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Don’t Expect A Central Bank Bailout This Time, ECB’s Nowotny Warns
Don’t Expect A Central Bank Bailout This Time, ECB’s Nowotny Warns To all those hoping for a sign or signal from central bankers that the recent correction in US stocks was necessary and sufficient for intervention, here are some disappointing examples of what they have said recently: “If stock prices or asset prices more generally […]
The Fed’s Impossible Choice, In Three Charts
The Fed’s Impossible Choice, In Three Charts Critics of “New Age” monetary policy have been predicting that central banks would eventually run out of ways to trick people into borrowing money. There are at least three reasons to wonder if that time has finally come: Wage inflation is accelerating Normally, towards the end of a […]
Three Crazy Things We Now Accept as “Normal”
Three Crazy Things We Now Accept as “Normal” How can central banks “retrain” participants while maintaining their extreme policies of stimulus? Human habituate very easily to new circumstances, even extreme ones. What we accept as “normal” now may have been considered bizarre, extreme or unstable a few short years ago. Three economic examples come to […]
Inflation Alert: The Velocity Of Money Has Finally Bottomed
Inflation Alert: The Velocity Of Money Has Finally Bottomed Forget the Trump tax cuts, the Senate budget deal, the Fed’s Quantitative Tightening and the collapse in foreign buying of US Treasuries: after years of dormancy, the biggest catalyst for a sharp inflationary spike has finally emerged, and it is none of the above. Behold: the […]
The State of the American Debt Slaves
The State of the American Debt Slaves It was one gigantic party. But wait… Total consumer credit rose 5.4% in the fourth quarter, year over year, to a record $3.84 trillion not seasonally adjusted, according to the Federal Reserve. This includes credit-card debt, auto loans, and student loans, but not mortgage-related debt. December had been […]
Two Elephants In The Room That The GOP Has Completely Forgotten
Two Elephants In The Room That The GOP Has Completely Forgotten The US economy is threatened by two giant problems which cause all others to pale into insignificance. We are referring to a rogue central bank that has become an absolute enemy of capitalist prosperity and a fiscal doomsday machine that is hostage to the […]
It’s Looking A Lot Like 2008 Now…
It’s Looking A Lot Like 2008 Now… Did today’s market plunge mark the start of the next crash? Economic and market conditions are eerily like they were in late 2007/early 2008. Remember back then? Everything was going great. Home prices were soaring. Jobs were plentiful. The great cultural marketing machine was busy proclaiming that a […]
Fed’s QE Unwind Accelerates Sharply
Fed’s QE Unwind Accelerates Sharply With a sense of urgency. No more dilly-dallying around. The Fed’s balance sheet for the week ending January 31, released this afternoon, completes the fourth month of QE-unwind. And it’s starting to be a doozie. This “balance sheet normalization” impacts two types of assets: Treasury securities and mortgage backed securities […]
QE…The Gift That Just Kept Giving…Is Now Taking
QE…The Gift That Just Kept Giving…Is Now Taking I know the Federal Reserve doesn’t effectively create money or directly monetize. I know this because then Fed chief, Ben Bernanke, told us so (HERE). But still, something has me wondering about that exchange, now almost a decade ago. The simplest of math. The plan to utilize quantitative […]
Greenspan Warns: “We Have A Stock Market Bubble”
Greenspan Warns: “We Have A Stock Market Bubble” US equity markets stumbled notably as former Fed Chair Alan Greenspan told Bloomberg TV that “we have a stock market bubble.” Greenspan stuck to his usual discussion topics of low productivity and fiscal doomsday inevitability… “Productivity has been dead in the water for the past 10 years… […]
The Fed Will Ignite The Next “Financial Crisis”
The Fed Will Ignite The Next “Financial Crisis” There seems to be a very large consensus the markets have entered into a “permanently high plateau,” or an era in which price corrections in asset prices have been effectively eliminated through fiscal and monetary policy. Partnering with this fairytale like mindset is an overwhelming sense of […]
The Liquidity Punch Bowl
THE LIQUIDITY PUNCH BOWL It is appropriate with the inauguration of this weekly column to look at the “Big Picture”. The biggest risk to world stock markets, and asset prices in general, in 2018 is that G7 central banks (led by the Federal Reserve) are finally attempting to normalise monetary policy nine years after the […]
Central Banks Put a Safety Net Under Financial Markets
Central Banks Put a Safety Net Under Financial Markets Most early business cycle indicators suggest that the global economy is pretty much roaring ahead. Production and employment are rising. Firms keep investing and show decent profits. International trade is expanding. Credit is easy to obtain. Stock prices keep moving up to ever higher levels. All […]
Happy Landings
Happy Landings The blow-off orgy in the stock markets is supposedly America’s consolation prize for what many regard as the electoral bad acid trip of the Trump presidency. Sorry to tell you, it’s just another hallucination, something you’re going to have to come down from. Happy landings! While the markets have roared parabolically up, in […]
