Investment Markets Overview – w/e 26 April 2013

Austerity had another bad week, fresh on the heels of last week’s softening by the G20 and outright 180 degree hostility to it from the IMF head, Madame Lagarde.Now it appears that a 2010 study by Harvard University economists Carmen Reinhart and Kenneth Rogoff, entitled,” Growth in a Time of Debt, “which had a huge influence on Washington and UK policymakers, was flawed. It argued that high government debt is associated with slow economic growth and that growth is particularly weak when gross government debt exceeds 90 percent of GDP. The high debt, weak growth theory to all intents is still correct, but it’s the how high is high which has come into conflict as student Thomas Herndon, at the University of Massachusetts Amherst, had spotted a basic error in the spreadsheet. The Harvard professors had accidentally only included 15 of the 20 countries under analysis in their key calculation. Herndon found other issues, which had an even bigger impact on the now famous paper, including the fact that for some countries, some data was missing altogether. The Keynesians at the printing presses enjoyed this.

130426_chart

Subscribe to the Full Investment Markets Overview Newsletter which contains the following additional commentaries:-

  • US economic data . . .

  • Euro-Zone   . . .

  • The UK . . .

  • Out East   . . .

  • The $US index  . . .

  • Within the commodities complex  . . .

  • Economic data due next week includes  . . .

  • Returning to those dire US Durable Goods Orders, which were the worst in 7 months,  . . . .
     

  • Charts:-
    1. Indices Weekly
    2. Fed Funds Rate vs Population %
    3. Eurozone PMI Composite
    4. China Passenger Vehicle Sales Units Y on Y
    5. Gold Price Returns

 

Table of 15 Indices, 11 columns of detailed information, for accurate analysis

All men make mistakes, but only wise men learn from them

 

Click  HERE to view Details of the full version of this Newsletter

which includes full text and detailed Charts for each section

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