5th January 2012
Hampered by a remarkable collapse of private debt and struggling to sell its public debt on the market, Spain is in an economic free fall. Derek Thompson gathers Spanish economic data on unemployment, construction, export, retail sales, industrial production and service activity to show the full extent of Spain's problem. The Atlantic
"Those economists who insisted that the recovery was on track have been left with egg on their faces." David Blanchflower is chirpy for being one of the few economists who predicted that UK growth will falter and that Unemployment will reach nearly 3m. New Statesman
Peter Boockvar finds it interesting that despite the economic concerns in Europe and China, the AAII measure of individual investor sentiment has gotten very bullish. "While very fickle, from a contrarian standpoint it says watch out in the short term." The Big Picture
Rob Reich thinks the financial squeeze on government since 2008 and tax revolts by the middle class three decades ago are to blame for the decline in public institutions but "beyond all this is the reality that America no longer values public goods as we did before." Robert Reich
When the price of a good rises, people tend to consume less of it; conversely, when the price of a good falls, people tend to consume more of it. But there's one exception to this rule, called a Giffen good, where a higher price causes demand for the good to rise. "Well, it seems that the development economics literature has now produced strong evidence of a real-world example of a Giffen good." Conversable Economist
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