Sunday, August 26, 2012

The Certainty of Global Uncertainty

Notable commentary last week included:
  • Caterpillar, Inc. CEO Doug Oberhelman  -  “There’s never been a more unpredictable set of tea leaves than right now.  Even in 2008 and 2009, U.S. housing was already dying and had been for two years. We saw that”  and “I don’t think the situation is as grave as it was in 2008, but the uncertainty, the storm clouds are around things that none of us know about – like what will happen with the political situation in Europe”,
  • the U.S. Congressional Budget Office’s updated Economic Outlook suggests if the Fiscal Cliff is not addressed, “fiscal tightening will lead to economic conditions in 2013 that will probably be considered a recession, with real GDP declining by 0.5% between the fourth quarter of 2012 and the fourth quarter of 2013 and the unemployment rate rising to about 9% in the second half of calendar year 2013”  and
  • German Chancellor Angela Merkel - “I want Greece to stay in the Eurozone and that’s what I’m working for."
With mixed economic data and comments by central bankers and policy makers driving market moves, this week’s focus is on an annual gathering  in Jackson Hole, WY - Federal Reserve Chairman Ben Bernanke and European Central Bank President Mario Draghi will speak, as well as the Republican convention in Tampa, FL. Expect more debates on the effectiveness of economic stimulus, austerity and debt reduction efforts.

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