I thought I would start 2010 with a new tradition--a Monday blog that will toss out "Seven Issues for the Week." That's one issue for each day of the week, if you like. You nitpickers will point out that today is Tuesday, not Monday, which means that 2010 is not even two weeks old and I've already slipped on the schedule. OK, I will do better.
Here are my seven issues for this week, followed by my own quick take. The purpose is to open up the discussion. I want to hear your takes.
1. Are stocks still a leading economic indicator? The stock market's performance tends to lead the real economy's performance by six months. That's always been the conventional wisdom. Ambrose Evans-Pritchard thinks it is time to put this old canard to rest. Me, I still think the conventional wisdom is correct more often than not. But after reading Evans-Pritchard I am less sure about this. What do you think?
2. Is James Chanos right about China? The billionaire short-seller thinks the China bubble is about to pop. Now, Chanos is super smart and he's a superb investor, but he also admits he has been studying China only since the summer of 2009. My take is that China is moving up the value chain faster than most Westerners realize. That is why China's consumption of raw materials is not keeping pace with its 10% growth. The company that best represents China's new high-value economy is Huawei, a competitor to Cisco. That's high-value turf, folks. Of course, I must admit that Chanos is a far better investor than I have ever been or will be. What do you think?
3. Will ObamaCare pass? Retiring Connecticut Sen. Christopher Dodd says ObamaCare is "hanging by a thread." Is Dodd sandbagging or is he really speaking truth? Will another retiring senator, North Dakota's budget conscious Byron Dorgan, vote against ObamaCare because he has nothing to lose? My take is that ObamaCare might just blow up. What do you think?
4. Are Wall Street bonuses justified? The libertarian economist John Tamny thinks so. Nobody likes to defend investment bankers these days, but I am forced to agree with John's logic. What do you think?
5. Should Washington keep spending? The chief economist for Nomura Research Institute, Richard Koo, says America is suffering a "balance sheet recession" similar to that suffered by Japan in the 1990s. The solution, he says, is federal stimulus out the gazoo. Koo makes an argument similar to that of New York Times columnist Paul Krugman. Hmmm. When Krugman says it, I instantly recoil. When Koo says it, I'm willing to listen. What do you think?
6. Will Scott Brown upset Martha Coakley next Tuesday? Scott Rasmussen, a Republican friendly pollster, has Brown down nine points but gaining rapidly in next Tuesday's Massachusetts Senate race. But Coakley has a lot more money to pour into the campaign's final week. (The Republican National Committee has really muffed this. Evidence enough that Michael Steele is not up to the job.) What do you think?
7. Is Unemployment really this bad? New York Post columnist John Crudele says America's true jobless rate is close to 22%. Is he right? He might be. Will the situation improve? Not until small businesses start investing for the future. If the Republicans score big in the November elections and force Obama back to the center--which means to abandon policies that are frightening small business owners and investors--employment will improve quickly. What do you think?
Post your comments on any (or all) of the seven issues. Fire away!
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