ricardian ambivalence

Un-New Labour & the tea party

UK Labour booked a long date with opposition last night; the union movement pressed red-ed Miliband – the son of Marxist Ralph Miliband – to the leadership of their party. There is a risk that the various nationalistic-populist movements will mutate into a Smoot-Hawley policy error.

My conjecture is that the various movements reveal a little about the soul of their nations. The US tea party movement is unique — it is a small governement individual freedom movement. These core values are the key to US exceptionalism, and the reason I think the USA will fully recover from the financial crisis.

Fed on hold to 2012 as deflation fight looms

Forget Hoenig, the Fed isn’t going to raise the funds rate in 2010, and is unlikely to do so in 2011 either. The Fed has a deflation fight to fight, and the battle looms closer than most think. I’m a buyer of TYH0 at friday’s night’s close (118*10, target 120, stop 119). risk reward is with longs – good data doesn’t prove europe is out of trouble, but bad data will make everyone quake.