Well, it is day 3 of Davos, and that means more snow stories from that princely hamlet atop the Swiss mountain tops. Lauren Lyster, who has been reporting from Davos all week, is there to fill us in
at the top of the show. Demetri starts the program by asking Lauren if the conference still has that "convention" atmosphere, where people are less worried about what's on the agenda, and more what's "off the agenda." More business deals, political deals, and personal intrigues abound. But on the official program, top on the list, is social inequality and income disparity that the davos men and women say, may be contributing to social unrest in Europe and the United States. Could social unrest represent the new "tail risk" for portfolio managers the world over? And last time Demetri spoke with Lauren, she was busy catching a glimpse of JP Morgan CEO, Jamie Dimon, heading somewhere with his running shoes. Perhaps he was running to do an interview with CNBC, where he said, among other things, that he was happy with the latest LTRO in europe, because it helps banks remain "liquid." Really? Liquid? How can you be illiquid for 3 years? That's not a liquidity crisis, its a solvency crisis. Jamie also said during this interview, that a Greek default posed "almost zero risk" to the US banking system, we examine that claim, as well as another claim that Jamie Dimon made -- mainly, that we are in a new normal economy of "muddle-through" economics -- with our other guest Mike "Mish" Shedlock. Mish is a prominent financial blogger and a financial advisor at Sitka Pacific Capital. Demetri starts his interview with Mish by asking him to give his opinion on the latest US GDP numbers, which came out at 2.8 percent for the quarter. Taking into account restocking and consumer price inflation, this number doesn't look so rosy. In fact, it looks like this country is on the verge of another recession. Demetri also asks Mish about this "muddle-through" term, and what this means in practice. Is this just code for Japan? Is it just code for "we, the banks, will continue to make money while the rest of the economy starves to death?" And Demetri also asks Mish for his take on the prospects for civil unrest given all the "muddle-through" economics and the reality of what this means for the economy. Source