Evening Reading – January 4, 2011

The Economist: Grounded PIIGS

Countries with the fastest and slowest growth forecasts.

The Big Picture: Long Term Stock Market Growth (1871-2010)

I was kicking around some of the outstanding charts at Visualizing Economics, when these two below leapt out at me.

The Big Picture: According to the Fed, it’s everything but inflation

Basically, the Fed listed every single reason EXCEPT a rise in inflation, notwithstanding the sharp jump in commodity prices and move up in inflation expectations. They continue to see little inflation pressures (I believe mistakenly) which they feel give them license to print.

Economix: Fearing (Another) U.S. Debt Default

The merits of raising the debt ceiling aside, Professor Goolsbee isn’t quite right that an American debt default would be “totally unprecedented.” As Carmen Reinhart documented in her impressive chartbook of the last several hundred years of international financial crises, the United States has actually defaulted on its debt obligations before.

FT Alphaville: SNB collateral, an Irish and BP non-love story

Hat-tip to Lorcan for this — the Swiss National Bank no longer accepts Ireland’s government bonds as eligible collateral in its repo operations.

The Slope of Hope: Weak Precious Metals

Yesterday I offered the idea to short GLD, and naturally some folks thought this was nuts (one gent wrote, “Not ever. No way.”). I can understand the concern. Precious metals have been strong for years.

I will point out this, though. Here’s what the EUR/USD chart – – gold’s very best friend – – has been doing lately:

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