For many years now there has been a contingent of alternative economists working diligently within the liberty movement to combat disinformation being spread by the mainstream media regarding America’s true economic condition. Our efforts have focused primarily on the continued devaluation of the dollar and the forced dependence on globalism that has outsourced and eliminated most U.S. manufacturing and production of raw materials. Read More
It’s amazing how individual stocks, at the tippy-top of the biggest stock market bubble in modern times, are getting taken out the back one by one to be crushed, but without denting the overall indices all that much.
The stock market bubble was driven by $4.5 trillion in QE in the US alone, along with many more trillions by other central banks, and it was driven by interest rate repression, even has inflation has been surging to multi-decade highs, not just in the US but globally, and not just in goods, but now also in services, particularly housing, such as rents. Read More
“Bitcoin is for Dummies.”
I remember saying that to a friend back in 2011. From that time onward, I was relentless in my criticism of bitcoin. So no one was more shocked than I was when a metaphorical bolt of lightning struck me off my high horse.
I was in Las Vegas for the CES (Consumer Electronics Show) in 2016. I had just listened to a talk on bitcoin given by a gifted speaker. After his talk, I finally understood why bitcoin had value. Read More
We are living in strange times. To demonstrate how strange (at least partly), here’s a brief “State of the Economy” as 2021 winds down.
Between November 8th and December 1st, the Dow Jones Industrial Average lost 2,400 points. That loss is quite substantial, but the Dow’s volatility has been incredible since January.
The Dow has whipsawed all year long. It lost, then regained, more than 1,200 points in January, again in May, then again late May through June. You might think the Dow was nervous. Investors certainly are. Read More
"Economic Collapse" you say?
The IMF are warning of “economic collapse”, which should get headlines. Not because the IMF have any kind of track record of being timely or right about anything, but because the Fund so rarely says anything negative for fear of being seen as precipitating the crises which the policies it imposes always end up creating anyway. Besides a total lack of surprise on first seeing the headline, my initial thought was “Yes, but where?” There are so many candidates as: Read More
For many years now there has been a contingent of alternative economists working diligently within the liberty movement to combat disinformation being spread by the mainstream media regarding America’s true economic condition. Our efforts have focused primarily on the continued devaluation of the dollar and the forced dependence on globalism that has outsourced and eliminated most U.S. manufacturing. Read More
Most recent data continue to show a visible acceleration in "price inflation," with the yearly growth rate of the US Consumer Price Index (CPI) rising to 6.2 percent in October from 5.4 percent in September and 1.2 percent in October of last year—its highest level since December 1990.
Most experts seem to be surprised by the massive increase in the momentum of the CPI in October. Based on the definition of inflation as increases in the money supply and not increases in prices, the sharp increase in the yearly growth rate of the CPI is predominantly on account of past massive increases in money supply. Read More
Insiders dumping big portions of their stakes after historic share-price spikes is a sight to behold.
Microsoft disclosed in an SEC filing on Wednesday before Thanksgiving, when no one was paying attention and when this would likely get shuffled under the rug, that CEO Satya Nadella had sold on November 22 not 1% of his holdings or 5% of his holdings of Microsoft stock [MSFT] and not 10% of his holdings, but 50.2% of his holdings in numerous trades on one heck of a busy day. Read More
11.29.21- The US Dollar Implosion: Questions To Consider For Non-Bitcoiners
One approach to orange-pilling no-coiners is to simply draw attention to the various economic uncertainties facing the U.S. Dollar today...
The purpose of the article is to examine the current state of the U.S. dollar in reference to the average American’s mentality during economic hardship. The article will serve as a potential onboarding ramp for non-bitcoin holders through an exploration of current events and posing of questions to the reader. Read More
This week, a hush falls over headquarters. Office phones ring with no one to answer them.
But we continue our lonely vigil, watching over the world of money… dumbstruck by the complex majesty of it…
…and a little bummed out by the scammy fraud perpetrated by Federal Reserve economists.
We drove out of the city to look at a colleague’s new house. The house is on farmland in one of the most attractive suburbs, just 15 minutes from the heart of Baltimore. Read More
Unless you have the fortitude of a Greek God, peeling back the layers of our current "economic onion" will very likely bring you to tears. Looking back over the last several years could make a person argue that massive stupidity has been a huge factor in keeping the economy afloat. In short, those pulling the strings have constructed a false economy that is unsustainable and will at some point implode. Read More
The sky’s the limit. Now find the sky.
That is the ongoing story of used truck prices at both auction and retail for the first 10 months of the year. J.D. Power Valuation Services pegs the year-over-year increase in auction prices at 89.9% — with the gavel dropping on month-over-month increases of 7%.
11.24.21- And Now, for Something Entirely Different: A Big Flip?
Normally, inflation is not a major theme on Thanksgiving. Unfortunately, these are not normal times. Thanks to Joe Biden and our other crooked politicians in Washington, we are facing an inflation crisis that is unlike anything that we have experienced since the 1970s. Earlier this week, I discussed a new poll which showed that 88 percent of Americans are deeply concerned about inflation, and a different poll found that 67 percent of Americans disapprove of the way that Biden is handling rising prices. Now Thanksgiving is nearly upon us, and most Americans are finding that their grocery dollars are not stretching as far as they once did. Read More
11.22.21- I am Inflation, Destroyer of Worlds
Poor and Middle Class Get Smashed by Inflation.
Inflation, inflation, and inflation. People tend to think that inflation merely means higher prices. Yet the type of inflation we are dealing with is extremely problematic. Inflation is running at a multi-decade high clip at 6.2% annualized and it may be even worse since the way we measure inflation is an imperfect science. Inflation punishes the poor, middle class, and savers. You wonder why the stock market, crypto, and real estate are all at record high levels? People with assets are chasing yield and younger Americans are disenfranchised and want to swing their YOLO bets on Crypto since many believe this is the only way to become financially independent. All of this reeks of an unsustainable period in economics but we are in a perpetual bubble world. Read More
Most of us have seen the shortages on the shelves at grocery stores, empty spaces, front facing products with nothing behind them, whole sections just gone as is the variety and selections we once enjoyed.
We have also seen the incredibly high prices for certain foods, or “shrinkflation” where the cans or boxes are smaller, less product, yet the prices are the same or higher than they were just one year ago. Read More
11.19.21- The 'Fasten Seat Belt' Sign Just Lit Up
A few months ago, I drew attention to the fact that the Nasdaq was showing signs of increasing dispersion under the surface, a warning regarding the relative health of the uptrend. The following month, the Nasdaq Composite underwent a brief correction of about 8% (from high to low). It has since recouped those losses and then some but these breadth warnings have only continued. Read More
One of the most interesting stories from the early days leading up to the American Revolution involves the events surrounding the Boston Massacre. On March 5th, 1770 the Stamp Act had just been repealed but British Soldiers were ever present in Boston as a show of force against the “rowdy” colonists. The British government, in order to save face, implemented the Townshend Acts instead as a means to continue taxing the colonies (without representation, of course). Anger was growing in the streets. Read More
Very short Porridge this morning as I’m about to fly…
Thankfully, I shall not be flying on a Boeing 737 Max.
At the end of this month a new book will be launched – Flying Blind: the 737 Max Tragedy and the Fall of Boeing, by Peter Robinson. Bloomberg carries a piece on it this morning: Boeing Built an Unsafe Plane, and Blamed the Pilots When it Crashed. Read More
11.16.21- Look Out Below: Why a Rug-Pull Flash Crash Makes Perfect Sense
It makes perfect financial sense to crash the market and no sense to reward the retail options marks by pushing it higher.
11.15.21- Supply Chain Disruptions Will Continue
Forty percent of all the cargo into the United States comes through the ports of Los Angeles and Long Beach. Offshore, there are thousands of containers stacked up on vessels waiting to get in. How many containers can the ports unload on a normal day?
New containers are coming in. There are daily arrivals. When will that supply chain backlog clear?
The answer is never. If there are more coming in than you can unload and you have an existing backlog that’s getting worse, it will never clear. Read More
11.13.21- Money, Funny-Money, & Crypto
That the post-industrial era of fiat currencies is coming to an end is becoming a real possibility. Major economies are now stalling while price inflation is just beginning to take off, following the excessive currency debasement in all major jurisdictions since the Lehman crisis and accelerated even further by covid.
The dilemma now faced by central banks is whether to raise interest rates sufficiently to tackle price inflation and lend support to their currencies, or to take one last gamble on yet more stimulus in the hope that recessions can be avoided. Read More
11.12.21- Housing Is Officially A Bubble
Since we’re in the “everything bubble,” it kind of follows that real estate — one of the things about which people with more money than sense tend to get most excited — would be rocking. And it is. But bubbles are about more than rising prices. They’re also about behavior, to be specific behaviors that hardly anyone would consider wise in normal times. So beyond record-high prices and record-low affordability, here’s how we know US housing is now an epic bubble: Read More
11.12.21- The Madness Of Taxing Unrealized Capital Gains
President Biden’s proposal to require roughly seven hundred US billionaires to pay taxes annually on unrealized capital gains has garnered wide support from Democrats as another step to make the rich pay for the uncontrolled spending by the federal government. House of Representatives speaker Nancy Pelosi says Democrats hope the plan will raise as much as $250 billion to help pay for expanding the social safety net and tackling climate change. The current tax system is already too complicated and adding another layer will not make the system any fairer or make rich people pay more in taxes. Read More
If you have a bad feeling about 2022, you are not alone. As we approach the new year, it seems like things are going wrong all around us. We are facing the most epic supply chain crisis in our history, inflation is out of control, vaccine mandates are killing careers and forcing people out of jobs all over the country, and America is the most deeply divided that I have ever seen in my entire lifetime. Meanwhile, another wave of the pandemic appears to be building, our hospitals are already packed with non-COVID patients, global hunger is on the rise, and a major war could erupt in the Middle East at literally any moment. Unfortunately, I am entirely convinced that many of the problems that we are currently dealing with will escalate to an entirely new level in 2022. Read More
11.09.21- How Long Can Lies & Control Supplant Reality & Free Markets?
The Great Disconnect: Tanking Growth vs. Supported Markets
It’s becoming harder to keep up with the increasingly downgraded GDP growth estimations from the Atlanta Fed.
As recently as August, its GDPNow 3q21 estimates for the quarterly percentage change was as high as 6%.
But within a matter of weeks, this otherwise optimistic figure was cut embarrassingly in half. Read More
Last week, the bond market’s prediction for inflation over the next five years hit an important new high…
Bond traders foresee inflation just below 3% over the next five years – higher than they’ve ever predicted. And when the bond market talks, I listen…
That’s because bond traders are famously accurate at predicting important macroeconomic trends.
That goes for anything from recessions… to what the Federal Reserve will do next… to wars, government policy, and even inflation. Read More
I have a simple question for every ‘expert’ who thinks they understand the root causes of the shipping crisis:
Why is there only one crane for every 50–100 trucks at every port in America?
No ‘expert’ will answer this question.
I’m a Class A truck driver with experience in nearly every aspect of freight. My experience in the trucking industry of 20 years tells me that nothing is going to change in the shipping industry. Read More
11.05.21- MASS WALKOUTS! - MILLIONS Say No To Jab Mandates As Supply Chain COLLAPSES!
The Fed finally begun its cautious taper and the market did not immediately self-destruct… but 14 years of central bank experimentation, regulatory overkill and the “processification’ of markets will have consequences… they may be bleak…
The big news this morning is Fed Taper. Everything in markets is about consequences…. In bonds there is truth. Unintended and unexpected consequences and bond markets seldom sit well together. When bond markets sneeze… equity markets can end up on ventilators, dragging confidence down in their wake… Read More
11.03.21- Revenge Of The Real World
Rather than stare at empty shelves, you have two options for distraction: you can don a virtual-reality headset and cavort with dolphins in the metaverse, or you can trade various forms of phantom wealth that always go up (happy happy!) because the Fed.
Neither distraction actually solves any real-world problems, a reality we can call the Revenge of the Real World We've entered a peculiar phase in American history in which illusions of wealth and control are the favored distractions from the unraveling of the real world economy and social order. Read More
The ship was carrying basic provisions and goods for trade.
But unknown to the sailors, dockworkers, and the locals in Dorset County, the ship was infested with a nasty bacteria called Yersinia pestis, also known as the Black Death. Read More
Recently, whilst having lunch with several successful businessmen, the value of formal education was being discussed and one said, “When I got out of school, I thought I was fully educated and ready to take on the business world, but actually, I was clueless.”
The others laughed, recalling their own introductions into business. All agreed that, although they had taken all of the requisite courses, formal schooling prepared them not at all in the understanding of commerce. Read More
A lot of people aren’t going to want to hear this. There are a lot of people out there that just want to hear that the future is going to be filled with rainbows, lollipops and unicorns, but that isn’t the truth. Months ago, I warned my readers that the global chip shortage wasn’t going to end any time soon and that it would deeply affect thousands of other industries, and that is precisely what is happening right now. Industry after industry is deeply hurting, and a lot of executives are really starting to freak out. Earlier this year, many among the blind optimists assured us that the chip shortage would be resolved by the end of 2021, but obviously that has not happened. In fact, the corporate media is now telling us that it is getting even worse. Read More
We previously discussed the misuse and abuse of stock buybacksover the last decade. Such is not surprising given the low interest rate environment. But, as we now know, there is a point where low rates deter economic activity. Companies become unwilling to “invest” due to the low return environment. The chart shows the problem of economic growth rates and monetary velocity. Read More
If you haven’t been paying attention, you will want to start watching the price of oil again. Just before the financial crisis of 2008, the price of oil briefly shot up to 140 dollars a barrel, and experts agree that a very high price for oil would definitely unsettle financial markets now. Unfortunately, it appears to be inevitable that the price of oil will go much higher. Large financial institutions have become extremely hesitant to fund any projects that would “pollute the environment”, and governments around the world have made it extremely difficult for those that produce traditional forms of energy to expand operations. Read More
10.27.21- Gradually and Then All at Once
So far in 2021, we must have already used that Hemingway-inspired phrase at least a dozen times in these weekly columns. But now, as the investment world is finally beginning to realize that inflation is definitely not "transitory", it's time to use it again.
If you're not familiar with the phrase, it's inspired by Ernest Hemingway, who, when asked about how he went bankrupt, replied, "gradually and then suddenly". Almost all bankruptcies play out this way—including the pending bankruptcy of the U.S. government—but that's not what we're referencing again today. Read More
A global bond market meltdown is only a matter of time. One fine morning, traders will wake up to find all benchmark yields sharply higher, 10 to 20 basis points or more, and no buyers around.
Bond price indicators are flashing deep red right now, from decade-high inflation expectations to waning auction demand and whispers of depressed liquidity. Last week, the U.S. 5-year breakeven rate briefly topped 3% for the first time since the maturity was restarted in 2004
10.25.21- Is It Time To Start Talking About Hyperinflation?
A specter is haunting discussions of the economy — the specter of Covid agency. Almost from the very moment unprecedented government actions were announced worldwide to stop the spread of Covid-19, people became accustomed to referring to the virus as a sentient being with the ability to bend people to his will. Read More
I’m traveling to attend a memorial service, so in place of my usual Monday Economics & Investing column, I’m posting the following article that was written by Brandon Smith of the great Alt-Market.usweb site and originally published at Birch Gold Group. It is re-posted with permission. Read More
BALTIMORE, MARYLAND – What a marvelous time to be alive… with a front-row seat to watch a great empire stumble and fall!
It only happens once every hundred years or so… So pull up a chair and enjoy the show.
Here’s the big news, from Bloomberg:
10.19.21- And Now, for Something Entirely Different: Let Us Count the Ways
What America really wants to know is: after those months of “family leave,” did Pete Buttigieg get the hang of lactating? Hey, if sexuality is just a “social construct,” then the functions of sexuality must be teachable. So now Pete can move on to ovulation lessons and become the “birthing person” of his dreams. Pete’s dreams are America’s dreams, you see. In the meantime, though, America has a little transportation problem that a Secretary of Transportation might look into if he wasn’t so busy performing a gender reeducation parable for the Woke family values crowd. Namely, that federal rules combined with California Air Resource Board regulations are destroying the trucking industry, a major link in the broken supply-chains for the gazillion products and parts that an advanced technological economy needs to keep on keeping on. Read More
The Federal Reserve has been increasing the money supply at an explosive rate. The federal budget, deficits, and the trade deficit are record levels. Governments, both foreign and domestic, have locked down people, restricting production and consumption. How should this be viewed by an economist?
There is clearly chaos in the economy, and hardly a day goes by when I don’t find unusual if not unprecedented situations in day-to-day economic life. However, many people and economists are either oblivious to the problems or in denial. Things are normal for them. Politicians are mostly in this camp. For economists and investment promotors, inflation is “transitory.” They don’t know how the economy works and they expect near perfection from the economy and entrepreneurs. This view is wrong. Read More
Sunday was once my favorite day. Church, then mimosas, then falling asleep on a hammock while reading TheNew York Times. Those were the days. Then church was canceled and replaced by public health messaging.
Now Sunday is the day that the insufferable Anthony Fauci holds court on TV. Whatever he says dominates the headlines for the rest of the week. Reporters let him talk and talk and are either unable or unwilling to ask any hard questions. Read More
10.15.21- The Demand Shock of 2022
Investors are growing cautious as we approach the fourth quarter, and their trepidation is justified. Here’s a brief summary of the situation: there is a potential global financial crisis stemming from the Chinese property market meltdown, supply chain bottlenecks are growing worse, Q3 Earnings warnings are being reported from many large corporations, interest rates are rising, inflation is at a 40-year high, tax hikes are coming in ’22, and the threat of a U.S. debt default still hangs in the air until the end of November. Read More
10.14.21- Distraction as Policy While Our Economic Rome Burns
Desperation and distraction are masquerading as economic policy. Below we see how and why—and at what cost.
COVID: The Great Economic and Political Hall-Pass
If every time I stole a cookie from the jar in front of my mom (age 8), or drove dad’s car (sometimes into a tree) without permission (age 16), failed a dorm-room inspection (age 17), broke a lawnmower for driving over a fence post (each year) or forgot a key anniversary (eh-hmm), it would have been so convenient to have a universal “hall pass” to excuse what is/was otherwise just plain stupid behavior. Read More
10.13.21- A Trillion-dollar Game of Chicken
Most of my readers have followed the ongoing debates in Washington, D.C., about the $1 trillion infrastructure bill and the $3.5 trillion welfare bill now pending in Congress. Here’s a quick recap of the state of play:
The infrastructure bill is only about one-third related to real infrastructure such as tunnels, bridges, roads and airports. The rest involves welfare for union workers and pork-barrel projects that do not benefit the public at large. Read More
When I was about five years old in the early 1980s, my dad brought home our first computer.
I’ll never forget it– it was an clunky IBM with a tiny, orange, monochromatic monitor, and dual floppy disks. It had 640 kilobytes of RAM, and no hard disk.
I loved it. With that computer I learned how to program, how to navigate a command-line interface, how to design algorithms, and how to solve constant problems… because it was ridiculously buggy and would break down all the time. Read More
Now, five years later, Mr. Grant, creator and editor of the esteemed Grant’s Interest Rate Observer, is sharing his thoughts on what the unraveling of Evergrande means moving forward in a wide ranging interview with Wealthtrack’s Consuelo Mack. Read More
No matter how the Evergrande drama plays out - whether it culminates with an uncontrolled, chaotic default and/or distressed asset sale liquidation, a controlled restructuring where bondholders get some compensation, or with Beijing blinking and bailing out the core pillar of China's housing market - remember that Evergrande is just a symptom of the trends that have whipsawed China's property market in the past year, which has seen significant contraction as a result of Beijing policies seeking to tighten financial conditions as part of Xi's new "common prosperity" drive which among other things, seeks to make housing much more affordable to everyone, not just the richest. Read More
Used vehicle wholesale prices spiked 5.3% in September from August, to a new record, according to Manheim this morning, the largest auto auction operator in the US and a unit of Cox Automotive. This spike in the Used Vehicle Value Index more than wiped out three months in a row of declines that had spread false hopes that the used vehicle craziness would finally abate.
The index is now up 27% from September last year when this craziness was already well underway. And it formed a record two-year spike of 46.4% from September 2019. Read More
The unique technical setup in the NASDAQ over the past 30+ days is warning that the markets have lost momentum and may attempt to break below the $14,700, the Neck Line of the Head-n-Shoulders pattern. This unique price setup crept up over the past 20+ days as the US markets started to move away from upward price momentum as the Chinese and US market dynamics started to shift away from the continued reflation trade expectations. What does this Head-n-Shoulders pattern mean for traders and investors right now? Read More
10.06.21- Economic theory and long-wave cycles
Investors and others are confused by the early stages of accelerating price inflation. One misleading belief is in cycles of industrial production, such as Kondratieff’s waves. The Kondratieff cycle began to emerge in financial commentaries during the inflationary 1970s, along with other wacky theories. We should reject them as an explanation for rising prices today.
10.05.21- A Depression is Inevitable
Historically, the start of most wars has not been a surprise. Usually, there is a very clear build up before hostilities begin, and we are seeing the same pattern today. For example, by now it should be exceedingly clear to everyone that Israel and Iran will be going to war. Both sides have been talking about the coming conflict for years, and everyone knows who has been causing the “mystery explosions” inside Iran and everyone knows who has been attacking Israeli commercial ships. A “shadow war” has already been going on for quite some time, and at some point missiles will start flying back and forth between the two countries. Likewise, by now it should be exceedingly clear that China wants to invade Taiwan. Read More
Below, we look at The hidden bankruptcy of the US in the wake of even more inflationary forces confirmed by cost-of-living-adjustments, Uncle Sam’s interest expenses, objectively unloved Treasuries and a roaring as well as convenient COVID narrative.
Math vs. Double-Speak
Given the fact that just about everything coming out of the mouths of debt-cornered policy makers requires a lie-detector and “double-speak” translator, we’ve been arguing since the moment the Fed began peddling the “transitory inflation” meme/myth to think differently. Read More
Global food prices climbed back to near-decade highs in early September, reviving concerns about inflationary pressures. A newly emerging risk that many have missed and could catapult food prices even higher this fall/winter is China’s difficult harvest season as power curbs hurt the outlook for production, according to Bloomberg.
Autumn harvest has begun for the world’s second-largest economy amid power constraints in at least 20 Chinese provinces and regions, making up more than 66% of the country’s GDP. Some of these regions are industrial hubs that have manufacturing plants. Read More
09.30.21- The Market Crash Nobody Thinks Possible Is Coming
You cannot stand aside, watching America go pure Marxist and do nothing to save what is so DEAR to us all.
Face facts. We are watching in silence everything meaningful to us fall into oblivion in large chunks almost on a daily basis. Read More
The so-called Dark Winter is actually a die-off plan to exterminate humanity, and the vectors of attack against human beings include mass vaccination genocide, engineered food supply collapse (leading to mass starvation), financial sector disruptions and an accelerating supply collapse of energy (gasoline, natural gas) needed to heat homes, make fertilizer and power transportation. Read More
Here Is The ‘Spartacus COVID Letter’ That’s Gone Viral
This is an anonymously posted document by someone who calls themselves Spartacus. Because it’s anonymous, I can’t contact them to ask for permission to publish. So I hesitated for a while, but it’s simply the best document I’ve seen on Covid, vaccines, etc. Whoever Spartacus is, they have a very elaborate knowledge in “the field”. If you want to know a lot more about the no. 1 issue in the world today, read it. And don’t worry if you don’t understand every single word, neither do I. But I learned a lot. -Raul Ilargi Meijer Read More
It was January 2007…
Wearing his signature jeans and black turtleneck, Apple cofounder Steve Jobs walked on stage in front of a crowded audience. It was Apple’s 2007 MacWorld conference.
Addressing the audience, Jobs said he was going to reveal a “revolutionary and magical product that is literally five years ahead of any other mobile phone.” That device was – of course – the original iPhone. Read More
From stimulus boom to income thud, the coming “reversion to the mean” of economic growth is happening faster than economists expected.
We previously noted that while many mainstream economists believed the current economic “boom” would persist, several factors suggested it wouldn’t. Read More
The Evergrande (“EverSCAMMED”) fiasco is nothing more than a classic Bernie Madoff Ponzi scheme involving property developers and greed-driven investors who chased high returnswhile forgetting about the existence of risk. (Every generation, it seems, must learn this painful lesson the hard way…)
Like all successful Ponzi schemes, Evergrande’s rise to become a global Fortune 500 business hinged on it finding a steady supply of new suckers to hand over their money as “investments” in the Evergrande scheme. Read More
The Biden administration is seeking to compel banks to report to the IRS any bank account with more than $600 in transactions per year. This proposal is a linchpin of Biden’s American Families Plan, and will supposedly help generate almost $500 billion in federal revenue over the next decade. But previous catch-all financial reporting requirements have helped spur national disasters, complete with pervasive federal looting. Read More
“Reflect on what happens when a terrible winter blizzard strikes. You hear the weather warning but probably fail to act on it. The sky darkens. Then the storm hits with full fury, and the air is a howling whiteness. One by one, your links to the machine age break down. Electricity flickers out, cutting off the TV. Batteries fade, cutting off the radio. Phones go dead. Roads become impossible, and cars get stuck. Food supplies dwindle. Day to dayvestiges of modern civilization – bank machines, mutual funds, mass retailers, computers, satellites, airplanes, governments – all recede into irrelevance. Picture yourself and your loved ones in the midst of a howling blizzard that lasts several years. Read More
The migrant mass of some 15,000 mostly Haitians now illegally on U.S. territory in a squalid, never-before-seen shantytown under a bridge near Del Rio, Texas, demands some answers.
Here's how bad it is:
BREAKING: I am absolutely stunned by what I’m witnessing right now. We are on a boat in the Rio Grande near the Del Rio international bridge and we are watching as masses of hundreds of migrants walk across the river from Mexico and stream into the US illegally. @FoxNews pic.twitter.com/xXE4pDkpIe — Bill Melugin (@BillFOXLA) September 18, 2021 Read More
09.18.21- Why Is the Fed Desperate
China hasn’t bailed out its over-indebted property developers yet, to the shock of foreign investors who’d bought their dollar bonds. Could the forced deleveraging trigger a financial crisis?
Property development has been a huge factor in China’s economic growth. It accounts for 28% of GDP. And much of it has been funded by debt, including dollar-debt, and much of it is now blowing up. Read More
09.16.21- Nothing is Real: A Visual Journey Through Market Absurdity
When it comes to modern markets, risk assets and the now normalized yet twisted tango of fiscal and monetary policy gone wild, it’s safe (rather than sensational) to simply confess that nothing is real.
As I recently watched BTC drop by 16% in one hour from $50K to $43K, only to reach back up to $46K in 20 minutes, my 20+ years of Wall Street experience watched with bemused yet experienced awe at what amounted to just another day of leverage, emotion and institutionalized front-running as the big money whales in crypto pulled off yet another media and SEC-ignored pump-dump-and-pump trade. Read More
There are a great many things coming from Biden, Fauci, the CDC, the State Department, the military, the Justice Department, and basically the Deep State that make no sense. From Biden and the Deep State, we are getting executive orders, mandates, guidelines, decisions, policies, and edicts that just do not make any sort of intellectual sense. It is not just a difference of opinion. It is not just different politics or a different point of view. Decisions, guidelines, policies, and proposed laws are coming out of Washington D.C., Biden, and the Deep State that one just can't figure out in an intellectual, factual, common-sense sort of way. Read More
The great financial historian, Charles Kindleberger, pointed out in the 1970s that over several centuries, history showed there was a financial crisis about once every ten years.
His observation still holds.
In every decade since his classic Manias, Panics and Crashes of 1978, such crises have indeed continued to erupt in their turn, in the 1980s, 1990s, 2000s, 2010s, and again in 2020.
What could cause the next crisis in this long, recurring series?
I suggest seven possibilities: Read More
In a story that should be on the front page of every newspaper, or at least have any reporter worth their salt digging into it, a man who purports to be a controlled demolitions special operative for the United States, has come forward with a damning confession. According to Manuel Garcia Jr., he was tasked by a team created by Dick Cheney to help carry out a false flag attack on the World Trade Centers, otherwise known as 9/11, in order to “reshape the World Order to secure another century of US control.” Read More
09.11.21- Weekend Rant: There Is No Turning Back After This
This is the most sickening thing that Joe Biden has ever done. That is saying a lot, because Biden has a long history of doing sickening things. For the past couple of hours I have been trying to find the right words to put what we just witnessed into proper perspective. This truly is one of the most pivotal moments in American history, and there will be no turning back after this. We are descending into full-blown tyranny, and I have literally felt sick to my stomach as I have pondered the ramifications. What remained of the country that so many of us once loved is being absolutely eviscerated, and it is deeply heartbreaking to watch it happen. Read More
The U.S. and most of the world is at the threshold of what I would call a nexus point in history. There are establishment forces at play that seek to impose a permanent authoritarian presence within our nation in the name of Covid “safety.” This includes lockdown mandates and restrictions on economic participation for the unvaccinated (including being unable to keep a job).
At the same time, only 53% of the public has been fully vaccinated against Covid. A significant number of the unvaccinated seem likely to dig in their heels and refuse to comply with the advice of medical professionals and the government. Read More
Where's the beef? (And pork and chicken?)
Yesterday US stocks had the temerity to go down. Not a lot: S&P -0.13%, Dow -0.2%-- but red, not green. It’s apparently headline news. More significantly, markets are worrying the all-time high in stocks might not last for all time. The chatter / whisper is of a possible correction which, to be fair, it has been for a long time as stocks have kept levitating regardless. Meanwhile, as Treasury yields dropped to reverse the previous day’s climb, 3-month USD LIBOR is still only just above the lowest level this year at 0.11% vs 0.24% at the start.Read More
"I wish it need not have happened in my time," said Frodo. "So do I," said Gandalf, "and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us."
I am of the opinion that we are all a part of one of the great epochal shifts in human history and that what we fight to secure today will reverberate through society for generations. We did not ask for this moment — most of us, in fact, have hoped that by quietly enduring the hardships that come our way, our toleration of what is intolerable would somehow be rewarded with comfort and peace. As with all turning points in human history, Read More
09.07.21- Human Capital Losses
Remember math class? Let me give you a quick refresher.
In the equation 3 x 5 = 15, the 3 and 5 are factors, and 15 is the product. You can’t have a product without factors. Read More
It is slowly dawning on all the different entities, including health care, that if they actually try to enforce jab mandates they're going to be screwed. Some of this is very visible already if you know where to look. Hospitals report "staffed and available" ICU (and regular) beds. For a bed to be usable legally-mandated staffing levels must be present. Beds don't "disappear" in a hospital; you don't make the building larger or smaller, do you?
Nope -- it's all about staff levels.
Well? Read More
09.04.21- The Four Horseman
Over the last two days, I’ve outlined THE single most important development you need to see, in order for the market to crash.
Think of them as BIG warnings, or the FOUR Horsemen that precede a stock market apocalypse.
What are they?
When most heavily weighted companies began to break down badly. Read More
09.03.21- The Four Horsemen
Yesterday I outlined THE single most important development you need to see, in order for the market to crash.
Think of them as BIG warnings, or the FOUR Horsemen that precede a stock market apocalypse.
What are they?
When most heavily weighted companies began to break down badly. Read More
We’ve been hearing a lot of speculation that the Afghan debacle is more than it seems – that rather than being a typical outcome of activity by some of the dumbest, most ill-informed, and most blinkered individuals ever to occupy places in the U.S government, it is instead a dark, convoluted conspiracy aimed at some goal sinister beyond words.
Some of this is from the usual suspects who see conspiracies every time a cat falls out of a tree, and some by more reputable people. The core concept here can be expressed simply: “There has to be something else going on. Nobody could be that stupid.” Read More
“Anyone who claims to know the future of interest rates is certifiable.”
The great Autumnal Bond Funding Season is upon us, but the looming taper of Central Bank Asset Purchase Schemes could well expose just how broken and dysfunctional bond markets have become. Markets always over-react to stress and panics, but when markets struggle with price discovery and liquidity the coming sell off could be magnified, which means a great buying opportunity in bonds may be coming! Read More
08.31.21- And Now, for Something Entirely Different: A Heedless Aftermath
Getting ready for the holiday selling season.
There are currently 56 cargo ships anchored in front of the ports of Los Angeles and Long Beach. This includes a record of 44 container ships, bypassing the infamous record of 40 set in February 2021.
This is the run-up to the holiday selling season in the US, when retailers are desperately trying to stock up their inventories, which from many categories, including apparel, have already been running low. Green dots are cargo ships, red dots are tankers (image via Maritime Traffic): Read More
08.28.21- Avoid the Herd of Bulls Stampeding Toward the Exit
If you’re concerned that the equities markets are going insane and that you might need to adjust your plan, you’re not alone.
Let’s first shed some light on the insanity…
Every Friday after Thanksgiving (except perhaps last year), major retail stores have had a “doorbuster” sale of some type.
08.27.21- The Distorted Truth about Stocks
YOUGHAL, IRELAND – We’re backing and filling this week.
Are our views correct? Are we on firm footing?
Or are we slipping and sliding, with a cockeyed perspective?
We’ve already seen that the actions that produce wealth are those where people work to satisfy others’ needs and desires. Neither goods nor services have any value of their own. They are given value by the people who want them… whose desires are aggregated and measured in market prices. Read More
Kris’ note: Before we get into today’s Dispatch, a quick reminder about a special event that’s due to kick off around four hours from now (at 8 p.m. ET). It involves a dear friend of Casey Research, Jeff Brown.
As far as we’re concerned, Jeff is hands down the best technologist and tech investing expert we’ve come across in our 25-plus years in the market. And tonight, Jeff is livestreaming details about his latest project. Read More
If there’s one thing the world has taught us over the past 18-24 months, it’s that everything can change… in an instant.
We’ve seen the world shut down over a virus. Riots, looting, and chaos spilled into the streets in some of the most stable democracies in the West.
Fanatical progressives in the Land of the Free hijacked the education system, from kindergarten through university, and began forcing their woke doctrine into young minds. Read More
“How many divisions does the Pope have?”
As markets shake off their summer slumbers, what should we be worrying about? Lots..! From real vs transitory inflation arguments, the long-term economic consequences of Covid, the future for Central Banking unable to unravel its Gordian knot of monetary experimentation, and the prospects for rising political instability in the US and Europe.
Same as, same as…. Read More
We’re now in the middle of a new surge of COVID cases blamed on the Delta variant of the SARS-CoV-2 virus. The Delta surge should abate significantly by mid-September.
But I’m afraid the consequences of bad economic policies engendered by the pandemic will last much longer.
In the immediate aftermath of the first pandemic wave (March – May 2020), the White House, Congress and the Fed implemented a financial wave of new policies. Read More
08.21.21- The Most Important Price in Capitalism
When I was growing up in the Soviet Union, our local grocery store had two types of sugar: The cheap one was priced at 96 kopecks (Russian cents) a kilo and the expensive one at 104 kopecks. I vividly remember these prices because they didn’t change for a decade. The prices were not set by sugar supply and demand but were determined by a well-meaning bureaucrat (who may even have been an economist) a thousand miles away. If all Russian housewives (and househusbands) had decided to go on an apple pie diet and started baking pies for breakfast, lunch and dinner, sugar demand would have increased but the prices still would have been 96 and 104 kopecks. As a result, we would have had a shortage of sugar — a very common occurrence in the Soviet era. Read More
It seems like sophistry—a fallacious argument with the intention of deceiving. What is really going on here? Read More
Brian Dean Wright, a former CIA Ops Officer, explains in a brief but incisive Twitter thread that "former US intelligence colleagues are angry and deeply worried at what has happened in Afghanistan."
Wright warns that "there's nearly universal belief that America and the world are in for one of the most dangerous, unpredictable times in modern history." Read More
08.18.21- The Folly of Ruling Out a Collapse
Investors accept in theory the premise that the stock market may have its recessions in the future. But these drops are envisaged in terms of the experience of the past ten years when the maximum decline was only 19 percent. The public is confident that such setbacks will be made up speedily, and hence that a small amount of patience and courage will bring great rewards in the form of a much higher price level soon thereafter.
Investors may think they are basing this view of the future on past experience, but in this they are surely mistaken. The experience of the 1949-1959 market – or of all bull markets put together – reflects only the sunny side of the investment. Read More
08.16.21- Why I No Longer Invest
I’ve touched upon this subject in my subscription newsletter, but I had no plans to write anything more until I got a note from a friend, mentioning a particular investment analyst and his views on investing over the next few years. I had to agree that it was brilliant analysis, but at the same time I knew that I’d never do anything about it, because I simply can’t bring myself to put money into “the markets” anymore.
As a young man I spent time learning the nuts and bolts of investing: Price to earning ratios, book values, charting, puts, calls, covered positions, and so on. And when I had extra money, I tended to put it into the markets and use my tools. But I can no longer do that, and I think explaining why may be useful. Read More
08.14.21- Weekend Rant: Situation Report
I don’t get out that often. Farming requires a constant set of eyeballs on the herds and flocks as well as a fair degree of labor regardless of the season. Throughout the past year and half as the rest of the world seemed to have descended into a collective psychosis over an annual flu bug I watched from a comfortable distance, not only in the physical sense, but psychologically as well. I began to pay attention to the developing narrative very early in January of 2020 when most people were going about their lives blithely unaware of the developing storm clouds building on the horizon. Read More
08.12.21- A Global Liquidity Crisis Is Underway
I’ve been analyzing currency wars for years. In fact, I’ve written a book called Currency Wars, so I have some expertise in the subject.
A new front in the currency wars is emerging, but it has not yet erupted into blatant currency manipulation. That will probably come in early 2022. Read More
Yes, it’s an official concern now. The mainstream media and the Biden Administration have gone from suggesting that Covid vaccinations would “not be mandated” to saying they “should be mandated.” This means several very uncomfortable consequences are on the way for our economy and the nation as a whole. Remember, the federal government already decided it’s legal for companies to require coronavirus vaccines. The most obvious next step: A mandatory “vaccine passport” certifying its holder has gotten the recommended injections. Read More
08.10.21- The Fall of the Dominoes
Inflation, as measured by the PCE (personal consumption expenditures) index, was, on an annualized basis, over 7 percent in March and April, and over 6 percent in May and June. Going by the more popular CPI (consumer price index), annualized inflation was between 8 and 11 percent in those same months. For perspective, the last time the economy experienced four consecutive months of inflation this high was at the tail end of Jimmy Carter’s stagflation. Read More
I have three goals. First, I want to clarify the nature and function of private property. Second, I want to clarify the distinction between “common” goods and property and “public” goods and property, and explain the construction error inherent in the institution of public goods and property. Third, I want to explain the rationale and principle of privatization. Read More
08.07.21- Currency Emergency: When the Debt Comes Due
What happens when the debt comes due?
It’s a question millions of Americans are grappling with in their personal finances. It’s also a multi-trillion dollar question facing officials in Washington, D.C.
How they decide to answer it – or evade it, as the case may be – will have profound implications for investors and anyone who holds U.S. dollars. Read More
08.06.21- MMT – When Theories Collide With Reality
Previously, we discussed Modern Monetary Theory (MMT) and its one limitation of inflation. However, as is always the case when “theories” collide with “reality,” the tenants of the theory are quickly discarded.
There is no doubt that since 2020 both Republicans and Democrats alike have shunned fiscal responsibility for the short-term gratification of MMT. Ms. Kelton tweeted such earlier this year. Read More
08.05.21- Stop the Lies
Health officials continue to lose credibility over COVID-19. They seem to change their minds daily based on whim rather than science. But that’s been the case since the pandemic started.
Going back to last January, official comments on COVID have been mostly wrong. The comments were either outright lies or were prescriptions based on politics, not medicine.
In January 2020, the World Health Organization said there was no human-to-human transmission of COVID. They knew better because of data from China, so that was a lie. Dr. Anthony Fauci said there was little risk of COVID coming from China to the U.S. Another lie. Read More
The deflationists had another bad day yesterday.
Deflationists argue that inflation doesn’t exist because the Treasury market isn’t acting as if inflation is a problem. They always fail to mention that the Treasury market is ALSO the most manipulated market on the planet. The Fed is currently spending over $1 trillion per year buying these bonds, effectively cornering them.
So why was yesterday a bad day for deflationists? Read More
Imagine it: a national classification system that not only categorizes you according to your health status but also allows the government to sort you in a hundred other ways: by gender, orientation, wealth, medical condition, religious beliefs, political viewpoint, legal status, etc.
This is the slippery slope upon which we are embarking, one that begins with vaccine passports and ends with a national system of segregation.
It has already begun. Read More
08.02.21- The Road To Totalitarianism
People can tell themselves that they didn’t see where things have been heading for the last 17 months, but they did.
They saw all the signs along the way. The signs were all written in big, bold letters, some of them in scary-looking Germanic script. They read:
I’m not going to show you all those signs out again. People like me have been pointing them out, and reading them out loud, for 17 months now. Anyone who knows anything about the history of totalitarianism, how it incrementally transforms society into a monstrous mirror image of itself, has known since the beginning what the “New Normal” is, and we have been shouting from the rooftops about it. Read More
A term has been coined for product sellers who shrink their packages, and thus, the amount of product in those packages, keeping the package price the same: shrinkflation. Anyone with a bit of good sense or economics training knows this is another form of price inflation, caused by what used to be the dictionary meaning of inflation; an increase in the supply of money. Read More
07.30.21- Housing Prices Slide
Interestingly, you’re about to find out that the fall in housing prices and home sales may power us further into high inflation for longer. We are entering a situation that could turn into a true oxymoron where lower prices equal higher prices as early as this week at the Fed’s Federal Open Market Committee meeting. I’ll tell you how that works.
Housing prices are finally falling Read More
The Federal Reserve insists inflation is “transitory” and the economy is making “progress.” Yet, it continues with the extraordinary monetary policy it launched at the onset of the COVID-19 pandemic. Meanwhile, we’re seeing all kinds of data hinting that the economy may not be as great as advertised. Despite this, and even as prices continue to spiral higher, the Fed’s only monetary policy is talk. Peter breaks it all down on his podcast and drills down to the key question: what happens if the markets call the Fed’s bluff? Read More
07.28.21- How to Beat Wall Street at Its Own Game
07.27.21- 2021’s Most Common Financial Scams
Among the many contenders for the most frequent scams in 2021, Business Insider has selected the five most frequent offenders. Last year, there were more than 800,000 scams with some form of online presence, resulting in losses of more than $4.2 billion. Scammers haven’t taken it any easier this year, and the diversity of the scams shows that caution and common sense should be part of everyone’s daily routine. Read More
Every Word of the Official Covid Narrative Is a Lie. There is a vast amount of hard empirical evidence disproving the orchestrated narrative, but the presstitute scum censors it instead of reporting it.
Covid deaths are associated with co-morbidities, impaired immune systems, and deficiency of Vitamin D and Zinc. There have been known safe cures for the virus since the beginning, and the cures were blocked from use in order to have a market for the vaccines. Read More
If you were awake at all this week, you caught glimpses of the stock market drama. Maybe you tuned it out? Here’s a quick recap:
Monday: Huge sell-off, the worst one-day decline since October 2020.
Tuesday: Big rebound recaptured 80% of Monday’s losses.
Wednesday: Rally continues, Monday’s losses fully recouped.
Thursday: Stocks rise a bit, ended the day up.
Friday: All major indices up, near their record highs. Read More
07.23.21- Time to Buy Your Umbrella
Heavy weather barreled through Wall Street Monday — beneath the weatherman’s detection — and gave investors a savage drenching.
Squalling rains washed away 925 points from the Dow Jones Industrial Average… before relenting late in the day.
High pressure, high skies and high expectations were back yesterday. The Dow Jones reclaimed 536 points. It took back another 286 points today. Read More
07.22.21- Do You Have This Smartphone App?
The stock market bounced back today after yesterday’s major losses. “Buy the dip” is alive and well.
But today, I want to revisit a topic I haven’t addressed much lately due to the pandemic, the inflation debate, and many other topics that have taken center stage.
I’m talking about the war on cash. Read More
Tuesday was an “Interesting” day in markets. Monday’s full-on wobble in global equities reversed into a buying binge as investors sensed the opportunity to buying a cheap market, at pretty much the same price it was the day before when they sold because it was an expensive market. What had changed? Precisely nothing.
You could dig into the details and guess on Monday people got scared of the ongoing consequences of Covid. On Tuesday the market voted again and decided the pandemic isn’t an issue… Basically it’s a market bouncing off the walls, looking for something to trade around. Read More
Short-term interest rates are now as negative as they were in the inflationary 1970s.
But that’s where the similarity ends. As the above chart shows, 1970s indebtedness was relatively modest as a percentage of GDP, which gave that financial system the resiliency to withstand the double-digit interest rates necessary to throttle inflation and bring things back into balance. Today, debt in both nominal terms and as a percentage of GDP is off the charts, which means even modestly higher interest rates would bankrupt the world. Read More
07.19.21- What Triggered the Crash?
And so on to the moment of mass disillusion and the crash. This last, it will now be sufficiently evident, never comes gently. It is always accompanied by a desperate and largely unsuccessful effort to get out. The least important questions are the ones most emphasized. What triggered the crash?
This is not very important, for it is in the nature of a speculative boom that almost anything can collapse it. Any serious shock to confidence can cause sales by those speculators who have always hoped to get out before the final collapse, but after all possible gains from rising prices have been reaped. Their pessimism will infect those simpler souls who had thought the market might go up forever but who now will change their minds and sell. Read More
07.17.21- Soaring Debts
After decades of unhinged money-pumping, the Fed has driven real interest rates so low that there are no more bond investors - just traders and suckers.
The former have driven the 10-year yield in recent days to just 150 basis points in nominal terms (and deeply into the red in real terms in the face of surging monthly inflation numbers), because they are “pricing-in” one thing and one thing only: simple and supreme confidence that the spineless fanatics who occupy the Eccles Building will keep buying $120 billion per month of government and quasi-government debt. Read More
Bad news … Retirement savers with some (or all) of their assets tied up in a private pension could be facing a nightmare scenario sooner than expected.
07.15.21- The Approaching Storm
So, it looks like GloboCap isn’t going to be happy until they have fomented the widespread social unrest — or de facto global civil war — that they need as a pretext to lock in the new pathologized totalitarianism and remake whatever remains of society into a global pseudo-medicalized police state, or that appears to where we’re headed currently. We appear to be heading there at breakneck speed. I don’t have a crystal ball or anything, but I’m expecting things to get rather ugly this Autumn, and probably even uglier in the foreseeable future. Read More
When the 2020 presidential election was stolen from President Trump, the Republican Establishment was happy to be rid of him. Trump’s intent to bring the offshored corporate jobs back home to Americans where they belong was regarded as a threat to corporate profits. Wall Street and corporate executives were strongly opposed and used their influence against Trump. Read More
07.12.21- Why I Don’t Operate On My Gut Instincts
When I was younger and desperate to “figure out the stock market,” I’d ask everyone all the questions I could. I thought that was the best way to learn.
But I ended up frustrated at the conflicting information I would get. And nothing irked me more than hearing that profiting from the market required a lot of “feel.”
That’s probably because I had no “feel.” Or worse yet, my feelings were constantly wrong. Read More
“Brace for a significant market correction,” said Mark Zandi earlier this week. He hinted that a 10 to 20% correction was already underway.
Which isn’t surprising, as manic investing behavior coupled with last year’s pandemic mitigation attempts eventually must give way to fundamental market forces.
07.09.21- The Problems With Central Planning
07.08.21- China: Fragile Giant
We asked and answered the above trick question in a blog post on 22nd March. It’s a trick question because although rising interest rates put downward pressure on some stock market sectors during some periods, they are never the primary cause of major, broad-based stock market declines. After all, the secular equity bull market that began in the early-to-mid 1940s and ended in the mid-to-late 1960s unfolded in parallel with a rising interest-rate trend, and the preceding secular equity bear market unfolded in parallel with a declining interest-rate trend. Read More
Nothing Goes to Heck in a Straight line, not even the dollar’s hegemony.
Yes, the Fed is a drunken reckless money-printer, and the US government has been high for years on deficit spending, but other major central banks and governments do the same or worse. The long-term trends are clear, however. Read More
1: The stock market is deliriously overvalued by history’s standards…
2: Investors fully acknowledge 1…
3: Investors continue to pile into the stock market despite 1.
Conclude the gentlemen and ladies of Bespoke Investments:
Russia warned the U.K. that it would bomb any British warships it finds in the Black Sea. The June 24 threat from the Kremlin followed a British Royal Navy vessel passing by the waters of Crimea – which Russia annexed in 2014. On the other hand, Downing Street has insisted that the disputed territory’s waters belong to Ukraine and the warship made no provocative actions.
On June 24, British Ambassador to Russia Deborah Bronnert was summoned for a formal diplomatic reprimand over Britain’s purportedly “dangerous” action in the Black Sea. Read More
07.02.21- The Fed Can’t Tighten
Gold’s recent selloff looked familiar in that it resembled the types of gold selloffs that occurred when the Fed talked about tightening its loose policy for years in the mid-2010s.
It sure talked a good game. But, when it came time to really test how much tightening the debt-saturated economy could handle, by late 2018, the Powell Fed folded like a cheap suit. Read More
“If you want a picture of the future, imagine a boot stamping on a human face—for ever.”— George Orwell, 1984
Tread cautiously: the fiction of George Orwell (Jun. 25, 1903-Jan. 21, 1950) has become an operation manual for the omnipresent, modern-day surveillance state. Read More
It’s been hard, lately, to untangle the many causes of inflation’s sudden surge. How much is due to the pandemic lockdown distorting year-over-year comparisons? How much to crippled supply chains forcing manufacturers to pay up for needed components? And how much to good old-fashioned excessive money printing?
Whatever the cause, headline inflation numbers have been brutal, with the CPI rising at rates that would normally call for a fast, hard tightening. See Key inflation indicator posts biggest year-over-year gain in nearly three decades. Read More
Inflation is here, and with it the possibility of an agricultural commodities supercycle. We’ve all seen inflation at the gas pump and the grocery stores, and heaven help you if you need to build something right now. Just recently ZeroHedge published an article about ag leaders predicting a mini supercycle in commodities.
Let’s unpack this a little bit. Read More
06.28.21- The Only Metric That Matters
Interest rates remain chained at zero. Any slight increase remains one year distant — at minimum — and likely two years distant.
Meantime, the Federal Reserve continues to purchase assets at the rate of $120 billion the month.
It is only now beginning to “talk about talking about” kinking the liquidity lines.
That is, the Federal Reserve remains what professional men term… accommodative. Read More
06.26.21- Do You Hear The Bells Ringing?
There’s an old Wall Street adage, you’ve likely heard it, “No one rings a bell at the top (or bottom) of the market.”
The bell, of course, is the signal to sell at the market top. Here we pause to take exception with this adage.
As far as we can tell, bells do ring at market tops. Yet few hear them. Most people’s ears are plugged with the prospects of easy riches. Read More
06.25.21- Welcome To The “Pre-Taper” Tantrum
In 2018, the Fed tried to moderate its post-Great Recession emergency policy of low interest rates and torrential money printing. It reduced (or tapered) its asset purchases and, in a series of tiny steps, boosted short-term interest rates by about one percentage point. Read More
06.24.21- It Always Ends The Same Way: Crisis, Crash, Collapse
Risk has not been extinguished, it is expanding geometrically beneath the false stability of a monstrously manipulated market.
Appearing Tuesday on CNBC’s Squawk Box, hedge fund manager Kyle Bass estimated that the United States’ inflation rate is approximately 12 percent.
A transcript is as follows:
06.22.21- The Decentralization Fetish
There is a common view among bitcoin advocates, which also prevails to some extent among economists working in the Austrian tradition, that decentralization is always good and more-decentralized solutions are always better. In both forms, this view starts with a reasonable premise. Bitcoin revolutionized payments by enabling digital transactions to take place between strangers without a trusted third party serving as a centralized clearinghouse. Ludwig von Misesargued that economic calculation was impossible under central planning, while Friedrich Hayek explained that markets relied on decentralized knowledge of a particular time and place. Read More
Out of Control
American workers are trying to make their way in an economy that’s rigged against them. We made this claim many years ago. Today, for fun and for free, we revisit this assertion…starting with the latest from those doing the rigging. Read More
06.19.21- Too Much Liquidity
Yesterday, the FOMC released its June statement which only served to remind us that its members are powerless in the face of inflationary conditions. They refuse to accept the price consequences of monetary inflation, still clinging on to an increasingly untenable hope that price rises are “transitory”.
The fact of the matter is that the world is now awash with excess money, the two greatest inflationists being the Fed and the Bank of England. In the US, the Fed’s $120bn monthly QE continues to goose financial asset values, while the US Government has spent a further trillion into circulation from its general account at the Fed. This tidal wave of money threatened money market funds totalling over $4 trillion with negative rates, thereby “breaking the buck”, which is why the Fed has increased its outstanding reverse repos to $721bn. Read More
06.18.21- No Return to “Normal”
Our subject today has a little of everything – ambition… betrayal… idealism… cynicism… democracy… revolution… corruption… you name it!
But today’s setting is not the USA. Still, we will turn to the U.S. media for a big surprise, before taking up our parable.
Here’s a rare event… where the reporter got the story almost right. The Hill: Read More
06.17.21- Are we at the Inception of an Inflationary Depression?
It is an acknowledged fact within the circle of Austrian Economists that the Central Banks have to continuously rely on and actively indulge in a propaganda of Voodoo Economics to hide the extreme imbalances that they have created in the world economy.
What lies in the decade ahead for much of the Western economies and indeed most parts of the world is a prolonged period of high inflation combined with an economic depression. Read More
A report published last year by the WEF-Carnegie Cyber Policy Initiative calls for the merging of Wall Street banks, their regulators and intelligence agencies as necessary to confront an allegedly imminent cyber attack that will collapse the existing financial system.
In November 2020, the World Economic Forum (WEF) and Carnegie Endowment for International Peace co-produced a report that warned that the global financial system was increasingly vulnerable to cyber attacks. Advisors to the group that produced the report included representatives from the Federal Reserve, the Bank of England, the International Monetary Fund, Wall Street giants likes JP Morgan Chase and Silicon Valley behemoths like Amazon. Read More
Earlier this year, none other than Michael 'Big Short' Burry confirmed BofA's greatest fears, as he picked up on the theme of Weimar Germany and specifically its hyperinflation, as the blueprint for what comes next in a lengthy tweetstorm cribbing generously from Parsson's seminal work, warning that:
"The US government is inviting inflation with its MMT-tinged policies. Brisk Debt/GDP, M2 increases while retail sales, PMI stage V recovery. Trillions more stimulus & re-opening to boost demand as employee and supply chain costs skyrocket." Read More
As the world economy awakens from the 15-month slumber caused by the pandemic, Deutsche Bank has launched a series of research articles to spark debate and discussion about pressing post-pandemic economic issues.
06.12.21- How Fanatics Took Over the World
Early in the pandemic, I had been furiously writing articles about lockdowns. My phone rang with a call from a man named Dr. Rajeev Venkayya. He is the head of a vaccine company but introduced himself as former head of pandemic policy for the Gates Foundation.
Now I was listening.
I did not know it then, but I’ve since learned from Michael Lewis’s (mostly terrible) book The Premonition that Venkayya was the founding father of lockdowns. While working for George W. Bush’s White House in 2005, he headed a bioterrorism study group. From his perch of influence – serving an apocalyptic president — he was the driving force for a dramatic change in U.S. policy during pandemics. Read More
...and it’s a lot worse than it appears.
The Consumer Price Index jumped 0.6% in May, after having jumped 0.8% in April, and 0.6% in March – all three the steepest month-to-month jumps since 2009, according to the Bureau of Labor Statistics today. For the three months combined, CPI has jumped by 2.0%, or by an “annualized” pace of 8.1%. This current three-month pace of inflation as measured by CPI has nothing to do with the now infamous “Base Effect,” which I discussed in early April in preparation for these crazy times; the Base Effect applies only to year-over-year comparisons. Read More
On Monday, Deutsche Bank released a report that further confirms a portent of doom for the U.S. economy and Democrats led by President Joe Biden. While many economists and policymakers claim that the recent uptick in inflation is temporary, Deutsche Bank warned that Biden’s profligate spending, the Federal Reserve’s low interest rates, and global economic trends threaten to unleash persistent inflation, which amounts to an insidious tax on the poor and middle class that benefits the government. Read More
One Bank Goes Apocalyptic: Inflation Is About To Explode "Leaving Global Economies Sitting On A Time Bomb"
As excerpted from “Inflation: The defining macro story of this decade” a must-read report written by Deutsche Bank’s global head of research, David Folkerts-Landau, co-authored by Peter Hooper and Jim Reid.
Ronald Reagan (1978): “Inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hit man.”
Joe Biden (2021): “A job is about a lot more than a paycheck. It’s about dignity. It’s about respect. It’s about being able to look your kid in the eye and say everything will be okay. Too many people today can’t do that – and it’s got to change.” Read More
People used to call those who could see the writing on the wall “crazy conspiracy theorists.” Now, major mainstream media outlets are reporting that the United States dollar could crash by the end of 2021.
Honestly, I am surprised the dollar hasn’t crashed already. It’s almost worthless in the sense that prices are skyrocketing and hyperinflation is right around the corner.
Energies of legalism, monetarism and fatalism Complete control of humanity
The seething energies of legalism, monetarism and fatalism raise the question, why is it better to be ruled by the head and not the heart?
Due to the tradition of Abrahamic laws, it has been much too easy for our Western rulers to impose the unemotional political ideology of legalism. It also explains why most of our politicians are lawyers. Legalism has led to a statute book with thousands of laws and created a monstrous bureaucratic labyrinth of government agencies. Read More
06.05.21- Weekend Rant: What If
Maybe now that Dr. Tony Fauci has begun to spill the beans on his doings in service to the Wuhan virology lab, the phrase “conspiracy theory,” flogged by the media as jauntily and incessantly as by the soviet kommissars of yore, will have worn out its welcome.
In a sane polity, Dr. Fauci would be cooked. He looks circumstantially like an epic villain of history, who promoted and funded dangerous research activities knowingly, which led to an international disaster that killed millions of people and destroyed countless livelihoods and households, perhaps even the whole global economy. Read More
I could start this blog with “Don’t listen to morons, ever.”
That would basically be the same as starting this blog with “They’re dumbing down the kids and no one’s noticing because they’re so busy being social justice warriors.”
Especially the kids in question.
Generation Z is said to be the strongest generation America has ever seen. (If you don’t mentally see the meme of the old white guys laughing, you’d better watch today’s video). Read More
06.03.21- Why Do Inflation Expectations Matter?
There is, understandably, a lot of talk about inflation lately. Much of this talk is rooted in a naïve interpretation of the quantity theory. An increase in the quantity of money is thought to surely lead to a proportionate increase in the price level. Yet, the monetary base has increased from around $850 billion to over $5.8 trillion in just over the span of a decade. Despite this nearly 600% increase in the quantity of money, the price level has increased by just 26%. The Fed’s balance sheet stands at $8 trillion today. Where is the inflation hiding? Read More
That the era of stability has ended and a new era of increasingly chaotic volatility has begun is not on anyone's radar as a possibility.