Here is a blast from the past. I came across this little nugget while doing some work on real estate. The title of the piece is Bubbling (or Just Frothy) House Prices? It was written by a couple of researchers at the Federal Reserve Bank of St. Louis in November of 2005. For context, I’ve included a chart of the Case-Shiller Home Price index with an arrow pointing to when the report was released. From the report (emphasis is ours): Yet, do the P/I [Price-to-Income] ratios observed on the two coasts constitute a bubble? Note that when real estate is evaluated as a potential investment, housing … [Read more...]
The Hubris of the Bernanke Fed
The hubris of the Bernanke Fed is more astonishing with each passing day. … [Read more...]
Billionaire Bond King Bill Gross Slams Ben Bernanke
Bill Gross is out with a scathing new Investment Outlook on Dr. Bernanke’s misguided monetary activism. [expand title="Click here to read more."] Below are the highlights. You can read the letter in its entirety here. Central banks – including today’s superquant, Kuroda, leading the Bank of Japan – seem to believe that higher and higher asset prices produced necessarily by more and more QE check writing will inevitably stimulate real economic growth via the spillover wealth effect into consumption and real investment. That theory requires challenge if only because it doesn’t seem to be … [Read more...]
Volcker Delivers Punishing Blow to Bernanke Fed
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...]
Will Summer Spell the End of the Bull Market?
As U.S stock prices continue their liquidity-fueled ascent, the rationalizations for remaining bullish on the U.S. stock market become more perverse by the day. Barron's is calling this the TINA market, as in There Is No Alternative to U.S. stocks. [expand title="Click here to read more."] How comforting. The best justification for putting your life savings into the stock market is, "Might as well, ain't nothing better." The peddlers pushing product for Wall Street's biggest banks are using a similar line of reasoning, telling their clients to load up on U.S. stocks because the American … [Read more...]
Escalating Currency Wars an Imminent Threat
With the cabal of central bankers and finance ministers once again denying at the G-20 meetings last weekend that the world’s largest economies are engaged in clandestine currency wars we are reminded of the famous Groucho Marx quote, “Who you gonna believe, me or your lying eyes?” [expand title="Click here to read more."] It should be self-evident to even the casual observer that the world’s largest central banks are engaged in currency wars. Pick up the morning paper and you are bound to see evidence of this. From yesterday’s Financial Times: “But the central bank governor, Graeme … [Read more...]
Printing the Path to Prosperity
The Fed is engaged in an unbounded money-printing campaign at a rate of $85 billion per month, but they aren't the only money-printing bank in town. The European Central Bank has agreed to print an unlimited amount of money to buy any and all bonds from whichever euro-area country needs a bailout. The United Kingdom doesn't have a money printing campaign underway today, but it is on the verge of announcing one. And then there is the Bank of Japan, which recently doubled its inflation target and doubled the amount of money it is printing each month. [expand title="Click here to read more."] … [Read more...]
Covert Global Currency Wars
“The lessons for the present are clear. Today most advanced industrial economies remain, to varying extents, in the grip of slow recoveries from the Great Recession. With inflation generally contained, central banks in these countries are providing accommodative monetary policies to support growth. Do these policies constitute competitive devaluations? To the contrary, because monetary policy is accommodative in the great majority of advanced industrial economies, one would not expect large and persistent changes in the configuration of exchange rates among these countries.”—Federal Reserve … [Read more...]
Alert: Bernanke’s Sanguine Forecast a Bad Omen
Stocks sold off a bit on Wednesday and Thursday following the release of the minutes from the Federal Reserve’s last policy meeting. Investors were apparently concerned that Bernanke & Co. may pull the Free Money Truck back into the garage ahead of schedule. The minutes from the last Federal Open Market Committee (FOMC) indicate that more than a couple FOMC members are worried that the Fed is inflating asset bubbles and encouraging speculative excess in financial markets. That asset bubbles and speculative excess are the result of pinning interest rates at zero for years and printing over … [Read more...]
Investors Ride Shotgun in Bernanke’s Free Money Truck
With a strong start out of the gates in 2013, U.S. stocks have now almost fully recovered from the devastating 57% plunge during the last bear market. Both the Dow and the S&P are once again bordering on all-time highs. Investors have long forgotten the dark days of the financial crisis. Fear is no longer the dominant theme on Wall Street. Greed is back in favor. Investors are convinced the next 50% move in stocks will be up rather than down. To some, the strong performance of stocks over recent years seems puzzling. Economic growth is tepid, unemployment is still nearly 8%, and … [Read more...]
- « Previous Page
- 1
- …
- 188
- 189
- 190
- 191
- 192
- …
- 218
- Next Page »