’re better off with all your data and software stored in a data center somewhere on the planet. It’s a beacon of growth that revenue-challenged global tech giants like Oracle and IBM wave in the faces of antsy investors. But now, they’re going to pay a steep price for their cooperation with the NSA.
Room For Hope? Fourth Largest Industry In France: It’s “Never Been This Catastrophic”
by Wolf Richter • • Comments Off on Room For Hope? Fourth Largest Industry In France: It’s “Never Been This Catastrophic”
An awful turn of events in France, just when everyone was hailing signs of a recovery, of which evidence has been trickling in, albeit mixed at best. If you held your tongue just right, you could see vague glimmers of hope. Then came the results from France’s fourth largest industry, hotels and restaurants (along with the idea that you can always raise taxes).
In Honor Of The Shivering Huddled Executives Of Bear Stearns
by Wolf Richter • • Comments Off on In Honor Of The Shivering Huddled Executives Of Bear Stearns
When Bear Stearns blew up in 2008, the New York Fed handed it to JP Morgan Chase – the beginning of a vast bailout corruption fest. Turns out, five years later, the execs who caused it to blow up have jobs on Wall Street that are more lucrative than ever. To honor these sordid details, Nick Stuart wrote a hilarious, cynical parody about the last days of Bear.
Even the CEO Of China’s Largest Appliance Manufacturer Gets Cold Feet
by Wolf Richter • • Comments Off on Even the CEO Of China’s Largest Appliance Manufacturer Gets Cold Feet
China’s property and infrastructure bubbles, nurtured by limitless borrowed money, are still swelling up beautifully. Service industries are also growing. But hot air has been hissing out of manufacturing. Now Zhang Ruimin, CEO of China’s largest appliance maker Haier Group, put his finger on the problem. And it doesn’t look good for manufacturing in China.
The Dark Side Of The Guys Who Run Japan Oozes To The Surface
by Wolf Richter • • Comments Off on The Dark Side Of The Guys Who Run Japan Oozes To The Surface
Japan’s Prime Minister Shinzo Abe skillfully used his miraculous economic salvation plan, a religion lovingly dubbed Abenomics, as a platform to catapult his party, the LDP, into power. With the LDP controlling both houses of parliament, real changes, after years of dickering, might now finally be possible.