Another risk-off day. US stocks down, gold and silver back at multi-week highs. Bitcoin stable after recent plunge. Home sales tumble. Trump’s popularity slumps. French presidential campaign in full swing. Best Of The Web The broken bond market – Global Macro Monitor Status quo under increasing attack by ‘populist people power’ – MATA SII […]
Just as everyone was finally accepting the idea of deflation and negative interest rates, inflation decides to pay a return visit. In the past day, articles with the following headlines appeared in major publications around the world: Swiss inflation rises at highest monthly rate in 5 years China February producer inflation fastest in nearly nine […]
One of the traditional signs of market tops is individual investors finally succumbing to the lure of apparently easy money and pouring their savings into the stock market. In the past this dumb money flowed into equity mutual funds in general. But today it’s favoring exchange traded funds (ETFs) that, rather than trying to pick […]
Every few years, it seems, one or another mismanaged eurozone country falls into one or another kind of crisis. This leads to speculation about the end of the common currency, which in turn spooks the global financial markets. Then the ECB conjures another trillion euros out of thin air, buys up and/or guarantees all the […]
A recurring problem for most developed-world governments is explaining why last year’s plan didn’t work while convincing voters that this year’s new and improved plan will do the trick. This is especially tough when the new plan is pretty much the same as the old one and therefore just as likely to fail. Let’s take […]
ECB Chairman Mario Draghi’s announcement of bigger and better QE this morning should have surprised no one. The fact is that the eurozone is coming apart at the seams and the only tool left to delay the inevitable is easier money. As the following chart illustrates, the euro has been declining since 2008, with the […]
It’s rare for the world to worry about Italy. But Sunday’s referendum has the global Establishment on the edge of its seat. The worst case scenario — from the Establishment point of view — is the vote going against the government, causing the Prime Minister to resign and be replaced by an anti-euro, anti-EU party […]
No rest for the wicked. With the shockwaves from Brexit and President Trump still reverberating around the world, the established order is bracing for more bad news. Next up is a December 4 Italian constitutional referendum that might end the reign of centrist prime minister Matteo Renzi and replace him with a bunch of anti-euro […]
You read that right. Not only is Italy selling 50-year bonds, but people are lining up buy them. Italy’s first 50-year bond sale had huge demand (Reuters) – Italy sold its first 50-year bond on Tuesday as some investors bet the European Central Bank may soon add ultra-long debt to its asset-purchase stimulus scheme. About […]
Deutsche Bank, Commerzbank, the Italian banks…it’s getting ugly across the pond, and the worst is yet to come. Here’s a brief look at the reasons why, including derivatives, ridiculous capital rules, dumb lending practices and, of course, negative interest rates. If you’re looking for short sale candidates, Europe’s banks should be on the list.
The “whatever it takes” economy is progressing nicely around the world, with governments and central banks doing things that no 20th century economist would have viewed as possible, let alone wise. Now the question becomes, where does this process hit the wall first? Based on recent events, Europe is looking like the best bet. Consider […]
The world’s central banks clearly have no idea what they’re doing. Yet they keep on making threats, promises and predictions, most either nonsensical or contradictory, while acting in ways that make their countries’ problems worse rather than better. The end of their credibility is in sight.
For most of the world, the past decade’s monetary and fiscal experiments are viewed as failures. See, for instance, French support for the EU project crumbling on both left and right and Why were smart people suckered by Abenomics? So what do the best and brightest now running global economic policy do when their experiments […]
In the sound money community it’s generally understood that abandoning the last vestige of the gold standard in 1971 gave major countries effectively-unlimited credit cards – which corrupted them irredeemably. Now – with government bonds yielding either next to or less than nothing – that corruption has begun to spread to corporations, whose bonds are […]
Brexit looked like the end of the world — until people figured out that central banks would have to ease in response. Then markets turned positively jubilant with US stocks, for example, hitting record highs. The result: A world of mounting debts, weekly terrorist attacks and even military coup attempts alongside financial assets priced for […]