In a speech this week to the Economic Club of New York former Federal Reserve Chairman Paul Volcker delivered a punishing blow to the misguided monetary activism of the Bernanke Fed. This is the best speech on economic policy you will read this year. [expand title="Click here to read more."] Volcker has under his belt the wisdom of over 60 years of experience in monetary policy. In addition he brings loads of common sense and humility to the table—two ingredients in short supply at the Bernanke Fed. Volcker can see the shortcomings of the misguided approach that Dr. Bernanke and is erudite … [Read more...]
Archives for May 2013
What We’re Reading 5-31-13
A roundup of articles we found interesting this week. [expand title="Click here to read more."] The Emperor Creates No Jobs, Review & Outlook, The Wall Street Journal The New ‘New Paradigm’ for Equities, Alen Mattich, MoneyBeat Web Courses Woo Professors, Belkin and Korn, The Wall Street Journal Monterey Shale Shakes Up California's Energy Future, Josie Garthwaite, National Geographic Fed Policy Is a Drag on Recovery, David Malpass, The Wall Street Journal [/expand] … [Read more...]
This Can’t Be Healthy: Monetary Base Increases Over 260% in less than 5 Years!
The newest monetary base estimate was released by the Fed today. Many investors and analysts have become desensitized to ever increasing amounts of money in the economy, perhaps it’s time to take a step back and look at just how bad it’s gotten. [expand title="Click here to read more."] The Fed reported that today’s monetary base is roughly $3.2 trillion. That’s up more than 260% since November 2008. At that point, the monetary base had never breached $1 trillion, and was still only $0.875 trillion. As you can see on the chart below, monetary base expansion has happened slow and … [Read more...]
VIDEO: Cramer: You’re Right to Worry About Rates!
CNBC's Jim Cramer on the bad is good, good is bad mentality ruling markets today. [expand title="Click here to read more."] [/expand] … [Read more...]
VIDEO: Why Deficits Matter
Rick Santelli interviews David Stockman about budgets, deficits, taxes and more. [expand title="Click here to read more."] [/expand] … [Read more...]
Investing in the Dark
You can be sure there’ll be a price to pay for Federal Reserve Chairman Ben Bernanke’s easy-money policies. Retirees are already feeling the hurt with his 0% interest rates. There was a time, not too long ago, when savers and retirees could depend on Treasury bonds. Not anymore. [expand title="Click here to read more."] Not only is the Fed keeping rates on Treasuries near zero, it’s also creating a false sense of demand with the $1.8 trillion it’s hoarding on its books. Simply put, the higher the demand for Treasuries, the higher the price, which for bonds means the lower the yield. So now … [Read more...]
What We’re Reading 5-24-13
A roundup of articles we found interesting this week. [expand title="Click here to read more."] Defining Moments in So-Called Currency War, David Wessel, The Wall Street Journal The Fed can't save the stock market again, John H. Makin, AEI Move into ‘junk’ stocks powers bull run, Mackenzie and Massoudi, Financial Times The Apple Tax Diversion, Review & Outlook, The Wall Street Journal How North Korea Could Cripple the U.S., Woolsey and Pry, The Wall Street Journal The Truth About Elizabeth Warren’s Student Loan Crusade, Jason Delisle, Yahoo! Finance Phoney QE peace … [Read more...]
Apple, Corporate Taxes and Congress
Senator Carl Levin, Chairman of the Senate Permanent Subcommittee on Investigations, invited Apple CEO Tim Cook up to Capitol Hill to testify on what the senator called Apple’s “Holy Grail of tax avoidance.” So what is Apple guilty of that required special testimony before a Senate subcommittee? Apparently the company used perfectly legal means to avoid paying the United States’ corporate tax rate—the highest among OECD members. [expand title="Click here to read more."] Rather than wasting taxpayer dollars on fishing expeditions targeting one of America’s most successful companies, … [Read more...]
This Global Index Is up 27% within Six Months
You need to make sure you have a safe harbor for your money. Yes, I know it’s been a good year for the market, but what is supporting it? Take a look at the Baltic Dry Index. [expand title="Click here to read more."]It shows the cost of transporting bulk goods across the world’s oceans. It’s up 27% YTD as shown in the first chart, but down 93% compared to its May 2008 peak. How much of this year’s gain is thanks to the money printing by the Federal Reserve? $85 billion a month goes a long way to keep markets afloat. Hedge funds loved trading the BDI until the crash in 2008. It’s hard to … [Read more...]
Is this Rally all about the Fed?
The relentless rise in the U.S. stock market over recent months has emboldened the perma-bulls. The business news cable networks are parading out this crowd in all of their glory to gloat over the market’s rise.[expand title="Click here to read more."]Never mind that many of these pundits are the very same cheerleaders who led investors astray right before the last two stock market collapses. True to their colors, the perma-bulls are as exuberant as ever—yes even after a 140%+ rise off the 2009 low. Before the last crash we were hearing some of the same hollow arguments that we hear today. … [Read more...]