On Friday, we suggested that we’re probably already in a recession. Nothing we’ve read this morning makes us think any different.
China has required banks to stop lending through the end of the year, in a desperate attempt to slow down the runaway Chinese economy (+11.5% in the latest quarter) and runaway Chinese inflation (+6.5%). They’ve already tried raising interest rates, which did nothing. One of these years, one of these measures will work, and the Chinese economy and stock market will temporarily collapse. Hopefully this won’t coincide with a similar collapse of our own.
Commercial real estate values are now following residential real-estate values into the tank…
Oil’s leaping again, back up to $95. Meanwhile, the “peak oil” theory is back in vogue, with global oil execs saying they can’t imagine how the world will ever produce more than 100 billion barrels a day (demand forecasts are far higher than this). The execs are trying hard to sound depressed about that.
Iran’s much-beloved president has deemed our currency “a worthless piece of paper”–which , sadly, means he’s seeing the greenback more clearly than most U.S. government officials. The toilet-paper dollar should at least make the Fed think twice about slashing interest rates to zero in order to allow folks who shouldn’t have bought houses to keep them.
(Photo: HASSAN AMMAR/AFP/Getty Images)