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The return of the peasant: or, the history of the world in 10½ blog posts. 10. The current impasse
The return of the peasant: or, the history of the world in 10½ blog posts. 10. The current impasse I’ve just returned from a short but fascinating meeting in Nicaragua on small-scale farming, which I plan to write about soon. But first I want to finish my history of the world. Apologies if the latter […]
The Cardinal Sin Of Investing: Permanent Impairment Of Capital
Victor Moussa/Shutterstock The Cardinal Sin Of Investing: Permanent Impairment Of Capital How to avoid making it Last week we presented a parade of indicators published by Grant Williams and Lance Roberts that warned of an approaching market correction as well as a coming economic recession. The key message was: When smart analysts independently find the same […]
Why The Markets Are Overdue For A Gigantic Bust
r.classen/Shutterstock Why The Markets Are Overdue For A Gigantic Bust It’s just not possible to print our way to prosperity Let me begin with a caveat: confirmation bias is an ever-present risk for an analyst such as myself. If you’re not familiar with the term, ‘confirmation bias’ suggests that once we’ve invested time and emotional […]
How Heavy Is This?
How Heavy Is This? Here is a glass of water. You’re holding it. How heavy is it? The answer is: the actual weight probably doesn’t matter. It’s just a glass of water. What matters is how long you hold it. Hold it for a minute, it’s no problem. An hour and your arm will ache. A day […]
Banks Are Evil
Barandash Karandashich/Shutterstock Banks Are Evil It’s time to get painfully honest about this I don’t talk to my classmates from business school anymore, many of whom went to work in the financial industry. Why? Because, through the lens we use here at PeakProsperity.com to look at the world, I’ve increasingly come to see the financial […]
Canada’s Fourth Largest Bank Erases $1 Billion In Excess Capital In Unexpected Accounting Gimmick
Canada’s Fourth Largest Bank Erases $1 Billion In Excess Capital In Unexpected Accounting Gimmick Early in 2016, when oil prices were plunging and when US banks were careful to push up their loan loss reserves to exposed E&P loans, we noted something surprising: Canadian banks had barely taken any loss reserves to their exposure in the […]
Hell To Pay
SkillUp/Shutterstock Hell To Pay The final condition for a market crash is falling into place Sometimes I wonder if I’m ever going to run out of new things to say about the economy. Nothing interesting has happened in a long time. Our liquidity-drunk “markets” remain over-priced due to the chronic intervention of the global central […]
Is Europe In Trouble Again: Hints Of Portuguese, Italian Bank Bailouts Suggest Not All Is Well
Is Europe In Trouble Again: Hints Of Portuguese, Italian Bank Bailouts Suggest Not All Is Well In the aftermath of Germany refusal to allow Italy to breach Eurozone regulations, and provide its banks with up to €40 billion in new capital, Italy has unveiled a new track to handle its insolvent banks and as Reuters reports, the […]
The Banking Turmoil Spreads—-Massive Banking Crisis Brewing In Singapore
The Banking Turmoil Spreads—-Massive Banking Crisis Brewing In Singapore By Singapore Business Review The three biggest banks are losing capital. A crisis of staggering proportions is looming in China, and tiny Singapore will be caught right in the middle of the storm once the disaster finally erupts. Speaking at the annual Barron’s roundtable, Swiss billionaire […]
Why NIRP (Negative Interest Rates) Will Fail Miserably
Why NIRP (Negative Interest Rates) Will Fail Miserably What NIRP communicates is: this sucker’s going down, so sell everything and hoard your cash and precious metals. The last hurrah of central banks is the negative interest rate policy–NIRP. The basic idea of NIRP is to punish savers so severely that households and businesses will be compelled […]
New Harbor: A Time For Staying Out Of Harms Way
New Harbor: A Time For Staying Out Of Harms Way Preserving your financial capital Given the brutal start to the markets in the first three weeks of 2016, we thought it a good time to check in with the team at New Harbor Financial. We have had them on our podcast periodically over the past […]
Falling Interest Causes Falling Profits
FALLING INTEREST CAUSES FALLING PROFITS Most people assume that prices move as a result of changes in the money supply. Instead, let’s look at the effect of changes in interest. To start, consider a hamburger restaurant. Suppose that the average profit in the burger business is ten percent of invested capital. If MacDowell’s is thinking […]
A Hard Look at a Soft Global Economy
A Hard Look at a Soft Global Economy MILAN – The global economy is settling into a slow-growth rut, steered there by policymakers’ inability or unwillingness to address major impediments at a global level. Indeed, even the current anemic pace of growth is probably unsustainable. The question is whether an honest assessment of the impediments […]
Advice to the Prime Minister/President
Advice to the Prime Minister/President Your country faces a stagnating economy. Let us assume your Prime Minister (or President if that is who holds the executive power) seeks advice from two imaginary economists. PM: You two economists have different views on what our economic policy should be. What is your advice? FIRST ECONOMIST (Austrian school): Prime Minister, the […]
How Do People Destroy Their Capital?
How Do People Destroy Their Capital? I have written previously about the interest rate, which is falling under the planning of the Federal Reserve. The flip side of falling interest rates is the rising price of bonds. Bonds are in an endless, ferocious bull market. Why do I call it ferocious? Perhaps voracious is a better word, […]
