02.18.19- The Birth of a Monster
David Howden

The Federal Reserve’s doors have been open for “business” for one hundred years. In explaining the creation of this money-making machine (pun intended — the Fed remits nearly $100 bn. in profits each year to Congress) most people fall into one of two camps.

Those inclined to view the Fed as a helpful institution, fostering financial stability in a world of error-prone capitalists, explain the creation of the Fed as a natural and healthy outgrowth of the troubled National Banking System. How helpful the Fed has been is questionable at best, and in a recent book edited by Joe Salerno and me — The Fed at One Hundred — various contributors outline many (though by no means all) of the Fed’s shortcomings over the past century. Read More

02.16.19- Fed Tightening Is Over: Markets Now Expect Cuts In 2019
John Rubino

People who assumed the Fed, along with the rest of the government, would cave the minute the financial markets got a little choppy turned out to be right. A couple of bad months and the “normalization” of both interest rates and the Fed’s balance sheet have stopped cold. Now the markets expect falling rates and (apparently) rising asset purchases.

From today’s Wall Street Journal:

Debt Investors Embrace ‘Upside Down’ World After Fed Shift

Signs that the Federal Reserve may be done with its yearslong campaign to raise interest rates are sending ripples through markets.  Read More

02.15.19- What Happens When More QE Fails to Reverse the Recession?
Charles Hugh Smith

The smart money is liquidating assets, paying off debt and moving capital into collateral that isn't impaired by debt or speculative valuations.

The Federal Reserve's sudden return to "accommodative" dovishness in response to the stock market's swoon telegraphs its intent to fire up QE once the recession kicks into gear. QE (quantitative easing) are monetary policies designed to ease borrowing and the issuance of credit, and to prop up assets such as stocks and real estate. Read More

02.14.19- Fed Warns Dollar "Might Not Retain Its Dominance Forever"
Tyler Durden

When the TBAC published the minutes to its quarterly refunding decision two weeks ago, the most interesting part of the discussion was the "unique challenges" faced by the Treasury over the medium term, especially the possibility of significant financing gap over next 10 years amounting to over $12 trillion and the potential need for more domestic investor participation if foreign reserve growth slows.

Here, among other things (which potentially include the Green New Deal, with its $6+ trillion cost) the TBAC cautioned that the Treasury’s financing needs are expected to increase significantly even without factoring in recession possibilities over the next decade. Read More

02.13.19- As The Fed Reflates The Stock Bubble The Economy Crumbles
Dave Kranzler

I get a kick out of these billionaires and centimillionaires, like Kyle Bass yesterday, who appear on financial television to look the viewer in the eye and tell them that economy is booming.  Kyle Bass doesn’t expect a mild recession until mid-2020. Hmmm – explain that rationale to the 78%+ households who are living paycheck to paycheck, bloated with a record level of debt and barely enough savings to cover a small emergency.

After dining on a lunch fit for Elizabethan royalty with Trump, Jerome Powell decided it was a good idea to make an attempt at reflating the stock bubble. After going vertical starting December 26th, the Dow had been moving sideways since January 18th, possibly getting ready to tip over. Read More

02.12.19- Debt Trifecta at All-Time Highs – Billionaires Panic
Birch Gold Group

The “trifecta” of national, corporate, and consumer debt has reached all-time highs, and could prove to be catastrophic if a recession hits.

Let’s start by quickly bringing each part of this debt trifecta up to date as much as possible…

U.S. National Debt

The national debt, ever on the rise, currently sits at around $22 trillion: Read More

02.11.19- Fed Crumples - and Seals
the Dollar's Fate
Clive Maund

The Fed didn’t just fold on Wednesday, it crumpled, capitulated. A long time ago we had figured out that when push came to shove, this is what it would do. However, we thought that it would take a market crash to force it to change course, in order that it could use that as solid justification for a U-turn, instead of which it only took a crashlet, or the start of a crash.

The Fed’s “Prime Directive” is to serve the interests of their Masters, the fabled 1% who control society, and they have done an admirable job of it over the past 10 years since the market crash, with their QE and ZIRP policies, which have funneled the wealth of the lower and middle classes up to the top of the pyramid, to the 1%, whose wealth has increased enormously as a result, while the common man has lost. Read More

02.09.19- Why Monetary Easing Will Fail
Alasdair Macleod

The major economies have slowed suddenly in the last two or three months, prompting a change of tack in the monetary policies of central banks. The same old tired, failing inflationist responses are being lined up, despite the evidence that monetary easing has never stopped a credit crisis developing. This article demonstrates why monetary policy is doomed by citing three reasons. There is the empirical evidence of money and credit continuing to grow regardless of interest rate changes, the evidence of Gibson’s paradox, and widespread ignorance in macroeconomic circles of the role of time preference. Read More

02.08.19- The Real Elephant in the Room... Debt
Nell Sloane

We decided to wait till the FOMC meeting to release this week’s letter so that we could capture the most important event of the week. It’s not that we didn’t expect a few of the tech giant earnings would be painted with bullishness, but we felt maybe the earnings didn’t really matter. Maybe all that mattered was the “Powell Put” which was made quite obvious by the monotonous speech he gave after the FOMC decision. It’s amazing how quickly the FED has caved to the pressure laid out by both the bond market and #POTUS himself. Here are the bullet points as laid out from Zhedge: Read More

02.07.19- The Categorical Insanity of
Central Banking
MN Gordon

Currency debasement.  Asset price inflation.  Booms, bubbles, and busts.  Yes, folks, central bankers have succeeded at making full hash of the world at large.  This goes for the Federal Reserve too.

Tracing back recent financial disasters we find the mortgage meltdown coincided with the Fed’s interest rate raising cycle.  The Fed had dropped rates following the dot com bust and, in return, puffed up a massive housing bubble.  So they raised rates to let some air out and – pop! – the bubble exploded. Read More

02.06.19- Will Government Shutdown Return As The Trade War Expands?
Brandon Smith

The mainstream economic community has a notoriously short attention span and a lack of long-term perspective. After the longest government shutdown in American history subsided, the mainstream proclaimed the fight well and over – in other words, nothing to see here, Trump “folded” and all is well. Of course, what they consistently seem to ignore is the fact that the shutdown was only placed on a three week hiatus. This is hardly any assurance of a return to “normalcy”.

As I write this, the Trump Administration has yet to make its State Of The Union Address, and it is possible we will know more afterwards on the shutdown issue. Read More

02.05.19- A Survival Guide For 2019
Adam Taggart

As the first month of the year concludes, it's becoming clear that 2019 will be a very different kind of year.

The near-decade of 'recovery' following the Great Financial Crisis enjoyed a stability and tranquility that suddenly evaporated at the end of 2018.

Here in 2019, instability reigns.

The world's central banks are absolutely panicking. After last year's bursting of the Everything Bubble, their coordinated plans for Quantitative Tightening have been summarily thrown out the window. Suddenly, no chairman can prove himself too dovish. Read More

02.04.19- Powell Put Sends Stocks Soaring, Recession Must be Near
David Haggith

Federal Reserve Chair Jerome Powell placed his put in stocks while saying there is none. When he doubled down today on a more dovish approach to the economy, Powell claimed the Fed is not designing interest rates to keep the market climbing. If that is true, recession must be near:

Fed delivers a “double-barrel dovish blast”

The Fed sees recession dead ahead. You have only that choice in how to interpret this because the Fed made a major course correction in late December, which instantly saved the crashing market, and today it announced it fully intends to stay the new course while stating that had nothing to do with the market. After all, Read More

02.02.19- Here’s the ‘most contrarian trade’ on Wall Street — and investors can thank the Fed, Bank of America says
Mark DeCambre

Remember that time when the Federal Reserve was busily dialing up benchmark interest rates to normalize crisis-era monetary policy? Well, Wall Street doesn’t either, after a 180-degree pivot on Wednesday by Powell & Co. that sent expectations for future rate increases to rock-bottom levels — at least for the moment.

Bank of America research analysts on Friday described wagers for interest-rate hikes in 2019 as the “most contrarian” investment bet in the world, in a popular “flow show” research report titled “Long risk, long leverage, short vol.” Read More

02.01.19- The Plan to Ditch King Dollar
Jim Rickards

When critics point to Japan’s debt-to-GDP ratio of over 200%, Japan’s defenders are quick to say that most of the Japanese debt is owned by the Japanese themselves in insurance companies, banks, pension plans and personal portfolios, not to mention the Bank of Japan.

There’s truth in this. Japan has a highly homogenous culture.

The Japanese are all in the same lifeboat rowing in the same direction. As long as no one rocks the boat, the debts can keep piling up.

But it’s not the same for the US. Read More

01.31.19- The Stock Market Would Crash Without Central Bank Support
Dave Kranzler

The mis-pricing of money and credit has also driven a terrible misallocation of capital and kept unproductive zombie debtors alive for too long. Saxo Bank, “Beware The Global Policy Panic”

“Mis-pricing of money and credit” refers to the ability of the Fed to control interest rates and money supply.  Humans with character flaws and conflicting motivations performing a role that is best left to a free market.   After the market’s attempt in December to re-introduce two-way price discovery to the stock stock market, the Fed appears ready to fold on its “interest rate and balance sheet normalization” policy, whatever “normalization is supposed to mean. Read More

01.30.19- Screwed
Sven Henrich

James Madison: “We are free today substantially but the day will come when our Republic will be an impossibility. It will be an impossibility because wealth will be concentrated in the hands of a few.” 

The tax cut has now been shown the very scam I outlined it to be in 2017. Debt is soaring and so are debt financing obligations. The CBO estimated that the US will have to add $12 trillion in debt over the next 10 years. As growth estimates for GDP keep being revised downward into 2019 and 2020 there is zero evidence that the tax cut has added anything but a 2 quarter temporary bump to GDP, but the financial consequences will linger for years to come. The promises of resulting investments were lies: Read More

01.29.19- The Fed Sends Market Big, Fat Gift
Brian Maher

The clouds part, and a crack of sunshine scatters the gloom…

Markets learned today the Federal Reserve may soon declare victory… and mothball its ambitious balance sheet reduction plans.

From today’s Wall Street Journal:

Federal Reserve officials are close to deciding they will maintain a larger portfolio of Treasury securities than they’d expected when they began shrinking those holdings two years ago, putting an end to the central bank’s portfolio wind-down closer into sight.

Does the Journal speculate to simply draw itself a crowd? Read More

01.28.19- U.S. Debt Worries Fed Chairman Powell – Fears May Be Confirmed in March
Birch Gold Group

As we enter 2019, the U.S. national debt continues to grow, approaching $22 trillion with global Government debt sitting at $72 trillion.

It seems like the 21st century is hitting the U.S. with a debt “haymaker,” according to CNBC (emphasis ours):

U.S. debt began accelerating at the turn of the 21st century. The total jumped 85 percent to $10.6 trillion during former President George W. Bush’s two terms, another 88 percent to $19.9 trillion under President Barack Obama and has risen 10 percentduring the first two years of President Donald Trump’s term. Read More

01.26.19- And Now, for Something Entirely Different: When Science Isn't Science
Jason Morgan

The Earth’s climate is extraordinarily complex. Unlike dinosaur fossils or organic chemistry or primate behavior, climate is always in flux, with countless factors influencing one another in an endless unfolding of diachronic stochastics. Given this complexity, one might presume that scientists who study planetary climate would be endowed with exceptional patience, scholarly integrity, and intellectual humility. After all, it takes a long time to learn even a little bit about such an intricate system, so part of the job description of climate scientist would seem to be acknowledging that there is only so much that is known about the 1.09 x 1044 or so molecules swirling about in the atmosphere.Read More

01.25.19- The Magic's Gone - Central Bankers Will Be "Surprised" & "Shocked"
Jeffrey Snider

For the magic trick to work, it has to be credible. The audience has to be given something concrete upon which they will suspend their disbelief. Quantitative Easing was just such a trick, though only the public held onto any basis for success. You still hear it all the time, how QE was “money printing.” That was the trick.

It doesn’t work if there is the slightest doubt. We know as late as 2013 even policymakers had them, the Dallas Fed President’s hushed “monetary head fake.” That actually makes it sound better than it was, that officials were doing the faking rather than being in the group who fell for it. Read More

01.24.19- Fire The Fed?
Ron Paul

By firing Powell, President Trump would once and for all dispel the myth that the Federal Reserve is free from political interference…

President Trump’s frustration with the Federal Reserve’s (minuscule) interest rate increases that he blames for the downturn in the stock market has reportedly led him to inquire if he has the authority to remove Fed Chairman Jerome Powell. Chairman Powell has stated that he would not comply with a presidential request for his resignation, meaning President Trump would have to fire Powell if Trump was serious about removing him. Read More

01.23.19- And Now, for Something Entirely Different: The Cost of the Government Shutdown
Financial Sense Staff

Ryan Sweet, Director of Real-Time Economics for Moody’s Analytics spoke with Financial Sense’s Jim Puplava on the impact of the government shutdown on U.S. GDP and how it’s not only affecting thousands of American families but is beginning to trickle into areas of the economy like housing and small business. Sweet tells us when he predicts the shutdown will end and what happens if it continues into the coming months. Read More

01.22.19- Warning: This Market Rig
is Going to End BADLY
Graham Summers

The market rally has devolved into a complete farce.

The latest reason stocks rallied? An article from the Wall Street Journalclaiming that  the Trump admin was considering cutting tariffs on China (implying a trade deal is close). 

The story was debunked as 100% FAKE NEWS within an hour.

This kind of ridiculous intervention ALWAYS ends terribly. We saw the same thing in 2008, right before the meltdown hit. I’m beginning to suspect the same situation is about to play out.  Read More

01.21.19- "Modern Monetary Theory" Is a Joke That's Not Funny
Michael Strain

Yes, a government that issues its own currency can pay its bills. But piling up debt for no urgent reason is lunacy...

If you follow the debates over U.S. economic policy, you had probably heard of modern monetary theory well before freshman Democratic Representative Alexandria Ocasio-Cortez spoke favorably about it earlier this month.

If you thought from the start that the whole idea sounded like lunacy, you were right, even if it’s possible to admit some sliver of sympathy for it. So why is MMT, as it is known for short, generating such intense interest now? Read More

01.19.19- Federal Reserve Confesses Sole Responsibility for All Recessions
David Haggith

In a surprisingly candid admission, two former Federal Reserve chairs have stated that the Federal Reserve alone is responsible for creating all recessions in the United States.

First, former Fed Chair Ben Bernanke said that

Expansions don’t die of old age. They get murdered. - MarketWatch

To clarify this statement, former Chair Janet Yellen placed the murder weapon in the Fed’s hands:

Two things usually end them…. One is financial imbalances, and the other is the Fed.  Read More

01.18.19- Trillion-Dollar Deficits From Here to Eternity
Bill Bonner

BALTIMORE, MARYLAND – We are on our way to the future. Not that we know what will happen, but we’ve been looking at the broad patterns of history. Most likely, they will repeat themselves… and surprise everyone.

Over the last few days, we’ve looked at three of them.

First, stocks go up and down in a cycle that seems to last 30-40 years, peak to peak. Stocks have been falling since October.

Movers and shakers can move and shake the stock market. Most investors are hoping they can keep prices moving up forever. But it’s never happened. Every boom is followed by a bust. Read More

01.17.19- Volatility Holds the Key to Markets in 2019
Nomi Prims

Over the last two weeks, after making good on the four-rate interest hike of 2018, Fed Chairman, Jerome Powell, became more dovish to start 2019.

His change in tone is worth considering because of his historical stance on reducing the amount of artificial stimulus coming from the Fed. Last week, after the required five-year holding period for Fed transcripts were up, we got a glimpse into Powell’s thoughts from 2013, before he was Chairman.

Powell tried to persuade then-Chairman, Ben Bernanke, to reduce the Fed’s stimulus, even though it would lead to greater near-term market volatility. The Fed was purchasing an estimated $85 billion per month mix of Treasuries and mortgage-backed securities. Read More

01.16.19- 2018-2019 Pop Goes The Bubble
Darryl Robert Schoon

Fiat paper money: Once gold and silver derivatives 

Today, instruments of debt issued by central banks 

Afer the 2008 financial crisis, Fed Chairman Ben Bernanke invoked Milton Friedman’s theory that a helicopter drop of money could prevent a collapsing credit bubble from becoming a Great Depression.

When credit bubbles burst, defaulting debt and disappearing demand cause the velocity of money to plunge; and, in 2008, Bernanke resorted to Friedman’s untested theory hoping to prevent the US economy from collapsing as it did in the 1930s. Read More

01.15.19- Can You Time Peak Crazy?
Mike Krieger

You don’t need me to tell you how completely crazy and distorted the financial markets have become over the last decade. Anyone reading this already knows that, which is partly why I stopped writing on the topic several years ago. I came to the conclusion there was no point in constantly screaming at the top of my lungs about what a farce the global financial system was. Instead, I decided to step back, let things play out to their predictably tragic end, and then play closer attention as the curtains started to come down. As has been made clear in my recent commentary, I think we’re now reaching that point.

I’ve begun reflecting a little more about the lessons I’ve learned over the past several years of status quo stupidity, and one particular conversation I had a while ago with a friend who was a portfolio manager at a major hedge fund came to mind. Read More

01.14.19- The Fed Dilemma
Valentin Schmid

For the most part in 2017 and 2018, only academics and easy-money cranks scolded the Federal Reserve for raising rates. After all, the stock market was bubbling up and the economy was strong.

The economy is still strong, but the stock market has ended its record 10-year bull-market run with a bang. The 20-percent drop in the S&P 500 during one of the worst quarters in market history classifies as a bear market, although prices rebounded at the end of 2018 and in early 2019.

Now everybody from traders to retirees as well as President Donald Trump is scolding Fed Chairman Jerome Powell for his relentless path to higher interest rates and a reduction in the Fed’s balance sheet. Read More

01.12.19- The Crash Of The “Everything Bubble” Started In 2018 - Here’s What Comes Next In 2019
Brandon Smith

In 2018, a very significant economic change occurred which sealed the fate of the U.S. economy as well as numerous other economies around the globe. This change was the reversal of central bank policy. The era of stimulus and artificial support of various markets, including stocks, is beginning to fade away as the Federal Reserve pursues policy tightening, including higher interest rates and larger cuts to its balance sheet.

I warned of this change under new Chairman Jerome Powell at the beginning of 2018 in my article ‘New Fed Chairman Will Trigger Stock Market Crash In 2018’.  Read More

01.11.19- At Taxpayers’ Expense, Fed Paid Banks $38.5 Billion in Interest on “Reserves” in 2018. Here’s How
Wolf Richter

Normally, this would be ironic: The Fed doesn’t need to borrow; it creates money when it needs some. So it wouldn’t pay interest. But these are not normal times.

The Fed reported its preliminary results this morning for the year 2018. The headline is that it sent $65.4 billion of its profits to the US Treasury Department in 2018, and that this amount had plunged by 18.5% from the remittances, as they’re called, in 2017, and by 44.1% from the peak of $117 billion in 2015.  Read More

01.10.19- The Powell Helium Pump
Dave Kranzler

The stock market has gone “Roman Candle” since Fed Chairman, Jerome Powell, gave a speech that was interpreted as a precursor to the Fed softening its stance on monetary policy.  Not that intermittent quarter-point Fed Funds rate nudges higher or a barely negligible decline in the Fed’s balance sheet should be considered “tight” money policy.

Credible measures of price inflation, like the John Williams Shadowstats.com Alternative measure, which shows the rate of inflation using the methodology in place in 1990, show inflation at 6%.  The Chapwood Index measures inflation using the cost of  500 items on which most Americans spend their after-tax income.  The index is calculated for major metro areas and has inflation averaging 10% (The John Williams measure which uses 1980 Government methodology also shows the current inflation at 10%). Read More

01.09.19- The Fed IS the Ugly Truth
Raúl Ilargi Meijer

This Fed thing just keeps going on, and it needs to stop. There is nothing in the discussion about the Federal Reserve these days that has any value other than it provides even more proof that the Fed has killed off the most essential elements of what once made the US economy function. All markets, stocks, bonds, housing markets, all price discovery, all murdered. No heartbeat. Pining for the fjords.

And instead of addressing that, and I’m not even talking about addressing fixing what is wrong, all I see is neverending stuff about Jay Powell using, or not using, terms such as “patient” or “accommodative”. Like any of it means anything coming from him and his ilk. Other than for making ‘investors’ a quick buck. Like a quick buck could ever trump the survival of entire market systems. Read More

01.08.19- The Fed Is Ignoring the Biggest Lesson of 2008
David Shipley

Banks should be raising capital while they still can.

The 2008 financial crisis showed what happens when the banking system lacks an adequate foundation of loss-absorbing equity capital. Unable to raise what they needed from wary investors, banks were forced to slash lending at precisely the worst time for the economy. Ultimately, only the full faith and credit of the U.S. government — and a direct infusion of more than 200 billion taxpayer dollars — could prop them up.

The lesson seems clear enough: Banks should raise capital while they can, and before they have to. The Federal Reserve apparently hasn’t learned it. Read More

01.07.19- Perhaps The Fed Is Not Clueless
Zoltan Ban

There has been quite a bit of criticism of current Federal Reserve policy in media and certain political circles lately. I have to admit that this article has been inspired by Mr. Cramer's semi-populist rhetoric in regards to the Federal Reserve's policy of raising interest rates, as well as President Trump's criticism in this regard. This critical rhetoric is easy to embrace, especially among the investment community, which has been somewhat rattled by the market activity we saw in the past few months. I cannot say that I am necessarily happy about it myself, given that I have gone from having six out of seven stocks in my portfolio being up, to only three being up, as I write this. Read More

01.05.19- The Economic Tsunami IS COMING and Can't be Stopped!!
HighImpactFlix

View Video

01.04.19- Markets Are in a Tizzy.
So What Will the Fed Do?
Wolf Richter

Investors are waking up after years of somnolent money-making.

Markets are in a tizzy. They’re finally reacting to the Fed’s rate-hike cycle, the slowest rate-hike cycle in history. It took three years to nudge up the effective federal funds rate from near zero to 2.40% now. Throughout, the Fed has communicated its goals of “removing accommodation” from the “financial conditions” in the markets — thus tightening “financial conditions” that had become loosey-goosey during years of zero-interest-rate policy and QE. Read More

01.03.19- 2019: The Beginning Of The End
Adam Taggart

For ten long years, the world’s central banks have dragged everyone along for one last attempt at scaling Mount Credit.

At several points along the way, in 2011, in 2013 and then again in 2016 it seemed all but certain that the wrong route had been picked and all was lost.  We warned people then about the risks, but to no avail. They found a way to navigate even higher from there.

And here we are again in 2018, warning everyone of the same risks. Starting back in August of 2018 we were questioning whether “it” had arrived and then were declaring that it had throughout October and November. Read More

01.02.19- "QE Has Done Something Much More Damaging Than The Fed Could Have Imagined"
Lindsay Politi

"I think of the markets like an ecosystem," the fund manager told me.

"The environment causes some strategies to flourish and multiply, while others die off. The abnormally long, QE-fueled bull market killed off anything that wasn't, at its core, a short volatility strategy. Now, whether it's risky credit, levered equities, or risk parity, almost all strategies are taking similar risks. QE has done something much more damaging than the Fed could have imagined. It changed the very nature of the market, destroying the diversity of the market ecosystem, and making it incredibly vulnerable to the smallest change in the macro environment." Read More

01.01.19- A Debt Based System Can't Succeed Without Population Growth
Chris Hamilton

Last week, I highlighted that since '00, when the Federal Reserve has ceased adding to its balance sheet or begun "normalizing" (via rolling off assets), equity markets have swooned (detailed HERE).

A simple idea today... that the end of population growth (where it matters) has long been upon us (detailed below).  Absent population growth among the nations that do nearly all the consuming, a debt based economic and financial system (to coerce ever higher levels of debt fueled consumption) can't ultimately succeed.  That is, without population growth, assets generally don't appreciate, homes are just shelter rather than "investments", and debt is generally only a drag on future spending.  Likewise, without population growth, total global energy consumption is on the precipice of secular decline. Read More

12.31.18- The Recline and Flail of Western Civilization and Other 2019 Predictions
MN Gordon

Darts in a Blizzard

Today, as we prepare to close out the old, we offer a vast array of tidings.  We  bring words of doom and despair.  We bring words of contemplation and reflection.  And we also bring words of hope and sunshine.

After all, the New Year’s nearly here.  What better time than now to turn over a new leaf?  New dreams, new directions, and new delusions, are all before us like a patch of ripe strawberries.  Today’s the day to make a double-fisted grab for all of them – and more. Read More

12.29.18- Where to Put Your Money in 2019
Dan Denning

As Dan shows below, the “new permanent portfolio” could be your best strategy to protect and grow your wealth in 2019 and beyond.

Diversification and asset allocation can help you reduce your risk as an investor.

For your kids and grandkids, a depression could be just the tonic they need. In a world where real wage growth is stagnant and the robots are taking all of our jobs, your best chance to build a fortune is to buy assets when they’re cheap. You can only get them at that price after a crash.

Do you think it’s a coincidence that famed investor and economist Benjamin Graham wrote his investment classic, Security Analysis, in 1934, just five years after the Great Crash of 1929?  Read More

12.28.18- The Federal Reserve Is A Suicide Bomber With A Deeper Agenda
Brandon Smith

Central bankers are sociopathic in nature and sociopathic people tend to behave like robots. When one understands the motivations of central bankers, or at the very least what their goals are, their actions become rather predictable. The question is, what truly motivates these people?

I believe according to the evidence that the central banks are motivated by ideological zealotry with the core purpose of total global centralization of economic and political power into the hands of a select group of elitists. This agenda is really just a modern “reboot” of feudalism or totalitarianism. They sometimes refer to the plan in public as the “new world order,” or the “global economic reset.” I often refer to the ideology as “globalism” for the sake of expediency. Read More

12.27.18- Fed Med is Dead: How We Went from Fake Recovery to Freefall
David Haggith

Until you got to this tax and spending deal a year ago, it was one of the most hated bull markets. The markets steadily climbed one wall of worry after another, and the problem was that the economic data did not confirm it. - Bloomberg

That’s right. The market was not rising for the past ten years due to a healthy underlying economy. On the contrary, the market was rising due to the Federal Reserve pumping out stratospheric amounts of thin-air money, which needed somewhere to land. Read More

12.26.18- Are The Financial Markets
Rejecting The Fed?
Rudi Fronk

Last Wednesday, the Fed raised the Fed Funds rate by a quarter point as expected. The FOMC statement was suitably “dovish” by reducing the consensus forward guidance on future rate hikes from three to two. The Fed also signalled that its Quantitative Tightening program would continue on “autopilot” as planned. The response was not what the Fed expected. Stocks fell hard and bonds soared.

Financial markets are about to revisit some important questions.

First, does QE actually work? Does it boost the real economy or does it simply drive up valuations by speculation? We think the weakest economic recovery in two generations provides the answer. Read More

12.25.18- The Ghost of Christmas Past
Bill Bonner

Editor’s Note: Happy Holidays from Bonner & Partners!Today’s Diary, originally penned in 2000, will begin a special three-part Christmas series from Bill. 

Old Greenspan was not dead. Not dead as a doornail, nor dead as a door knocker. Not even as dead as a laptop computer after the power goes out – not even John Maynard Keynes is that dead.

Not even God himself… but that is another story.

Nothing is as dead as a computer without power. For even a nail continues to provide good service after the spark of life has gone out of it. Read More

12.24.18- In Defense Of Powell's Restoration Of Price Discovery
Charles Hugh Smith

Relying on fakery and addictive stimulus is the acme of fragility and vulnerability.

Having become addicted to the Federal Reserve's nearly free money for financiers and the infamous Fed Put stock market players are now weeping and thrashing about in the agony of withdrawal as Fed chair Jay Powell has instituted a cold-turkey withdrawal from the financial stimulus of the Bernanke-Yellen days.

12.22.18- Murky 2019 Could Be In Store for U.S. Economy Thanks to Fed’s Monetary Policy
Birch Gold Group

December 19 marks the day the Fed may have decided it’s going “all in” on the idea of a “strong U.S. economy.”

The Fed locked in an increase of the Federal Funds Rate from 2.25% to 2.40%, and it will increase the primary credit rate to a full 3.00%. These December increases were pretty much anticipated back in early November.

The increases came in spite of commentary by Jeffrey Gundlach from Doubleline, who said the Fed shouldn’t have raised rates: Read More

12.21.18- Is this a joke?
Bill Holter

As the year comes to a close, we all look back and reflect on what happened, what didn’t, and what should or should not logically happen in the future. During some recent reflection, I could only laugh and finished my thoughts by thinking “is this a joke”?

We all (even the brain dead) know something has seriously changed in our financial markets. Emotional thought has morphed from buy the dip to sell the rip. In other words, fear is now in the process of replacing greed as the prevailing sentiment. But why? What has changed? Read More

12.20.18- Powell To Markets: "You're Wrong!"
Nicholas Colas

“Today’s prices are wrong” is the central tenet of active portfolio management. Without that belief, no manager could justify his or her role in capital markets. Systematically identifying mis-priced assets is the first line of a PM’s job description.

At the same time, investors have grown accustomed to questioning the existence of rampant asset price inefficiencies. That has driven the growth of passive management, of course. But it has also made “what’s your investment edge?” the only question that matters when quizzing everyone from a junior hedge fund analyst to the most senior long-only manager. Read More

12.19.16- It’s Lose-Lose For The Fed And For Everyone
Dave Kranzler

A friend asked me today what I thought Powell should do.  I said, “the system is screwed. It ultimately doesn’t matter what anyone does.   The money printing, credit creation and artificially low interest rates over the last 10 years has fueled the most egregious misallocation of capital in history of the universe.”

Eventually the Fed/Central Banks will print trillions more – 10x more than the last time around. If they don’t this thing collapses. It won’t matter if interest rates are zero or 10%. You can’t force economic activity if there’s no demand and you’ve devalued the currency by printing it until its worth next to nothing and people are toting around piles of cash in a wheelbarrow worth more than the mountain of $100 bills inside the wheelbarrow. Read More

12.18.18- Trump Slams Fed On Eve Of Rate Decision: "Incredible" Fed Hiking With
"World Blowing Up"
Tyler Durden

On the eve of Wednesday's Fed decision, President Trump is once again bashing the Federal Reserve over its plans to raise interest rates at a time when markets are already in chaos and the "world is blowing up" thanks in part to the central bank's "double-barreled blitz" of higher rates and tighter liquidity.

But instead of insinuating that Fed Chairman Jerome Powell is trying to undermine the administration, the president ticked off a reasonable list of factors that should give a truly "data-dependent" Fed reason to reconsider. Read More

12.17.18- Wall Street, Banks, and Angry Citizens
Nomi Prins

The Inequality Gap on a Planet Growing More Extreme

As we head into 2019, leaving the chaos of this year behind, a major question remains unanswered when it comes to the state of Main Street, not just here but across the planet. If the global economy really is booming, as many politicians claim, why are leaders and their parties around the world continuing to get booted out of office in such a sweeping fashion?

One obvious answer: the post-Great Recession economic “recovery” was largely reserved for the few who could participate in the rising financial markets of those years, not the majority who continued to work longer hours, sometimes at multiple jobs, to stay afloat. Read More

12.15.18- It’s official:
the Federal Reserve is insolvent
Simon Black

In the year 1157, the Republic of Venice was in the midst of war and in desperate need of funds.

It wasn’t the first time in history that a government needed to borrow money to fight a war. But the Venetians came up with an innovative idea:

Every citizen who loaned money to the government was to receive an official paper certificate guaranteeing that the state would make interest payments.

Those certificates could then be transferred to other people… and the government would make payments to whoever held the certificate at the time. Read More

12.14.18- Fed Net Worth Turns Negative Following Record $66BN In Paper Losses
Tyler Durden

While the Fed has been engaging in quantitative tightening for over a year now in an attempt to shrink its asset holdings, it still has over $4.1 trillion in bonds on its balance sheet, and as a result of the spike in yields in the last summer, this massive portfolio suffered substantial paper losses which according to the Fed's latest quarterly financial report, hit a record $66.453 billion in the third quarter, raising questions about its strategy at a politically charged moment for the central bank, whose "independence" has been put increasingly into question as a result of relentless badgering by Donald Trump. Read More

12.13.18- Jerome Powell Is Between
A Rock And A Hard Place
Nomi Prins

One of the major drags on the market, besides trade wars, has been uncertainty about whether the Fed will raise rates this month. Despite the verbal bravado of Federal Reserve Chairman, Jerome Powell, over how strong the U.S. economy is, he doesn’t live in a vacuum.

Powell’s borne the brunt of President Trump’s recent accusations that the Fed’s hikes are what’s hurting the stock market and threatening the economy. That lead to a media debate over whether Powell would “cave” to Trump or demonstrate that the Fed is the independent body that it’s legally designed to be, and continue with planned hikes anyway. Read More

12.12.18- The Fed Dollar System Is Going To Fail, The System Is Ready For A Reset
Craig Hemke

View Video

12.11.18- JPMorgan Teams Up With French Central Bank To Juice Gold-Lending
Ronan Manly

The central bank gold lending market, centered in London, is probably the most secretive financial market in the world, with very little known about its transactions and market structure.

The gold lending market’s opacity is further supported by regulators who protect the secrecy of the central banks, and mainstream financial news agencies whose editorial policies seem to forbid any market investigations, in-depth or otherwise. Read More

12.10.18- Every Bubble Is In Search Of A Pin
Chris Martenson

The 'Everything Bubble' has popped

Now that the world’s central banking cartel is taking a long-overdue pause from printing money and handing it to the wealthy elite, the collection of asset price bubbles nested within the Everything Bubble are starting to burst. 

The cartel (especially the ECB and the Fed) is hoping it can gently deflate these bubbles it created, but that's a fantasy. Bubbles always burst badly; it's their nature to do so. Economic suffering and misery always accompany their termination.

It's said that "every bubble is in search of a pin". History certainly shows they always manage to find one. Read More

12.08.18- Yield Curve Poised to Invert – Where Will Fed Go From Here?
Birch Gold

Looks like the yield curve the Fed swept under the rug back in June continues to prove itself a reliable potential signal for market correction.

On Tuesday, the Dow Jones continued to trend downward since October 3, dropping 800 points. After a tumultuous ride on Thursday, the index ended the week on Friday by dropping another 550 points.

An article over at MarketWatch highlighted the yield curve between 2-year and 10-year treasury notes as one potential signal of Tuesday’s drastic drop: Read More

12.07.18- How Private Banks Create Bubbles —
with the Help of Central Banks
Frank Shostak

With meagre resources at his disposal, an individual is likely to allocate these resources (i.e., his wealth) towards essentials such as food, clothing and a roof over his head.

He is unlikely to allocate his meagre wealth to less essential goods as far as life and wellbeing is concerned. His variety of consumer goods is likely to be very limited.

As his real wealth begins to expand, the individual is likely to expand the variety of goods consumed, thereby raising his living standard. Read More

12.06.18- The Art of Defaulting
Niels Clemen Jensen

… the debt-financed overspending of the 1960s had continued into the early 1970s. The Fed had funded this spending with easy-credit policies, but by paying back its debts with depreciated paper money instead of gold-backed dollars, the U.S. effectively defaulted. -Ray Dalio

Principles for navigating big debt crises

Ray Dalio of Bridgewater Associates is one of my role models in life and, when he writes a new book, I would normally visit Amazon.co.uk more quickly than you can count to ten, but not this time! Read More

12.05.18- Why the Yield Curve Inverts
in One Simple Picture
Mike Mish Shedlock

The yield curve inverts when the Fed keeps hiking in the face of a slowdown.

OK. But Why?

Answer: The Fed kept hiking in the face of a slowing economy as the chart I posted shows.

Thus, whether or not the 3-month to 10-year spread inverts may very well depend on how many more hikes the Fed gets in. Read More

12.04.18- This Is How the “Everything Bubble”
Will End
Nick Giambruno

I think there’s a very high chance of a stock market crash of historic proportions before the end of Trump’s first term.

That’s because the Federal Reserve’s current rate-hiking cycle, which started in 2015, is set to pop “the everything bubble.”

I’ll explain how this could all play out in a moment. But first, you need to know how the Fed creates the boom-bust cycle…

To start, the Fed encourages malinvestment by suppressing interest rates lower than their natural levels. This leads companies to invest in plants, equipment, and other capital assets that only appear profitable because borrowing money is cheap. Read More

12.03.18- Caved
Sven Henrich

Of course Powell caved. Isn’t it obvious why?

Home sales are dropping hard. Global growth is slowing hard. Financial conditions are tightening. Stock have been dropping. Never mind all the Fed Crying or Trump expressing his displeasure.

Real rates are still negative and the Fed’s tough talk on raising rates came to a sudden halt:

Fed’s Powell, in dovish shift, says rates near neutral: Read More

12.01.18- Chairman Powell Talks Out of Both Sides of His Mouth
Birch Gold Group

In a speech on Wednesday, Federal Reserve Chairman Jerome Powell stated that he had a “neutral” outlook on rates. According toa CNBC article, he was quoted:

Interest rates are still low by historical standards, and they remain just below the broad range of estimates of the level that would be neutral for the economy — that is, neither speeding up nor slowing down growth.

But CNBC notes that, as recently as October, Powell’s was indicating that rates were “a long way from neutral.” Could the change in tone simply be public relations damage control? Read More

11.30.18- Don't Get Distracted By The Trump/Fed Soap Opera - The Crash Will Continue
Brandon Smith

At the beginning of 2018 I wrote extensively on what was likely to happen under the administration of Jerome Powell, the new Federal Reserve Chairman. In my article ‘New Fed Chairman Will Trigger A Historic Stock Market Crash In 2018‘, published in February, I predicted that the Fed would continue interest rate increases and balance sheet cuts throughout the year and they would knowingly initiate a crash in equities.Read More

11.29.18- Dollar Dumps, Gold Jumps As Powell Abandons Hawkish "Long Way" From Neutral Stance
Tyler Durden

As Bloomberg's Brendan Murray notes, there are the key takeaways from Powell's prepared text:

• Powell says rates "just below" range of estimates for neutral policy, raising the question of whether he's walking back an earlier view that neutral was a longer way off

• He says even after eight hikes since December 2015, rates are still low by historical standards

• Powell explains Fed's gradualism, saying the approach is meant to balance risks of moving too fast or too slowly Read More

11.28.18- Bitcoin’s Crash Looks Like a Real Currency Crisis
Lionel Laurent

In a virtual world without a central bank, who is the buyer of last resort?

Bitcoin is in crisis. You can never really declare it dead — the idea of an electronic currency that is theoretically borderless and lawless will always live on somewhere — but its price has slumped 80 percent in less than a year, wiping about $700 billion off cryptocurrency markets.

Where does it go from here? True believers are betting on a simple repeat of past asset bubbles, like dot-com stocks or real estate: a system-wide cleansing of bad actors before the roller-coaster ride begins anew. On that argument there’s a price for everything, even niche assets with no intrinsic value. Maybe Bitcoin should be above $3,700. Read More

11.27.18- A Message for Trump
Hugo Salinas Price

Mr. President Trump, Sir: you are working tirelessly, against tremendous odds, to carry out your mission in life, which is to “Make America Great Again”.

I propose to you a measure fully in accord with your vision of a great, united nation of America, working for prosperity; a measure that conveys a fundamental message of inspiration for the American people. The greatness of a nation flowers when its moral stature is elevated, and such is the object of the measure that I suggest to you. Read More

11.26.18- This RED PILL Will Change EVERYTHING You Thought You Knew!
HighImpactVlogs

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11.24.18- Who Owns The Fed?...
Does It Even Matter?
Ron Paul

View Video

11.23.18- Why Interest Rates Are Rising Long-Term
Alasdair Macleod

There are growing expectations that the current cycle of rising interest rates will result in a deflationary recession. While a credit crisis is increasingly likely to evolve in the coming months, it is a highly inflationary situation. A combination of higher interest rates and catastrophic falls in the purchasing power of fiat currencies will continue to plague welfare-driven states in the wake of a credit crunch.

The standard post-crisis solution of monetary and fiscal reflation will not be available. This article examines the ultimate consequences of the West’s abandonment of sound money, free markets and wealth creation in favour of increasing state intervention and wealth destruction. Read More

11.22.18- Jim Cramer Rips Housing’s “Toxic Cocktail” Created by the Fed
Birch Gold Group

Home builders across the U.S. are struggling to come to grips with an incredibly toxic combination of rising rates and lack of affordability in the housing market.

National Association of Home Builders (NAHB) Chairman Randy Noel downplayed the situation, saying customers are “taking a pause” to see how high rates will go and keeping an eye on prices.

Sentiment dropped 8 points in November alone to 60. The total drop of 12 points since November 2017 is the sharpest drop in one year since 2014. The red arrow points to the start of an even bigger downward trend (sustained drop over time). Read More

11.21.18- Unthinkable!
Gary Christenson

Sometimes we must consider the unthinkable.

Official US national debt is $21.6 trillion. Unfunded liabilities are five to ten times higher. Global debt is about $250 trillion. US national debt has doubled every eight to nine years for decades.

1. National debt in 2018 – $21.6 trillion
   
   
2. National debt in 2026? – $40+ trillion
   
   
3. National debt in 2040? – $100+ trillion  Read More

11.20.18- Central Banks Take Aim at Bitcoin
Bill Bonner

DUBLIN – We’re in Dublin… en route to the USA for the holidays.

Dublin is a vibrant, lively city. Not especially elegant, unlike Paris… and not especially dynamic, unlike London… Nor is it especially huge and imposing, like New York or Chicago.

Instead, it is a comfortable, charming, livable place… with many restaurants, hotels, and bars where you can pass an agreeable hour in front of a fire while drinking a pint of Guinness.

But let’s turn to our beat – money. Read More

11.19.18- Rates on Their Way to 10-Year High After Hawkish Fed’s Recent Meeting
Birch Gold

Round and round we go, where the hawkish Fed stops, nobody knows…

There was a bit of tension in the markets last week. This tension stemmed from a prediction that the federal funds rate would be well on its way to a decade high even if the Fed did nothing at their November meeting.

Well, that concern has been justified. In a statement issued after the meeting, the Fed kept their funds rate at 2 – 2.25%, the same range after their September meeting.  Read More

11.17.18- As the Fed Tightens, Where Will the Credit Crunch Pinch First?
Yves Smith

Josh Rosner of Graham Fisher has graciously allowed us to republish their latest report on the outlook for banks and credit. Rosner was the first to warn of the dangers of allowing widespread mortgage lending with low down payments in his 2001 article: A Home Without Equity is Just a Rental With Debt. Rosner was the co-author with Gretchen Morgenson of Reckless Endangerment and describes himself as a “recovering GSE analyst.” From his analysis; the full document is embedded at the end of this post:

This report is the first in an ongoing series in anticipation of the likely recession of Q3 2019  Read More

11.16.18- The Fed Will Continue Tightening Until Everything Breaks
Brandon Smith

Around three years ago, in September 2015, I wrote an article titled ‘The Real Reasons Why The Fed Will Hike Interest Rates‘ in which I predicted that the Federal Reserve, in the face of criticism, would soon pursue a program of interest rate hikes into economic weakness. I argued that this plan would be somewhat similar to what the Fed did in the early 1930’s; an action that prolonged the Great Depression for many more years. So far, my prediction has proven to be correct. Read More

11.15.18- Fate Has A Sense of Irony
Neal Ross

“All the perplexities, confusion and distress in America arise, not from defects in their Constitution or Confederation, not from want of honor or virtue, so much as from the downright ignorance of the nature of coin, credit and circulation.” ~ John Adams

In 2016 Governor Gerry Brown signed into law SB-3 which would phase in a series of increases in California’s minimum wage until it finally reaches the goal of $15 per hour in 2023. This was done to provide a ‘living wage’ for those working minimum wage jobs. I’m telling you right now, you may as well start stuffing little squares of toilet paper in your wallets and purses, because if you don’t learn about the nature of coin, credit and circulation it will have about the same value as the money you currently use to purchase goods and services. Read More

11.14.18- The Fed Is “Triple Tightening” Into Crisis
Jim Rickards

I’m in Dublin, Ireland, today, where I was honored and humbled to receive a writing award from Trinity College.

It’s my job to continue pointing out the risks to the financial system that we still face and to try to help people prepare for the next crisis. Of course, central banks are a big part of the problem.

If you have defective and obsolete models, you will produce incorrect analysis and bad policy every time. There’s no better example of this than the Federal Reserve. Read More

11.13.18- It’s Fraud & Theft, the Central Banks Get Special Set of Laws to Steal Our Wealth
Mike Maloney

View Video

11.12.18- When Fake Money Becomes Scarce
MN Gordon

Remaining Focused

A rousing display of diversions this week assured the American populace was looking every which way but right under its collective nose.  Midterm elections.  White House spats with purveyors of fake news.  The forced resignation of Attorney General Sessions…

Old drug warrior (otherwise recused) on his way home to Alabama…

Sideshows like these, and many more, offered near limitless opportunities to focus on matters of insignificance. Read More

11.10.18- And Now, for Something Entirely Different: The Nation's Fiscal Doomsday Machine is Now Unstoppable
David Stockman

Earlier this year the Donald provoked a bleep-hole moment per the Fox "family channel" or what was otherwise known as the shit-hole moment across the rest of the MSM.

But whatever you called the contretemps spurred by the president's crude utterance with regard to certain countries domiciled on the African continent, the claim this was evidence that he's an incorrigible racist was risible. Actually, we already knew that the Donald is a semi-literate bully, who never got (read) the memo on racial comity---to say nothing of political correctness. Read More

11.09.18- The Fed Will Continue Tightening Until Everything Breaks
Brandon Smith

Around three years ago, in September 2015, I wrote an article titled ‘The Real Reasons Why The Fed Will Hike Interest Rates‘ in which I predicted that the Federal Reserve, in the face of criticism, would soon pursue a program of interest rate hikes into economic weakness. I argued that this plan would be somewhat similar to what the Fed did in the early 1930’s; an action that prolonged the Great Depression for many more years. So far, my prediction has proven to be correct. Read More

11.08.18- The Next Big Market Risk: Here Comes A Sharp Slowdown In Stock Buybacks
Brandon Smith

Stock buybacks may be back as blackout session ends, but suddenly companies' appetite to repurchase their own shares appears to be slowing sharply.

After an initial record surge in the amount of US corporate cash repatriated from offshore jurisdictions (if only for accounting purposes, as the bulk of said cash was already largely invested in domestic securities via offshore entities) following Trump's tax law overhaul and tax repatriation holiday, the movement of foreign cash has slowed sharply. This comes at a time when record notional corporate buybacks have not only surpassed total capex spending for the 2nd quarter in a row, but have been seen as responsible for the relentless bid supporting the stock market. Read More

11.07.18- The Fed Crying Has Begun
Northman Trader

So stocks dropped a little in October. Ok they actually dropped a lot and all of a sudden the S&P 500 was miles away from the all those optimistic 3,000+ year end targets. And what happens when stocks drop hard? Bulls cry for the Fed to come to the rescue.

It was quite the scene.

Here’s the global market cap wiped off in just October: Read More

11.06.18- The Fed's Misleading
Money Supply Measures
Steve H. Hanke

The most robust national income determination model is the monetarist model. The course of the economy when measured in nominal terms is determined by the course taken by the money supply. Indeed, the positive relationship between the growth rate of the money supply and both nominal GDP and nominal aggregate demand growth is unambiguous and overwhelming.

So, just what is the measure of money that is most suited for taking the temperature of the economy and forecasting its course? Is a narrow metric, like the monetary base (M0), the best? Or, should we focus on broad money metrics, like M3 and M4? For national income determination, the more inclusive the metric, the better. Indeed, for the most complete and accurate picture, one should include all the important components of money supply, not just a few. Read More

11.05.18- What Happens When You Stomp The Gas and the Brake Simultaneously? Pro-cyclical Trump / Congress vs. Counter-cyclical Fed
Chris Hamilton

Fiscal Conservatism is Dead - Surging Government Spending Coupled with Tumbling Tax Receipts Are Fiscal Populism

Many American's believe in a simple idea called fiscal conservatism.  Low taxation coupled with low government spending and low (or reduced) government debt.  However, the nations leadership (executive and legislative branches) have fallen in love with the idea of spending tax money you and I haven't made yet.Read More

11.03.18- Central Banks Have Gone Rogue,
Putting Us All at Risk
Ellen Brown

Excluding institutions such as Blackrock and Vanguard, which are composed of multiple investors, the largest single players in global equity markets are now thought to be central banks themselves. An estimated 30 to 40 central banks are invested in the stock market, either directly or through their investment vehicles (sovereign wealth funds). According to David Haggith at Zero Hedge:

Central banks buying stocks are effectively nationalizing U.S. corporations just to maintain the illusion that their “recovery” plan is working. … At first, their novel entry into the stock market was only intended to rescue imperiled corporations, such as General Motors during the first plunge into the Great Recession, but recently their efforts have shifted to propping up the entire stock market via major purchases of the most healthy companies on the market. Read More

11.02.18- Time to Worry
James Grant

It took the United States 193 years to accumulate its first trillion dollars of federal debt. We will add that much in the current fiscal year alone.

America’s deteriorating public credit is the cold-button issue of the 2018 midterms. With rare bipartisanship, Democrats and Republicans compete to pretend that the country isn’t going broke. In 1992, the third-party presidential candidate Ross Perot likened the widening gap between federal receipts and federal spending to “the crazy aunt tucked away in the room upstairs nobody talks about.” The old gal’s dottier than ever. Read More

11.01.18- The Fed Will Panic…
Bill Bonner

A wonderfully fraudulent confrontation is setting up… 

On one side is Donald J. Trump, pretending that he has “already made America great again” and blaming the Fed for ruining his beautiful work. He wants the Fed to lower interest rates, not raise them.

On the other is the Fed, pretending that it is the architect and creator of such an amazing economy, and that it’s now guiding it to perfection. It believes it is “normalizing” the economy by gradually raising rates.

So who’s right? Read More

19.31.18- Halloween Special: The Monster Mash
James Howard Kunstler

The sad reality is that last week’s Pittsburgh synagogue massacre is only the latest float in the long-running parade of ghastly homicidal spectacles rolling across this land and will be just as forgotten in one week as was last year’s Las Vegas Mandalay Bay slaughter of 58 concert-goers plus over 800 wounded and injured, a US record for non-military acts of violence. The Pittsburgh shootings elbowed the mass pipe bomber, Cesar Sayoc, out of the news cycle — but then Sayoc didn’t manage to actually hurt any of the high-profile figures he targeted with his mailings. What I wonder — and what the news media has so far failed to report — is just how incompetent a bomb-maker Sayoc was. Fake news meets fake bombs. Read More

10.30.18- Trump Is Right, The Fed IS Crazy
Ron Paul

President Trump recently called the Federal Reserve’s interest rate hikes crazy. Leaving aside President Trump’s specific complaint, which is likely motivated by the belief that low rates will help him win reelection, he is right that “crazy” is a good way to describe the Federal Reserve.

When not forced to use a government-created currency, individuals have historically chosen to use a precious metals as money. The reasons include that precious metals are durable and their value tends to remain relatively stable over time. A stable currency ensures that prices accurately convey the true value of goods and services. Read More

10.29.18- The Cantillon Effect: Because of Inflation, We’re Financing the Financiers
Jessica Schultz

It may come as a surprise to you that the United States has been financing a welfare program that takes money from the poor and gives it to the rich.

If you read a lot of modern macroeconomic literature or major in economics in college, you’ll hear economists talk of the “multiplier effect” of monetary and fiscal stimulus. In times of economic slump, money injection (for monetary policy) or government spending (fiscal policy) greases the wheels of our complex economic machine, bringing unemployment down and output up. Read More

10.27.18- Weekend Rant: The Establishment Must Undermine Alternative Economists As Crisis Unfolds
Brandon Smith

There is a notion within the mainstream media that certain economic indicators are unassailable; they never stop being reliable. The way they look at and report on the system is rather outdated and extremely limited in scope; showcasing and cherry picking only net-positive statistics, even if those stats don’t represent reality. The result is a kind of holographic view of the financial structure; a mirage of a healthy and vibrant foundation that simply does not exist.

This fraudulent view appeals to the masses for a time because it provides fuel for false hopes. In economics, an analyst must always account for two major factors: the hard math and human psychology. Read More

10.26.18- Central Banks And ETF Investors
Start Buying Gold Aggressively
Jason Hamlin

The gold price has been rising over the past month, driven by investors seeking safe-haven assets as the stock market sells off sharply. On the technical chart, we can see a bottoming pattern followed by a price spike higher. I am now looking for gold to break above resistance at $1,240, which was support twice in the past year. Major support levels often turn into resistance on the charts and overcoming such resistance levels can lead to an inflow of funds from technical traders. Read More

10.25.18- Trump vs. The Fed: When Markets Crash, Who Is To Blame?
Brandon Smith

After a certain length of time examining history in-depth, anyone who is honest and relatively objective comes to understand that most of what we are told about our past in the mainstream is completely fabricated. We learn that much of “history” is not about posterity or heritage and more about a continuous set of false narratives peppered with half-truths. That is to say, what we thought we knew is actually lies.

Unfortunately, these lies can be complex, to the point that even many alternative researchers get caught up in their own biases to the point that they lose track of reality. Of course, this is what propaganda and 4th generation warfare is meant to accomplish; it creates a series of filters that thin out the crowd of truth seekers a little at a time. Read More

10.24.18- Inside The Fed's Survey Of Economic (Un)Well-Being
Richard Rosso

The Federal Reserve Report on the Economic Well-Being of U.S. Households in 2017 was recently released.

The Federal Reserve Board’s Division of Consumer Affairs 5th annual Survey of Household Economics and Decision-making is designed to gain understanding of how adults in the U.S. feel about the state of their finances.

A sample of 12,000 received the survey in late 2017. What’s unique about the study in my opinion, is that it tackles subjective well-being from a financial perspective and emerging issues that may be formidable obstacles in the future. Read More

10.23.18- And Now, foe Something Entirely Different: Forget Russia. Here’s the Real Threat to American Elections…
Bill Bonner

WATERFORD, IRELAND – Alleluia!

We join with all Americans today in breathing a sigh of relief; justice is being done.

The bad guys are being hunted down. Our pristine democracy – in its pure white, unblemished, unsullied, and unbelievable gown – is being protected.

Finally, at least one of our foreign enemies has been nabbed by the gendarmes and will soon be railroaded by the courts; others will surely follow. Read More

10.22.18- Bubbles, Balloons, Needles and Pins
Raúl Ilargi Meijer

It’s no surprise that China has its own plunge protection team -but why were they so late?-, nor that Beijing blames its problems on Trump’s tariffs. GDP growth was disappointing at 6.5%, but who’s ever believed those almost always dead on numbers? It would be way more interesting to know what part of that growth has been based on debt and leverage. But that we don’t get to see. 

So we turn elsewhere. How about the Shanghai Composite Index? It may not be a perfect reflection of the Chinese economy, no more than the S&P 500 is for the US, but it does raise some valid questions. Read More

10.20.18- Weekend Rant: It Ain't So, Alan! Why Greenspanian Central Banking Is the Mortal Enemy of Capitalist Prosperity
David Stockman

We can thank bubblevision and the Maestro himself for a splendid reminder today that Greenspanian central banking is the greatest menace to capitalist prosperity ever invented. This was made abundantly clear by his pronouncement on CNBC regarding the current labor market:

“Tightest labor market I’ve ever seen.” – Greenspan on @CNBC

Read More

10.19.18- Bill Fleckenstein: Fed Confidence Won't Last & the Dollar Will Collapse
Egon von Greyerz

Bill Fleckenstein is one of my all time favorite market commentators and one of the few that understands how badly the Fed is making the economic situation in this country. He talks today about last week's market volatility, Apple, GE, the precious metal markets and why Jerome Powell is an "idiot". 

Bill is a professional money manager with over 30 years of experience. He has written daily commentary on market action since 1996 and FleckensteinCapital.com launched in 2003. His website is:  https://www.fleckensteincapital.com/ Read More

10.18.18- My Proprietary Fed “Hawkometer” is Redlining
Wolf Richter

It’s untested, results may vary, and it may appear a tad tongue-in-cheek. But it shot up 240% from long-run average and 500% from a year ago.

Reading the purposefully repetitive and strategically mind-numbing minutes of the FOMC meetings, such as the minutes that the Fed released today, can be a brutal affair. But it’s where the Fed discusses the economy and vaguely hints at risks balling up in it. It sprinkles in clues about its decisions on interest rate hikes. So these minutes are a link in understanding where interest-rate policy might go in the future, and they’re designed to communicate precisely that. Read More

10.17.18- Chairman Powell - You're Fired!
Michael Lebowitz

“I’m a low interest rate person” – Donald Trump 2016

On Donald Trump’s hit TV show, The Apprentice, contestants competed to be Trump’s chief apprentice. Predictably, each show ended when the field of contestants was narrowed down by the firing of a would-be apprentice. While the show was pure entertainment, we suspect Trump’s management style was on full display. Trump has run private organizations his entire career. Within these organizations, he had a tremendous amount of unilateral control. Unlike what is required in the role of President or that of a corporate executive for a public company, Trump largely did what he wanted to do. Read More

10.16.18- Powell has lost his North Star, and the Fed is flying blind
Peter Morici

The Fed risks raising interest rates too much as the compass spins wildly

Federal Reserve Chairman Jerome Powell is in an unenviable position. Folks expect him to fine-tune interest rates to keep the economy going and inflation tame but he can’t make things much better...only worse. Read More

10.15.18- Trump Is Right: The Federal Reserve Is Crazy And Here Are 101 Reasons
Why It Should Be Shut Down
Michael Snyder

Donald Trump just made one of the most brilliant moves of his entire presidency.  By accusing the Federal Reserve of “going loco”, he is placing the blame for the coming stock market crash and horrifying economic downturn squarely where it belongs, and he is firing up millions of true conservatives among his base at the same time.  For many, many years, a lot of us have been trying to educate the American people about the deeply insidious Federal Reserve system.  As Ron Paul once so astutely observed, it is actually about as “federal” as Federal Express is.  The Federal Reserve is an unelected cabal of central bankers that is running our economy into the ground, and the only way we are going to fix our long-term economic and financial problems is if we abolish it.  So for those of us that understand these things, it is extremely exciting to hear President Trump use language such as this… Read More

10.13.18- Weekend Rant: Of Course
The Fed Is Crazy
Raúl Ilargi Meijer

Finally financial ‘markets’ go through a substantial dip, which Steve Mnuchin claims is just temporary and Donald Trump says is caused by the fact that the Fed is ‘loco’. Mnuchin may well be right, but it won’t be because he knows something you don’t. 

And Trump is certainly right, but in reality the Fed has been loco for many years, so why be surprised if it acts crazy now? The reason Mnuchin and a million other ‘experts’ may be right without realizing it is that the Fed has been crazy enough to kill the financial markets. Read More

10.12.18- Convincing Congress to Abolish the Fed
Freedom League, Sept/Oct 1984

When Congress borrows money on the credit of the United States, bonds are thus legislated into existence and deposited as credit entries in Federal Reserve banks. United States bonds, bills and notes constitute money as affirmed by the Supreme Court (Legal Tender Cases, 110 U.S. 421), and this money when deposited with the Fed becomes collateral from whence the Treasury may write checks against the credit thus created in its account (12 USC 391). For example, suppose Congress appropriates an expenditure of $1 billion. To finance the appropriation Congress creates the $1 billion worth of bonds out of thin air and deposits it with the privately owned Federal Reserve System. Upon receiving the bonds, the Fed credits $1 billion to the Treasury's checking account, holding the deposited bonds as collateral. Read More

10.11.18- The Myth Of The Eternal Market Bubble And Why It Is Dead Wrong
Brandon Smith

Economic collapse is not an event — it is a process. I’ve been saying this since the initial 2008 crash, and I suppose I will keep saying it until it burns into people’s minds because I don’t think that it is a widely understood concept. When alternative analysts talk about financial collapse, we are not talking about something that suddenly happens out of the blue, we are talking about an ongoing decline that occurs in stages. This decline is happening today in the U.S. and around the world, and it has been accelerating since the chaos of 2008. When we bring up the reality of collapse, we are referring to something that is happening NOW, not something waiting on the distant horizon. Read More

10.10.18- Why Do Most Nations Use Fiat Money Today?
Jeff Clark

The primary reason nations use fiat money today is that it doesn’t limit how much of their currency they can put into circulation.

This reality starts with the meaning behind the word “fiat”…

The term fiat may sound obscure, even mystical, but it’s actually straightforward. Fiat is Latin for “let it be done,” or “it shall be.” Apply that definition to money and it simply means that currency is “money” because a government says its money. The dollar bill in your wallet is money by government decree. Read More

10.09.18- Why Your Vote Hasn’t Mattered Since 1913
Joe Jarvis

“No taxation without representation!”

That was a popular phrase during the decades leading up to the Revolutionary War. Colonists thought it was unfair to be taxed and subjected to English rule without consent.

Today Washington DC hands down laws and taxes to every one of the 320 million people living in the United States.

And just like under English rule, we are not represented in the federal government. Read More

10.08.18- The Federal Reserve’s Rising Interest Rates Are A Ticking Time-bomb For U.S. Economy
Steve St Angelo

One of the worst things for an over-heated and extremely leveraged economy is rising interest rates.  So, with the recent 2-2.25% interest rate, big trouble is on the horizon,  Also, with higher interest rates, the U.S. Treasury will have to fork out even more money to service its debt.  In just a little more than two years, the U.S. Fed Funds Rate jumped by nearly 2%.

This is indeed a big change for the Federal Reserve’s “economic stimulation policy” as it kept interest rates below 0.25% since January 2009.  And with extremely low-interest rates, nearly zero, it allowed the United States to more than double domestic oil production.  Unfortunately, this newly created oil supply has come at a cost. Read More

10.06.18- Will Phillips Curve Revenge Trigger Inflation?
Kurt Kallaus

Milton Friedman promulgated the Phillips Curve interpretation that posits a tight labor market generates higher inflation. Since 1967 this has been the primary tool of Central Banks and economists in forecasting inflation. During the previous generation it appeared that falling unemployment during an economic recovery would always trigger a strong inflation response. Today’s near record low unemployment should support a robust economic expansion, but has confounded economists expecting worrisome inflation. The inflation to unemployment sensitivity was strong in the 1960’s and 1970’s as Boomers entered the workforce triggering abnormal rates of spending and inflation. Combined with the Vietnam War and Johnson’s 1964 War on Poverty, this inflationary Baby Boom phase caused the US to close the Gold window in 1973 and send the world to free floating currencies. Read More

10.06.18- Will Phillips Curve Revenge Trigger Inflation?
Kurt Kallaus

Milton Friedman promulgated the Phillips Curve interpretation that posits a tight labor market generates higher inflation. Since 1967 this has been the primary tool of Central Banks and economists in forecasting inflation. During the previous generation it appeared that falling unemployment during an economic recovery would always trigger a strong inflation response. Today’s near record low unemployment should support a robust economic expansion, but has confounded economists expecting worrisome inflation. The inflation to unemployment sensitivity was strong in the 1960’s and 1970’s as Boomers entered the workforce triggering abnormal rates of spending and inflation. Combined with the Vietnam War and Johnson’s 1964 War on Poverty, this inflationary Baby Boom phase caused the US to close the Gold window in 1973 and send the world to free floating currencies. Read More

10.05.18- The Tragically Flawed Fed Policies And The Eventual Reset Of The Gold Price
Dave Kranzler

With gold showing good resiliency as it has tested the $1200 level successfully after enduring aggressive paper gold attacks during Comex floor trading hours, it’s only a matter of time before gold breaks out above $1220 and heads toward $1300. Gold has been under attack in the futures market this week as the world’s largest physical gold importer, China, has been closed all week for holiday observance. In addition, with financial market conditions stabilizing in India, the world second largest physical gold importer’s peak gold buying season resumed this week. When gold spikes over $1220, it will unleash an avalanche of short-covering by the hedge funds. Read More

10.04.18- Fed Chair Powell Hints He May Soon Crash The Market
Tyler Durden

Speaking at an event at the Atlantic Festival in Washington, Jerome Powell's second public appearance of the week, the Fed chair took the opportunity to underscore just why he remains so complacent about the US economy, saying "it’s a remarkably positive set of economic circumstances,” and “there’s no reason to think it can’t continue for quite some time."

Powell also praised the wage increases, saying some gains are welcome and noting that "the Phillips curve is not dead, just resting." Read More

10.03.18- UN Report Cites Central Bank Liquidity Bubbles, Loose Money, Debt Expansion
Mike "Mish" Shedlock​

A UN report has everything wrong as to the cause of current problems. Yet, the report mentions central bank liquidity.

Seldom does one see a report that "debt is the problem" while being 180 degrees wrong as to the cause of the buildup in debt.

The United Nations' Trade and Development Report for 2018 blames the "Free Trade Delusion" for what ails the word. Read More

10.02.18- Fed Indicates
You’d Be Wise To Get Some Gold
Chris Marcus

This week the Federal Reserve had its latest policy meeting, and as widely expected raised its short-term interest rate by another 25 basis points. Which given the precarious state of today’s economy, is great reason to purchase gold and silver as a response.

As a result of the Fed’s interest-rate increases in recent years, many of the emerging market economies are already experiencing currency chaos. And while wider turbulence has yet to impact the pricing in the U.S. markets, the evidence that the real estate market is running into trouble continues to emerge. With similar consequences becoming increasingly more likely in the stock and bond markets as well as the Fed continues to attempt to unwind its low-interest-rate policy. Read More

10.01.18- The Fed is Facing Two Bubbles…
And It Can Only Save One
Graham Summers

Yesterday, the Federal Reserve stated it would no longer be “accommodative” with its monetary policy. 

On that same day Fed chair Jerome Powell stated that stock market valuations were in the “upper reaches of historic ranges” i.e. bubbly.

And most importantly, the Fed stated it would likely hike rates again in 2018… with another three rate hikes in 2019. If each rate hike were for 0.25%, the Fed is targeting an interest rate of 3.25% before it’s done. Read More

09.29.18- Banks Sputter After
Hawkish Fed Raises Rates
Birch Gold Group

In March we warned of continued Fed rate hikes. In May, we reported on more rate hikes and their potential impacton stocks. In August, the QT “time bomb” started ticking…

On Wednesday, the Fed raised rates for the eighth time since tightening started. But the KBE Bank ETF — which holds Bank of America and Citigroup among others — failed to rally.

This could be a sign of an alarming trend beginning to unfold. Read More

09.28.18- Fed QT is Bull's Death Knell
Adam Hamilton

The Federal Reserve's unprecedented quantitative-tightening campaign is finally ramping to its full-steam speed in Q4. That will destroy $50b per month of quantitative-easing money created out of thin air! QT will need to maintain this terminal pace for over two years to meaningfully unwind the Fed's grotesquely-bloated balance sheet. This record tightening poses a dire threat to today's QE-inflated overvalued stock markets.

This week traders are focused on the Fed's 8th rate hike of this cycle, which was universally expected. Ever since the FOMC's previous meeting in early August, federal-funds futures have implied odds of another hike way up at 91% to 100% at this latest meeting. But the Fed's ongoing hiking pales in comparison with what it's doing with its balance sheet. One year after its birth, quantitative tightening is hitting full speed. Read More

09.27.18- Member of Economic Elite Comes Clean
Jim Rickards

Many of those who warn of near-term economic collapses or market panics are consigned to the fringes of economic analysis.

The mainstream analysts at university faculties or Wall Street banks are almost unanimous in saying, “All is well.” Most predict years of strong growth ahead, higher stock prices and higher interest rates.

Of course, these are the same people who told you Brexit would never happen and Hillary would be president and who never saw the 2008 panic coming when it was staring them in the face. Read More

09.26.18- The Fed's In A Box And People Are Starting To Notice
John Rubino

It’s long been an article of faith in the sound money community that the Fed, by bailing out every dysfunctional financial entity in sight, would eventually be forced to choose between the deflationary collapse of a mountain of bad debt and the inflationary chaos of a plunging currency.

That generation-defining crossroad is finally in sight.

On one hand, a tight labor market is pushing inflation to levels that normally call for higher interest rates: Read More

09.25.18- With a New Crash Looming, it is Time to Learn the Lesson of 2008
Harley Schlanger

A decade after the meltdown of the Trans-Atlantic financial/monetary system in September 2008, there are calls circulating for an urgent return to Glass Steagall banking regulation.  The original Glass Steagall bill was passed in 1933 to deal with the banking collapse of the Great Depression, as an essential part of Franklin D. Roosevelt's New Deal.  Its leading features were the establishment of a wall of separation between commercial and investment banks, and an insurance program to protect depositors.  Its repeal in 1999, by the Gramm-Leach-Bliley Act, with support from leaders of both U.S. political parties, opened the door for an orgy of speculative swindles,  allowing commercial banks to buy and sell "instruments of financial innovation", such as "derivatives" and "swaps", which are in reality worthless pieces of paper with no underlying value.  The blowout of the Mortgage-Backed Security bubble, which had been pumped up by speculative lending from deregulated financial institutions was the trigger for the Crash in 2008.  Read More

09.24.18- Central Bank Gold Purchases Now Control 10% Of The Total Market
Steve St Angelo

Central Banks have become big players in the gold market and now control 10% of the total market demand.  Now, this wasn’t always the case.  Just ten years ago, the Central Banks were main suppliers via their policy of dumping gold into the market.  However, the Central Bank strategy to sell gold into the market to depress the price, had quite the opposite effect.

For example, Central Banks dumped over 2,600 metric tons of gold into the market between 2003 and 2007, according to data from the World Gold Council.  So, what kind of impact on price did the sale of 84 million oz of Central Bank gold have on the market during that period?  The price of gold doubled from $363 in 2003 to $695 in 2007. Read More

09.22.18- The 10-Year “Illusion” that May Signal a Repeat of the 2008 Financial Crisis
Birch Gold Group

It’s been 10 years since Washington Mutual, Lehman Brothers, and other financial institutions went bust. When that happened, thousands lost their jobs.

The real estate market dried up, and the mortgage industry’s exotic loan products put subprime buyers out on the streets.

In September 2008 the stock market crashed at an unprecedented rate, costing many investors and retirees their livelihoods. Read More

09.21.18- Hyperinflation Has Destroyed Venezuela
Alex Deluce

Has coffee become an unattainable luxury? It is if you live in Venezuela’s capital of Caracas. In July, the price of a cup of coffee was 2 million bolivars. In a country where the minimum wage has been raised to 3 million bolivars, coffee has become as unaffordable as food, housing, clothing, and medicine.

Venezuela is in crisis mode. Ninety percent of citizens live in poverty conditions. Most of them have lost up to 25 pounds due to lack of food. Call it the Maduro Quick Weight-Loss Plan. President Maduro, who has blamed everything but his own socialist policies for the economic disaster, points out that he has raised the minimum wage to 3 million bolivars. For Venezuelans, this is utterly meaningless when prices are doubling every 18 days. Read More

09.20.18- Heroes & Whores
Jim Qunn

“Certainly one of the most important things I learned is that numbers can be deceiving. There is a logic to mathematics, but there is also the underlying human element that must be considered. Numbers can’t lie, but the people who create those numbers can and do. As so many people have learned, forgetting to include human nature in an equation can be devastating.” ― Harry Markopolos, No One Would Listen

The quote I used from Harry Markopolos’ No One Would Listen book about the Bernie Madoff ponzi scheme in my last article triggered a bittersweet recollection. For me, the experience captured the true nature of our warped financial markets, a culture  glorifying wealthy arrogant criminal assholes, while ignoring or ridiculing honest, hard working, highly intelligent truth tellers. Read More

09.19.18- And Now, for Something Entirely Different: "I Don't Have An Attorney General": Trump Blasts Sessions, Says FBI Is A "Cancer In Our Country"
Tyler Durden

Ever since Attorney General Jeff Sessions decided to recuse himself from overseeing the DOJ's probe into alleged collusion between the Trump campaign and Russia back in the Spring of 2017 - a decision that set the stage for the appointment of Special Counsel Robert Mueller - President Trump has subjected his AG to an unceasing wave of public abuse and belittling comments, all the while suggesting that Sessions might soon be cut loose thanks to his disloyalty to his boss. Read More

09.18.18- The Committee to Destroy The World:
The Federal Reserve
Virginia Fidler

The general belief among average citizens is that the purpose of central banks is to help the economy by fighting inflation and mitigating financial crisis. It’s a fairy tale that politicians like to encourage. If there were any truth to it, however, where was the Federal Reserve during the crisis of 2007? Rather than helping, it was widening the crisis with its easy money policies.

While central banks are not a government entity, their primary purpose is to create money for the benefit of the government. By mindlessly printing fiat currency, central banks create a shaky illusion of financial stability. In reality, each central bank is a monopoly that controls the production of distribution of currency and interest rates.  Read More

09.17.18- By the Time the Fed Hits the Neutral Rate of Interest, the Markets Will Be Crashing
Graham Summers

The Powell Fed has set one goal and one goal only for its policy…

Hitting the “neutral rate of interest.”

The neutral rate of interest is when the Fed has rates equalto the pace of inflation. While this is technicallywhat the Fed is SUPPOSEDto be doing, NO Fed (or any other Central Bank for that matter) has done it in over 30 years: the Greenspan, Bernanke, and Yellen Feds were all notorious for running “accommodative” policy in which rates were kept well BELOW the rate of inflation.  Read More

09.15.18- The Fed's Plan for "Countercyclical Capital Buffers" Is Just More of the Same
Christopher Westley

If you follow financial news related to Fed policy, you would have noticed arecent push for the use of “a new monetary tool,” called countercyclical capital buffers. Some prominent Fed officials and Fed watchers — the monetary version of all the king’s horses and all the king’s men — have decided the time is now to start raising such requirements, notwithstanding resistance to their implementation.

A countercyclical capital buffer, often abbreviated CCyB, is a capital requirement enforced on the US’s largest banks to promote bank stability when the inevitable recession hits. Restated in FedSpeak, CCyB Read More

09.14.18- How the Trade War Helps Hide Central Bank Sabotage Of The Economy
Brandon Smith

Almost every aspect of the global economic downturn, which started ostensibly in 2007-08 and is still ongoing to this day, can be traced back to the actions and policies of central banks. The Federal Reserve, for example, used artificially low interest rates and easy money to create a supposedly no-risk loan environment. This translated into a vast amount of toxic mortgage debt along with a web of derivatives (Mortgage Backed Securities) attached to that debt. Read More

09.13.18- Blame the Fed — Not Investors — For Asset Bubbles
Frank Shostak

In his speech on April 7 2010 at the Economic Club of New York the President of the New York Fed, William Dudley argued that asset bubbles pose a serious threat to real economic activity.

The New York Fed chief is of the view that the US central bank should develop effective tools to counter this menace.

According to Dudley, it should be the role of the Fed to stop the expansion of the bubble while it is still in the making. Read More

09.12.18- The End Of Cheap Debt: The Fall & Rise Of Interest Rates
Adam Taggart

Perhaps the greatest single trend impacting the next decade

Total debt (public + private) in America is currently at a staggering $67 trillion.

That number has been rising fast over the past 47 years, following the US dollar's transformation into a fully-fiat currency in August of 1971.

Perhaps this wouldn't be such a big concern were America's income, measured by GDP, growing at a similar rate. But it's not. Read More

09.11.18- Bubble Watch: The Fed Has Burst the Everything Bubble
Graham Summers

The Fed has burst the Everything Bubble.

No one has noticed it. Indeed, everyone in the US seems to be blissfully unaware. But the reality is that the massive bubble created between 2008 and 2018 is in the process of bursting.

And the Fed was the needle.

If you think I’m being dramatic, consider what has happened around the world in the last nine months. Read More

09.10.18- Congressmen Introduce Bill to End Taxation of Gold and Silver
Stefan Gleason

The battle to end taxation of Constitutional money has reached the Federal level with this newly introduced sound money legislation. Here are the details…

Washington, DC (September 7, 2018) – The battle to end taxation of constitutional money has reached the federal level as U.S. Representative Alex Mooney (R-WV) pictured right, today introduced sound money legislation to remove all federal income taxation from gold and silver coins and bullion. Read More

09.07.18- Fed Said to Be More Unprepared For Crisis Than 10 Years Ago
Tyler Durden

A group of current and former policymakers and academics in the financial industry that comprise the "Group of 30" - a financial industry working group that includes names like Mario Draghi and Mark Carney and which is the "who's who" of economists and experts that led the world into the last financial crisis - has come to the same conclusion that the many in the "fringes of economic thought" have been warning about for the last decade: the Fed is going to be in worse off shape to fight the next major crisis than they were in 2008.

“Some of the tools to fight the hopefully rare but extreme crises in the future have been weakened,” Tim Geithner, a distinguished Group of 30 member, told Bloomberg. Read More

08.06.18- The Shocking History of Market Shocks
Jeffrey Bennett

It is Labor Day weekend.

The nation pauses to acknowledge its sweating and groaning classes — those who hew its wood… and draw its water.

Or at least it pretends to.

Today is also Sept. 1.

On this day in 1939, the lights went out across Europe as the German Wehrmacht rolled on Poland.

Nearly six years, it would be, before they came on again. Read More

09.05.18- The Fed Will Not Give up “Dark Money”
Nomi Prins

When it comes to second quarter U.S. economic growth figures, interpretation is everything.

On one hand, the projection of 4.1% second quarter growth is a sign of a surging economy set to grow for years to come.

But on the other hand, it is seen as temporary sugar rush created by tax cuts and debt. It’s unsustainable in the light of higher tariffs, an escalating trade war that could impact large portions of the economy, and rising federal deficits that put America even deeper in debt. Read More

09.04.18- Mike Maloney: REVEALED —
The Dangerous F.O.G
Alexander Trigaux

The current US economy is like 100 cars flying down a fog-shrouded highway at 80MPH with two feet of visibility. Everyone is all-in, bullish as can be, and simply hoping against hope that nobody in front of them hits the brakes.

The Federal Reserve is the communal foot on the gas. Their massive QE campaigns have injected titanic liquidity into risk assets and kept the stock market free-floating into bubbled-out valuation territory for years on end.

And by pursuing a zero (or nearly zero)-interest-rate policy for the better part of a decade, corporations and consumers alike were heavily incentivized to leverage themselves to the extreme. Read More

08.03.18- How Trump Turns on The Fed
Bill Bonner

POITOU, FRANCE – The U.S. economy… all $20 trillion of it… explained in a single tweet (any similarity between this and one you might get from the president of the United States of America is pure coincidence):

Just look at the Dow (near an all-time high)… and unemployment (near an all-time low)…

The tax cuts ARE WORKING! The trade war, too! And those who say otherwise are just jealous SOBs! Read More

09.01.18- Inflation Is A Policy Decision
Gary Christenson

Inflation results from policies implemented by governments, commercial banks and central banks. 

A FEW CONSEQUENCES:

1. More currency placed into circulation devalues all currency units. We can thank fractional reserve banking, deficit spending and QE.

2. Stock markets rise as each currency unit buys less.

3. Commodities rise in price. Read More

08.31.18- Interest Rates Need to Tell the Truth
Richard M. Ebeling

In the middle of July 2018, President Donald Trump said in an interview that he was “not happy” with the Federal Reserve nudging up interest rates and threatening economic growth in the United States. At the recent Jackson Hole, Wyoming, meeting of global central bank leaders, the Federal Reserve chair, Jerome (“Jay”) Powell, said the Fed board would continue to act independently of politics and move interest rates up to ensure a stable economy with limited price inflation.

Lost in the exchange was one simple question: should it be the business of any central bank to be targeting or setting interest rates, or should this be the business of the market forces of supply and demand, as with any other price in the economy?  Read More

08.30.18- Chairman Powell’s Bizarre Statement Ignores the Reality of Price Inflation
Birch Gold Group

Inflation has been on the rise since late 2015. According to the Consumer Price Index (CPI) measure, the Fed has typically maintained the “target inflation” rate of 2%.

During strong economic growth, this inflationary cycle is common. And if you look only at the numbers on their surface, the illusion of a strong economy is what someone would see.

But all that changes once you look behind the curtain…

But official inflation has moved well past that benchmark. It is currently nearing 3% while rising at a consistent and alarming rate (see chart below):  Read More

08.29.18- And Now, for Something Entirely Different: Hippies
Johnny Silver Bear

Talking 'bout my g-g-g-generation...

Today is Saturday, October 22th, 2011. We are quickly approaching the tenth anniversary of the Silver Bear Cafe which will come in January, 2012. Over the last ten years your editor has scoured, sourced, verified, formatted, re-formatted, adorned, posted and archived over twenty thousand essays and articles from the minds of gracious free thinking pundits around the globe. Most of these patriots are ignored by the mainstream media (an industry that, coincidentally, happens to be owned by the "Darkside").  Read More

08.28.18- Trump’s War With the Fed
Bill Bonner

POITOU, FRANCE – Yesterday, we were preparing for a train wreck.

It’s what happens when the sordid fantasies of politics run into the gaudy delusions of finance. Everyone can see the crash coming. No one can do anything about it.

Today, we draw up a chair and bring popcorn.

Donald Trump is naturally at odds with the “elite.” He’s a New York Post guy; The New York Times despises him.  Read More

End The Fed -- or Face The Consequences
Ron Paul of Ron Paul Liberty Report

View Video

08.25.18- The Fed Will Not Give up “Dark Money”
Nomi Prins

When it comes to second quarter U.S. economic growth figures, interpretation is everything.

On one hand, the projection of 4.1% second quarter growth is a sign of a surging economy set to grow for years to come.

But on the other hand, it is seen as temporary sugar rush created by tax cuts and debt. It’s unsustainable in the light of higher tariffs, an escalating trade war that could impact large portions of the economy, and rising federal deficits that put America even deeper in debt. Read More

08.24.18- The Fundamental Case
For Owning Gold Today
Jesse Felder

Recently my friend Ben Hunt pointed out that gold is really more a hedge against a central bank mistake than a hedge against geopolitical upheaval. I agree but I believe gold is an effective hedge against a fiscal mistake, as well. In other words, when the government gets very aggressive in a budgetary sense it can be positive for gold. And I guess these two points are related.

Many times a central bank mistake forces the fiscal authorities to step in and get aggressive with the budget. Just think of the financial crisis. The Fed engineered a real estate bubble that, when it burst, forced the Treasury to step in and backstop the financial system to the tune of hundreds of billions of dollars. The federal government was also forced to implement significant fiscal stimulus during the recession that followed. This led to a record budget deficit of over a trillion dollars and the gold price soared. Read More

08.23.18- Iran Sanctions, Emerging Markets And The End Of Dollar Dominance
Brandon Smith

The trade war is a rather strange and bewildering affair if you do not understand the underlying goal behind it. If you think that the goal is to balance the trade deficit and provide a more amicable deal for U.S. producers on the global market, then you are probably finding yourself either confused, or operating on blind faith that the details will work themselves out.

Case in point, the latest reports that the U.S. trade deficit is now on track to hit 10-year highs, after a 7% increase in June. This is the exact opposite of what was supposed to happen when tariffs were initiated. In fact, I recall much talk in alternative media circles claiming that the mere threat of tariffs would frighten foreign exporters into balancing trade on their own. Obviously this has not been the case. Read More

08.22.18- How Bill Clinton’s Fed Twisted the Economy
Bill Bonner

The man who made America great again in record time – only 18 months – with unemployment at half-century lows and stocks at all-time highs… now says he is “not thrilled” about the Fed’s tightening policy. 

From CNBC:

The dollar weakened on Tuesday after U.S. President Donald Trump slammed the Federal Reserve for raising interest rates, while global equity markets rose as strong economic and earnings growth favored stocks in a relatively benign environment. Read More

08.21.18- "How to End the Federal Reserve" with Ellen Brown
Sarah Westall

View Video

08.20.18- Trump Complained About Fed's Rate Hikes, Expected Powell To Be
"Cheap-Money" Fed Chair
Tyler Durden

One month after Trump first ventured into territory few presidents have dared to go before, when he told CNBC in an interview that he was "not thrilled" about the Fed raising rates, and noted that the strong dollar is disadvantageous, moments ago Bloomberg reported that during a Hamptons fundraiser with wealthy Republican donors, Trump said he expected Jerome Powell to be a cheap-money Fed chairman and lamented that his nominee instead raised interest rates, according to three people present. Read More

08.18.18- Governments and Central Banks Should Look to Gold, Not Cryptocurrencies
Jeffrey Tucker

Let the private sector innovate; governments should stick with what they know

There will be no Fedcoin, according to Federal Reserve Chairman Jerome Powell, in testimony given before the House Committee on Financial Services.

“We’re not looking at this at the Fed as something that we should be doing,” Powell said, when asked whether the Fed is considering issuing its own digital currency. “That’s not something we’re looking at.” Read More

08.17.18- And Now, for Something Entirely Different: Decline in the Fall
(or Late Summer, Anyway)
Fred Reed

I am not sure why people write columns. Partly from boredom, I suppose, or lack of anything better to do. Partly from exasperation. Yet partly from the hope that if enough people collectively become aware of problems, they might, just maybe, do something about them. I can’t believe this any longer. Today’s crimes, lunacies, and decays  are too many, profitable, and intractable. We are racing out of control toward some as yet dimly limned catastrophe. Hang on and take the ride.

To begin with, America is no longer a country. It is a set of special interests occupying the same place: Corporations, races, ethnicities, faiths, ideologies, foreign agents pretending to be Americans, all at each other’s throats. No cure is possible. Read More

08.16.18- Economic Contagion?
Central Banks Are The Real Culprit
Brandon Smith

The mainstream news has been awash lately in talk over the danger of economic “contagion,” primarily due to lack of dollar liquidity in emerging markets. This lack of liquidity is being pegged as a trigger for instability in stocks, bonds and forex markets around the world, and this time around it is the nation of Turkey that is being called a potential trigger for a fiscal domino effect spreading through multiple countries.

We have heard talk of “contagion” before. Not long ago, Italy’s political shift toward a supposedly populist government led to fears of debt contagion within the European Union; this is still a valid concern, just not for the reasons the mainstream financial media usually presents. Read More

08.15.18- For most U.S. workers, real wages have barely budged in decades
Drew DeSilver

On the face of it, these should be heady times for American workers. U.S. unemployment is as low as it’s been in nearly two decades (3.9% as of July) and the nation’s private-sector employers have been adding jobs for 101 straight months – 19.5 million since the Great Recession-related cuts finally abated in early 2010, and 1.5 million just since the beginning of the year.

But despite the strong labor market, wage growth has lagged economists’ expectations. In fact, despite some ups and downs over the past several decades, today’s real average wage (that is, the wage after accounting for inflation) has the same purchasing power it did 40 years ago. Read More

08.14.18- 'It's big corrupt government': Glenn Beck on why it's time to audit the Federal Reserve
The Blaze

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08.13.18- The Donald From Jekyll Island: Will Trump Take Over The Federal Reserve?
Jeff Berwick

Threatening the Federal Reserve System’s monopoly on money is often credited as the main reason JFK was assassinated. Though we may never know the full truth, this was likely at least one of the motives for the CIA taking him out.

If there’s one good thing about Trump’s recent “attack” on the Fed, it’s that he may be helping to expose the criminal organization for what it's always been: a monstrous tool of the .000001%.

During an interview with CNBC, Trump, in very simple words (which is about all he knows… he does have “the best words” though!), openly voiced his disagreement with current Fed policies. Read More

08.11.18- Hawkish Fed Accelerates QE Unwind – Sets a “Ticking Time Bomb”
Dan Denning

The only other time the Fed did an “unwind” of quantitative easing similar to today’s market conditions was back in 1937.

The same chart pattern may happen soon under the guise of “balance sheet normalization.”

In fact, “balance sheet normalization” may become known as both the greatest and worst economic magic trick the Fed has ever performed.

The “greatest” because a hawkish Fed continues to unwind the money it printed as a result of Quantitative Easing (QE), and that money simply goes “POOF!” Read More

08.10.18- And Now, for Something Entirely Different: How Roger Williams
Started a Free Society
Joe Jarvis

Formation of a Radical

Kings never impressed him. And Roger Williams was exposed to Kings from early in his life.

As a youth, he worked for Sir Edward Coke, who was a lawyer, judge, and held other similar political posts in 17th century England. Williams accompanied him daily into the chambers of Parliament and other Councils.

Coke trailblazed many decent government policies for the time. One was that a man’s home is his castle. This helped set the tone for individual rights in England, even against royal opposition. It was Ye Olde Stand Your Ground. Read More

08.09.18- Signs Point to a Global Slowdown
James Rickards

As gold has struggled through 2018, (down over 10% from $1,363/oz. on January 25 to $1,215/oz. today), my forecast for a strong year-end for gold has remained unchanged.

This forecast is based on a better-late-than-never realization by the Fed that they are overtightening into fundamental economic weakness, followed quickly by a full-reversal flip to easing in the form of pauses on rate hikes in September and December.

Those pauses will be an admission the Fed sees no way out of its multiple rounds of QE and extended zero interest rate policy from 2008 to 2013 without causing a new recession. Once that occurs, inflation is just a matter of time. Gold will respond accordingly. Read More

08.08.18- Putting The 'Con' In 'Confidence': All The Fed Really Has To Offer Is Smoke And Mirrors
Michael Lebowitz, CFA

“At the end fiat money returns to its inner value—zero.”  – Voltaire

 “Within our mandate, the ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough.” – Mario Draghi July 26, 2012

On July 26, 2012, European Central Bank (ECB) President Mario Draghi essentially guaranteed the ECB would not allow the markets to cripple the Euro region. This shot across the bow finally remedied the instability caused by the sovereign debt crisis. The markets quickly reversed the damaging trends and uncertainty that had plagued the Euro-zone for months. Read More

THE AMERICAN DREAM - how debt slavery is killing us
Frank White

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08.06.18- Here's Why Rip-Roaring Inflation
Is Inevitable
Charles Hugh Smith

One of the enduring mysteries of the past decade is why inflation has remained tame while the central bank and government have pumped trillions of dollars of newly created money into the economy. Millions of words have been written about this, and so some shortcuts will have to be taken to make sense of it in one essay.

Let's start with the basics.

1. Adding newly created money but not generating new goods and services of the same value reduces the purchasing power of existing money. To keep it simple: say the economy of a country is $20 trillion. (Hey, the US GDP is $20 trillion...) Say its money supply is $10 trillion. Read More

08.04.18- Trump Discovering Federal Reserve’s Dilemma
Chris Marus

U.S. president Donald Trump recently issued some pointed comments about the Federal Reserve and some of the currency policies of China and the Eurozone. Which highlight the underlying flaw in the Federal Reserve’s management of the money supply, that the entire world is on the verge of finding out about in a big way.

When the Federal Reserve lowered interest rates and printed several trillion dollars a few years ago, even former chairman Ben Bernanke acknowledged that the purpose was to promote easier financial conditions and the appearance of wealth. Of course it would logically follow though that when interest rates rise and the printed money is retracted, that you would get the opposite effect. Which is never particularly politically palatable. Read More

08.03.18- 21st Century Misery Index: Labor’s Share Of The Economy And Real-World Inflation
Charles Hugh Smith

The “Misery Index” signals things have never been better, but that’s because the data isn’t accurate. It’s time for a new index, like the one proposed here…

Isn’t it obvious that those at the top of the wealth-power pyramid don’t want us to know how much ground we’ve lost while they’ve gorged on immense gains?

In the late 1970s and early 1980s, an era of stagflation, the Misery Index was the unemployment rate plus inflation, both of which were running hot. Read More

08.02.18- What’s behind the stock and bond markets’ spooky reaction to the Fed’s moves?
Ed Yardeni

Counterweights keep 10-year Treasury yields from soaring to 4% or even 5%

Helping stocks to recover from the year's lows in early February is the eerie calm in the U.S. bond market. 

The Bond Vigilante Model suggests that the 10-year Treasury bond TMUBMUSD10Y, -0.56%  yield tends to trade around the growth rate in nominal GDP on a year-over-year basis (Fig. 1). It has been trading consistently below nominal GDP growth since mid-2010. The current spread is among the widest since then, with nominal GDP growing 5.4% while the bond yield is just below 3.0%. Read More

08.01.18- America’s greatest foe isn’t China or Russia — it’s debt
Harry J. Kazianis

While many in conservative circles hailed the latest jump in economic growth, there was little talk of a long-term fiscal challenge which, left unaddressed, will wreak havoc on our economy and the world’s — our skyrocketing national debt that could become unmanageable in coming decades.

The numbers don’t lie. While recent tax cuts seem to have at least partially fueled strong economic growth, projections by the Congressional Budget Office (CBO) for this year forecast an $890 billion deficit, up from $438 Billion in 2015. If current CBO projections hold, next year the deficit will surpass $1 trillion. The last time that happened was during the great recession. Read More

07.31.18- Trumping the FED...What Will It Mean?
Wayne Jett

The Board of Governors of the Federal Reserve System presently has three members. The chairman and vice-chairman of the Board are appointees of President Trump. The third sitting governor was appointed in 2014. Four vacancies exist on the seven-member board, which President Trump plans to fill soon. The president’s appointees already have control of the Fed board. But POTUS will add board members to assist in the work to be done, which includes a currency reset and ending the Fed.

Private Central Banks Create Illusory Money

These are not small matters. Financial sins of the Federal Reserve have been horrendous since its creation in 1913.  Read More

07.30.18- America’s middle class is slowly being ‘wiped out’
Larry Getlan

It’s 30% more expensive to be middle class than it was 20 years ago, according to a new book

America’s middle class is being wiped out by the cost of living far outpacing salaries, says Alissa Quart, author of ‘Squeezed: Why Our Families Can’t Afford America.’

After spending his days teaching AP American history and economics at the public Live Oak High School in San Jose, Calif., Matt Barry drives for Uber. Read More

07.28.18- How Inflation Destroys a Civilization
Nick Giambruno

In 1971, President Nixon severed the final connection between gold and the U.S. dollar. Regular readers know that Bill has long warned of the unseen side effects of this decoupling. 

Today, Casey Research’s globetrotting analyst, Nick Giambruno, shows one more threat posed by America’s “fake” money, and reveals what you can do to protect yourself.

Fight for $15!

This was the rallying cry of what eventually became the largest fast-food strike in U.S. history. Read More

07.27.18- Confederate Inflation Rates (1861 – 1865)
Kettle Moraine Precious Metals

The Chart attached below shows the Annualized Confederate Inflation Rate. The Annual Inflation Rates are calculated from information provided by the Richmond Civil War Centennial

Committee on the purchasing power of Confederate Notes.

The table below shows the actual Confederate Treasury Note Inflation data that was used to develop this chart. At the beginning of the war on January 1, 1861 one Confederate dollar would purchase one gold dollar. By May it took  $1.05 Confederate dollars to purchase one Gold Dollar or 5% inflation in four months. By February of 1861 it took $1.25 Confederate Dollars to buy one Gold Dollar or 25% inflation. Read More

07.26.18- Trump vs. The Fed: America Sacrificed At The NWO Altar
Brandon Smith

There is a disconnect within the liberty movement over the notion of where to find the root source of globalism. A segment of people within the movement seem to think that the fount of globalism resides within America itself; that American imperialism is the foundation of the globalist scheme and the dollar is the single most important mechanism supporting their power. This is an naive oversimplification of the problem. Read More

07.25.18- IRS to revoke 362,000 passports
from US citizens
Simon Black

About two and a half years ago, I told you about a particularly nasty piece of legislation that President Obama quietly signed into law towards the end of his administration.

They called it the “FAST Act”, which stood for Fixing America’s Surface Transportation.

Yet despite $300 billion earmarked for infrastructure repairs, they didn’t manage to fix very much of America’s surface transportation.

The legislation did, however, have two major effects:

1) The FAST Act authorized the US government to plunder excess capital from the Federal Reserve… which is about as stupid as thing as anyone could possibly do. Read More

07.24.18- More Lies From The Corrupt Elite...
Don’t believe them
Paul Craig Roberts

For two decades the offshoring of American jobs to Asia and Mexico has destroyed the careers and incomes of tens of millions of US citizens, the pension tax base for state and local governments, the federal tax base for Social Security and Medicare, and the opportunity society that once characterized the United States of America.

The rise in corporate profits that resulted from substituting foreign labor for American labor rewarded corporate executives and boards, hedge funds, large shareholders, and Wall Street with profits at the expense of the American population and the US economy. Read More

07.23.18- America The Insolvent
Chris Martenson

A reckoning is due. One the elites are already readying for.

Watching the world these days, I’m experiencing the same fury that rises up from my gut when the driver in the car ahead me is weaving drunkenly, endangering everyone on the road.

Fury is a normal and rational human response when threatened with unnecessary harm. Women who are groped (or worse) by a disgusting predator like Harvey Weinstein, pensioners whose funds are stolen by Wall Street shysters, everyone who is being fleeced by corporations in search of a few extra dollars this quarter --  all have the right to be infuriated. Read More

07.21.18- Are You Prepared for the
End of Fake Money?
MN Gordon

Today we begin with a fundamental question: What is money?

This, no doubt, is an important question.  And we ask it with clear intent and purpose.  Namely, we want to better understand how it’s possible for America to rack up such a massive trade deficit with China.

America’s trade deficit with China, in 2017 alone, was $375 billion.  That’s a gap of over $31 billion a month – or $1 billion a day.  We believe having a better grasp on what money is will bring clarity to the nasty trade deficit that’s motivating today’s burgeoning trade war. Read More

07.20.18- Fed chair Jerome Powell is whistling past two looming threats to the US economy
Pedro Nicolaci da Costa

• Federal Reserve Chairman Jerome Powell downplayed the threat of a trade war to the US economy.
  
  
• He also dismissed a key recession signal emerging from bond market yield spreads, despite its historical reliability.

Federal Reserve chairman Jerome Powell is overlooking two central risks facing the US economy: the prospect of a trade-war induced slowdown and a key recession warning sign from financial markets.  Read More

07.19.18- What Can QE Tell Us About QT?
Peter Cook

In “The Fed’s Real Target” it was explained that the Fed’s interest rate manipulations are intended to influence the behavior of borrowers, not investors.  Fed Chairman Powell agrees.  In his most recent press conference, Powell reiterated that the Fed Funds rate continues to be the Fed’s primary tool to influence the U.S. economy.  Based on the Fed’s analytical framework, the economy is slowed by a series of interest rates increases because the behavior of borrowers is constrained.  Using similar logic, the economy is stimulated by a series of interest rates declines because borrowers use the reduction in interest expense that promote economic growth. Read More

07.18.18- The Fed Will Sacrifice Stocks
to Save Bonds
Graham Summers

The single most important bond in the world is the 10-Year US Treasury bond.

This bond represents the “risk free” rate of return for a total economic cycle (roughly 10 years) denominated in the global reserve currency (the $USD).

Put simply, this is THE bond to watch if you want to keep an eye on how the financial system is acting. It is the bedrock for all risk… and its yield represents rate of return against which all risk assets are priced/ valued. Read More

07.17.18- Purchasing Power Warning
Gary Christianson

In a better world we might expect:

• “Honest” money is universally used, has intrinsic value, retains its purchasing power and cannot be counterfeited by individuals or bankers.

• Individuals, corporations, and governments spend less than their income.

• Governments and bankers support and encourage real accounting and “honest” money. Read More

07.16.18- Powell’s Testimony:
The 4 Numbers That Matter
Nick Colas

What does Fed Chair Powell want to accomplish in his congressional testimony? We’re betting he would like Fed Funds Futures to more fully discount 2 more rate hikes in 2018. That could be a problem for US equities, as we outline below.

During Fed Chair Jay Powell’s congressional testimony over the next 2 days, consider the following 4 numbers:

1. 2.61%. That is the yield on the 2-Year Treasury as of today’s close, which is a high for the year. Yes, it is also a high for the last decade, but it is the 2018 high that matters right now. Since the 2-Year Treasury is keenly sensitive to Fed policy, this push to new high yields signals that bond markets expect a very upbeat testimony from Mr. Powell. Read More

07.14.18- Fed Sweeps Yield Curve Under the Rug – What Are They Trying to Hide?
Birch Gold Group

A few weeks ago we reported the Fed was getting hawkish despite what they were calling “low inflation.”

In that article, we showed rates possibly being raised more than 4 times in 2019. But more importantly, we warned that anyone investing in the market should start preparing to expect the unexpected.

And right now, it looks like the Fed’s bizarre moves are continuing. Read More

07.13.18- Fed chair says Trump's trade wars are starting to worry businesses, and the end result could be ugly
Jeff Thomas

Federal Reserve Chair Jerome Powell, in an interview published Thursday, suggested he isn't sure how President Donald Trump's trade battles are going to turn out. 

But Powell told Marketplace's Kai Ryssdal that business contacts across the US have raised alarm about Trump's trade policy to the 12 Federal Reserve branches. 

"And we are hearing a rising level of concern about the effects of changes in trade policy," Powell said. Read More

07.12.18- Is This The Most Hawkish Fed Ever?
Michael Pento

My research shows that this is one of the most hawkish Fed rate-hiking regimes ever. It has raised rates seven times during this current cycle and is on pace to raise the Fed Funds Rate(FFR) four times this year and three times in 2019.

But what makes its monetary policy extraordinarily restrictive is that for the first time in history the Fed is also selling $40 billion per month of Mortgage Backed Securities (MBS) and Treasuries starting in Q3 and $600 billion per year come October. Because the Fed is destroying money at a record pace while the rest of the world’s major central banks are still engaged in money printing (QE) and zero interest rate policies (ZIRP), Jerome Powell’s trenchant and unilateral tightening policy is now causing chaos in emerging markets. Read More

07.11.18- Is Hammurabi's Code the key
to fixing the banks?
The Hutch Report

Over the years there have been a chain of events that have led us to where we are now. This is true not only for the US but for the rest of the world. In a previous article we tried to determine when the US was at its strongest, to maybe shed some light on where the US went off track. It seemed clear that when the US middle class was the largest portion of the population domestic production was also at its greatest. Simply put, people were working and had money to spend. More demand created more production and more jobs.

Looking at the non-farm payroll reports you would think that everything is booming yet we see from a number of sources that low unemployment numbers do not tell the whole story. There are a large number of facts and arguments that support that point of view. Read More

07.10.18- Inflation: Your Role as a Milk Cow
Jeff Thomas

Traditionally, inflation has been defined as “an increase in the amount of currency in circulation.” Such an increase almost always causes an increase in the cost of goods and services, since, more plentiful currency units lowers their rarity, as compared to the supply of goods and services, which remains roughly the same. Therefore, it shouldn’t be surprising if a 20% increase in the amount of currency units translates into a 20% increase in the price of goods and services.

Unfortunately, in recent decades, even dictionaries have been offering a revised definition of inflation, as “an increase in the price of goods and services.” This is a pity, as it makes an already confusing subject even more difficult to understand.  Read More

07.08.18- And Now, for Something Entirely Different: Make Border Security Great Again – Privatize It!
Kerry Lutz

The media continually informs us that there’s a crisis at the US southern border. However, little is being done about it. President Trump has his ideas and the Congress appears completely unwilling to act. Parts of the Wall are being built, but it can’t happen soon enough to quickly staunch the flow of illegals. Therefore, it’s time to take an approach that always works when it’s tried. Unleash the power of capitalism to solve this intractable problem. It’s time to privatize border enforcement.  Read More

07.06.18- As the Yield Curve Flattens, Threatens to Invert, the Fed Discards it as Recession Indicator
Wolf Richter

This Fed is getting seriously hawkish: It revealed that instead of thinking about backing off rate hikes, it’s replacing the yield curve.

In the minutes of the FOMC meeting on June 12 and 13, released this afternoon, there was a doozie, obscured somewhat by the dynamics of the rate hike plus the indication that there would be two more rate hikes this year, for a total of four, up from three at the prior meeting, with more hikes to come in 2019, along with other changes – a phenomenon I called, This Fed Grows Relentlessly More Hawkish, Gone are the Kid Gloves.

But the doozie in the minutes was about the flattening “yield curve.” Read More

07.06.18- As the Yield Curve Flattens, Threatens to Invert, the Fed Discards it as Recession Indicator
Wolf Richter

This Fed is getting seriously hawkish: It revealed that instead of thinking about backing off rate hikes, it’s replacing the yield curve.

In the minutes of the FOMC meeting on June 12 and 13, released this afternoon, there was a doozie, obscured somewhat by the dynamics of the rate hike plus the indication that there would be two more rate hikes this year, for a total of four, up from three at the prior meeting, with more hikes to come in 2019, along with other changes – a phenomenon I called, This Fed Grows Relentlessly More Hawkish, Gone are the Kid Gloves.

But the doozie in the minutes was about the flattening “yield curve.” Read More

07.05.18- Unfunded Promises
John Mauldin

In describing the global debt train wreck these last few weeks, I’ve discovered a common problem. Many of us define “debt” way too narrowly.

A debt occurs when you receive something now in exchange for a promise to give something back later. It doesn’t have to be cash. If you borrow your neighbor’s lawn mower and promise to return it next Tuesday, that’s a kind of debt. You receive something (use of the lawn mower) and agree to repayment terms – in this case, your promise to return it on time and in working order. Read More

07.04.18- Globalists Are Telling Us Exactly What Disasters They’re Planning for The Economy
Brandon Smith

Years ago when analysts first started to use the term “globalist”, there was an immediate recognition among liberty advocates as to who they were referring to. This was back when the movement for small government, the non-aggression principle, and true free markets was small but growing. These days, it’s difficult to gauge how many liberty groups there are or even if they know what small government and the non-aggression principle represent, let alone what makes a “globalist” a globalist. Read More

07.03.18- The Dollar Is a Source of Global Instability
Jim Rickards

The dollar constitutes about 60% of global reserves, 80% of global payments and almost 100% of global oil transactions.

So the dollar’s strength or weakness can have an enormous impact on global markets.

Using the Fed’s broad real trade-weighted dollar index (my favorite foreign exchange metric, much better than DXY), the dollar hit an all-time high in March 1985 (128.4) and hit an all-time low in July 2011 (80.3).

Right now, the index is 95.2, below the middle of the 35-year range. But what matters most to trading partners and international debtors is not the level but the trend. Read More

07.02.18- James Grant and Jim Chanos:
Fed Fraud and More
NYHS

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06.30.18- Fed Unwinding the Bernanke Experiments: Progress Report
Bluford Putnam and Erik Norland

Raising rates and shrinking its balance sheet, the Federal Reserve (Fed) is now part way into the process of unwinding the Bernanke emergency policies following the Great Recession.  So far, the well-telegraphed approach to unwinding quantitative easing and raising rates has had no discernible impact on the pattern of real GDP, inflation or the labor markets.  While Fed actions are only a part of the cause, US Treasury yields have risen and equities have become more volatile.

In this research report, we will examine the evolution of Fed policy as the Federal Open Market Committee (FOMC) seeks to create a sustainable approach to managing an economy no longer requiring emergency measures.  Specifically, we will study: Read More

06.29.18- The Yield Curve Is The Economy’s Canary In A Coal Mine
Dave Kranzler

The economy has hit a wall and is now sliding down it. I don’t care what bullish propaganda may or may not be bubbling up in the headlines from the financial media and Wall Street, the hard numbers I look at everyday show accelerating economic weakness. The fact that my view is contrary to mainstream consensus and political propaganda reinforces my conviction that my view about the economy is correct.

As an example of the ongoing underlying systemic decay and collapse conveyed by this week’s title, it was announced that General Electric would be removed from the Dow Jones Industrial Average index and replaced by Walgreen’s. GE was an original member of the index starting in 1896 and was a continuous member since  1907. Read More

06.28.18- Guess What Happens When Money Is Made Cheap And Labor Is Made Expensive?
Charles Hugh Smith

There’s a dark side to our financial system, and its benefiting the few at the expense of the many. Here’s the details…

Employment expands in the Protected cartel-dominated sectors, and declines in every sector exposed to globalization, domestic competition and cheap capital.

If you want to understand why the global economy is failing the many while enriching the few, start with the basics: capital, labor and resources. What happens when central banks drop interest rates to near-zero? Capital becomes dirt-cheap. It becomes ludicrously easy to borrow money to buy whatever cheap capital can buy: Read More

06.27.18- How Long Can The Federal Reserve Stave Off the Inevitable?
Paul Craig Roberts

When are America’s global corporations and Wall Street going to sit down with President Trump and explain to him that his trade war is not with China but with them? The biggest chunk of America’s trade deficit with China is the offshored production of America’s global corporations. When the corporations bring the products that they produce in China to the US consumer market, the products are classified as imports from China.

Six years ago when I was writing The Failure of Laissez Faire Capitalism, I concluded on the evidence that half of US imports from China consist of the offshored production of US corporations. Read More

06.26.18- The Fed Just Made Its Most Hawkish Turn in 30+ Years (Did Anyone Notice?)
Daniel Nevins

I realize it’s getting late to discuss the June 12–13 FOMC meeting, but I think the Fed’s biggest news from that meeting may have slipped under the radar. 

To confirm the relevance of what I thought I heard during the post-meeting press conference, I spent some time last week reviewing old speeches, transcripts and other materials produced by Fed officials. I’m now convinced that Chairman Jerome Powelldelivered an important message that went largely unreported, and I expect him to keep at it until people take notice. Read More

06.25.18- Abolishing The Private Central Bank (Fed) Is Challenging And Those Who’ve Tried We’re Stopped
Harley Schlanger

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06.23.18- And Now, for Something Entirely Different: More TRUTH… and it Matters!
Giacomino Nicolazzo

And while I am on my political soap box today, I am compelled to tell you something most people in America are not aware of & I guarantee you that most people around the world are not being told. It has to do with the children of illegal aliens being ripped from the arms, and sometimes from the nursing breasts of their mothers, thrown into cages and treated little better than dogs…all at the hands of the tyrannical Trump administration.

But you won’t believe what just a little research has revealed. Keep in mind, this is the research the Far Left & the MSM are banking on you will never do. If you don’t know the facts, they are free to lie & brainwash & mis-represent to their heart’s content. Read More

06.22.18- Fun With The Fed's "Stress" Test
Nicholas Colas

Like many of you, I spent part of the late afternoon reading through the results of the Federal Reserve’s annual stress test of the US banking system. At first blush, everything looks good. Everyone passed. Now investors can look forward to next week’s Comprehensive Capital Analysis and Review, when we hear what sorts of buybacks and dividends these institutions can pay in the year ahead.

It’s difficult not to gasp a little when you look at the “Severely adverse” scenario the Fed used in this year’s review: Read More

06.21.18- How you can undermine the ‘evil cabal’
Dylan Charles

Over the years, the description of the tyrants and psychopaths that so often occupy positions of power in our world has evolved, and today it is fashionable to refer to this nebulous group by using the term ‘Evil Cabal.’

Language is perhaps the most important device we have for creating reality, and just as George Orwell knew, the more linguistically vague, simplistic, ambiguous and nondescript the language, the more room there is to shape perception. This is called Newspeak, and in the case of the ‘Evil Cabal,’ the term fails to fully describe our complex world, but succeeds tremendously in maintaining the prison of fear that actually inhibits freedom. Read More

06.20.18- The Federal Reserve Cartel – 
A Financial Parasite
Chris Hamilton

United World Federalists founder James Warburg’s father was Paul Warburg, who financed Hitler with help from Brown Brothers Harriman partner Prescott Bush. [1]

Colonel Ely Garrison was a close friend of both President Teddy Roosevelt and President Woodrow Wilson.

Garrison wrote in Roosevelt, Wilson and the Federal Reserve,

“Paul Warburg was the man who got the Federal Reserve Act together after the Aldrich Plan aroused such nationwide resentment and opposition. The mastermind of both plans was Baron Alfred Rothschild of London.” Read More

06.19.18- The Federal Reserve Is Increasing The Pace Of Interest Rate Hikes Just In Time
For The 2018 Mid-Term Elections
Michael Snyder

If the Federal Reserve really wanted to hurt the U.S. economy, the quickest way that it could do that would be by aggressively raising interest rates.  Lower interest rates make it less expensive to borrow money, and therefore economic activity tends to expand in a low interest rate environment.  Alternatively, higher interest rates make it more expensive to borrow money, and economic activity tends to slow down in a high interest rate environment.  Since 1913, the Federal Reserve has engaged in 18 previous rate hiking cycles, and every single one of them resulted in a huge stock market decline and/or a recession. Read More

06.18.18- The Fed’s Short-Term Rate Policy Is Meaningless: The USD Is Doomed
Jim Rickards

Think of the Fed and its interference in the markets as a wanderer in the desert, who despite carrying enough water, can’t help himself from wading into the glorious, shimmering, pristine pool he sees over there in the distance.

Except it’s not water. It’s quicksand. Once the Fed first fell for the mirage that it could somehow execute the job so perfectly executed by free markets better than those free markets on their own, it has been left trying to extricate itself from yet another totally unnecessary, could-have-been-avoided, self-created disaster. Read More

06.16.18- Texas Bullion Depository
Open for Business
Mike Maharrey

The Texas Bullion Depository officially opened for business this week. The creation of the facility represents a power-shift away from the federal government, and sets the foundation to undermine the Federal Reserve’s monopoly on money.

In June 2015, Gov. Greg Abbot signed legislation creating the state gold bullion and precious metal depository. The facility will not only provide a secure place for individuals, business, cities, counties, government agencies and even other countries to store gold and other precious metals, the law also creates a mechanism to facilitate the everyday use of gold and silver in transactions. In short, a person will eventually be able to deposit gold or silver – and pay other people through electronic means or checks – in sound money. Read More

06.15.18- The Federal Reserve: Public Enemy Number One
Peter Schmidt

When currency was backed by gold, a central bank’s main function was to maintain the value of the issued currency in terms of gold.  For example, if a central bank created too much money against the gold reserves in the banking system, an increasing number of people would begin to exchange their currency for gold.  To combat this, a central bank would be forced to raise interest rates and decrease the money supply.  The higher interest rates would incentivize people to exchange gold for larger savings on deposit that earn interest.  Banking reserves – gold – would return to the banking system and the economy would return to balance.  The prime reason for insisting on defining currency in terms of a precious metal was to provide a self-correcting braking mechanism to the creation of money.  As expressed by the great Wilhelm Röpke: Read More

06.14.18- The Federal Reserve Cartel: The Roundtable and The Illuminati
Dean Henderson

According to former British intelligence agent John Coleman’s book, The Committee of 300, the Rothschilds exert political control through the secretive Business Roundtable, which they created in 1909 with the help of Lord Alfred Milner and South African industrialist Cecil Rhodes.

The Rhodes Scholarship is granted by Cambridge University, out of which oil industry propagandist Cambridge Energy Research Associates operates.

Rhodes founded De Beers and Standard Chartered Bank. According to Gary Allen’s expose, The Rockefeller File, Milner financed the Russian Bolsheviks on Rothschild’s behalf, with help from Jacob Schiff and Max Warburg. Read More

06.13.18- The Federal Reserve Cartel: Freemasons and The House of Rothschild
Dean Henderson

Part two of a four-part series

In 1789 Alexander Hamilton became the first Treasury Secretary of the United States.  Hamilton was one of many Founding Fathers who were Freemasons.  

He had close relations with the Rothschild family which owns the Bank of England and leads the European Freemason movement.  George Washington, Benjamin Franklin, John Jay, Ethan Allen, Samuel Adams, Patrick Henry, John Brown and Roger Sherman were all Masons.

This was before their knowledge that the masons were being corrupted by the Rothschild Cartel ~ It was then outlawed in The United States Read More

06.12.18- The Federal Reserve Cartel; The Eight Families
Dean Henderson

Yes The First Central Bank Of The United States Was Started By A Founding Father, Alexander Hamilton, who was Rothschild’s Son-In-Law.

We Won The Battle But Lost The War Against The Cabal’s Bank From Which We Fled Britain In The First Place. As It Followed Us Here To America Through Rothschild’s Son-In-Law Alexander Hamilton In 1791.

But their monopoly over the global economy does not end at the edge of the oil patch. According to company 10K filings to the SEC, the Four Horsemen of Banking are among the top ten stock holders of virtually every Fortune 500 corporation.[1] So who then are the stockholders in these money center banks? This information is guarded much more closely. Read More

06.11.18- And Now, for Something Entirely Different: World Trade Center Building 7 Was Brought Down by Explosives
George Cassidy Payne

I know that World Trade Center Building 7 was not brought down by office fires. I know this because of my capacity to reason.The building fell symmetrically in less than 7 seconds at free fall acceleration for the first 100 feet. The overall building mass fell uniformly through what was the path of greatest resistance. The kink in the roof line is characteristic of a demolition timing sequence where the walls are collapsing inward. All of the debris ended up in a compact pile centered within the building’s footprint. In short, the hallmark characteristics of controlled demolition. Read More

06.09.18- Beware Former Central Bankers Telling You To Work More
Michael Krieger

I’m not the only one of course. The financial crisis of 2008/09 similarly shattered the worldview of tens, if not hundreds of millions of people across the globe. I believe that the old manner of doing things as far as organizing an economy and society died for good during that crisis and its aftermath. Sure it’s been shadily and undemocratically propped up ever since, and we haven’t yet transitioned to what’s next, but for all intents and purposes it’s dead. It’s dead because it has no credibility.

Hard work is fundamental to our continued existence and advancement as a species. I would never devalue the importance of hard work, particularly when combined with intense passion and drive, which leads to extraordinary technological progress and soaring artistic creations. Read More

06.08.18- 18 Times The Fed Has Gone Through A Rate Hiking Cycle, And 18 Times It Has Caused A Huge Stock Market Decline And/Or A Recession
Zach Scheidt

Since 1913, the Federal Reserve has engaged in 18 distinct interest rate hiking campaigns, and in every single one of those instances the end result was a large stock market decline, a recession, or both.  Now we are in the 19th rate tightening cycle since 1913, but many of the experts are insisting that things will somehow be different this time.  They assure us that the U.S. economy will continue to grow and that stock prices will continue to soar.  Of course the truth is that if something happens 18 times in a row, there is a really, really good chance that it will happen on the 19th time too. Read More

06.07.17- How Many Rabbits?
Bob Rinear

Logic says this had to end. History says it’s got to end. And yet they keep finding rabbits. I’ll be the first to admit, that I NEVER thought they could kick the cans down the road as far as they have. Yet, here we are.

I’ve been in this game for quite a while. I started in 1994 doing seminars for local investment clubs. That migrated into the first newsletter in 1996, and in 1997 we launched the web site.

All along the way, there were ills and evils that I pointed out, about how the economy is fake, the economic reports were fudged, the debts were unpayable, and on and on. And yet, through the magic of Central banking, they’ve managed to keep the wheels on this thing. It truly is incredible if you think about it. Read More

06.06.18- A Recession Is Coming... And the Fed Can't Stop It
Jim Rickards

Is the Fed ready for the next recession? The answer is no.

Extensive research shows that it takes between 300 and 500 basis points of interest rate cuts by the Fed to pull the U.S. economy out of a recession. (One basis point is 1/100th of 1 percentage point, so 500 basis points of rate reduction means the Fed would have to cut rates 5 percentage points.)

Right now the Fed’s target rate for fed funds, the so-called “policy rate,” is 1.75%. How do you cut rates 3–5% when you’re starting at 1.75%? You can’t.

Negative interest rates won’t save the day. Negative rates have been tried in Japan, the eurozone, Sweden and Switzerland, and the evidence is that they don’t work to stimulate the economy. Read More

06.05.18- What History Teaches
About Interest Rates
Brian Maher

“At no point in the history of the world has the interest on money been so low as it is now.”

Who can dispute the good Sen. Henry M. Teller of Colorado?

For lo eight years, the Federal Reserve has waged a ceaseless warfare upon interest rates.

Economic law, history, logic itself, stagger under the onslaughts.

We suspect that economic reality will one day prevail. Read More

06.04.18- Fed Finds New Way to Blunder
Jim Rickards

If you have defective and obsolete models, you will produce incorrect analysis and bad policy every time.

There’s no better example of this than the Federal Reserve.

The Fed uses equilibrium models to understand an economy that is not an equilibrium system; it’s a complex dynamic system.

The Fed uses the Phillips curve to understand the relationship between unemployment and inflation when 50 years of data say there is no fixed relationship. Read More

06.02.18- The Fed's Mission Impossible
Danielle DiMartino Booth

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06.01.18- And Now, for Something Entirely Different: Modern Civil War Without Guns - So Far!
Monty Pelerin's World

Does our country run the risk of a civil war? Is such a horrible event even possible today?

The answers are “Yes” and “Yes.” Furthermore, a case can be made that we are already in such a civil war.

I received the following via email. The main piece was written by Jack Minzey, a person  I was unfamiliar with.  His take on this issue seems unique and accurate! According to him,  we are already in a Civil War whether  we recognize it or not. Read More