UK jobless total rises by 25,000

[jamesbrown]

Predictions for the next economic crash?

Not really TBH, I'm surprised it hasn't happened already. Everyone could see China coming a mile off, and I'd be amazed if they don't trigger it, given the cack-handed nature of all these policy interventions (they can't help themselves). Everyone knows the official growth figures are a joke. Commodities and shipping prices etc. tell us everything we need to know. Much of the recovery has been illusory, global demand remains weak, and there's literally no ammo left. All sorts of asset prices are primed for a kicking (property being top of the list). The timing or precise trigger is anyone's guess though.

[PurpleGorilla]

UK jobless total rises by 25,000

On past trends it could be anything from NOW-5 years away.

My instincts say the end of 2017... Gives time for a rise in oil and the referendum result.

[Zero Liability]

I guess the smart money is on this. OTOH, I do wonder about Yellen. She's painted as this uber-dove, but I don't think that's right. Honestly, I wouldn't be stunned by a rate rise this year (September if the August NFP comes in really strong). Despite what they say about being data dependent, I think that's only partly true, and they're starting to realize that we're pretty far into the business cycle. They have feck all ammo when the next crash happens (look at the diminishing returns from successive QE, and none of that has been unwound yet). At some point, I think there's a cross-over between crappy economic data and having to do something in order to get to a position where they can cut rates when the next crash happens.

Yes, well I also believe the data set they focus on - at least officially - is far narrower (and more manipulated/massaged) than other indicators of economic performance. Perhaps not to the same extent as China's, but it still means these figures have little correlation with actual economic health. On the one hand, I don't think they can really afford to raise rates by a meaningful amount, what with the global credit bubble they've helped reflate and catapult skywards. On the other, if they don't, like you say, their already ineffective tools for dealing with another crisis will be no longer be there, and the market rate may then reassert itself forcefully. They rely on the perception of being in a position to do something. The election complicates matters as they're nowhere near as independent from political pressures as textbooks would have you think, so Yellen must be very nervous.

David Stockman's blog is something I keep track of since he surveys a broad variety of websites and data, and little of it is suggestive of anything close to a recovery anywhere you care to look.

[jamesbrown]

Yes, well I also believe the data set they focus on - at least officially - is far narrower (and more manipulated/massaged) than other indicators of economic performance. Perhaps not to the same extent as China's, but it still means these figures have little correlation with actual economic health. On the one hand, I don't think they can really afford to raise rates by a meaningful amount, what with the global credit bubble they've helped reflate and catapult skywards. On the other, if they don't, like you say, their already ineffective tools for dealing with another crisis will be no longer be there, and the market rate may then reassert itself forcefully. They rely on the perception of being in a position to do something. The election complicates matters as they're nowhere near as independent from political pressures as textbooks would have you think, so Yellen must be very nervous.

David Stockman's blog is something I keep track of since he surveys a broad variety of websites and data, and little of it is suggestive of anything close to a recovery anywhere you care to look.

Completely agree. Much of their credibility is built on perception, rather than actually being able to predict anything (patently, they can't). Unless the bottom falls out, I think the balance is shifting towards a couple of token rises quite soon. They don't want to start this in an election cycle, regardless of what they might say, but they also don't want to be caught with their pants down at the precipice of the next shock, unable to alter perception (if not reality). I think the rises will be tepid and will stall at a fairly low rate - more a token gesture and repositioning than a belief it's necessary to counter any future inflationary pressures.

[PurpleGorilla]

http://www.bloomberg.com/news/articl...n-house-prices

Looks like the Swede's have a similar problem...

[alphadog]

Sweden

Looks like the Swede's have a similar problem...

Looks like the Kiwi's have an even bigger problem...

Auckland house prices up 26% in June year, buyers looking further afield: REINZ - Business - NZ Herald News

[PurpleGorilla]

Looks like the Kiwi's have an even bigger problem (26pc annual house price inflation)...

Ouch!

Sweden (according to the article) has interest rates at -0.25%

Where do you go from there!

[DimPrawn]

Ouch!

Sweden (according to the article) has interest rates at -0.25%

Where do you go from there!

Errr, -0.5%?

[jamesbrown]

Where do you go from there!

The new central banker buzzword is macroprudential regulation (e.g. the recent MMR here). In simple terms, take an area of systemic risk, such as mortgage lending, prod it with a stick and see what happens. Because that always ends well. Only, they'll never use a particularly big stick because we all know the "recovery" is predicated on the consumer feeling good about their house price.

[BrilloPad]

The new central banker buzzword is macroprudential regulation (e.g. the recent MMR here). In simple terms, take an area of systemic risk, such as mortgage lending, prod it with a stick and see what happens. Because that always ends well. Only, they'll never use a particularly big stick because we all know the "recovery" is predicated on the consumer feeling good about their house price.

I thought that was just the UK?