What do you want to believe and there can be a link to a commentator to confirm your belief! This is called 'media content' at places such as News Ltd where the content is often tailored to the beliefs of the advertising target and agenda of the advertisers.
Optimist Adam Carr at BusinessSpectator opines that this is "the biggest bout of mass hysteria I have seen for a long time" and lets his readers know he will away for a holiday for two weeks:
Hopefully the world won’t slip back into worshipping the moon and cannibalism while I’m away, but who knows! At this rate anything is possible. Please, keep it real and I'll see you in two weeks.Nobel economist Krugman (a committed keynesian who is by no means positive on the US outlook either) has even posted a link to John Hempton down under who has queried whether there were some big hedge fund margin calls in recent activity?
In the event of a real crisis, rather than a market and media crisis, Australia has plenty of ammunition on both interest rates and the currency. CBA has today slashed fixed interest mortgage rates. The $AUD has fallen back below parity, at least for now. May we live in interesting times.
Up here in Cairns the Journal of Ignorance has posted today on what the impact may be on Cairns. Complete with a finishing spruik from their real estate advertisers! Actually, the Journal has turned surprisingly positive of late if anyone has noticed with some improved work from Nick Dalton! We had this yesterday reporting the latest CairnsWatch report from Rick Carr at HTW.
"The trend average for June 2011 stood at 315 job vacancies advertised per week, up 17 per cent since December 2010."What? Tourism is leading a jobs bounce? It's good to see Rick's closing reference to the fave indicator of KS Global Economics which is the EPWI (Esplanade People Watching Index) which has been quite positive in recent months despite recent screaming, wailing and pessimism about the currency and almost everything else.
Mr Carr said it was clear tourism was leading the jobs bounce back.He said accommodation in the Far North was fully booked."They have been full for the past four weeks and the bookings show they are full for the next four weeks," Mr Carr said."The people are here. The challenge is to get them to spend their money."The town looks a bit more vibrant. If you go to the Esplanade the restaurants are full."
Regardless in times of "toil and trouble" KS only advice as ever is always to avoid anyone who says they know. As the great modern philosopher Billy Connolly has said: "avoid the company of those who say they know the answer; seek the company of those trying to understand the question".
Postscript: This post may seem too optimistic and is not dismissive of current risks or outlook but rather relates to the media frenzy. The more pessimistic views at such as HenryThornton and Macrobusiness and also Paul Krugman are respected and understood. Australia was the only market in Asia to rally strongly today. Stephen Bartholomeusz has commented on this amazing intra-day U-turn on the ASX.
Update: Ross Gittins best reflects the sentimment I was trying to convey with that last note. Elsewhere Warwick McKibbin, probably our most significant economist of global standing currently, and recently removed from the RBA board by the Feral Guvmint, is worth a read on where he sees problems and required responses in the USA and Europe.