04.23.18- "Ice Nine" Comes to China
Jim Rickards

The war on cash has been going on for decades. The U.S. abolished the $500 bill in late 1969. (The old $500 bill featured a portrait of President William McKinley, by the way. I remember seeing a few when I was a kid.)

Today’s $100 bill is only worth 10 cents on the dollar compared with the $100 bill of 1969.

Europe will abolish the 500 euro this year. We all recall what happened in India in late 2016 when India abolished the 500 and 1,000 rupee notes (worth about $10 and $20, respectively); there was mass chaos as peasants lined up to turn in the old notes for digital credit. Read More

04.21.18- Inflationary Reality vs. The Efforts of the Fed to Manage Expectations
Frank Shostak

According to Ludwig von Mises,

Inflation, as this term was always used everywhere and especially in this country, means increasing the quantity of money and bank notes in circulation and the quantity of bank deposits subject to check. But people today use the term 'inflation' to refer to the phenomenon that is an inevitable consequence of inflation, that is the tendency of all prices and wage rates to rise. The result of this deplorable confusion is that there is no term left to signify the cause of this rise in prices and wages. There is no longer any word available to signify the phenomenon that has been, up to now, called inflation. Read More

04.20.18- Now Even a Fed Dove Homes in on the “Everything Bubble”
Wolf Richter

Bonds, junk bonds, spreads, commercial real estate, leveraged loans, over-leveraged companies… all get named as risks to the banks. This is why tightening will continue.

“If we have learned anything from the past, it is that we must be especially vigilant about the health of our financial system in good times, when potential vulnerabilities may be building,” explained Federal Reserve Board Governor Lael Brainard in a speech in Washington, D.C., this morning.

This was a reference to a time-honored banker adage, now mostly forgotten after nearly nine years of easy money: Bad deals are made in good times. Read More

04.19.18- Danielle Dimartino Booth on the $240 Trillion Global Debt Bomb
Boom Bust

View Video

04.18.18- It’s Been a Good Run: 70 Years of Dollar Dominance Draws to a Close
Alex Deluce

The great transition is moving slowly enough that most people haven’t noticed yet, but the world is steadily decoupling from the USD.

It’s a long game, to be sure. As gold hoards are amassed and repatriated, as the petro-yuan becomes a more widely accepted form of petro-commerce, as the greenback is printed into oblivion and obscurity, US paper fiat currency is losing both its prominence, status, and power both within and without American borders.

If the gold standard were to be reinstated, control of the dollar would revert to free market forces instead of the whim of the Federal Reserve. It would mean that each dollar would have its equivalent in gold, as it did prior to 1913. Read More

04.17.18- There Is No ‘Patriotic Duty’
to Pay More Tax

Simon Black

In 1873 during the administration of Ulysses S. Grant, the government abolished its income tax.

Aside from a single episode in 1894, there would be no income tax in the United States of America for nearly 40 years.

It was during this period that the United States emerged as the largest, most powerful economy in the world.

And the country achieved this with no income tax. No inflation. And very little public debt.

Today it’s entirely different. The dollar has lost over 99% of its value since 1913. Read More

04.16.18- Why Trade Wars Will
Unleash Central Banks

Nomi Prins

There’s been an abundance of coverage surrounding the recent steel and aluminum tariffs. Those measures could hurt more sectors than they help within the U.S. In particular, it could damage businesses that require metals because they’ll have to pay more for raw materials.

Trade wars also escalate geopolitical tensions and economic hardships the world over. They have in the past. When the U.S. imposed tariffs in the 1930’s to try to relieve the Great Depression at home, they achieved the opposite effect. Read More

04.14.18- Another Weekend Rant: As War Drums Beat for Syria, Remember, Lies and Propaganda Started Nearly Every War in US History
John Vibes

War is one of the most primitive and senseless manifestations of the human experience, so naturally, most sane people with families, ambitions and kind hearts want nothing to do with such things. Unfortunately, as we are seeing with the Syrian escalation, governments thrive on war, as it gives them a pressing excuse to grab more power and take extrajudicial measures—both at home and abroad.

To get around the obstacle of public opinion, governments have an extensive history of lying their way into war. This is hard to believe for people who think that government has their best interest in mind, but it is something that rulers have been doing since the beginning of time. In the modern United States, people are led to believe that the establishment accidentally flounders its way into war. Read More

04.13.18- Ron Paul: Assad Gassing His Own People is “Total Nonsense”
Jay Syrmopoulos

Former Congressman Ron Paul has strongly argued following the alleged chemical gas attack blamed on the Syrian government that it makes no logical sense for Assad to order a gas attack, and has called the accusations a telltale sign of a false flag attack meant to provide justification for the U.S. military to maintain a presence in Syria.

“An incident will occur and somebody will get blamed and it’s usually a false flag,” said Paul.

“Right now, recently, it’s all been in Syria, ‘Assad did it! Assad did it!’” explained the former congressman. “No proof at all.”  Read More

04.12.18- The Fed is Officially Screwed: Inflation's Over 2% Despite 6 Rate Hikes
Graham Summers

The Fed is now officially screwed. 

The single biggest concern for the Fed is inflation. The reason for this is that US Treasuries are currently in a massive bubble. And those Treasury yields trade based on inflation.

If inflation rises, so do Treasury yields. 

If Treasury yields rise, Treasury prices fall. 

If Treasury prices fall, the bond bubble begins to burst.  Read More

04.11.18- Jerome Is The New Janet: Tie, Trousers And Same Old Keynesian Jabberwocky
David Stockman

The election of 2016 was supposed to be the most disruptive break with the status quo in modern history, if ever. On the single most important decision of his tenure, however, the Donald has lined-up check-by-jowl with Barry and Dubya, too.

That is to say, Trump's new Fed chairman, Jerome Powell, amounts to Janet Yellen in trousers and tie. In fact, you can make it a three-part composite by adding Bernanke with a full head of hair and Greenspan sans the mumble. Read More

04.10.18- Ayn Rand’s Hymn To Money
Antal E. Fekete

Gold Money Is the Root of All Good; Paper Money Is the Root of All Evil~ A Blueprint for a New Gold Coin Standard

Millions of people who have read Ayn Rand’s 1957 monumental work “Atlas Shrugged” must have been impressed by an insert that could be entitled “Hymn to Money”. This insert is buried in the 1600 pages of the novel and is difficult to find. However, it is a self-contained literary masterpiece in its own right. For these reasons it may be a good idea to publish it separately. Read More

04.09.18- Inflation Alert: Prepare For The Coming Price Spikes BEFORE Costs Are Passed On
To The Consumer

Graham Summers

“Initially, corporations will “eat” these increased costs…eventually corporations are FORCED to rise prices.” Here’s a look at the coming inflation…

The Prices Paid Index just rose for its fourth straight month to 78.1: its highest level since April 2011.

Why does this matter?

Because it’s a MAJOR warning that inflation is coming. Read More

04.07.18- Weekend Rant: The Central Bank Effect - The Best Friend of The One Percent
Tom Lewis

When it was created in 1913, the Federal Reserve was supposed to stabilize the US dollar. That was its stated purpose. The reality has proven to be quite different. The gap between rich and poor keeps widening. Today, more than half of US workers have less than $25,000 set aside for retirement. Thirty-six percent have savings of less than $1,000.

The Federal Reserve has almost limitless power to print paper money, extend credit and create debt, thus creating the illusion of prosperity where none exists. At one time, hard work could provide a secure future for generations. Now, a person is fortunate if hard work can help them get through the day. Read More

04.06.18- Futures Tumble Amid Tariff, Payrolls, Powell Chaos
Tyler Durden

When summarizing yesterday's market action, which saw the market surge for the third consecutive day and culminated with Europe's best day since June 2016, we said that it all boiled down to one question: "Trade war or no trade war?"

Until 6pm, the answer was the latter, however with one announcement Trump flipped everything on its head, and just as the president called for an additional $100 billion in Chinese tariffs, futures tumbled, with Dow futs plunging over 400 points as escalating trade war with China was back front and center. Read More

04.05.18- The First Wave of Inflation is Already Here… The Next One is the Bad One
Graham Summers

The Prices Paid Index just rose for its fourth straight month to 78.1: its highest level since April 2011.

Why does this matter?

Because it’s a MAJOR warning that inflation is coming.

You see, when inflation hits, it doesn’t hit all at once. Instead it rolls out into the economy in stages.

The first stage occurs at the “production” level of the economy. In this stage, managers at large manufacturers/production companies will see a spike in the cost of goods and services they buy in order to supply their firms.  Read More

04.04.18- From the Leader of the Free World to Banana Republic: Fiat Debt 101
Paul Craig Roberts

The thing about never weaning the US off emergency stimulus conditions for the past decade is that it has left the Fed without moderate tools to combat the coming recession.

If you go to the hospital and they give you morphine once so that you don't have to feel short-term, significant pain, fine. Taking morphine for the next 10 consecutive years because it's just easier that way? Not so fine. Read More

04.03.18- How The Federal Reserve Drives The Economy
Kelsey Williams

With each succeeding day, obsession with the Federal Reserve continues. And the obsession is a good indicator of just how misinformed most of us are.

This is true with respect to various policies, statements, and actions; and includes comments made by board members, either in speeches or interviews. But it is also true regarding purpose and motivation.

To a large extent, it is a matter of perception. Some, maybe most, people see the Fed as the lead driver. There is an assumed aura of authority and control. On all matters economic, we look to them for direction. But where are they taking us?

That question might be better answered by asking where they/we have been. And not just since last month or last quarter. Read More

04.02.18- Fed mistakes could spark ‘unusually fast’ bear market, ‘lost decade’ for stocks
Ryan Vlastelica

Uncertainty over trade policy may be the primary driver of the U.S. stock market at the moment, but the real policy risk facing equities could be coming from the Federal Reserve, with the potential downside a lot more pronounced than investors are currently anticipating. 

Last week, Fed Chairman Jerome Powell said the economic outlook had strengthened, but he painted a mixed picture about what policy might look like going forward. The U.S. central bank raised interest rates but indicated it would only do a total of three rate hikes in 2018, which some saw as a dovish signal given that a number of investors had expected four this year. However, the Fed pushed up its expected rate path in 2019 and 2020. Read More

03.31.18- Why Do Media Idiots Love Stormy Daniels But Ignore a Totally Rigged
Stock Market and Economy?

Christopher Irons

In this podcast, QTR asks the question of why the Stormy Daniels "controversy" is even in the news, while issues like the Federal Reserve potentially rigging the stock market are never talked about and often even frowned upon by the financial media.

QTR digs into why consensual sex by two people that lack moral compasses in the year 2006 is in any way worth reporting on and confirms the existence of the Presidents Working Group on Financial Markets, explaining the executive order that put the group in place during the Reagan administration. Read More

03.30.18- Central banks manipulating & suppressing gold prices
Ronan Manly

Central bank gold price suppression is a well-documented fact. Central banks have a long and colorful history of manipulating the gold price. This manipulation has taken many shapes and forms over the years. It also shouldn’t be surprising that central banks intervene in the gold market given that they also intervene in all other financial markets. It would be naive to think that the gold market should be any different.

n fact, gold is a special case. Gold to central bankers is like the sun to vampires. They are terrified of it, yet in some ways they are in awe of it. Terrified since gold is an inflation barometer and an indicator of the relative strength of fiat currencies. The gold price influences interest rates and bond prices. Read More

03.29.18- The Real Reason Why Stock Markets Will Continue To Crumble This Year
Brandon Smith

Public sentiment on the economy is generally influenced by to two false indicators — the national unemployment rate and stock markets. This is not to say the average person tracks either of these numbers very vigorously; they don’t. What they do is hear these numbers on the morning news, the radio news on their way to work (if they are employed) or they hear them on the evening news just before bed. If the jobless rate is low and the Dow is high, then all is right with the world, at least financially.

When it comes to the economy, most people are lost. Read More

03.28.18- Who Needs Wall Street When You Can Have A Monetary Unicorn?
David Stockman

The single most important price in all of capitalism is the interest rate----and at all points on the maturity curve. And the single most important truth about honest interest rates is that they must be discovered by markets, not imposed by the state.

We got to ruminating about those core propositions when we read that San Francisco Fed head, John Williams, may be headed toward the true #2 job at the Fed. That is, President of the New York Fed----the joint that actually runs the casinos domiciled in the canyons of Wall Street. Read More

03.27.18- The Fake Recovery: Risk Asset Price Increases Have Been Simple Inflation
Alex Deluce

Central Banks: Rapid Asset Inflation is Destroying Purchasing Power

There is a relatively fixed universe of stocks to buy in the US. The Wilshire 5000 is made up of almost every single nationally listed, SEC-reporting company on the NYSE, AMEX, and Nasdaq, and is comprised of about 6,700 individual companies.

For the vast majority of American stock investors, institutional and retail alike, that’s where their investment money is going to go. And when the Fed creates an investment universe in which banks are simply awash in ZIRP cash, a lot of that money is going end up bidding up this relatively limited pool of equities. Read More

03.26.18- What Fed Chair Powell Forgot To Mention
MN Gordon

Son of the Imperial City

What are the chances of Federal Reserve Chairman Jerome Powell being wrong?  The chances he’ll be wrong on the economy’s growth prospects, the direction of the federal funds rate, and inflation itself?  Our guess is his chances of being wrong are quite high.

The new central planner-in-chief. Central banks are facing a special case of the socialist calculation problem pertaining to the financial system. Like the comrades in the former Eastern Bloc, who tried to adjust their plans based on prices they were able to observe in the capitalist West, their best bet is to simply follow market rates. Unfortunately market rates – especially at the short end of the yield curve – are subject to an observer-participant feedback loop with the Fed. Read More

03.24.18- From Zero Interest-Rate Policy to Zero Options Left: Prepare for Chaos
Michael Pento

Minor to moderate pain inflicted and felt in real time is one of the great gifts of the unfettered free market. If you overextend yourself, make foolish bets, you pay, immediately and justly, as the market’s ruthless efficiency is exacted via others’ recognition of the opportunity to profit from your poor performance.

In this way, equilibrium is maintained. If, via dint of central bankery, such pain is delayed, it simply accumulates. A decade of manipulated prosperity has resulted in a largely anesthetized market that has forgotten what true pain feels like. There will be no controlling the pain when the dam breaks and system collapses. Investments in risk assets will be eviscerated across the board. In such an environment, the flight to safety into silver and gold will likely drive unprecedented price appreciation. Read More

03.23.18- When Powell Does It, It’s Policy;
When Traders Do It, It’s Criminality

Martin Armstrong

Traders will use every trick in the book to try to gain an upper hand on their adversaries. It’s a cutthroat world, and one in which there is no winner without a commensurate loser; a true zero-sum game. Your gain is always someone else’s loss.

That said, even small-scale trader behavior and tactics can bleed over from “aggressive and creative” to illegal pretty easily by the letter of regulatory law. To see central banks loudly and proudly and openly boasting of their market manipulations, which have drastic impact on not just market participants but on all citizens (often while cloaking themselves in the fraudulent fabric of ‘public service’) is repugnant. Read More

03.22.18- The Central Bank Bubble: It Will Be Ugly
Alex Deluce

The global economy has been living through a period of central bank insanity, thanks to a little-understood expansion strategy known as quantitative easing, which has destroyed main-street and benefitted wall street. 

Central Banks over the last decade simply created credit out of thin air. Snap a finger, and credit magically appears. Only central banks can perform this type of credit magic. It’s called printing money and they have gone on the record saying they are magic people. Read More

03.21.18- What Should Gold Investors Expect From The New Fed Chair?
Arkadiusz Sieron

The Federal Open Market Committee will gather today for a two-day meeting. It will be the most important event this week, since Powell will chair the meeting for the first time. Gold investors want to get to know him better as the uncertainty makes them a bit nervous. What should we expect from the new Fed Chair?

First FOMC meeting under Powell as Chair

Do you remember your first bike ride? Or the first date – and kiss? People often fear doing something new. It’s normal. We are status quo creatures. We are afraid of changes. They are risky. Particularly in monetary policy. Indeed, we like technical innovations, but we prefer predictable and conservative banks, don’t we? Read More

03.20.18- Fed Day: Mr. Market Meets Mr. Hyde
Stewart Thomson

  1. It’s very important for gold, bond, and stock market investors to stay focused on the main fundamental price drivers and ignore what may feel exciting but is largely irrelevant to price discovery. Citizen demand from China/India and US central bank policy are the main price drivers for gold.

  2. From 1960 to 1980, US recessions were generally inflationary, and the Fed raised rates during that period. Since then, recessions have carried a deflationary theme, and interest rates have fallen. Read More

03.19.18- Will Rising Interest Rates
Push Gold Higher?

Paul Farrugia

There has been an incredible amount of chatter as to how many times the Federal Reserve is going to raise rates in 2018, and the speed at which it will raise them by. For gold investors, the old question lingers, “What will rising interest rates mean for the price of gold?” The simple viewpoint has been that rising rates are bad for gold because gold is not an interest-bearing asset. Why would you own gold if interest rates are rising and gold doesn’t pay you anything?

There are typically two sides to the debate on the impact of gold from the change in interest rates. There are those who see rising interest rates as good for gold, and there are those that see rising interest rates as harmful to the price of gold. But who is right? We look to see which side is correct? Could they both be wrong? Or both are right? Read More

03.17.18- Weekend Rant: The recycling of the US dollars financing the US deficits is going to end
Gijsbert Groenewegen

Hugo Salinas Price wrote an excellent article called 'Bad karma brings bad consequences for those who practice it’ on the unwanted consequences of the trade tariffs imposed by the US. He points out that the accumulation of US dollar reserves in the forex reserves of the central banks is a function of the foreign countries being able to sell (underselling) or export goods to the US. And the US dollars generated rom the exports allows the central banks to buy Treasuries thereby financing the budget deficits of the US that basically transpired since 1971 when the gold standard was abolished by Nixon! Read More

03.16.18- The Fed Has Its Finger On The Button Of A Nuclear Debt Bomb
Brandon Smith

I hear a lot of talk lately in the alternative media (and even the mainstream media) of the potential for World War III. The general assumption when one hears that term is that “nuclear conflict” is imminent. But a world war does not necessarily have to be fought with nukes. For example, we are perhaps already witnessing the first shots fired in a global economic war as the Trump administration gets ready to implement far-reaching trade tariffs. This action might provide cover (or justification) for destructive attacks on the U.S. fiscal system by China, Japan, Russia, the EU, OPEC nations, etc. The ultimate attack being a dumping of their U.S. debt holdings and the death of the dollar’s world reserve status. Read More

03.15.18- Shooting Ourselves In the Foot
Gary Christenson

This article was originally written for Miles Franklin by Gary Christenson. Link is here.

Serious problems affect Americans. Problems first, solutions at the end!

We did what to ourselves? Our representatives, senators, and Presidents, supposedly acting on our behalf, voted for and created what history has shown are huge monetary and fiscal mistakes.

Some will disagree, but consider this partial list: Read More

03.14.18- Will Inflation Burst the Everything Bubble?
Graham Summers

The economic data is now beginning to reveal what the bond market has been screaming for weeks: namely that INFLATION. HAS. ARRIVED.

In the last 24 hours we’ve seen:

  • Core inflation rose 2.2% year over year for the month of February.
  • Media one-year inflation expectations rose to 2.83% from 2.71%
  • Wage data rose at an annualized pace of 3% over the last three months.

The markets have already taken note, with inflationary assets exploding out of downtrends and entering raging bull markets. Read More

03.13.18- Cash vs. Gold vs. Inflation: Would You Prefer $2,000 or $4,900,000?
Peter Krauth

$100,000 kept in cash when the US went off the gold standard in 1933 is now worth an inflation-adjusted $2,000.

The same $100,000 kept in gold? Now worth $4.9M.

Inflation = Game, Set, Match: Gold.

Fears of rising inflation will push the gold price higher. Gold has plenty of room to run up to the top end of its range, near $1,360. If it breaks above that ceiling and heads higher, it won’t take much to test $1,400. Read More

03.12.18- Super-Duper-Irrational Exuberance, Report 11 Mar 2018
Monetary Metals

Think back to the halcyon days of the dot com boom. This was a time after Greenspan declared “irrational exuberance”. Long Term Capital Management collapsed in 1998, and Greenspan decided to risk propelling exuberance to a level beyond irrational. Super-duper-irrationalexuberance?

Anyway, Greenspan cut interest rates a few times in late 1998. Technology companies were able to raise $5 million or more with just a sketch on a napkin (“serviette” for those outside the US). Companies at a “later stage”, though without revenues, could raise $30 million. A company called “Webvan” was able to raise nearly a billion dollars without ever becoming profitable. Read More

03.10.18- Central Bankers Never Get it Right
Egon von Greyerz

Central bank heads have been at it again last week. And they have clearly all been singing from the same hymn sheet. The messages have been very similar from the bosses of the Fed, ECB and BOJ. The head of the Swedish Riksbank had a different and much more interesting message. More about that later.

Why should we ever listen to any of these self-important central bankers. They are consistently inaccurate in their forecasts and policies. Their timing is always wrong as they are always behind the curve. More importantly they are distorting the natural economic cycles by artificial manipulation of markets and thereby creating booms and busts of an enormous magnitude. Central banks and bankers should not exist. They fulfil no purpose and the world economy would function so much better without them. Read More

03.09.18- New Fed Chairman Hints at Big Policy Change That Could Crush Markets
Peter Reagan

When a CEO or coach takes a new position, they often make drastic changes to distinguish themselves from their predecessor. The new Fed Chairman appears to be no different.

On February 5th, Jerome Powell was sworn in as the new chairman of the Federal Reserve. The next day, in his first testimony before Congress, he hinted that some big changes were on his mind.

However, when you’re the head of the world’s most powerful central banking system, making major policy changes can have serious consequences. Read More

03.08.18- MOPE; The Government
Will Never Let It Happen …

Bill Holter

How often have you heard the phrase “the government will never let it happen”? It almost doesn’t matter what the topic is you are talking about, nothing “bad” can ever really happen …or so it is thought. The reason of course is because we are so many years into “MOPE” (management of perspective economics). No matter what has happened in the past, the media, Wall Street, and the government have constantly spun the narrative to lead the “perspective”. MOPE has been with us for such a long time, it is not surprising the public is conditioned into believing nothing bad will EVER happen. Read More

03.07.18- Is Jerome Powell About to End the Famed
“Fed Put”?

Graham Summers

The Fed officially has a new Fed Chair, Jerome Powell. And ever since he took office, it is clear that “something” has changed at the Fed.

That something is the famed “Fed put” or the idea that the Fed would immediately move to prop up stocks any time they began to fall.

Jerome Powell was sworn in as Fed Chair on February 5th 2018. At that time, the market was in the sharp sell-off annotated in the chart below: Read More

03.06.18- Are Subprime Debt Slaves, a Leading Indicator, Worrying the Fed?
Wolf Richter

Credit problems always appear first at the margins.

The new Fed remains a somewhat unknown quantity: There are still four vacancies on the Fed’s seven-member Board of Governors that forms the core of the policy-making FOMC. The new Chairman, Jerome Powell, has already shown in his testimony before Congress last week that he may use a little more straight talk than his predecessors, and the markets took notice.

No one knows for sure what this new Fed will look like once the four vacancies are filled. But this new Fed will likely try to push interest rates back to a somewhat more normal level and lighten their balance sheet so that they have some options when the business cycle trips over balled-up credit problems. Read More

03.05.18- And Now, for Something Entirely Different: Now, a Trade War -
Is a Shooting War Next?

Jim Rickards

A popular thesis since the 1930s is that a natural progression exists from currency wars to trade wars to shooting wars. Both history and analysis support this thesis.

Currency wars do not exist all the time; they arise under certain conditions and persist until there is either systemic reform or systemic collapse. The conditions that give rise to currency wars are too much debt and too little growth.

In those circumstances, countries try to steal growth from trading partners by cheapening their currencies to promote exports and create export-related jobs. Read More

03.03.18- Rising Economic Head Winds
Jim Rickards

Remember the “tea party” revolt in 2009–2010 against government bailouts and government spending?

Remember the “fiscal cliff” drama of Dec. 31, 2012, when Congress raised taxes and cut spending to avoid a debt default and government shutdown?

Remember the actual government shutdown in October 2013 as Republicans held the line against more government spending?

Well, congratulations if you do, because everyone else seems to have forgotten. Read More

03.02.18- An Apocalyptic Paul Tudor Jones Warns The Fed Is About To Lose Control
Tyler Durden

In a striking interview with Goldman's Allison Nathan, legendary trader Paul Tudor Jones argues that US inflation is set to accelerate sharply, making bonds a very poor investment, and that the Fed must act swiftly to tackle financial bubbles created by prolonged monetary easing.

Joining such luminaries as Bill Gross and Ray Dalio, who have both claimed the bull market in bonds is over, PTJ joins the choir and warns that "markets disciplined Greece for its budget transgressions. Read More

03.01.18- The Latest in a Long Line: The USD’s Inevitable Fiat-Currency Failure
Tom Lewis

History and memory are funny things. While we can read history and know, intellectually, that things happened, we don’t really internalize that comprehension. When we actually feel the pain of mistakes, we earn memory, which is a valuable bank upon which to draw so we don’t repeat avoidable errors.

Fiat currencies have been tried again and again and again and again throughout history, and they always fail. But because the vast majority of Americans can’t remember a time when America didn’t seem like the immortal ruler of the world, they simply can’t imagine a state of reality where that is not the case. Read More

02.28.18- Lemonade Stand Economics
Gary Christenson

Summary:  Timmy, a precocious ten-year-old opens a lemonade stand and learns about unbacked currencies.

“Dad, I’m excited and ready for business. Mom made me sign an IOU when she gave me sugar and frozen lemonade so I have stuff to sell.” Timmy looked up at his father and smiled in anticipation.

“Great job! This’ll be a learning experience. Here comes your first customer.” James, his father, wanted to be helpful, but expected Timmy to interact with customers.

A retired gentleman pushed his walker toward the lemonade stand and said, “Hi little fellow, I want a cup of that lemonade.” Read More

02.27.18- "Money For Nothin'...
And The Stocks For Free"

Sven Henrich

With apologies to the Dire Straights:

Now look at them yo-yo’s that’s the way you do it
You play the bull on the fin TV
That ain’t workin’ that’s the way you do it
Money for nothin’ and stocks for free

After 9 years of artificial liquidity drenching markets the same game continues in 2018: It’s raining money. Again. Still. Read More The Dirty Work Is Already Done,
Powell’s Just The Fall Guy

MN Gordon

Jerome Powell, the new Chairman of the Federal Reserve, just completed his third week on the job.  He’s hardly had enough time to learn how to operate the office coffee maker, let alone the all-in-one printer.  He still doesn’t know what roach coach menu items induce a heinous gut bomb.

Yet across the planet, folks high and low are already telling him exactly how he should do his job.  What’s more, they’re passing advanced judgement on things that may or may not happen.  For example, the South China Morning Post recently offered the following opinion:  Read More

02.24.18- An Insider’s Insider to Advise the Fed
Jesse Cohen

Sometimes the most important news is buried so deep it’s not even news. A certain story may be the most important market development by far, but if no one notices and no one understands the significance, it hardly qualifies as news.

We had an event like that last week. The most important financial story I have read in a long time went completely unnoticed. It was not reported in the mainstream media. You will not hear it discussed anywhere, you will not see it reported anywhere. Read More

02.23.18- The End of (Artificial) Stability
Charles Hugh Smith

The central banks'/states' power to maintain a permanent bull market in stocks and bonds is eroding.

There is nothing natural about the stability of the past 9 years. The bullish trends in risk assets are artificial constructs of central bank/state policies. As these policies are reduced or lose their effectiveness, the era of artificial stability is coming to a close.

The 9-year run of Bull-trend stability is ending as a result of a confluence of macro dynamics: Read More

02.22.18- Trump’s New Dark Money Man Takes Over
Nomi Prins

During her last news conference in December, Janet Yellen stood firm on her record stating, “The global economy is doing well. We’re in a synchronized expansion. This is the first time in many years that we’ve seen this.”

While attempting to lock in her record, Yellen urged, “There’s less to lose sleep about now than has been true for quite some time.”

Well, a lot of people lost sleep these past few days. And they might lose more sleep in the days to come.

Markets were due for a correction. Whether it turns out to be something worse, time will tell. Read More

02.21.18- The Fed’s “Catch 22”
Dave Kranzler

Before diving into the topic, let’s be clear about one thing:  The economic definition of “inflation”  is the increase in money supply relative to the marginal increase of wealth output (GDP) in the economic system for which money supply is created. This is differentiated from “price inflation,” which is “a general rise in prices.”

Money and credit creation in excess of wealth output causes currency devaluation.  It is this currency devaluation that arises from money and credit printing that causes “price inflation.”  More money (and credit) chasing a relatively less amount of “goods.” Read More

02.20.18- The Federal Government Can’t Account for $21 Trillion. Does Anybody Care?
Dr. Terrence Leveck

[Catherine Austin Fitts Note: This article was submitted by Terrence Leveck for publication. It was so substantially edited that we decided to publish at Solari.com. Our readers really want to know where the missing money went and how we get it back!]

On September 10, 2001, then Secretary of the Department of Defense Donald Rumsfeld said that for the 1999 DOD budget, “According to some estimates, we cannot track $2.3 trillion in transactions.”  The War On Waste The following day the US sustained the terrorist attacks that forever changed our world, and this startling revelation was largely forgotten, until recently. Read More

02.19.18- And Now, for Something Entirely Different: The Matrix Revealed -
Cartels That Run The World

Jon Rappoport

The following information comes from insider interviews with Ellis Medavoy and Richard Bell, two people I interview extensively in my collection, The Matrix Revealed. This is just a brief taste of what they have to say…

Major institutions on this planet that control Military, Money, Energy, Government, Medical, Corporate, Media, and Education are becoming, more and more, global cartels, horizontally integrated across national borders. Read More

02.17.18- The Worst Threat We Face
Is Right Here At Home

Chris Martenson

The Federal Reserve is ruining us

Last week, volatility made a long-overdue return to the US and global equitymarkets.

It began with a 2-day back-to-back violent drop. Day 3 saw a big rebound, swiftly followed by two more days of gut-wrentching losses.

And then finally, last Friday, the day saw massive swings both high and low, ending with a huge upside run. Read More

02.16.18- New Fed Chairman Will Trigger A Historic Stock Market Crash In 2018
Brandon Smith

Ever since the credit and equities crash of 2008, Americans have been bombarded relentlessly with the narrative that our economy is “in recovery”. For some people, simply hearing this ad nauseam is enough to stave off any concerns they may have for the economy. For some of us, however, it’s just not enough. We need concrete data that actually supports the notion, and for years, we have seen none. In fact, we have heard from officials at the Federal Reserve that the exact opposite is true. They have admitted that the so-called recovery has been fiat driven, and that there is a danger that when the Fed finally stops artificially propping up the economy with constant stimulus and near zero interest rates, the whole farce might come down. Read More

02.15.18- Do Financial Markets Still Exist?
Paul Craig Roberts, Dave Kranzler, Michael Hudson

For many decades the Federal Reserve has rigged the bond market by its purchases. And for about a century, central banks have set interest rates (mainly to stabilize their currency’s exchange rate) with collateral effects on securities prices. It appears that in May 2010, August 2015, January/February 2016, and currently in February 2018 the Fed is rigging the stock market by purchasing S&P equity index futures in order to arrest stock market declines driven by fundamentals, and to push prices back up in keeping with a decade of money creation. 
No one should find this a surprising suggestion.  The Bank of Japan has a long tradition of propping up the Japanese equity market with large purchases of equities. The European Central Bank purchases corporate as well as government bonds. Read More

02.14.18- This May Be The Beginning Of The Great Financial Reckoning
Simon Black

Less than two weeks ago, the United States Department of Treasury very quietly released its own internal projections for the federal government’s budget deficits over the next several years.

And the numbers are pretty gruesome.

In order to plug the gaps from its soaring deficits, the Treasury Department expects to borrow nearly $1 trillion this fiscal year.

Then nearly $1.1 trillion next fiscal year.

And up to $1.3 trillion the year after that. Read More

02.13.18- Danielle DiMartino Booth: Don't Count On The Powell Fed To Rescue The Markets
Adam Taggart

The new Fed Chair may break from his predecessors

The recent gut-wrenching drop in asset prices began on the first day of the job for new Federal Reserve Chairman Jerome Powell.

How is Mr. Powell likely to react to a suddenly sick-looking market? Will he step in forcefully to reassure investors that there's a "Powell put" in place as a backstop? Read More

02.12.18- The Fed’s Impossible Choice In Just Three Charts
John Rubino

Critics of “New Age” monetary policy have been predicting that central banks would eventually run out of ways to trick people into borrowing money. There are at least three reasons to wonder if that time has finally come:

Wage inflation is acceleratin

Normally, towards the end of a cycle companies have trouble finding enough workers to keep up with their rising sales. So they start paying new hires more generously. This ignites “wage inflation,” which is one of the signals central banks use to decide when to start raising interest rates. Read More

02.10.18- The Spark That Lights the Wick: Velocity of Money to Ignite Inflation
Tyler Durden

Forget the Trump tax cuts, the Senate budget deal, the Fed's Quantitative Tightening and the collapse in foreign buying of US Treasuries: after years of dormancy, the biggest catalyst for a sharp inflationary spike has finally emerged, and it is none of the above. Behold: the velocity of money.

The velocity of money measures the turnover of dollars, how often they are spent, and then spent again by their recipients, over a certain period of time. It has been falling, more or less on a line, since 2008. Read More

02.09.18- Global Synchronized Bond Collapse
Michael Pento

We have all heard, in ad nauseam fashion, Wall Street’s current favorite mantra touting a global synchronized economic recovery. For the record, global GDP growth for 2017 was 3.7%, according to the International Monetary Fund. And, although this is an improvement from recent years, you must take into account that in 2004 it was 4.4%, in 2005 it was 3.8%, in 2006 it was 4.3%, and in 2007 it was 4.2%. The Point being, it’s not as if the current rate of global growth has climbed to a level never before witnessed in history—it’s not even close. 

However, the more salient phenomenon now underway—far more important than the rather pedestrian move higher in global GDP--is the globally synchronized bond collapse, which the Main Stream Financial Media is dismissing with alacrity. Yields are on the move higher around the world and the rate of change is now escalating. Read More

02.08.18- Trump’s New Dark Money Man Takes Over
Nomi Prins

During her last news conference in December, Janet Yellen stood firm on her record stating, “The global economy is doing well. We’re in a synchronized expansion. This is the first time in many years that we’ve seen this.”

While attempting to lock in her record, Yellen urged, “There’s less to lose sleep about now than has been true for quite some time.”

Well, a lot of people lost sleep these past few days. And they might lose more sleep in the days to come.

Markets were due for a correction. Whether it turns out to be something worse, time will tell. Read More

02.07.28- What The Crypto Crash & Stock Market Plunge Have In Common
Adam Taggart

Today saw Jerome Powell sworn into office as the new Chairman of the Federal Reserve, replacing Janet Yellen. Looking at the sea of red across Monday's financial markets, Mr. Powell is very likely *not* having the sort of first day on the job he was hoping for...

Also having a rough start to the week is anyone with a long stock position or a cryptocurrency portfolio.

The Dow Jones closed down over 1,200 points today, building off of Friday's plunge of 666 points. The relentless ascension of stock prices has suddenly jolted into reverse, delivering the biggest 2-day drop stocks have seen in years. Read More

02.06.18- Two Elephants In The Room That The GOP Has Completely Forgotten
David Stockman

The US economy is threatened by two giant problems which cause all others to pale into insignificance. We are referring to a rogue central bank that has become an absolute enemy of capitalist prosperity and a fiscal doomsday machine that is hostage to the ceaseless budgetary demands of the Warfare State, the Welfare State and the Baby Boom's demographic imperatives.

Needless to say, both ends of the Acela Corridor are completely oblivious to these twin menaces. Indeed, they are the proverbial elephants in the room, thereby giving rise to a considerable irony: To wit, the GOP party of the elephant, which is supposed to be the palladium of financial rectitude in American politics, has forgotten about them completely. Read More

02.05.18- And Now, for Something Entirely Different: What the FISA Memo Reveals about the FBI, DNC, GOP–and the sketchy timeline
The Daily Bell Staff

It wasn’t the bombshell everyone hoped for. But the release of the FISA (Foreign Intelligence Surveillance Act) memo did corroboratewhat we already knew: the government is corrupt.

In fact, the contents of the memo should be disturbing to everyone. But Bill Binney, Thomas Drake, and Edward Snowden revealed much worse. Americans are desensitized to immense abuses of their rights.

The Democratic National Committee (DNC) and Clinton Campaign paid Christopher Steele $160,000 to dig up information on Trump team members including Carter Page. Steele also provided this information to the FBI. Read More

02.03.18- Fed’s QE Unwind Accelerates Sharply
Wolf Richter

With a sense of urgency. No more dilly-dallying around.

The Fed’s balance sheet for the week ending January 31, released this afternoon, completes the fourth month of QE-unwind. And it’s starting to be a doozie.

This “balance sheet normalization” impacts two types of assets: Treasury securities and mortgage backed securities (MBS) that the Fed acquired during the years of QE and maintained afterwards. Read More

02.02.18- Yellen Starts Work At Brookings Institution On Monday
Tyler Durden

A glitch in the monetary matrix?

Fed watchers will recall that shortly after he departed the Fed to make way for Janet Yellen, Ben Bernanke first joined the Brookings Institution in DC (before also joining PIMCO and Citadel as an advisor), where he became blogger emeritus. Fast forward a little over three years, when deja vu has hit, and as Steve Liesman reported moments ago, Janet Yellen - who is still technically employed by the Fed until this weekend - will begin work Monday morning as a distinguished fellow at the Hutchins Center on Fiscal and Monetary Policy at the Brookings Institution in Washington, DC Read More

02.01.18- The Dollar Breakdown:
A Sign of Inflation to Come?

Mishka vom Dorp

Recently, we saw the dollar index (the DXY), which measures the USD against a basket of the world’s major currencies, break below its support of 91 for the first time since January of 2015 (Figure 1).

This event may signal the most important trend of 2018: the breakdown of the dollar. Read More

01.31.18- Big Little Lies by Central Bankers
Sven Henrich

How stupid do central bankers think we are? By account of their communications and actions the answer is: Very.

Just in the past 24 hours we got a heap of communications that can be considered cringeworthy at best, highly disingenuous more likely. But it all fits with a script that has been unfolding for years.

After all central bank intervention was supposed to be an emergency driven policy to re-inflate a global economy and help financial institutions at the brink of collapse back to solvency and health.

The big little lie: Central banks would nurse economies back to health and then normalize their policies and unwind their balance sheets. Truth: It’s never going to happen. Read More

01.30.18- We’re Getting A Stock Market Correction (At Best) Or A Crash (At Worst)
Jim Rickards

I started in the Treasury bond business in 1985 after a 10-year career in commercial banking. I retired as a senior officer of Citibank that year at a relatively young age and made the move to Wall Street.

My firm was Greenwich Capital Markets, one of a select group of “primary dealers” allowed to transact directly with the Federal Reserve. Monetary policy is conducted through open-market operations run by a trading desk at the Federal Reserve Bank of New York. Read More

01.29.18- The Fed Will Ignite The Next “Financial Crisis”
Lance Roberts

There seems to be a very large consensus the markets have entered into a “permanently high plateau,” or an era in which price corrections in asset prices have been effectively eliminated through fiscal and monetary policy.

Partnering with this fairytale-like mindset is an overwhelming sense of complacency. Throughout the entire monetary ecosystem, there is a rising consensus that “debt doesn’t matter” as long as interest rates remain low. Of course, the ultra-low interest rate policy administered by the Federal Reserve is responsible for the “yield chase” which has fostered a massive surge in debt in the U.S. since the “financial crisis.”  Read More

01.27.18- Beware These Mischievous Actions Behind the Fed’s Curtain
Birch Gold Group

Sometimes we get the impression that the Fed has absolutely no clue what they’re doing.

It’s almost like they can’t make up their mind when it comes to monetary policy. On one hand, they’re raising interest rates, but are also leaving the 2018 policy outlook unchanged.

And on the other hand, in spite of the evidence I’ll point to in a second, they’re still talking about “negative” interest rates over at the St. Louis Fed: Read More

01.26.18- Fed Nominee Marvin Goodfriend Lied to the Senate about Taxing Cash
Tho Bishop

The government shutdown wasn’t long enough to delay the nomination hearing for an economist who could be considered to be one of the “worst Fed nominees of all time.” While most of the headlines generated from Marvin Goodfriend’s testimony before the Senate today focused on the grilling he received from Senate Dems, there is one curious part of his testimony that has been largely overlooked: he flat out lied about his past support for taxing cash.

Unfortunately this issue that would directly impact every single American wasn’t brought up until well over an hour into this testimony. It was then that Nevada Senator Catherine Cortez Masto asked Mr. Goodfriend about his past advocacy on “taxing currency” and whether he would support such a policy today. Read More

01.25.18- Real Estate to be Torpedoed in 2018?
Birch Gold Group

Real estate is the number one form of wealth for most people. However, as the last housing bubble and ensuing recession have shown, real estate is not always a safe investment. In 2006, housing prices peaked before falling to new lows in 2011 in the aftermath of the recession.

But since then, home prices have skyrocketed to new highs thanks to federally sponsored low-interest mortgages. In fact, home prices have risen so much, so fast that Americans have all but forgotten the Great Recession and foreclosure crisis of 2008/2009. Read More

01.24.18- No Sugar High from Tax Cut Unless the Fed and Banking System Provide the Sugar
Paul Kasriel

There has been chatter about whether the Tax Cuts and Jobs Act of 2017 (TCJA) will result in a temporary stimulus, or sugar high, to U.S. economic activity because of the increase in corporate after-tax profits and the increase in household disposable income that will flow from the tax-rate cuts. How can putting this extra after-tax income in the hands of businesses and households not stimulate private sector spending? In order to answer this question, you have to follow the money. Read More

01.23.18- "The Dollar Will Be Destroyed By Its Own Government"
Kevin Massengill

View Video

01.22.18- Is The Federal Reserve Really Thinking About Negative Interest Rates?!
Chris Marcus

At the same time the Federal Reserve claims it’s going to raise interest rates and normalize its balance sheet, it’s also publishing an essay advocating negative interest rates.

It’s almost so incredible that were it not published on the Fed’s own St. Louis branch website, it might be hard to believe it’s true. But apparently St. Louis Federal Reserve economist Yi Wen disagrees with the projected Fed mantra that it’s time to raise interest rates. Because he actually just wrote an essay explaining what negative interest rates are, and how it could be a perfect next move for the Fed. Read More

01.20.18- A Shocking Admission: “The Federal Reserve is a Criminal Conspiracy”
Charles Hugh Smith

A spokesperson assured the assembled media that the Fed Board was “deeply concerned” about the American people, inflation, and the unemployment rate, but he was heckled off the stage.

In an extraordinary admission, the Board of Governors of the Federal Reserve conceded that the Federal Reserve is “at heart a criminal conspiracy of bankers.” The Board followed up this revelation with a breezy confession that the Fed “doesn’t really give a rat’s rear-end about the American people, and we’re tired of having to claim we do.” Read More

01.19.18- The Next Financial Crisis Will Be Worse Than the Last One
Nomi Prins

We made it through 2017.

And if you look at the stock and asset markets, as Donald Trump tends to do (and as Barack Obama did, too), you’d think all is fine with the world.

The Dow Jones Industrial Average rose about 24% last year. The Dow Jones U.S. Real Estate Index rose 6.20%. The price of one bitcoin rose about 1,646%.

And so far 2018 has been more of the same.

On the flip side of that euphoria however, is the fact that the median wage rose just 2.4% last year and has remained effectively stagnant relative to inflation. And although the unemployment rate fell to a 17-year low of 4.1%, the labor force participation rate dropped to 62.7%, its lowest level in nearly four decades.Read More

01.18.18- If Interest Rates Spike, Here's Who Will Be Hurt The Most
Tyler Durden

Interest rates are finally rising, and as we observed this morning, the 10Y - now above 2.60% and the highest since last March is now on the cusp of breaking above the 2.63% level which Jeff Gundlach said last week  is where stocks will be negatively impacted.

And while the financial sector is poised to benefit from this increase, although not if the curve flattens and eventually inverts, something which would unleash havoc among the banks, there are many parts of the US economy that will be unequivocally and negatively impacted from the rise in interest rates. Among them are housing, business investment and, of course, consumer spending: with credit card already at record highs, increase in the APR will crush America's purchasing power. Read More

01.17.18- Albert Edwards: The Trigger For The Next Market Correction
Tyler Durden

Fear of overvaluation – particularly for U.S. equities – has driven far too many investors to miss the strong bull market. For market bears to be proven right, according to Albert Edwards, it will take one or more of several triggers.

Edwards is the global strategist for Societe Generale and is based in London. He spoke at his firm’s annual investment conference in London on July 9. A copy of his slides, as well as those from his colleague Andrew Lapthorne’s presentation, can be found below. Read More

01.16.18- As the Controlled Inflation Scheme
Rolls On

MN Gordon

American consumers are not only feeling good.  They’re feeling great.  They’re borrowing money – and spending it – like tomorrow will never come.

On Monday the Federal Reserve released its latest report of consumer credit outstanding.  According to the Fed’s bean counters, U.S. consumers racked up $28 billion in November in new credit card debt and in new student, auto, and other non-mortgage loans.  This amounted to an 8.8 percent increase in consumer borrowing.  It also ran total outstanding consumer debt up to $3.83 trillion. Read More

01.15.18- Drowning In The Money River
Adam Taggart

Why the 99% of us are falling farther behind

It's a big club and you ain't in it. ~ George Carlin

If you suspect society is unfair, that there's a different set of rules the rich live by, you're right.

I've had ample chance to witness first-hand evidence of this in my time working on Wall Street and in Silicon Valley. Simply put: our highly financialized economy is gamed to enrich those who run it, at the expense of everybody else.

The Money River

A recent experience really drove this home for me. Read More

01.13.18- Social Change Will Upend the Status Quo
Charles Hugh Smith

The nation is fragmenting because the Status Quo is failing the majority of the citizenry.

The core narrative of the Status Quo is that nothing fundamental needs to be changed: all the problems can be solved with more "free money" (borrowed from the future at low rates of interest) and a few policy tweaks such as Universal Basic Income (UBI) (the topic of my new book Money and Work Unchained).

This core narrative is false: everything needs to change, from the bottom up. And that of course terrifies those gorging at the trough of status quo wealth and power. Read More

01.12.18- Party While You Can - Central Bank Ready To Pop The 'Everything' Bubble
Brandon Smith

Many people do not realize that America is not only entering a new year, but within the next month we will also be entering a new economic era. In early February, Janet Yellen is set to leave the Federal Reserve and be replaced by the new Fed chair nominee, Jerome Powell. Now, to be clear, the Fed chair along with the bank governors do not set central bank policy. Policy for most central banks around the world is dictated in Switzerland by the Bank for International Settlements. Fed chairmen like Janet Yellen are mere mascots implementing policy initiatives as ordered.  This is why we are now seeing supposedly separate central banking institutions around the world acting in unison, first with stimulus, then with fiscal tightening.  Read More

01.11.18- Traders Remind Central Banks to Take Care on Route to Exit Door
David Goodman

Global central banks are being served a sharp reminder by investors that their monetary policy planning carries the potential to roil financial markets in 2018.

minor tweak in the Bank of Japan’s bond-purchase operation Tuesday saw the yen strengthen more than 1 percent in two days. A change in the way China’s central bank manages the yuan sparked losses in that currency while recent hawkish comments from European Central Bank officials nudged the euro higher. Read More

01.10.18- The day I found out it was all rigged
Simon Black

May 6, 2010 started off as a pretty boring day.

The most exciting stories from the morning’s newspapers were reviews of the upcoming Iron Man 2 film.

But all that changed at around 2:45pm when, without warning, the stock market crashed, and the Dow Jones Industrial Average dropped 1,000 points within minutes.

It was unprecedented… especially because there was absolutely no reason why stocks should have fallen so much. Read More

01.09.18- What Has QE Wrought?
Dr. Ron Paul

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01.08.18- And Now, for Something Entirely Different: UFOs, Tesla, DeLonge, ETS, Covert Ops
Jon Rappoport


This is a “what if” story. But it’s also based on decades of experience analyzing propaganda and cover stories.

It’s based on the knowledge that military and intelligence operatives are trained to lie, and they like to lie, and they get up in the morning, licking their chops, because they know they’re going to lie during another day in paradise. Read More

01.06.18- It’s Not About Democracy: Control Fraud Is the Core of our Political System
Charles Hugh Smith

Charles Hugh Smith says “the many are finally calling out the abusers of power because there’s no longer any need to pay the corrupting costs…” 

he many are finally calling out the abusers of power because there’s no longer any need to pay the corrupting costs of centralization.

If we strip away the pretense of democracy, what is the core of our political System? Read More

01.05.18- Final Warning for America - The Fed Coin
Doug Casey

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01.04.17- Phillips Curve R.I.P.
Paul Craig Roberts

The Phillips Curve is the modern day version of the Unicorn. People believe in it, but no one can find it.  The Fed has been searching for it for a decade and the Bank of Japan for two decades.  So has Wall Street. 

Central banks’ excuse for their massive injections of liquidity in the 21st century is that they are striving to stimulate the 2% rate of inflation that they think is the requirement for sustained rises in wages and GDP.  In a total contradiction of the Phillips Curve, in Japan massive doses of central bank liquidity have resulted in the collapse of both consumer and financial asset prices.  In the US the result has been a large increase in stock averages propelled by unrealistic P/E ratios and financial speculation resulting in Tesla’s capitalization at times exceeding that of General Motors. Read More

01.03.18- Why the Financial System Will Break: You Can't "Normalize" Markets that Depend on Extreme Monetary Stimulus
Charles Hugh Smith

Central banks are now trapped.

In a nutshell, central banks are promising to "normalize" their monetary policy extremes in 2018. Nice, but there's a problem: you can't "normalize" markets that are now entirely dependent on extremes of monetary stimulus. Attempts to "normalize" will break the markets and the financial system.

Let's start with the core dynamic of the global economy and nosebleed-valuation markets: credit.

Modern finance has many complex moving parts, and this complexity masks its inner simplicity. Read More

01.02.18- Forecast 2018 — What Could Go Wrong?
James Howard Kunstler

If you take your cues from Consensus Trance Central — the cable news networks, The New York TimesWashPost, and HuffPo — Trump is all that ails this foundering empire. Well, Trump andRussia, since the Golden Golem of Greatness is in league with Vladimir Putin to loot the world, or something like that.

Since I believe that the financial system is at the heart of today’s meta-question (What Could Go Wrong?), it would be perhaps more to the point to ask: what has held this matrix of rackets together so long? After all, rackets are characterized by pervasive lying and fraud, meaning their operations don’t add up. Things that don’t comport with reality are generally prone to failure so sooner or later they have to implode. Read More

01.01.18- The Dreaded “Flattening Yield Curve” Meets QE Unwind
Wolf Richter

During prior incidents of an “inverted” yield curve, the Fed had no tools to get the market to push up long-term yields. Today it has one: the QE Unwind.

The price of three-month Treasury securities fell and the yield — which moves in the opposite direction — rose, ending the year at 1.39%, after having spiked to 1.47% on December 26, the highest since September 12, 2008. This is in the upper half of the Fed’s new target range for the federal funds rate (1.25% to 1.50%). Back in October 2015, the yield was still at 0%: Read More

12.30.17- Doug Casey On The Coming Financial Crisis: "It's A Gigantic Accident Waiting To Happen"
Justin Spittler

Justin’s note: Earlier this year, Fed Chair Janet Yellen explained how she doesn’t think we’ll have another financial crisis “in our lifetimes.” It’s a crazy idea. After all, it feels like the U.S. is long overdue for a major crisis. Below, Doug Casey shares his take on this. It’s one of the most important discussions we’ve had all year.

Justin: Doug, I know you disagree with Yellen. But I’m wondering why she would even say this? Has she lost her mind? Read More

12.29.17- And Now, for Something Entirely Different: Deep State Takedown In Progress: Is Trump About To Start Arresting Top Democrats And Bringing Them To Justice?
Michael Snyder

When Donald Trump gets hit, he always hits back even harder.  So when the deep state decided to conduct a legal witch hunt against President Trump and his family, they should have expected that Trump would return the favor.  In recent days, there have been all sorts of rumblings about sealed indictments, pending arrests and a “deep state takedown”.  Many believe that we are on the verge of seeing some of the most prominent Democrats in the entire nation being arrested and thrown in prison.  We shall see how all of this plays out, but in this article I am going to focus on the things that have been confirmed so far. Read More

12.28.17- The Dark Power Behind the Frauds and Financial Asset Bubbles - Whose Fool Are You?

"While everyone enjoys an economic party the long-term costs of a bubble to the economy and society are potentially great. They include a reduction in the long-term saving rate, a seemingly random distribution of wealth, and the diversion of financial human capital into the acquisition of wealth. 

As in the United States in the late 1920s and Japan in the late 1980s, the case for a central bank ultimately to burst that bubble becomes overwhelming. I think it is far better that we do so while the bubble still resembles surface froth and before the bubble carries the economy to stratospheric heights. Whenever we do it, it is going to be painful, however.” 
Read More

12.27.17- Doug Kass' 15 Surprises For 2018: FANG Crackdown, Gold All-Time-Highs, Stocks Slump
Doug Kass

Contrary to the expectations of many (including myself), the uncertainty following the surprising Trump presidential election victory, which produced a number of possible outcomes (some of them adverse), was enthusiastically embraced by investors in 2017.

After a year of historically low volatility and ever-rising stock prices, the bullish consensus was "in" and the contrary was "out" in 2017.

But after the Trump election win in late 2016, a market on steroids was not a conclusion or forecast by any main stream Wall Street forecaster. Read More

12.26.17- Americans have no savings and with very good reason: housing, education, and health care have seen extraordinary inflation while wages are stagnant.

It has now become a daily ritual in which story after story of broke Americans plaster the web.  Yet somehow on the mainstream press, very little is discussed about this topic.  Americans are largely broke because inflation is vey real.  Housing, education, and health care costs have soared out of control while wages have remained stagnant.  The way Americans continue to pay for these items is by going into loan shark levels of debt.  There used to be a pretense that “we” actually cared about having a middle class but that is now thrown out the window.  At this point, we are in a full on sprint towards low wage capitalism.  Many people live on a paycheck to paycheck diet. Read More

12.25.17- Ready To Delete The Fed
And Congress Yet?

Karl Denninger

Once in a while you read something that has a nugget of truth in it -- on accident.

That is, the writer didn't intend to enlighten, and for 99% of the people in the country, it won't -- because America is, for the most part, an innumerate nation.

It is for this very reason that I have pounded my head against the wall on this web page for over 10 years.  If the people of this nation were not innumerate there would have been an utterly vicious reaction by now and not one single politician -- or Fed President -- would still be in office.  None.

They'd have either left peacefully or piecefully long ago. Read More

12.23.17- Weekend Rant: Benjamin Franklin’s
Warning Is Coming True

Simon Black

“Anyone who has the courage to be honest and objective can see the obvious decay…”

On September 17, 1787 on the final day of the Constitutional Convention in Philadelphia, Benjamin Franklin was approached by a woman as he walked out of Independence Hall.

“Well Doctor, what have we got– a republic, or a monarchy?” she asked.

It was a burning question on everyone’s mind: what form of government would the Constitutional delegates establish for the new country?

Franklin didn’t hesitate. “A republic– if you can keep it.” Read More

12.22.17- And Now, for Something Entirely Different: De Facto Travel Restrictions Now Exist For Americans
Paul Craig Roberts

Green Party presidential Candidate Jill Stein is being investigated by the Senate Intelligence (sic) Committee for “Russian connections.” What has brought Russiagate to Jill Stein? The answer is that she attended the 10th Anniversary RT dinner in Moscow as did the notorious “Russian collaborator” US General Michael Flynn. RT is a news organization, a far better one than exists in the West, but if you were one of the many accomplished people who attended the anniversary dinner, you are regarded by Republican Senator Richard Burr from North Carolina as a possible Kremlin agent. Read More

12.21.17- Yield Curve Steepens Dramatically:
What's Going On?

Mike Shedlock

US treasuries are seeing action we have not seen for a while: Strong sharp steepening of the yield curve.

The yield curve is said to steepen when the spreads between short-term and long-term rates increases. The yield curve flattens when spreads shrink.

A bearish steepener occurs when rates are rising and long-term yields are rising more than short-term rates. Spreads widen.

A bullish steepener occurs when rates are falling and short-term rates are falling faster than long-term rates. Spreads widen.

A bullish flattener occurs when rates are falling and long-term rates are falling faster than short-term rates. Spreads narrow. Read More

12.20.17- And Now, for Something Entirely Different: How to Recapture the True Spirit of Christmas in a Toxic Age
John W. Whitehead

“I think there must be something wrong with me, Linus. Christmas is coming, but I’m not happy. I don’t feel the way I’m supposed to feel.” -  Charlie Brown, A Charlie Brown Christmas

I keep waiting to encounter the “kind, forgiving, charitable, pleasant” Christmastime environment that Charles Dickens describes in A Christmas Carol: “when men and women seem by one consent to open their shut-up hearts freely, and to think of people below them as if they really were fellow-passengers to the grave, and not another race of creatures bound on other journeys.” Read More

12.19.17- Bad Juju! US Treasury 10Y Term Premia Crushed As Fed Unwinds Treasury Note/Bond Holdings
Anthony B. Sanders

Its going to be bad juju (or incoming weeks) for some Treasury investors as The Fed continues its “great unwind” of their $4.4 Trillion balance sheet.

As The Fed dumps their Treasury Note/Bond holdings, the 10 year Term Premium declines.

The Term Premium is the compensation that investors require for bearing the risk that short-term Treasury yields do not evolve as they expected. Read More

12.18.17- Central Banks Want the World to Carry On While They Quietly Tighten
Rich Miller and Alessandro Speciale

Central bankers are gingerly trying to take away the punch bowl without interrupting the party.

Led by interest-rate increases by the Federal Reserve and the People’s Bank of China, central banks around the world shifted toward a tighter monetary stance this week. Yet the moves were either so well-telegraphed, or so tiny, and the language about future action so hedged, that there was barely a ripple in financial markets. Read More

12.16.17- Four Charts Prove The 'Economic Recovery' Is Just A Fed-Induced Entitlement Program For The Wealthy
Tyler Durden

"Economic recovery" in America no longer means what it used to mean.

Historically "economic recovery" was largely characterized by job and wage growth, distributed across the income spectrum, and a rebound in GDP growth to north of ~3%-5%.

These days, the notion of "economic recovery" has been hijacked by the Fed and bastardized in such a way that they celebrate "asset bubbles" rather than real growth in economic output. Read More

12.15.17- And So Begins The Rug-Yank Phase Of Fed Policy
MN Gordon

The political differences of today’s leading two parties are not over ultimate questions of principles.  Rather, they’re over opposing answers to the question of how a goal can be achieved with the least sacrifice.  For lawmakers, the goal is to promise the populace something for nothing while pretending to make good on it.

Take the latest tax bill, for instance.  The GOP wants to tax less and spend more.  The Democrat party wants to tax more and spend even more.  We don’t recall seeing any proposals to tax less, spend less, and shrink the size of the state.  And why would we? Read More

12.14.17- And Now, for Something Entirely Different: Get The Rope, Pitchforks And Torches
Karl Denninger

This is the sort of article that ought to get you digging around in the garage for what the American people seem to forget they have: Pitchforks, torches and rope.

There is one simple and easily actionable approach that each of us could take to try to wrest control over health policy decisions away from the lobbyists who now control it with little effective counterbalance and put it back in the hands of our patients, who should be powerful shapers of such decision making.

This is a short excerpt from an article in JAMA (Journal of the American Medical Association) on a conversation they urge doctors to have with you.  The gist of it?  Obamacare and forced cost-shifting in general is something you should demand more of from politicians. Read More

12.13.17- The Fed is Arranging Deck Chairs on the Titanic (the Iceberg Comes in 2018).
Graham Summers

The Fed concludes its final FOMC meeting of the year today.

The entire financial world expects the Fed to raise rates a final time. This will mark the fifth rate hike since December 2015, and the fourth of the last 12 months.

Throughout this time period, the Fed has routinely stated that it is confused as to why inflation is “too low.”

Inflation is not too low. The method the Fed uses to measure inflation is intentionally incorrect. As a result, the official inflation numbers reflect whatever the Fed wants, as opposed to reality. Read More

12.12.17- The Fed's Fantasy on Neutral Interest Rates
Frank Shostak

In her testimony to the Congressional Economic Committee on November 29, 2017, the Fed Chair Janet Yellen said that the neutral rate appears to be quite low by historical standards. From this, she concluded that the federal funds rate would not have to increase much to reach a neutral stance.

The neutral rate currently appears to be quite low by historical standards, implying that the federal funds rate would not have to rise much further to get to a neutral policy stance. If the neutral level rises somewhat over time, as most FOMC participants expect, additional gradual rate hikes would likely be appropriate over the next few years to sustain the economic expansion.Read More

12.11.17- The Process Through Which the First Major Central Bank Goes Bust Has Begun
Graham Summers

In the aftermath of the Great Financial Crisis, Central Banks began cornering the sovereign bond market via Zero or even Negative interest rates and Quantitative Easing (QE) programs.

The goal here was to reflate the financial system by pushing the “risk free rate” to extraordinary lows. By doing this, Central Bankers were hoping to:

1)   Backstop the financial system (sovereign bonds are the bedrock for all risk). Read More

12.09.17- Warning: Trump’s Federal Reserve Pick Hates Gold and Cash
Daily Bell

In case of emergency, you should always have a solid chunk of cash on hand. These days, that isn’t much riskier than keeping your money in a bank.

There are stories of banks and governments suspending accounts for no legitimate reason. Furthermore, the interest rates at banks hardly give you much incentive to store your money there.

But as with anything that gives individuals more control over their lives, the government doesn’t like it. They want the ultimate control to cut you off from your economic power. Read More

12.08.17- Finally, An Honest Inflation Index – Guess What It Shows
John Rubino

Central bankers keep lamenting the fact that record low interest rates and record high currency creation haven’t generated enough inflation (because remember, for these guys inflation is a good thing rather than a dangerous disease).

To which the sound money community keeps responding, “You’re looking in the wrong place! Include the prices of stocks, bonds and real estate in your models and you’ll see that inflation is high and rising.” 

Well it appears that someone at the Fed has finally decided to see what would happen if the CPI included those assets, and surprise! the result is inflation of 3%, or half again as high as the Fed’s target rate. Read More

12.07.17- Central Banks, Governments & Keynesian Economists Are Losing Their $hit Over Bitcoin
Jeff Berwick

If you were to tell me that central banks, governments, and Keynesian economists were in an uproar and hated something, I would put my finger to your lips and say, “Shhhh, you don’t even have to tell me what it is. Whatever it is, I love it.”

In this particular case, it happens to be bitcoin!

With bitcoin now on the cusp of breaking through $12,000 and a $200 billion market cap it seems all the puppets of the archaic, violent, tyrannical system of money and banking are losing their $hit! Read More

12.06.17- And Now, for Something Entirely Different: BLOCKBUSTER! - Deep Black Ops Contractor Exposes OKC!
Jeff Rense & Cody Snodgres

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12.05.17- The Economics of Bitcoin
Malavika Nair

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12.04.17- Three Blatant Lies The Fed Just Told You
Lee Adler

I told you I’d get you the rest of my Fed meeting notes soon, and (unlike the Fed) I always try to say what I mean.

Most of the little tidbits I gleaned from the latest meeting minutes (go here if you missed my expose earlier this week) are prevarications, obfuscations, or bald-faced lies. Here are a few.

Lie #1: Equities rise and fall because of investor behavior. 

Here’s what they said:

Broad equity price indexes rose notably, reportedly reflecting in part investors’ perceptions that tax reform was becoming more likely. Read More

12.02.17- Weekend Rant: Wall Street Criminals Continue Their Fraud And Theft: NO JAIL TIME
Mike Papantonio

Via America’s LawyerMike Papantonio talks with Danielle DiMartino Booth about how a new federal lawsuit says Goldman Sachs and other Wall Street banks rigged the U.S Treasury Bond Market to gain profits for themselves. Read More

12.01.17- And Now, for Something Entirely Different: The Ant and the Grasshopper
Jared Dillian

I’m sure you’ve heard the fable of the ant and the grasshopper. The ant busted his ass all year growing some grain to store for the winter, while the grasshopper was laying about, playing the fiddle. When winter came around, the grasshopper had no food, so he went to the ant’s house to beg for some. The ant told him to beat it, and the grasshopper starved to death. The end.

This tweet was getting retweeted all over the place last weekend. Apologies for the bad language. Read More

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