Some pretty good economic reports have energized various parts of the financial markets lately. Consumer spending is up, GDP is exceeding expectations and even factory orders, that perennial downer, popped this morning. In response the dollar is soaring and interest rates are at breaking out of their multi-decade down-channel. The economy is clearly recovering, implying […]
All this talk of massive new infrastructure spending financed with a tsunami of freshly-minted currency should be lighting a fire under gold. That it hasn’t is a testament to how out-of-whack the precious metals market had gotten during the first six months of this year. As gold rose, the futures contract traders whose games tend […]
During his run for the presidency, Donald Trump took the occasional break from insulting women and minorities to toss off some decent – even exciting – policy ideas. Term limits for congressmen and a ban on politicians becoming lobbyists, for instance, were straight from the Libertarian good-government Christmas list. But best of all was the […]
Nobel Prize winning economist and uber-liberal New York Times columnist Paul Krugman likes to illustrate his philosophy by noting that the threat of an alien invasion would help the economy by stimulating government spending.
The world’s elites, because they live in a system created by themselves for themselves, tend to see events like Brexit and President Trump as aberrations rather than symptoms of a fatal disease. They’re wrong of course, and the great Glenn Greenwald has posted an essay (Democrats, Trump, and the Ongoing, Dangerous Refusal to Learn the […]
At first, the idea of central banks intervening in the equity markets was probably seen even by its fans as a temporary measure. But that’s not how government power grabs work. Control once acquired is hard for politicians and their bureaucrats to give up. Which means recent events are completely predictable: SNB’s U.S. Stock Holdings […]
Between political instability and financial misrule, 2017 looks ripe for another financial crisis. Gold is the best protection.
A week ago it looked like the US government was destined to end up firmly – maybe even more firmly — in the hands of the banks, public sector unions and defense contractors. Trump was imploding and the markets were basking in the prospect of never-ending liquidity from a re-energized Fed. And safe-haven assets like […]
Friday was one of those days where you walk away from the screen for a minute and come back to find a completely different market. All it took was the FBI finding a trove of new Clinton emails, thus breathing new life into the Trump campaign and throwing what was a foregone conclusion back into […]
In June the UK shocked the world – or at least the world’s elites – by voting to pull out of the European Union. Economists predicted disaster, EU leaders threatened pain for British exporters and tourists, and the media settled in to watch the UK shrivel and die. Four months later, the appropriate response is […]
Cyclical turning points tend to feature large numbers of people doing and saying what in retrospect turn out to be amazingly dumb things. Think GM highlighting its line of Hummers just before an oil price spike bankrupts the company. Or half the world betting that tech stocks with infinite P/E ratios would keep rising in […]
With all the surprising and/or disturbing things going on – Brexit, China’s soaring debt, US/Russia/China saber rattling, the, um, unique US presidential race, the cyber attack that shut down big parts of the US Internet – you’d think that an unsettled world would be reflected in skittish financial markets. Instead we’re getting the opposite, with […]
In the latest gold and silver commitment of traders (COT) report (click here for an explanation of what this report involves), paper players made big strides in bringing the market back into balance — and setting the stage for an eventual rebound. Speculators – who tend to be emotional and therefore wrong at the extremes […]
It’s now clear that what governments did to counter the Great Recession may have delayed systemic collapse, but did not resurrect the old normal. Growth around the world is anemic – which is to say debt continues to increase faster than the productive capacity to service it – and inflation (the other way to shrink […]
Towards the end of a credit bubble, ideas that might have seemed crazy in more boring times are not just accepted but embraced by investors desperate to keep the high that comes from effortless bull-market profits. In the junk bond bubble of the late 1980s, for instance, there was the “PIK preferred,” a kind of […]