[Today's post is excerpted from the October Austrian Investment Monthly newsletter. To subscribe please visit St Onge Research]
2014 has been a nail-biter for GDP watchers. After a 2.1% decline in Q1, the worst in years, Q2 rebounded with a ripping 4.6% print. Why all the excitement?
In any story you first decide where to begin. And 2014 starts with 2011. Why 2011? Because that’s when the economy grew out of the 2008 rebound and started getting nervous.
Okay, the picture is Japan, but it’s what I imagine a roller-coaster in Liberia probably looks like right about now.
And what a roller-coaster it’s been for markets. After months of zombie-marching to new highs, in the past month the main US indices are down about 7%, while Europe is down even harder. If you’re long the market, it’s been painful. If you’re short, you’re probalby in Aruba right now trying not to spill your Mai Tai.
What’s going on? Is it the end of the world? Will we have to live in the car? Will Jimmy get his braces?
On the other hand, in science we might expect some “weeding-out” process analogous to natural selection that kills off bad ideas and promotes good ideas. Did Keynes go through this process? Or did his prominence come through some other channel? The historical record is pretty clear — Keynes is a naked emperor crowned by bureaucrats.
Keynes’ resume is fairly sordid for an alleged economist: after bouncing around India aimlessly, [click to continue…]
I spent last week at Doug Casey’s annual conference. It was in San Antonio, which is just bordering on hot this time of year. The hotel had a lazy river and a hot-water waterfall, and one of those big surf-boarding rides, which seemed kind of odd for San Antonio.
Doug is a libertarian, he’s friendly to Austrian economics, and lives in a kind of experimental community in remote Argentina. [click to continue…]