Wednesday, January 30, 2013

Wednesday roundup (01-30-13)

Spain's recession deeper than thought (The Associated Press) Spain's economy shrinks again and remains deep in recession: GDP contraction of 0.7% raises doubts of government-heralded recovery as hard-up consumers continue to cut back spending (The Guardian)

Catalonia asks Spain for further 9bn euros bailout (The BBC)

Italy risks political crisis as MPS bank scandal turns 'explosive': Italian magistrates investigating losses at Banca Monte dei Paschi say the mushrooming scandal has taken a dramatic turn, with political fallout that threatens to rock the country’s elections next month and upset eurozone plans for a banking union. (The Telegraph) Monte Paschi ignored warnings over risk, documents show (Reuters)

Japan's coming debt crisis as an ageing population eyes retirement: Shinzo Abe's policies will provide a short-term lift in economic activity, but are unlikely to create a sustainable recovery by Satyajit Das (The Independent)

U.S. Growth Halted as Federal Spending Fell in 4th Quarter (The New York Times) U.S. Economy Unexpectedly Contracts in Q4 (Iacono Research) One more like that and it’s a ‘recession’ (The Washington Post blogs) Analysis: GDP report doesn't mean recession (USAToday)

Pa. budget chief says pension reforms essential (Bloomberg)

Stuck in reverse, Detroit edges closer to bankruptcy (Reuters)

Daimler Trucks Unit to Cut Up to 2,100 Posts to Boost Profit (Bloomberg)

Time Inc. cuts 500 people, 6 pct of workforce (The Associated Press)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

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