Duncan’s Economic Blog

Preventing Collapse…

Posted in Uncategorized by duncanseconomicblog on May 22, 2009

Support from unlikely places today.

 Lombard Street Research are an independent macroeconomic forecasting company.

 As they say:

Lombard Street Research was founded in 1989 by Tim Congdon CBE and quickly established its reputation as a leading provider of independent macroeconomic research.

Our consistent aim has been to provide accurate economic forecasts in order to improve the investment thinking and strategic decisions of financial institutions, banks and corporations worldwide.

And

The key foundation of our research is monetary economics. Fundamental analysis of trends in money and credit, banking systems and flows-of-funds provide unique insights into economic developments and into likely movements of financial asset prices.

We also employ proprietary leading indicators to help generate forecasts for economic growth in all of the major economies of the world.

The key point here is that these guys are monetarists.

 So, I was delighted when this landed in my inbox:

 Savaged by a dead S&P/sheep

WE SUGGEST: Yields on Treasuries, Bunds and Gilts are attractive

SUMMARY: US/UK deficits are the only way of stopping global economic collapse until savings-glut countries cut their excess saving. For the foreseeable future, this is unlikely to happen. If and when it does, the Anglo-Saxons should and will cut their deficits.

 I’ll say that again, ‘US/UK deficits are the only way of stopping global economic collapse’.

So, there you go… We now both Keynesians and Monetarists arguing to run a deficit. Who exactly are the Tories being advised by?

3 Responses

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  1. newmania said, on May 22, 2009 at 1:19 pm

    Tim Congdon left the Conservative Party to attack from the right over the lack of promised tax cuts. I doubt he would like your company much. The IFS I noticed identified 7% cuts in the last budget so your complete refusal to complete the loss of a single face painter or community liaising waster puts you way out on your own. What Duncan do you have against working people and families , do you think we have had it too good ? Do you think we had a great Party for ten years and are due a hangover. Ha !

    Your suggestion that the ship can be righted through increasing revenue is absolutely ridiculous .Even if it was advisable ( and it would be lunatic ) it is impossible . Even if you employed a security firm to force people to work for nothing at gun point and hand it all over you would destroy any recovery .Even if it did not , the attempt would plunge the country into disorder and bankrupt us as money pulled its skirts up and ran away.

    This is plain nuts and I can only imagine you think that saying silly things will get you some vainglorious punditry gig on channel 666…….

    • duncanseconomicblog said, on May 22, 2009 at 1:43 pm

      Newmania,

      Been a while…

      My ‘lunacy’ is now endorsed by LSR.

      Ofcourse some cuts can be made to the public sector! Not every public sector job is needed. But I think the majority of the rebalancing will have to come from the revenue side, not the spending.

      Anyway, I already do vainglorius punditry and, for your information, me and Tim Congdon get along just fine:

      http://www.cnbc.com/id/15840232?video=1116537488&play=1

  2. newmania said, on May 22, 2009 at 4:20 pm

    As I suspected it’s a conspiracy of posh people media nabobs and New Labour to pull the ladder up and lecture the peasants about their social consciences . You come over like a genially befuddled vicar from a 1920s farce actually strangely soothing , it could catch on.

    ( OK ok very impressive )


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