Five Things You Need to Know: Cat's Out of the Bag, Next!, Cuba Libre?, Alan Greenspan: Failed Writer, The Ghost of Greenspeak
What you need to know (and what it means)!
Minyanville's Five Things You Need to Know to stay ahead of the pack on Wall Street:
1. PCE Cat's Out of the Bag, But Negative Savings Rate Improves!
The Federal Reserve's preferred measure of inflation, the personal consumption expenditure price index, rose 0.2% for the third straight month, and is up 2.4% year-on-year.
- Core U.S. consumer prices rose 0.2 percent in June, and the year-on-year rate of nonfood, nonenergy inflation rose to 2.4 percent, the Commerce Department said.
- That's the highest year-on-year gain since September 2002, according to Reuters. Or April 1995, according to the Associated Press.
- The Commerce Department also said personal income rose 0.6 percent in June, with nominal spending up 0.4 percent.
- Meanwhile the US savings rate improved slightly!
- In May the personal savings rate was negative 1.6%, meaning we're dipping into savings to maintain the lifestyle of the rich and famous to which we have grown accustomed.
- In June the personal savings rate improved to negative 1.5%!
U.S. Treasury Secretary Henry Paulson will deliver his first major speech today at 10:30 a.m. EST!
U.S. Treasury Secretary Henry Paulson will use his first major speech today to talk up globalization and warn on entitlement spending, Bloomberg says.
Paulson will argue that it's a mistake to turn to protectionism to save jobs and defend wages from global competition as some in Congress are under pressure to do in districts hard hit by joblessness.
The new Treasury Secretary and former Goldman Sachs chief will also outline the administration's social security plans.
Social Security will begin to pay out more benefits than it receives in tax revenue in 2017 and will be exhausted of assets in 2040, its trustees said in May, according to Bloomberg.
Financial markets will also be listening to Paulson for any hint of a position on the U.S. dollar, although for the life of me I can't figure out why.
Treasury secretaries have "advocated" a "strong dollar" for more than a decade.
In the past six years alone (during which time we've had four, count 'em, four Treasury secretaries) our "strong dollar" policy has managed to devalue the dollar by more than 22%.
3. Cuba Libre'?
Fidel Castro, the Cuban president who bears a striking resemblance to the character Heat Miser from the 1974 children's television special "The Year Without a Santa Claus," on Monday ceded power provisionally to his younger brother, the Snow Miser, after undergoing surgery for intestinal bleeding, the Financial Times said.
In a statement read by Mr Castro's top aide he said he would not be able to work for a number of weeks.
Mr Castro also said that given the country was "threatened" by the US, he was provisionally appointing his brother, the Snow Miser, to his three positions of commander of the armed forces, president of the Council of State and first secretary of the Communist Party.
Castro, who turns 80 this month, swept to power in a 1959 revolution and is among the longest-ruling government leaders.
The statement said plans to celebrate Mr Castro's birthday would be postponed until December 2, the 50th anniversary of the Revolutionary Armed Forces.
Below, Fidel Castro and his brother:
Castro Castro's brother
4. The Ghost of Greenspeak
The chief executive of Penguin Publishing's parent company Pearson, said yesterday that Alan Greenspan had agreed to allow a ghost writer to help give his memoirs more "pace," the Times Online reported.
- Dame Marjorie Scardino, chief executive of Penguin's parent company Pearson, said yesterday that Alan Greenspan had agreed to allow a ghost writer to help to "make [his memoir] more pacey - because Alan is an academic."
- Dame Marjorie said, however, that the former US Federal Reserve Chairman is proving to be "a diligent author" who will definitely help his publisher to make a return on the $8.5 million spent to secure the rights to produce his memoir.
- After a daring early-morning raid that did not involve the use or injury of small animals, Minyanville has uncovered a rough draft of a paragraph from Mr. Greenpsan's unedited memoirs:
Alan Greenspan's Unedited Memoirs, opening paragraph:
"We may not be able to usefully determine at what point my contributions as Federal Reserve chairman and, later, ad hoc economic advisor, will slow or even reverse, but it is evident that the greater the degree of international flexibility, the less the risk of a crisis. Should globalization continue unfettered and thereby create an ever more flexible international financial system, history suggests that current account imbalances will be defused with modest risk of disruption."
5. The Ghost of Greenspeak
Yeesh. After reading the excerpt above, I see what Dame Marjorie means. Good lord, Sir Alan Shake Spear-me-in-the-brain so I don't have to read one more word of that horribly boring prose! That text is dry as West Texas dust! It's as exciting as a fly in an ice cube! Greenspan doesn't need a ghost writer, he needs a ghost rememberer! Ok, enough. Even though I got plenty more of those, I'll stop because you get the point: dude needs a ghost writer.
Below is the same Alan Greenspan memoir paragraph massaged by potential ghost writers!
Alan Greenspan's Memoirs, as ghost written by Herman Melville:
"Call me Ishmael. Although my real name is Alan Joseph Greenspan. Some years ago - never mind how long precisely - having little or no money in my purse, and nothing particular to interest me no shore, I thought I would sail about a little and see the watery part of the world, and periodically adjust short term rates to manage inflationary pressures and the occasional bout of undesirable declines in the general rate of inflation."
Alan Greenspan's Memoirs, as ghost written by Richard Wright:
An alarm clock clanged in the dark and silent room. A bed spring creaked. A woman's voice sang out impatiently:
"Alan, shut that irrationally exuberant alarm clock off!"
A surly grunt sounded above the tinny ring of metal. Naked feet swished dryly across the planks in the wooden floor and the clang ceased abruptly. So far there is little evidence to undermine the notion that most of the productivity increase of recent years has been structural and that structural productivity may still be accelerating."
Alan Greenpan's Memoirs, as ghost written by Thomas Pynchon:
"A screaming comes across the sky. It has happened before, but there is nothing to compare it to now. It is too late. The evacuation still proceeds, but it's all theatre. The federal funds rate must rise at some point to prevent pressures on price inflation from eventually emerging. There are no lights inside the cars. No light anywhere."
Alan Greenspan's Memoirs, as ghost written by Hunter S. Thompson:
"We were somewhere around Barstow in 1998 on the edge of the desert when the drugs began to take hold. I remember saying something like "I feel a bit lightheaded; financial intermediation, although it cannot alter the underlying risk in holding direct claims on real assets, can redistribute risks in a manner that alters behavior." And suddenly there was a terrible roar all around us and the sky was full of what looked like huge bats, all swooping and screeching and diving around the car, which was going about a hundred miles an hour with the top down to Las Vegas."
Alan Greenspan's Memoirs, as ghost written by Franz Kafka:
"Someone must have been telling lies about Alan G., for without having done anything wrong he was arrested one fine morning. His landlady's cook, who always brought him his breakfast at eight o'clock, failed to appear on this occasion. That had never happened before. G. waited for a little while longer, as the conceptual share of the value added in our economic processes expands further, the ability to think abstractly will be increasingly important across a broad range of professions. Critical awareness and the abilities to hypothesize, to interpret, and to communicate are essential elements of successful innovation in a conceptual-based economy."
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