What recovery?

Making the rounds below the radar are the November 11 comments from the ever-wise Jan Hatzius, senior economist at Goldman Sachs, about how the current “recovery” statistics don’t include much of the small business picture, particularly small businesses shutting down.
Today’s comment attempts to gauge whether the recent official estimates might have overstated the economy’s [...]

Nothing, really.
The media love dramatic headlines and terrifying opening sentences, so “the sharpest drop in retail sales this year,” sounds the perfect panic note. But it helps to keep that 1.5% drop in retail sales in some perspective.
Last month, retail sales increased 2.2%, of which 1.7% was solely attributable to the Cash For Clunkers [...]

In all the hoopla, hand-wringing, and teeth-gnashing crashing around and about the auto industry meltdown — as newly-minted experts in business, industry, and economics sound off over their omelettes in every diner from Puyallup to Poughkeepsie about the wisdom of bailouts, the real fallout is starting to hit Main Street in an unexpected and unremarked [...]

Funny, that’s what the government is doing, in fact.
Reason has a must-read article on how our states mismanaged their budgets between recessions. The irrational growth of state spending, far outpacing inflation and population growth, did not produce any measurable increases in the quality of state services while putting the states in untenable positions for the [...]

Michelle Bachmann, Congresswoman from Minnesota’s sixth district, has introduced panicked legislation outlawing the establishment of a “global currency.” The legislation was inspired by China’s overture to establish a single reserve currency and, quite possibly, make that standard, universal global reserve currency some other currency rather than American dollars. Timothy Geithner limpidly announced that the U.S. [...]

If, like me, you followed Jon Stewart’s recent defeathering, skewering, and roasting of bulbous blabbermouth, Jim Cramer, with unrepentant delight, then I’m sure you would just love to see Stewart tongue-lash a few more of these cable television tunaheads. Starting with Chris Hansen, who’s graduated from lusting after teen girls to lusting after bankers.
As Uberwortsturmer [...]

From economist-turned-quiptificator, Brad de Long, who’s become a minor blogstar by word-storming the recession. Forget what the newspapers and the television have to say. You wouldn’t consult a barista to explain brain surgery, so why do you think the English majors at the newspapers can do a better job at explaining economics? Just click the [...]

This morning, I re-read Moorad Choudhry’s Introduction to Credit Derivatives from 2004, and came across this gem:
This isolation of credit [using credit derivatives] has improved the efficiency of the capital markets, because market participants can now separate the functions of credit origination and credit risk-bearing. Banks have been able to spread their credit risk exposure [...]

I’m a huge fan of Felix Salmon, who writes the Market Movers blog for Portfolio.com, and he has just writtenthe most approachable explanation as to what went wrong in the collateralized debt obligation market in this month’s Wired. It’s a charming little bedtime story about a little-train-that-couldn’t-but-everyone-thought-it-could called “the Gaussian copula function.” This fine little [...]

According to The Curious Capitalist, David Rosenberg, the telegenic Merrill Lynch economist, claims there’s good news buried in the housing starts numbers for January:
The Commerce Department reported that construction of single-family homes decreased to an annualized 347,000 last month. Rosenberg shaves about 30% off that number in order to exclude people who are signing up [...]

*You don’t know fear until you’ve faced number seven.
One of the curiosities about the current crisis is the sudden currency of economics opining, blogging, and just plain bloviating. Once the exclusive stomping ground of people you’d never invite out for a beer, economics is bringing the Bill O’Reilly out in all of us — including [...]

*Special boring banking blog for boring blog readers. That’s you, bucko.
All joking aside, there’s a real reason why I’m blogging about the economy on an entrepreneurial and small business blog. It’s not just that economics matter, but business owners and consumers are making real and rational decisions based on the fear and nothing that fill [...]

*Well, one, actually, but who’s counting in this panic?
In a previous post, I started ticking down ten misconceptions many of us, especially those paid to have an opinion, seem to be laboring under as the economy continues to head south and our fearless leaders continue to head nowhere. Today is our special banking edition, turning [...]

From Brad DeLong:
But when fiscal boost was tried on a large enough scale, it certainly did the job. And it is reasonable to infer (with all the caveats provided by the CBO) that what is true in the very large will be true in the merely large as well. Eugene Fama says that it is [...]

I was having the Beijing Beef and fried rice at Panda.
Just in case you thought things are bad, they could have been much worse.
Here is Capital Markets Subcommittee Chair, Rep. Paul Kanjorski (Pa), on C-SPAN talking about the bailout. The money quote (literally) comes at about two and half minutes into the video when he [...]

*That are making you madder or scareder than you should be.
In my consulting practice, the panic level of my clients is running on turbo-overdrive. Even Financial Times columnists are waking up in cold sweats without even falling asleep. Nancy Pelosi’s office just released a job loss chart that’s about as trauma-inducing as watching people jump [...]

I have spent most of this morning crunching the numbers the just released (January 24) Q4 Money Tree Report gathered by Thomson Financial and released through PriceWaterhouse Coopers and the NVCA. PriceWaterhouse doesn’t have the report up yet on the official Money Tree site, but you can download it from NVCA here. Charts can be [...]

As much as I like to hallucinate about my own greatness, I can never approach the lucidity of Eugene Fama’s discussion of all these government bailouts. His basic argument, which is the common-sensical nose-on-your-face obvious argument any freshman in macroeconomics will give you, is this:
Government bailouts must be financed.

Since the government does not have the [...]

Out with the old and in with the old, I say.
Two very smart post-mortems on the economic missteps of the Bush era: Justin Fox at Time.com and Douglas Holtz-Eakin at NewMajority.com. Both are worth a bit of dissection. After the break, of course.

Tags: 21st century business, analytics, API, business investing, business start up, business start [...]

Okay, Paul Volcker doesn’t know me from a turd on a Toronto street (though I’ve talked with the neither jolly nor green giant a couple dozen times back in the eighties, but he has talked with tens of thousands of somebodies and and twice as many nobodies, so it means nothing), but way, way back [...]