The Once and Future Dips of the US Economy

Last week, it looked as though a tide might have turned. The Dow fell another 97 points on Friday. And the 10-year US Treasury note rose to yield less than 3%.

What will happen next? We don’t know. But it wouldn’t be a bad thing if investors took a beating. At least, the rest of the country would probably like to watch.

[Read more...]

Hyperinflation and Double-Dip Recession Ahead

“The US is really in the worst condition of any major economy or country in the world,” says ShadowStats Editor John Williams. In the following interview with The Gold Report, John concludes the nation is in the midst of a multiple-dip recession and headed for hyperinflation.

The Gold Report: Standard & Poor’s (S&P) has given a warning to the US government that it may downgrade its rating by 2013 if nothing is done to address the debt and deficit. What’s the real impact of this announcement?

[Read more...]

Fed Vows to Maintain Public Financial Health

Extend and pretend…

That's the government's way of handling the crisis. Extend credit and cash to those who don't deserve it. Then, pretend that everything is okay…

But the problems don't go away. They just get stretched into the future…

What did the feds do for GM? They took over the company. They extended cash and credit. They put in place a “Cash for Clunkers? program to encourage people to buy cars. Then, they pretended that the problems were solved.

[Read more...]

Congress and the W-Shaped Recession

Each political party has more than earned its share of blame for the financial crisis fallout and the way it was handled. When the second dip arrives, with the same types of leaders and so much powder already spent, we should be ready to look out below.

This cartoon came to our attention via a post on The Big Picture about a double dip recession.

[Read more...]

Signs of the Times

We came to see the real America. This week, we had a good look around.

Fellow Reckoners will recall that we are on a vagabond's odyssey, traversing the Great Empire in search of a Greater Correction. We began our tour in California, the real estate bubble of the west. It will conclude, if all goes to our back-of-the-envelope plan, in Florida, the real estate bubble of the east. In between – Arizona, Nevada, New Mexico, Texas… We keep our ear to the ground, listening for aftershocks.

[Read more...]

Trade of the Decade Update

Breaking news: Our New Trade of the Decade Is Off!

Well, half of it…temporarily.

“This is what we got dead wrong,? Rob Parenteau candidly admitted on the top floor of the Fairmont Hotel Vancouver last night, where we gathered for the second annual meeting of the Richebacher Society.

[Read more...]

Trichet Gives the Euro Some Support

The euro (EUR) remained well bid yesterday, rising above $1.27 for the first time since May, after European Central Bank (ECB) President, Trichet, had some encouraging words for the Eurozone. Trichet said that he didn't believe that the things were as bad in Europe as the markets have made them out to be. The ECB President made his remarks at a press conference after the ECB left its benchmark rate at a record low of 1%.

[Read more...]

Double-Dip Recession a Fashionable Discussion Piece

To make money investing, you have to be ahead of the crowd…or at least looking for the story no one is telling.

That was a tough task this morning. Suddenly, discussing the unthinkable – a double-dip recession and a retest of the March 2009 lows – is in vogue. Even readers are bored with the end of the world as we have known it…

[Read more...]

Economic Recovery Awaits the Housing Market Correction

What happened to the recovery? This report from AP:

WASHINGTON (AP) – Sales of previously occupied homes dipped 2.2 percent in May, signaling that a boost from home-buying tax credits is fading sooner than expected.

Last month's sales fell from the previous month to a seasonally adjusted annual rate of 5.66 million, the National Association of Realtors said Tuesday. Analysts who had expected sales to rise expressed concern that the real estate market could tumble once the benefit of the federal incentives is gone entirely, starting next month.

[Read more...]