All posts by Daniel Lacalle

About Daniel Lacalle

Daniel Lacalle (Madrid, 1967). PhD Economist and Fund Manager. Author of bestsellers "Life In The Financial Markets" and "The Energy World Is Flat" as well as "Escape From the Central Bank Trap". Daniel Lacalle (Madrid, 1967). PhD Economist and Fund Manager. Frequent collaborator with CNBC, Bloomberg, CNN, Hedgeye, Epoch Times, Mises Institute, BBN Times, Wall Street Journal, El Español, A3 Media and 13TV. Holds the CIIA (Certified International Investment Analyst) and masters in Economic Investigation and IESE.

China Will Not Be Able To Offset Its Property Bubble Easily

China Will Not Be Able To Offset Its Property Bubble Easily

No economy has been able to ignore a property bubble and even less so offset it and continue to grow replacing the bust of the real estate sector with other parts of the economy. Heavily regulated economies from Iceland to Spain have failed to contain the negative impact of a real estate sector collapse. It will not be different in China.

China’s real estate problems are three: The massive size of the sector, its excessive leverage, and the amount of developer debt in the hands of average households and retail investors.

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Why Interventionist Governments Love Inflation

No government looking to massively expand its size in the economy and monetize a soaring deficit is going to act against rising prices, despite claiming the opposite.

One of the things that surprises citizens in Argentina or Turkey is that their populist governments always talk about the middle classes and helping the poor, yet inflation still soars, making everyone poorer.

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Weak Jobs Report Shows Failed Keynesian Policies

Weak Jobs Report Shows Failed Keynesian Policies

In the economy, real economic return on investment is not just an important metric. It is crucial. That is why I find it so intellectually dishonest when some economists look at the GDP and employment growth without putting it in the context of the massive increase in debt, spending and money supply.

A stimulus plan is supposed to generate higher and faster growth than the normal trend would dictate. Furthermore, the definition of a stimulus plan is that it should improve the long-term trend.

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Europe’s Energy Crisis. A Real Danger

This week the wholesale price of electricity has exceeded the psychological barrier of 200 euros per megawatt hour in most countries of the European Union. Although the daily price currently only affects 15% of the energy sold, since the rest is locked for almost twelve months since last winter at much lower prices, it is a sign of future risk. Thousands of contracts are going to have to be revised with huge price increases in the next three months when the locked contracts expire.

The price of liquefied natural gas (LNG) has soared to $34/mmbtu delivered in December and January. In comparable energy terms it would be about $197 per barrel of oil equivalent, according to Morgan Stanley. Meanwhile, the price of natural gas (NBP) has risen more than 200% in 2021.

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