Last time I checked there was a wee bit of leverage involved there too.
The yield curve inverted in 1928, and money supply and CPI went negative starting in late 1929. Finally in 1933 the CPI went positive, and M1 was positive at a higher rate. The yield curve was also positive.
From there on in until M1 and CPI went negative again late in the decade, the economy had positive GDP.
I see nothing more overwhelming in our day in comparison with 1929.
you are misinterpreting what he was saying, as least how I read it. This current crisis is a very different scenario, with a global financial crisis into the mix. So, you're focused in on these few economic indicators but other factors, outside of this sphere is what I took his comment to mean, not the current sphere of economic indicators you are looking at for correlations. As far as I know, during all of these past times, there never was some funky $65 trillion dollar derivatives market that could collapse or the housing bubble like this one. Maybe Japan is the best model but I did not read his comment the way you are...I read it to imply there are other factors so out of line that they will decorrelate the KWRI.
Just looking at the theory of subsets, logic is how I read his comment and was suggesting looking at other economic indicators and their levels of stability during these correlations to see if there is an overriding factor here in comparison.
Anyone who want to show I am wrong can do some easy searching at the St. Louis Fred site: CPI, M1, 10 year and 3 year yields (and their predecessor series) are all there and public.
To prove me wrong, all you need to do is find a consecutive 3 months' period of time where:
(1) 10 year bond yield minus 3 month bond yield over the last 12 months to the target date is a positive number
and
(2) cpi is a positive number
and
(3) M1 is a positive number greater than cpi
Yielding a result where
(1) the gdp is not a positive number
or
(2) gdp will not be a poisitive number within 6 months.
I haven't found any such time period, and I won't hold my breath that anybody else can find one, either.
Mish's comment might make sense if the potential result were something other than B/not B, e.g., where it could be B, C, or D. But here there is either negative or positive growth -- B or not B. And by his own touting, when the warning indicator has not flashed, there has been no recession. There has always been positive growth. So the only questions are whether the KRWI leads vs. is coincident or lags recoveries, as well as recessions, and if it does lead, by how much.
Again, I want to emphasize, there is only one month's data of M1 exceeding CPI, so the indicator (for recovery) hasn't been triggered yet.
not M1. Can't find a graph but the tables imply it's also exploding.
Yes, I agree deflationary hell o no is possible but recovery?
As far as the locked logic, I think I just pointed to something outside the subset of the correlation between M1/CPI just as an example, which implies Mish's comment is valid but it would be nice to follow this more easily.
...the most dangerous people on the planet are the assholes Hoyer, Pelosi and Reid. These people are so ignorant of what must be done, so stupidly perverse that as long as they are in office we are going to have a tough time.
Fortunately their are other voices. Barney Frank is one, Paul Krugman is another and from the hinterlands you can hear a woman named Cindy Sheehan who will be heard. I only hope she's got her economics talking points correct.
The idiot Pelosi has a 32% approval rating in her district.
Yeah....
The citizenry is not amused by the Congress's prancing as it's current approval rate of 9% demonstrates.
Subtle signs point to Obama actually understanding that he needs to make a radical course change, in line with what Robert has been advocating, to avert disaster and he might just be tough enough to carry it off. He certainly has the high ground now with the vile sack of shit Greenspan publicly admitting he has no idea about what is going on. Check that, senile old fool has been the biggest voice on conomics, the 'go to guy', in the nation for decades and all the while advocating action on the basis of a fatally flawed model of how things work.
They ought to shoot the bastard. And every politician who ever took his advice needs to rethink what they think they know.
The field of play is now much bigger and wide open for progressive change. We can only hope Obama is smart enough to go for it. Because I don't want to wait for Clinton in 2012.
It might very well be too late by then.
Check out Krugman's interview on Charlie Rose's show. Very interesting and informative. Too bad the MSM can't seem to find time to allow our newest Nobel Prize winner to speak to the nation.
But then many heads would explode.
I'd like to ask all those Republicans who voted for Reagan and the Bush's...
And there was not much more to it than what I described. I followed up with a comment inviting him to prove me wrong, and he didn't respond.
His own discussion from April 2007 ("no false positives, no false negatives") means exactly what I've represented it to mean, and the graph is, I submit, self-evident. Furthermore, I have posted graphs of M1 vs. cpi, and the yield curve, in previous blog entries.
It could always "be different" this time, but the relationship holds even in the 1927-54 period.
I did not include hyper-inflation among the possibilities for 2009, because as I explained in my previous post, there is no correlation - at least absent a very substantial lag - between M1 money supply and the inflation rate. Any period of higher inflation is going to have to follow a deflationary period first. Simply put, for 2009, hyper-inlfation isn't in the cards.
You can post video clips in comments too and this is our blog and I try to be the responsive geek. So, if there is some feature, problem, something you want to do technically, just post a comment in the admin forum or email. I'll do what I can to incorporate whatever media is around and modify the actual site so we can make it all look pretty and useful. This ain't no google blogspot, soapblox, DK or predefined website...I can modify the actual code underneath to accommodate requests! (cool huh!)
but absolutely, I could assuredly use help finding good clips as well as good comics for these series, so recommend away.
I'm always hunting around for both and it seems every day online video is becoming more and more ubiquitous which is super cool but locating stuff is still stuck in the 1990's.
I was thinking of doing a CT night and a un PC night for the Internets is loaded with these and thought it might be fun to debunk too.
of Mish taking you to task for there is something wrong with this logic. Not A implies not in the subset of A, therefore unknown to A and not comparable to B, even with not B.
So while ya all are touting the infallibility of the KWRI ...
during the last 40 years what other EI are within a certain bounded conditions during this framework that are not true today?
I mean Helicopter Ben with his delta function M1 increase...
that looks unprecedented to me and why is it that hyperinflation is not a possibility in your picture, delayed?
what would KRWI look like in Germany, 1920's or say the US 1930's?
"The workers targeted in the Chrysler announcement today include engineers, accountants and finance personnel who earn predetermined amounts. The cuts exclude hourly factory workers whose jobs are protected by union contracts"
So much for a college education giving you any kind of job security.
Also, big business keeps telling Congress there is a shortage of engineers. If so, why would a company so dependent on quality engineering, Chrysler, be dumping them?
One thing I know, I don't want to here Chrysler whining to Congress that there is a shortage of engineers.
For others, the "books" section should be good reads as well as economic "bibles" or reference texts and I am always looking for recommends, new reads. Swimming through the economic fiction cesspool is tough and on top of it, we all know there are 101 Academic texts out there to choose from.
'Nonzero: The Logic of Human Destiny' by Robert Wright
These will get you started on being able to see the upcoming paradigm shift in economics which will remake the entire world. No messin'
'The Maestro' was to put it bluntly a stupid little man who told the ReThug 'policy makers' and Big Dog too what they wanted to hear. He's spent his whole life lying to the people who put bread on his table, the public, so that his rich friends could loot the 'free market'. If you read the first book take care to understand the implications of the 'Sugarscape' simulation.
The 'Chicago School' the execrable Friedman and all the rest of the pig-ignorant assclowns who've populated most of the 'economics community' have been simply wrong with their made up theories.
They and their stupid theories need to be hammered out of existence and exposed for what they are....
I'm not kidding and he's saying this time period is the same as 1929 through 1932. and he's saying we have exceeded if one looks at the industrial (?) index?
and I am just not one to give advice but right now Gold is up, go figure. Everything I have read on gold from analysts implies baffled, bottom line, on what's going on.
I guess there are two different markets, physical Gold and paper gold. Metals are more unique in that they are sometimes seen as safe haven...but in this market, I personally cannot figure up from down and many people who really are good forecasters are predicting different things on top of it. (inflation, deflation, depression, mild recession and so on).
Other commodities, I suspect NDD's deflation (immediate) analysis seems to be right. If you recall NND talked about oil prices crashing when everyone was writing about $200 oil and what is good and be glad he posts on EP is he analyzes things from the raw economic indicators, which I guess I should do more of myself. ;)
Last time I checked there was a wee bit of leverage involved there too.
The yield curve inverted in 1928, and money supply and CPI went negative starting in late 1929. Finally in 1933 the CPI went positive, and M1 was positive at a higher rate. The yield curve was also positive.
From there on in until M1 and CPI went negative again late in the decade, the economy had positive GDP.
I see nothing more overwhelming in our day in comparison with 1929.
you are misinterpreting what he was saying, as least how I read it. This current crisis is a very different scenario, with a global financial crisis into the mix. So, you're focused in on these few economic indicators but other factors, outside of this sphere is what I took his comment to mean, not the current sphere of economic indicators you are looking at for correlations. As far as I know, during all of these past times, there never was some funky $65 trillion dollar derivatives market that could collapse or the housing bubble like this one. Maybe Japan is the best model but I did not read his comment the way you are...I read it to imply there are other factors so out of line that they will decorrelate the KWRI.
Just looking at the theory of subsets, logic is how I read his comment and was suggesting looking at other economic indicators and their levels of stability during these correlations to see if there is an overriding factor here in comparison.
Anyone who want to show I am wrong can do some easy searching at the St. Louis Fred site: CPI, M1, 10 year and 3 year yields (and their predecessor series) are all there and public.
To prove me wrong, all you need to do is find a consecutive 3 months' period of time where:
(1) 10 year bond yield minus 3 month bond yield over the last 12 months to the target date is a positive number
and
(2) cpi is a positive number
and
(3) M1 is a positive number greater than cpi
Yielding a result where
(1) the gdp is not a positive number
or
(2) gdp will not be a poisitive number within 6 months.
I haven't found any such time period, and I won't hold my breath that anybody else can find one, either.
Mish's comment might make sense if the potential result were something other than B/not B, e.g., where it could be B, C, or D. But here there is either negative or positive growth -- B or not B. And by his own touting, when the warning indicator has not flashed, there has been no recession. There has always been positive growth. So the only questions are whether the KRWI leads vs. is coincident or lags recoveries, as well as recessions, and if it does lead, by how much.
Again, I want to emphasize, there is only one month's data of M1 exceeding CPI, so the indicator (for recovery) hasn't been triggered yet.
even with a 32% approval rating. People don't get it that they have to get these folks out of office and don't work to do it.
not M1. Can't find a graph but the tables imply it's also exploding.
Yes, I agree deflationary hell o no is possible but recovery?
As far as the locked logic, I think I just pointed to something outside the subset of the correlation between M1/CPI just as an example, which implies Mish's comment is valid but it would be nice to follow this more easily.
...the most dangerous people on the planet are the assholes Hoyer, Pelosi and Reid. These people are so ignorant of what must be done, so stupidly perverse that as long as they are in office we are going to have a tough time.
Fortunately their are other voices. Barney Frank is one, Paul Krugman is another and from the hinterlands you can hear a woman named Cindy Sheehan who will be heard. I only hope she's got her economics talking points correct.
The idiot Pelosi has a 32% approval rating in her district.
Yeah....
The citizenry is not amused by the Congress's prancing as it's current approval rate of 9% demonstrates.
Subtle signs point to Obama actually understanding that he needs to make a radical course change, in line with what Robert has been advocating, to avert disaster and he might just be tough enough to carry it off. He certainly has the high ground now with the vile sack of shit Greenspan publicly admitting he has no idea about what is going on. Check that, senile old fool has been the biggest voice on conomics, the 'go to guy', in the nation for decades and all the while advocating action on the basis of a fatally flawed model of how things work.
They ought to shoot the bastard. And every politician who ever took his advice needs to rethink what they think they know.
The field of play is now much bigger and wide open for progressive change. We can only hope Obama is smart enough to go for it. Because I don't want to wait for Clinton in 2012.
It might very well be too late by then.
Check out Krugman's interview on Charlie Rose's show. Very interesting and informative. Too bad the MSM can't seem to find time to allow our newest Nobel Prize winner to speak to the nation.
But then many heads would explode.
I'd like to ask all those Republicans who voted for Reagan and the Bush's...
How's yer 401k pal?
And there was not much more to it than what I described. I followed up with a comment inviting him to prove me wrong, and he didn't respond.
His own discussion from April 2007 ("no false positives, no false negatives") means exactly what I've represented it to mean, and the graph is, I submit, self-evident. Furthermore, I have posted graphs of M1 vs. cpi, and the yield curve, in previous blog entries.
It could always "be different" this time, but the relationship holds even in the 1927-54 period.
I did not include hyper-inflation among the possibilities for 2009, because as I explained in my previous post, there is no correlation - at least absent a very substantial lag - between M1 money supply and the inflation rate. Any period of higher inflation is going to have to follow a deflationary period first. Simply put, for 2009, hyper-inlfation isn't in the cards.
You can post video clips in comments too and this is our blog and I try to be the responsive geek. So, if there is some feature, problem, something you want to do technically, just post a comment in the admin forum or email. I'll do what I can to incorporate whatever media is around and modify the actual site so we can make it all look pretty and useful. This ain't no google blogspot, soapblox, DK or predefined website...I can modify the actual code underneath to accommodate requests! (cool huh!)
although it would go into next weeks.
but absolutely, I could assuredly use help finding good clips as well as good comics for these series, so recommend away.
I'm always hunting around for both and it seems every day online video is becoming more and more ubiquitous which is super cool but locating stuff is still stuck in the 1990's.
I was thinking of doing a CT night and a un PC night for the Internets is loaded with these and thought it might be fun to debunk too.
of Mish taking you to task for there is something wrong with this logic. Not A implies not in the subset of A, therefore unknown to A and not comparable to B, even with not B.
So while ya all are touting the infallibility of the KWRI ...
during the last 40 years what other EI are within a certain bounded conditions during this framework that are not true today?
I mean Helicopter Ben with his delta function M1 increase...
that looks unprecedented to me and why is it that hyperinflation is not a possibility in your picture, delayed?
what would KRWI look like in Germany, 1920's or say the US 1930's?
Is it too late to post a rec for a movie?
from: http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aKCc6E5Ta1oY
"The workers targeted in the Chrysler announcement today include engineers, accountants and finance personnel who earn predetermined amounts. The cuts exclude hourly factory workers whose jobs are protected by union contracts"
So much for a college education giving you any kind of job security.
Also, big business keeps telling Congress there is a shortage of engineers. If so, why would a company so dependent on quality engineering, Chrysler, be dumping them?
One thing I know, I don't want to here Chrysler whining to Congress that there is a shortage of engineers.
I'll check 'em out.
For others, the "books" section should be good reads as well as economic "bibles" or reference texts and I am always looking for recommends, new reads. Swimming through the economic fiction cesspool is tough and on top of it, we all know there are 101 Academic texts out there to choose from.
'The Origin of Wealth' by Eric D. Beinhocker
'Nonzero: The Logic of Human Destiny' by Robert Wright
These will get you started on being able to see the upcoming paradigm shift in economics which will remake the entire world. No messin'
'The Maestro' was to put it bluntly a stupid little man who told the ReThug 'policy makers' and Big Dog too what they wanted to hear. He's spent his whole life lying to the people who put bread on his table, the public, so that his rich friends could loot the 'free market'. If you read the first book take care to understand the implications of the 'Sugarscape' simulation.
The 'Chicago School' the execrable Friedman and all the rest of the pig-ignorant assclowns who've populated most of the 'economics community' have been simply wrong with their made up theories.
They and their stupid theories need to be hammered out of existence and exposed for what they are....
Ponzi schemes run by bunco artists.
I'm not kidding and he's saying this time period is the same as 1929 through 1932. and he's saying we have exceeded if one looks at the industrial (?) index?
n/t
I'm not sure, but wasn't it about 3x?
NC has the bloomberg quote and some comments. That's incredible considering the money helicopter.
once they reach their historical, lower multiple of median household income (and they'll probably overshoot first).
Either wages and salaries go up in real terms, or housing prices continue to go down until the ratio is restored.
There is no bailout that can avoid that ground truth. Today's figures tell us that we have reached the first station along the way.
and I am just not one to give advice but right now Gold is up, go figure. Everything I have read on gold from analysts implies baffled, bottom line, on what's going on.
I guess there are two different markets, physical Gold and paper gold. Metals are more unique in that they are sometimes seen as safe haven...but in this market, I personally cannot figure up from down and many people who really are good forecasters are predicting different things on top of it. (inflation, deflation, depression, mild recession and so on).
Other commodities, I suspect NDD's deflation (immediate) analysis seems to be right. If you recall NND talked about oil prices crashing when everyone was writing about $200 oil and what is good and be glad he posts on EP is he analyzes things from the raw economic indicators, which I guess I should do more of myself. ;)
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