小伙伴们 万圣节快乐~ 大家昨天有没有吓到其他小伙伴/被其他小伙伴吓到，如果有，你就赚到了！因为Kim昨天跟会计考试纠结了一白天，晚上刚有时间就奔去gym，然后就回寝睡觉了。对于各种party和恶作剧什么的，也只有早上起来在微信里羡慕一下大家了。。Kim有个小提议，明年小分队是不是也搞个什么活动，==+让我们这些宅们也有种过节的感觉。。
Anyway，回到正题，今天经管的主题是Stagflation，第一篇文章选自wiki，作为科普；后面4个TIME共三篇文章，按顺序介绍了在1970s，美国由于Carter的错误政策导致了美国的stagflation，到1980s，在Reagan的领导下美国逐步走出经济低迷，最后说到1990s and beyond，Clinton时代的美国。越障找了几篇，最终选了个日期比较新的文章，也属于前些日子关于伯南克话题的系列，题目是David Rosenberg: Stagflation looming as Bernanke’s legacy。
剧透完毕，大家enjoy~
Putting a Stopper in All the 'Stagflation' Talk
[Rephrase 1]
[Dialog, 5min 15sec]
Source: NPR
http://www.npr.org/templates/story/story.php?storyId=74995288
Introduction of Stagflation (Definition and Causes)
[Time 2]
Stagflation, a portmanteau of stagnation and inflation, is a term used in economics to describe a situation where an inflation rate is high, the economic growth rate slows down, and unemployment remains steadily high. It raises a dilemma for economic policy since actions designed to lower inflation may exacerbate unemployment, and vice versa.
Economists offer two principal explanations for why stagflation occurs. First, stagflation can result when the productive capacity of an economy is reduced by an unfavorable supply shock, such as an increase in the price of oil for an oil importing country. Such an unfavorable supply shock tends to raise prices at the same time that it slows the economy by making production more costly and less profitable. Milton Friedman famously described this situation as "too much money chasing too few goods".
Second, both stagflation and inflation can result from inappropriate macroeconomic policies. For example, central banks can cause inflation by permitting excessive growth of the money supply, and the government can cause stagnation by excessive regulation of goods markets and labour markets. Either of these factors can cause stagflation. Excessive growth of the money supply taken to such an extreme that it must be reversed abruptly can clearly be a cause. Both types of explanations are offered in analyses of the global stagflation of the 1970s: it began with a huge rise in oil prices, but then continued as central banks used excessively stimulative monetary policy to counteract the resulting recession, causing a runaway price/wage spiral.
【249】
Source: wiki
http://en.wikipedia.org/wiki/Stagflation
[Time 3]
The term "stagflation" -- an economic condition of both continuing inflation and stagnant business activity, together with an increasing unemployment rate -- described the new economic malaise. Inflation seemed to feed on itself. People began to expect continuous increases in the price of goods, so they bought more. This increased demand pushed up prices, leading to demands for higher wages, which pushed prices higher still in a continuing upward spiral. Labor contracts increasingly came to include automatic cost-of-living clauses, and the government began to peg some payments, such as those for Social Security, to the Consumer Price Index, the best-known gauge of inflation. While these practices helped workers and retirees cope with inflation, they perpetuated inflation. The government's ever-rising need for funds swelled the budget deficit and led to greater government borrowing, which in turn pushed up interest rates and increased costs for businesses and consumers even further. With energy costs and inter
est rates high, business investment languished and unemployment rose to uncomfortable levels.
In desperation, President Jimmy Carter (1977-1981) tried to combat economic weakness and unemployment by increasing government spending, and he established voluntary wage and price guidelines to control inflation. Both were largely unsuccessful. A perhaps more successful but less dramatic attack on inflation involved the "deregulation" of numerous industries, including airlines, trucking, and railroads. These industries had been tightly regulated, with government controlling routes and fares. Support for deregulation continued beyond the Carter administration. In the 1980s, the government relaxed controls on bank interest rates and long-distance telephone service, and in the 1990s it moved to ease regulation of local telephone service.
But the most important element in the war against inflation was the Federal Reserve Board, which clamped down hard on the money supply beginning in 1979. By refusing to supply all the money an inflation-ravaged economy wanted, the Fed caused interest rates to rise. As a result, consumer spending and business borrowing slowed abruptly. The economy soon fell into a deep recession.
【327】
Source: economics.about
http://economics.about.com/od/useconomichistory/a/stagflation.htm
[Time 4]
The nation endured a deep recession throughout 1982. Business bankruptcies rose 50 percent over the previous year. Farmers were especially hard hit, as agricultural exports declined, crop prices fell, and interest rates rose. But while the medicine of a sharp slowdown was hard to swallow, it did break the destructive cycle in which the economy had been caught. By 1983, inflation had eased, the economy had rebounded, and the United States began a sustained period of economic growth. The annual inflation rate remained under 5 percent throughout most of the 1980s and into the 1990s.
The Political Impact of the Poor Economy in the 1970s
The economic upheaval of the 1970s had important political consequences. The American people expressed their discontent with federal policies by turning out Carter in 1980 and electing former Hollywood actor and California governor Ronald Reagan as president.
Reagan's Economic Policy
Reagan (1981-1989) based his economic program on the theory of supply-side economics, which advocated reducing tax rates so people could keep more of what they earned. The theory was that lower tax rates would induce people to work harder and longer, and that this in turn would lead to more saving and investment, resulting in more production and stimulating overall economic growth. While the Reagan-inspired tax cuts served mainly to benefit wealthier Americans, the economic theory behind the cuts argued that benefits would extend to lower-income people as well because higher investment would lead new job opportunities and higher wages.
The Size of the Government
The central theme of Reagan's national agenda, however, was his belief that the federal government had become too big and intrusive. In the early 1980s, while he was cutting taxes, Reagan was also slashing social programs. Reagan also undertook a campaign throughout his tenure to reduce or eliminate government regulations affecting the consumer, the workplace, and the environment. At the same time, however, he feared that the United States had neglected its military in the wake of the Vietnam War, so he successfully pushed for big increases in defense spending.
【340】
【The Rest】
The combination of tax cuts and higher military spending overwhelmed more modest reductions in spending on domestic programs. As a result, the federal budget deficit swelled even beyond the levels it had reached during the recession of the early 1980s. From $74,000 million in 1980, the federal budget deficit rose to $221,000 million in 1986. It fell back to $150,000 million in 1987, but then started growing again. Some economists worried that heavy spending and borrowing by the federal government would re-ignite inflation, but the Federal Reserve remained vigilant about controlling price increases, moving quickly to raise interest rates any time it seemed a threat. Under chairman Paul Volcker and his successor, Alan Greenspan, the Federal Reserve retained the central role of economic traffic cop, eclipsing Congress and the president in guiding the nation's economy.
Source: economics.about
http://economics.about.com/od/useconomichistory/a/economy_1980s.htm
[Time 5]
The 1990s brought a new president, Bill Clinton (1993-2000). A cautious, moderate Democrat, Clinton sounded some of the same themes as his predecessors. After unsuccessfully urging Congress to enact an ambitious proposal to expand health-insurance coverage, Clinton declared that the era of "big government" was over in America. He pushed to strengthen market forces in some sectors, working with Congress to open local telephone service to competition. He also joined Republicans to reduce welfare benefits. Still, although Clinton reduced the size of the federal work force, the government continued to play a crucial role in the nation's economy. Most of the major innovations of the New Deal, and a good many of the Great Society, remained in place. And the Federal Reserve system continued to regulate the overall pace of economic activity, with a watchful eye for any signs of renewed inflation.
The economy, meanwhile, turned in an increasingly healthy performance as the 1990s progressed. With the fall of the Soviet Union and Eastern European communism in the late 1980s, trade opportunities expanded greatly. Technological developments brought a wide range of sophisticated new electronic products. Innovations in telecommunications and computer networking spawned a vast computer hardware and software industry and revolutionized the way many industries operate. The economy grew rapidly, and corporate earnings rose rapidly. Combined with low inflation and low unemployment, strong profits sent the stock market surging; the Dow Jones Industrial Average, which had stood at just 1,000 in the late 1970s, hit the 11,000 mark in 1999, adding substantially to the wealth of many -- though not all -- Americans.
【263】
[Time 6]
Japan's economy, often considered a model by Americans in the 1980s, fell into a prolonged recession -- a development that led many economists to conclude that the more flexible, less planned, and more competitive American approach was, in fact, a better strategy for economic growth in the new, globally-integrated environment.
America's labor force changed markedly during the 1990s. Continuing a long-term trend, the number of farmers declined. A small portion of workers had jobs in industry, while a much greater share worked in the service sector, in jobs ranging from store clerks to financial planners. If steel and shoes were no longer American manufacturing mainstays, computers and the software that make them run were.
After peaking at $290,000 million in 1992, the federal budget steadily shrank as economic growth increased tax revenues. In 1998, the government posted its first surplus in 30 years, although a huge debt -- mainly in the form of promised future Social Security payments to the baby boomers -- remained. Economists, surprised at the combination of rapid growth and continued low inflation, debated whether the United States had a "new economy" capable of sustaining a faster growth rate than seemed possible based on the experiences of the previous 40 years.
【204】
Source: economics.about
http://economics.about.com/od/useconomichistory/a/economy_1990s.htm
David Rosenberg: Stagflation looming as Bernanke’s legacy
[Time 7]
You cannot keep real short-term rates negative for this long in the face of even modestly positive real economic growth without generating financial excesses today and inflationary pressures in the future. That’s why I continue to believe that the next major theme — and the legacy of the Ben Bernanke regime — will be stagflation.
We started off the great secular bull market in bonds in 1981 with 15% inflation and 15% bond yields, and the mantra led by none other than Henry Kaufman, who at the time spearheaded Salomon Brothers’ research department, was calling for much higher inflation and long-bond yields. But what he and everyone else underestimated was the U.S. Federal Reserve’s resolve to slay the inflation dragon.
Because few of us in the financial business are old enough to remember, I don’t think it is generally appreciated how deeply ingrained the inflation psychology was in the early 1980s. It took Paul Volcker a good four years and two severe recessions to kill inflation for good and it wasn’t until the mid-1980s that Mr. Market bought in by finally taking bond yields out of double-digit terrain.
It has taken Mr. Bernanke longer to dispel deflation concerns, even though the U.S. economy, in terms of consumer prices, hasn’t deflated once in the past six decades. I believe he will ultimately be successful and my call for higher long-term rates is a secular view that does not dismiss the prospect of a near-term rally from current oversold levels.
But I would fundamentally view any rally from here as a short-term one in the context of the last gasp of a three-decade-old bond bull phase. Unless you believe in deflation/disinflation, or an economic relapse — which is going to be difficult with the labour market gradually improving and organic wage income growth starting to revive as we saw in June — the ability to indefinitely hold yields out on the curve negative in nominal GDP adjusted terms seems highly unlikely.
The lingering deflation/inflation debate is quite a fascinating one, especially since at no time in the past 60 years has core inflation ever swung below zero. Despite all the talk about deflation, it has never really happened in the U.S. The core goods CPI has frequently deflated, but this segment ebbs and flows with the vagaries of the commodity cycle, which is increasingly hinged to demand from Asia, principally China.
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The U.S. economy is a service-sector economy for the most part and core services, now running close to a 2.5% annual rate, simply do not deflate.
While deflation continues to dominate the thought process in the marketplace and in the boardrooms of the world’s major central banks, the reality is core inflation has bottomed. It is running at 1.6% for the core CPI on a year-to-year basis, and, frankly, it was lower at 0.6% in October 2010 and the low was 1.1% in the prior cycle from November 2003 to January 2004.
As is the case today, both those periods were not recessionary even if they were far from robust from a macro standpoint. The important thing to note is that core inflation is carving out a secular bottom. Other specialized inflation metrics constructed by the Cleveland and Atlanta Fed banks validate that assertion.
We also now have a monetary policy dedicated towards getting inflation higher during the near and intermediate term, and, as the FOMC press statements have told us at each and every meeting since last December, the central bank would not resist any move in inflation expectations towards 2.5%.
For a monetary authority that up until several years ago was debating whether price stability was really closer to 1% than 2%, this is more than just a nuance or subtle shift in policy. At a 2.5% inflation rate, the price level actually soars nearly 30% over the coming decade. That’s more bad news for pensioners and those on fixed income, but this surreptitious default move is one peg in the restoration of a more comfortable debt/GDP ratio.
This cycle saw debt forgiveness, write-downs galore, delinquencies and insolvencies, but the policy-driven move towards higher inflation will help devalue the outstanding real level of what are still gargantuan liabilities, especially on the government side of the equation.
But the big picture is that the lows in Treasury yields were turned in a year ago when a three-decade secular bull market came to an end, and a secular bear market was in its infancy.
You want more evidence? Go to the piece Mr. Bernanke penned on March 1 titled “Long-Term Interest Rates” and you will see that the architect of today’s super-low interest rates sees 10-year T-note yields moving from today’s 2.5%-ish level to something closer to 4% or even higher in the coming years.
If you are an issuer, the time for refinancing is now, not later. If you are an investor, don’t spend too long debating whether you should start to hedge your portfolio against the prospect of a rising long-term interest rate environment, even as central banks continue to keep short-term policy yields at the floor.
From the perspective of an economist at a wealth management firm, this means embarking on strategies that over time will effectively hedge out interest rate risk with, for example, exposure to hard assets, long/short fixed-income trades, and screening the equity market for companies that have high fixed costs and low variable costs, high ratios of capital to labour, and a proven history of being able to pass on cost increases to protect profit margins.
【919】
Source：financialpost
http://business.financialpost.com/2013/07/30/david-rosenberg-stagflation-looming-as-bernankes-legacy/
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发表于 2013-11-1 21:27:52
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