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Debt, Deficits and the Cost of Free Lunches
DEBT, DEFICITS AND THE COST OF FREE LUNCHES It seems that every generation or two, fundamental economic ideas are questioned and challenged. The reasonable and important idea that governments should balance their budgets on an annual basis was challenged in the 1930s by the rise of Keynesian Economics and the counter-argument that deficit spending was […]
Weekly Commentary: Dudley on Debt and MMT
Weekly Commentary: Dudley on Debt and MMT December’s market instability and resulting Fed capitulation to the marketplace continue to reverberate. At this point, markets basically assume the Fed is well into the process of terminating policy normalization. Only a couple of months since completing its almost $3.0 TN stimulus program, markets now expect the ECB […]
Mike Maloney: “One Hell Of A Crisis”
Mike Maloney: “One Hell Of A Crisis” Crashing stocks, bonds, real estate & currency all at once? Mike Maloney, monetary historian and founder of GoldSilver.com, has just released two new chapters of his excellent Hidden Secrets Of Money video series. In producing the series, Maloney has reviewed several thousand years of monetary history and has […]
Massive Deficit Spending Greenlights Waste, Fraud, Profiteering and Dysfunction
Massive Deficit Spending Greenlights Waste, Fraud, Profiteering and Dysfunction America’s problem isn’t a lack of deficit spending/consumption. America’s problems are profoundly structural. The nice thing about free to me money from any source is the recipients don’t have to change anything. Free money is the ultimate free-pass from consequence and adaptation: instead of having to […]
America’s Greatest Crisis Upon Us…Debt to GDP Makes It Clear
America’s Greatest Crisis Upon Us…Debt to GDP Makes It Clear America in the midst of its greatest crisis in its 242 years of existence. I say this based upon the US federal debt to GDP (gross domestic product) ratio. In the history of the US, at the onset of every war or crisis, a period of federal […]
Canada’s Debt Spiral
Canada’s Debt Spiral Living beyond our means requires us to borrow money to cover the difference between our income and our spending. Many Canadians now understand the financial consequences of this practice and regret the choices they’ve made. Unfortunately, Prime Minister Trudeau is not one of them, as evidenced by his government’s budget deficits which […]
Generation Screwed to Morneau: stop shoveling government debts on Canada’s kids
Generation Screwed to Morneau: stop shoveling government debts on Canada’s kids Bill Morneau, Canada’s Minister of Finance, told a touching story recently about being alone while his daughters were away at university. A poster about women’s rights that he saw in one of the girls’ rooms as he toured the empty house provided inspiration […]
More Frogs Boiling—–Why Trillion Dollar Deficits Are Coming Back Soon
More Frogs Boiling—–Why Trillion Dollar Deficits Are Coming Back Soon Yesterday I noted that the frogs of Wall Street linger in the boiling pot because they are under the delusion that stocks are cheap based on the sell-side hockey sticks that always show $135 per share of S&P earnings and a 15X multiple in the next year ahead. Besides […]
Deficit Spending is Not the Answer
Deficit Spending is Not the Answer The Growing Chorus for Fiscal Stimulus Central bankers and monetary adherents the world over are united in the common grouse that fiscal policy is lacking. Grander programs of direct stimulation are needed, they grumble. Monetary policy alone won’t cut the mustard, they gripe. Global debt-to-GDP ratios (excl. financial debt). […]
Norway’s Interest Rate Conundrum
Norway’s Interest Rate Conundrum Current Situation The ECB recently stimulated more than expected, cutting rates by five basis points and expanding quantitative easing. It is already expected that Norges Bank (The Norwegian Central Bank) will cut rates next week, seeing accelerating inflation as temporary. They have a 2.5% inflation target mandate “over time,” giving them lee-way. They see demand […]
Canada’s new deficit plan is trouble
Canada’s new deficit plan is trouble Yesterday Federal Finance Minister Bill Morneau announced the projected deficit for 2016-17 is now $18.4 billion. This amount does not include $10.5 billion in new spending promised by the Liberals during the election campaign. When the budget is delivered in one month’s time it is foreseeable the total deficit […]
The Follies and Fallacies of Keynesian Economics
THE FOLLIES AND FALLACIES OF KEYNESIAN ECONOMICS Eighty years go, on February 4, 1936, one of the most influential books of the last one hundred years was published, British economist, John Maynard Keynes’s The General Theory of Employment, Interest and Money. With it was born what has become known as Keynesian Economics. Within less than a […]
A New Era For Canadian Oil And Gas, For Better Or Worse
A New Era For Canadian Oil And Gas, For Better Or Worse Canadian voters kicked out the conservative government in the October 19 election, a party that had been in power for a decade. Polls had predicted a slight lead for the Liberal Party, but in a surprise result, the Liberals actually won a majority of […]
Global Economy Nearing a “Structural Recession”
Global Economy Nearing a “Structural Recession” And monetary policies will be “ineffective” To the never-ending astonishment of our economists, global growth has been much weaker since the Financial Crisis than before it, despite enormous global stimulus from years of extreme central-bank monetary policies and record amounts of government deficit spending. This should not have happened, according […]
