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“Normal” – It’s the Opposite of What the Media Says

I hear it every day on the business channels or see it in the business media print: “The economy has to get back to normal.”  But normal means different things to different constituencies.  Wall Street and equity investors certainly don’t want to see the stock market behave normally, if indeed, normal means that PE ratios mean revert and that we have periodic 10%-20% corrections.  Everyone, especially the President, would like …Read More

Estimating GDP is like pinning the tail, somewhere, on the donkey

Wall Street hangs on every number published by any government agency as if they are accurate to the 3rd decimal place.  The fact is, most are estimates, especially the GDP number. On top of this, the seasonal adjustment process probably was key in understating economic activity, and this GDP number is most likely going to be adjusted upward over the next two months (the number today was the first of three …Read More