We Are All Subprime Now
Over the last 10 years (since year-end 2002), profligate spending in Washington has resulted in a staggering $6.9-trillion increase in debt held by the public. That’s $22,000 for every man, woman, and child in America. A family of four is looking at an $88,000 increase in their debt burden. How generous... Read the full story
Employment Picture Brightens: Is it Bullish for Stocks?
The Bureau of Labor Statistics released the monthly jobs report this morning. The headline numbers blew away expectations. Non-farm payroll employment increased by 243,000 in January compared to estimates of 140,000. The unemployment rate came in at 8.3%, 0.2% better than expectations. The big upside... Read the full story
The Dollar Game Is Rigged
You’re getting less than $0.20 on a 1971 dollar. You can see the decline in my chart. And based on the Fed’s rock-bottom interest-rate policy, there’s no reason to believe it’s getting any better. That’s why you want to study the Wall Street Journal op-ed by David Malpass. He writes: Wednesday’s... Read the full story
U.S. Manufacturing 20% More Expensive, Without Labor
A Risk-Free Income Generator
What if there were a way for you to own income-generating securities without having to earn the money to buy them? What if you were able to generate billions in profits from this “free” portfolio? That’s exactly what the Federal Reserve is doing, and it’s passing those profits along to the U.S.... Read the full story
Economic Distortion the Play of the Day
The Institute for Supply Management’s December Manufacturing ISM Report on Business was ballyhooed by the market on Monday. The headline PMI increased to 53.9%, up 1.2% percentage points compared to last month. A reading above 50% indicates that the American manufacturing sector is expanding, and the... Read the full story
Balance Sheets Deteriorate: Economy to Suffer
The Federal Reserve released its quarterly flow of funds report last week. The Fed’s flow of funds report is one of the most valuable economic data sets kept by the government. It is a treasure trove of financial information on the household, corporate, and government sectors of the economy. The most... Read the full story
Eurocrats Cry Wolf
It seems as though the half-life of euro-zone bailouts is getting shorter. It was only a month ago that policy makers announced a bailout plan that was supposed to put an end to the region’s debt crisis once and for all. Admittedly, the details of the plan were vague and it lacked credibility, but... Read the full story
A Striking Divergence
A striking divergence has emerged in global financial markets in recent weeks. During July and August as the euro-area sovereign debt crisis intensified and spreads on Spanish, Italian, and even French bonds rose, U.S. stocks plunged (point A on chart). After the European Central Bank restarted their... Read the full story
Got Jobs?
You want to retire to a state where there are jobs. Not because you might need one someday, though you might. I’m thinking for insurance reasons. States without jobs are states without revenue. And they may be eyeballing your nest egg someday like a ravenous rodent. It’s not a bad idea to have the... Read the full story
