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Currency War

For the past couple of years the European Central Bank has been the only sane inmate in the asylum. Unfortunately, in a crazy world being sane just gets you into trouble. Sound monetary policy leads to a strong currency, which in a currency war is tantamount to unilateral disarmament. Unable to export sufficiently to a […]

As it tries to punish Russia for the latter’s dismemberment of Ukraine, the West is discovering that the balance of power isn’t what it used to be. Russia is a huge supplier of oil and gas — traded in US dollars — which gives it both leverage over near-term energy flows and, far more ominous […]

It’s amazing how quickly China went from being the world’s savior to its biggest danger. To recap: When the developed world stepped off a cliff in 2008, China responded by borrowing about $15 trillion and spending most of it on infrastructure. Roads, bridges, skyscrapers, power plants, whole cities went up around the country. The resulting […]

Not so long ago — say when the Soviet Union was crushing rebellions in Czechoslovakia and Hungary in the 1960s or the US was invading half the Middle East in the 2000s — a big country picking on a small one was mostly a physical activity. Tanks would roll in, buildings and people would be […]

Only in a world totally corrupted by easy money could the following two things be announced on the same day. First: European Bonds Surge as ECB Stimulus Confines Crisis to MemoryYields on the euro area’s government bonds have never been lower as the potential for extended European Central Bank stimulus helps exorcise memories of the […]

The Eurozone’s Really Bad 2014, In Two Charts

by John Rubino on January 14, 2014 · 32 comments

Headline writers have found some brutal things to say about the eurozone lately. To take just a few of the dozens of possible examples: France Collective Depression 48.6% of Spaniards Aged 18-24 Would Take Any Job, Anywhere, for Low Wages Greek industrial slump persists, jobless rate at record high Opposition Dissent Tempers Greek Attempts at […]

For a while there it looked like Europe was beginning to dig itself out of the pit into which it had fallen after the 2008 banking crisis: Europe’s Recovery Gaining Momentum (August 22, 2013) Europe’s recovery looks to be gaining traction thanks to a revival in activity in Germany, the region’s biggest economy. The 17-nation […]

China Enjoying Gold Clearance Sale

by John Rubino on October 14, 2013 · 31 comments

Analyses of China’s massive appetite for gold are everywhere lately. But the following chart, which appeared today in a GoldCore market update was especially striking because it compares 2013 demand with that of 2012 – which was a big year in its own right. Through August, China has imported 994 tons of gold through Hong […]

One of the reasons that the developed world seems relatively stable while our debt, currency creation and unfunded liabilities go crazy is that we have a safety valve. When the Fed or ECB or Bank of Japan lowers interest rates to zero or buys up trillions of dollars of bonds with newly-created currency, a lot […]

For a while there it looked like Japan had the answer. A strong new leader comes in and cuts through all the indecision, orders the central bank to flood the system with cash to depreciate the currency now rather than later – and boom, the stock market soars, exports rise and the economy starts growing […]


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