Wednesday, November 2, 2011

The Earnings Scorecard: What Double Dip Recession?

CNBC is reporting that according to ThomosonReuters 74% of S&P 500 firms have reported Q3 earnings and that earnings reported are up 20.7% vs. Q3 2010. The likelihood of a double dip recession, fretted about by Keynesians such as Paul Krugman, appears very unlikely. The boom-bust cycle is just that a boom-bust cycle. This doesn't mean there are no negative consequences to Bernanke's new manipulated boom. The amount of money Bernanke is allowing into the system is enormous. The latest numbers show that the money supply (M2 nsa) is growing over the last 13-weeks at an annualized rate of 15% plus. Given that simultaneously, the demand to hold cash balances appears to be declining, the price inflationary consequences of Bernanke's money printing will be huge. Within months, it is possible that producer prices could start climbing on an annualized basis of 10% plus.


  1. Where has Krugman said anything about a double dip?

  2. All over the damn place google Krugman double dip.

  3. His thesis has been a "long depression", not a double dip. As in just enough growth to keep up with population growth, but not fast enough growth to bring back full employment any time soon.

  4. I looked at some of Krugman's quotes over the years, he's been saying double dip for quite some time, although it does appear he is changing his position.

    It was interesting to see they were clamoring for the creation of a housing bubble in 2002,... I didn't know People were even using the term "housing bubble" back then.
    Just another phrase for price fixing.

    Posted August 02, 2002

    Dubya's Double Dip?

    "... predictions of an imminent recovery in business investment keep turning out to be premature. Most businesses are in no hurry to go on another spending spree. And those that might have started to invest again have been deterred by sliding stock prices, widening bond spreads and revelations about corporate scandal.

    ...To fight this recession the Fed needs more than a snapback; it needs soaring household spending to offset moribund business investment. And to do that, as Paul McCulley of Pimco put it, Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble."

    Posted 2009-09-18

    "We might have a double dip, that's a real possibility now for the world as a whole," said Krugman.

    Posted December 1, 2009

    Double dip warning

    "I’ve never been fully committed to the notion that we’re going to have a “double dip” — that the economy will slide back into recession. But it has been clear for a while that it’s a serious possibility,..."

    Posted December 28, 2009

    Paul Krugman: "Reasonably High Chance" Of Double Dip Coming Next Year

    Posted 9:02AM 01/04/10

    "...If the stimulus is not increased within a few months and the Fed does not keep up its intervention, which includes keeping interest rates near zero, the oxygen to a weakened economy will be shut off. These things, Krugman argues, will cause a double-dip recession." ...

    Posted January 4, 2010

    “The double dip issue is present everywhere in the advanced world,” - Paul Krugman

    Posted January 5, 2010

    "Paul Krugman, the Nobel Prize-winning economist, says that there is a 30% to 40% chance that the U.S. economy will slip back into recession in the latter half of 2010.

    “It is not a low probability event, 30 to 40 percent chance,” Krugman told BusinessWeek. “The chance that we will have growth slowing enough that unemployment ticks up again I would say is better than even,” he added.

    Krugman said the winding down of the government’s stimulus efforts are the reason we could see a double-dip recession." ...

    Posted July 17, 2010

    De Facto Double Dips

    ... "If we have only have 1 1/2 percent growth, that will amount to a double dip in all the senses that matter."

    Posted Aug 8, 2011

    US not on the road to recovery: Paul Krugman

    Posted June 29, 2011

    "Economist Paul Krugman doesn't know how or when this economic downturn will end, but feels confident that we're not heading into a double-dip in 2011l

    Krugman, speaking at an even in Canada (according to Bloomberg), said he believed U.S. growth in 2011 would look a lot like 2010. That means the late Spring and Summer months will show weakness (what we're seeing) and things should pick back up in the Fall" ...