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July 2010

In this week’s Credit Bubble Bulletin Prudent Bear’s Doug Noland makes a crucial point: It’s not inflation that the U.S. risks by issuing trillions of dollars of new debt, but “a crisis of confidence at the very heart of our monetary system.” Exactly. If we keep this up the financial markets might abandon dollar-denominated assets, […]

“We Could Really Use Some Good News”

by John Rubino on July 16, 2010 · 27 comments

Normally, the consumer sentiment number that comes out each month seems like a piece of media fluff, far less substantial than, say, housing starts or the gold price. But today’s report is unusual enough to deserve a longer look. From MarketWatch: Nothing happened, but the news was bad anyway Commentary: Historic decline in sentiment comes […]

Why We’re Ungovernable

by John Rubino on July 14, 2010 · 34 comments

For the first time in 250 years, politics has become irrelevant. Not uninteresting or unimportant; obviously the way a society organizes itself matters to its citizens and its place in the world. But today there are no policies left on the “possible” menu that will save us from what’s coming. So a rational person’s time […]

Preying on the Pumpers

by John Rubino on July 12, 2010 · 18 comments

When you run a website that contains Google ads you constantly have to watch out for penny stock hustlers promising ludicrous returns. They’re generally “pump and dump” operators who push up the price of thinly-traded stocks and then bail, leaving their hapless clients holding worthless paper. Dirtbags, in other words. So it was with some interest […]

Another Take on Munis as the Next Big Short

by John Rubino on July 12, 2010 · 3 comments

Here’s a piece on municipal bonds by Rich Bookstaber, an SEC adviser and author of Demon of Our Own Design, a well-received book on derivatives. The article is a few months old, but — since the muni market has yet to blow up — it’s still timely. See the last paragraph for a succinct explanation […]

In this recent CNN interview, Harvard Professor Niall Ferguson predicts that, barring a radical change in policy, “nasty fiscal arithmetic” will send the U.S. into a “death spiral.” Some representative quotes: “Fiscal tightening is baked in the cake. Tax increases are coming and coming soon… The US has a kind of stay of execution while […]

Saturday’s New York Times has an article on Illinois’ finances that is must reading for anyone who thinks the U.S. has turned the corner. The crucial takeaways are 1) even though states can’t technically declare bankruptcy, they apparently can just stop paying their bills, 2) while salaries and pensions for current public sector workers are […]

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