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Tag Archives: monetary policy
Is the High Level of Debt a Major Economic Risk Factor?
IS THE HIGH LEVEL OF DEBT A MAJOR ECONOMIC RISK FACTOR? Many economic commentators regard high level of debt relative to GDP as a major risk factor as far as economic health is concerned. This way of thinking has its origins in the writings of the famous American economist Irving Fisher. According to Irving Fisher,[1] […]
The Rug Yank Phase of Fed Policy
The Rug Yank Phase of Fed Policy Bogus Jobs Pay Big Bucks The political differences of today’s two leading parties are not over ultimate questions of principle. Rather, they are over opposing answers to the question of how a goal can be achieved with the least sacrifice. For lawmakers, the goal is to promise the […]
Surveying the Damage of Low Interest Rates
Peter Macdiarmid/Getty Images Surveying the Damage of Low Interest Rates Few would disagree that it was necessary to slash interest rates in the immediate aftermath of the 2008 global financial crisis. But after a decade of ultra-loose monetary policies across advanced economies, growth remains tepid, financial risks have proliferated, and middle-class savers have lost […]
How Fed Rate Hikes Impact US Debt Slaves
How Fed Rate Hikes Impact US Debt Slaves But savers are still getting shafted. Outstanding “revolving credit” owed by consumers – such as bank-issued and private-label credit cards – jumped 6.1% year-over-year to $977 billion in the third quarter, according to the Fed’s Board of Governors. When the holiday shopping season is over, it will […]
Fed Tightens, “and so far, Nothing Has Blown Up”
Fed Tightens, “and so far, Nothing Has Blown Up” Gundlach frets about bonds during QE unwind, rate hikes, tax cuts, and rising deficits. “A tax cut will reduce revenue and it will grow the deficit and therefore, it will probably grow bond supply, and perhaps boost economic growth,” DoubleLine Capital CEO Jeffrey Gundlach said on […]
The Cost Basis of our Economy is Spiraling Out of Control
The Cost Basis of our Economy is Spiraling Out of Control What will it take to radically reduce the cost basis of our economy? If we had to choose one “big picture” reason why the vast majority of households are losing ground, it would either be the stagnation of income or the spiraling out of […]
Weekly Commentary: China Initiating a Global Bear Market?
Weekly Commentary: China Initiating a Global Bear Market? Chair Yellen is widely lauded for her accomplishments at the Federal Reserve. For the most part, her four-year term at the helm of the Fed boils down to four (likely soon to be five) little rate hikes over 24 months. Most lavishing praise upon Janet Yellen believe […]
Deflation Must Be Embraced
DEFLATION MUST BE EMBRACED There are two problems with understanding deflation: it is ill defined, and it has a bad name. This article puts deflation into its proper context. This is an important topic for advocates of gold as money, who will be aware that sound money, in theory, leads to lower prices over time […]
Benn Steil: The Fed Could be Tightening More Than it Realizes
BENN STEIL: THE FED COULD BE TIGHTENING MORE THAN IT REALIZES Ten years ago, before the collapse of Lehman Brothers rocked global financial markets, the Fed’s balance sheet stood at $925 billion—mostly U.S. Treasuries. After fifty-nine months of asset purchases to push down longer-term interest rates, it had ballooned to a peak of $4.5 trillion, […]
How Uncle Sam Inflates Away Your Life
How Uncle Sam Inflates Away Your Life “Inflation is always and everywhere a monetary phenomenon,” once remarked economist and Nobel Prize recipient Milton Friedman. He likely meant that inflation is the more rapid increase in the supply of money relative to the output of goods and services which money is traded for. As more and […]
Fed Hints During Next Recession It Will Roll Out Income Targeting, NIRP
Fed Hints During Next Recession It Will Roll Out Income Targeting, NIRP In a moment of rare insight, two weeks ago in response to a question “Why is establishment media romanticizing communism? Authoritarianism, poverty, starvation, secret police, murder, mass incarceration? WTF?”, we said that this was simply a “prelude to central bank funded universal income”, […]
Central Bank Group Think: Convince the Public More Inflation is Coming
Central Bank Group Think: Convince the Public More Inflation is Coming Chicago Fed chief Charles Evans is worried about the lack of inflation primarily because he is clueless about where to find it. As further proof of his economic illiteracy, Evans says “Low inflation expectations keep inflation down”. Bloomberg reports Evans Says Fed Must Convince […]
Is There a Way Out of the ECB’s Trap?
IS THERE ANY WAY OUT OF THE ECB’S TRAP? The ECB faces the Devil’s Alternative that Frederick Forsyth mentioned in one of his books. All options are potentially riskly. Mario Draghi knows that maintaining the so-called stimuli involves more risks than benefits, but also knows that eliminating them could make the eurozone deck of cards collapse. […]
Sweden: The World’s Biggest Housing Bubble Cracks
Sweden: The World’s Biggest Housing Bubble Cracks Sweden’s property bubble is probably the world’s biggest, despite which it gets relatively little coverage in the mainstream financial media – although that might be about to change. Warnings about this bubble are not new. In March 2016, Moody’s issued a very explicit warning that Sweden’s negative interest […]
