Best Yield Curve Chart

Via Zerohedge:

Three Charts on Inflation

First Annual Inflation and Capacity Utilization:


Then Monetary Base and CPI 1982 to 2008


Finally the same from 1982 to 2009. What kind of impact will this hockey stick have on the price level?

Recession Haiku

Via CrossingWallstreet a fun challenge, here is mine:
What grew GDP?
Too much leverage and some
Now it's over, save!

Deleveraging

Great little paper from the San Francisco Fed on consumer deleveraging.

Taking Japan as an example the process may take 10 years till 2018 to bring back household debt to personal income to 100%, the level of 2002, from the excessive 133% reached in 2007.

Their conclusion: "A simple model of household debt dynamics can be used to project the path of the saving rate that is needed to push the debt-to-income ratio down to 100% over the next 10 years—a Japan-style deleveraging. Assuming an effective nominal interest rate on existing household debt of 7%, a future nominal growth rate of disposable income of 5%, and that 80% of future saving is used for debt repayment, the household saving rate would need to rise from around 4% currently to 10% by the end of 2018. A rise in the saving rate of this magnitude would subtract about three-fourths of a percentage point from annual consumption growth each year, relative to a baseline scenario in which the saving rate did not change."

Markets

MSCI All Country World:

S&P500:

S&P500 Equally Weighted:

S&P500 Low Volatility:

S&P500:
Russell 2000:

S&P600 Small Caps:


Japan:

Japan Small Caps:


MSCI EMU:
S&P Europe 350:


Switzerland:


Pacific ex Japan:

Emerging Markets

Global Emerging Markets:


Brazil:


Russia:


India:


China:


Taiwan:


Korea:

Book Review - The Snowball: Warren Buffett and the Business of Life

Thanks Brad de Long for highlighting this book review by Michael Lewis. Have read Lowenstein's Buffett: the Making of an American Capitalist and was not keen on reading an other 960 pages on the great investor so this six pages summary comes in handy. A conclusion from the richest man on earth: ""Basically, when you get to my age," she quotes him telling a group of business school students, "you'll really measure your success in life by how many of the people you want to have love you actually do love you. I know people who have a lot of money, and they get testimonial dinners and they get hospital wings named after them. But the truth is that nobody in the world loves them.""