After months of bleeding economic advisers, President Obama just nominated Princeton economics professor Alan Krueger to be the chairman of the Council of Economic Advisers. Krueger is no stranger to the Obama administration, having served as assistant secretary of the Treasury until late last year, when he returned to Princeton in order to retain his tenured status.
Read moreBen Bernanke's August 26 Speech Shows Out-of-Touch Economic Worldview
No Ben to the rescue. The hugely anticipated speech by the Fed chairman proved to be remarkably vanilla, which should have surprised no one. Bernanke reiterated a series of themes that have been well iterated in recent weeks: that growth has stalled but is poised to rebound in the second half, that housing remains a drag on the slow economic recovery, that unemployment is disturbingly and dangerously high, and that better government fiscal policy to address short-term economic weakness and long-term deficits is essential.
Read moreApple After Steve Jobs’s Resignation: Is the Company Doomed?
Let it be acknowledged that Apple, from which Steve Jobs has finally resigned as CEO after years of battling pancreatic cancer, is no ordinary company. It is the most powerful, successful, and innovative consumer technology company of our age.
Read moreObama Economic Strategy Targets Jobs & Growth, but Aims at 2012 Reelection
Yet another day in the yo-yo chronicles. The markets tanked once again, reverting to their extreme behavior of last week; European banks groaned under the presumed weight of unresolved debt burdens; and American economic data, ranging from the Philadelphia Fed’s manufacturing survey to jobless claims, suggested that, yes, Virginia, there may be a Santa Claus, but his bag this year is shaping up as decidedly thin.
Read moreStock Crash Erased, Yet Where Is the Optimism?
In the past three trading days, U.S. markets recovered everything they lost last week. In the wake of S&P’s disastrous and ludicrous downgrade, the major indexes lost about 8 percent; since then they’ve gained that entire amount back and then some.
Read moreMarket Crash: Wall Street’s Credibility Gap Causes Freak-Outs
In case you stepped away for a few bucolic summer days, emulating Nicolas Sarkozy and much of France itself, you probably noticed that global markets swooned yet again on Wednesday to the tune of nearly 5 percent down before staging an equally impressive comeback on Thursday.
Read moreFlash Crash: Markets No Longer Reflect Economic Reality
Over the past 48 hours, global markets have lived a life cycle, from panic and fear through uncertainty and confusion, and then, finally, euphoria. The individuals and machines placing the trades have been along for the ride, and if you stepped away for lunch or coffee, you risked exiting the movie at a crucial plot point, asking distracted friends and colleagues, “What just happened?”
Read moreFlash Crash: Markets No Longer Reflect Economic Reality
Over the past 48 hours, global markets have lived a life cycle, from panic and fear through uncertainty and confusion, and then, finally, euphoria. The individuals and machines placing the trades have been along for the ride, and if you stepped away for lunch or coffee, you risked exiting the movie at a crucial plot point, asking distracted friends and colleagues, “What just happened?”
Read moreMarket Collapse 2011: How Crashes Are the New Black
Welcome to the crash of 2011. With stunning speed, global markets have sold off to a degree not seen since the worst days of late 2008 and early 2009. In fact, only three times in the past 40 years have stocks sold this hard this quickly, with a 16 percent decline in the S&P 500 in a 10-day period surpassed only by drops in the Octobers of 1987 and 2008.
Read moreDebt Default: How the U.S. Has Ceded Global Economic Power
So there you have it. The debt deal is done, and all that remains is for a ritualistic i-dotting and t-crossing, along with the howls of protest from left and right that their bedrock principles were violated in order to save the U.S. credit rating. But make no mistake: While Washington muddled through at the witching hour and avoided sending the global economic system into the vortex, what unfolded over the past few weeks will have repercussions, and they are not good for America.
Read moreStock Markets: Great Opinion Reads on the Mayhem, Obama, S&P Rating
Well, that was a bomb. As President Obama delivered his speech—nearly an hour after scheduled—the networks showed the Dow as he spoke. It wasn’t pretty—it went down, and down, and down. So why did his speech fail to reassure the market? Business Insider’s Joe Weisenthal speculates that Obama was conflating the market troubles with the S&P downgrade, when they’re actually two separate problems.
Read moreMarkets Spooked by S&P Downgrade but Have No Alternative to U.S.-led System
And the beat goes on. Global markets have begun to digest the fallout from Standard & Poor’s scurrilous downgrade of American sovereign debt, and equity markets in Asia and Europe opened lower. Odd pockets of perceived safety rallied, like Swiss francs, and of course gold soared, as investors attempted to win the game of musical chairs on the deck of the Titanic.
Read moreWall Street Markets Collapse After Jobs Report and Double-Dip Recession Fears
U.S. stocks finished with mixed gains and losses on Friday, as investors responded to progress in today's jobs report and in the eurozone's debt crisis. The Dow rose 61 points as investors learned that Italy will speed up austerity measures. Prime Minister Silvio Berlusconi pledged that Italy would balance its budget by 2013, one year earlier than originally planned.
Read moreMarket Crash: Why Developing Countries Will Save the Old World
Carnage on Wall Street came fast and swift Thursday, triggered in part by a raft of European selling on the heels of less-than-reassuring remarks by the president of the European Central Bank. But that alone can’t account for a day that saw stocks down almost 5 percent—the worst day since the nasty days of February 2009.
Read moreThe Faulty Logic Behind the Market Sell-off
Things Are Bad Unless You’re Amazon, Starbucks or Expedia
Derivatives to the Rescue? How ‘Betting Against’ the U.S. Could Prevent A Default Crisis
Wednesday’s plunge in the markets signaled that the impasse over the debt ceiling ,if it continues, will eventually trigger a substantial market sell-off. That belief itself should have been a warning sign; when investors dismiss what is known as “tail risk,” only trouble ensues.
Read moreDebt Ceiling: Unaccountable Credit Ratings Agencies Go Rogue
As the debt-ceiling storm intensifies, some reports indicate that the White House, and perhaps the global financial markets, are less concerned with paying bills after Aug. 2 than with credit-rating agencies imposing their first-ever U.S. government downgrade, from AAA to AA+.
Read moreWhy is Obama Opposed to a Short-Term Debt Deal? Politics
s the tortuous debt ceiling debate continues, with plot twists that even the most diehard political junkies are having a hard time keeping straight, one aspect continues to bedevil the process: the staunch refusal of both President Obama and Senate Majority Leader Harry Reid to accept a short-term deal.
Read moreThe Optimism Deficit
In the nearly 15 years that I’ve been writing about markets and managing money, there’s been a dramatic shift that has gotten only marginal notice. We’ve gone from having an optimism surplus to an optimism deficit. That may be a greater problem than the budget surplus becoming a deficit.
Read more