QE2 is ending in June. But globally, QE3 has already begun. As usual, Japan is the pacesetter. As temperatures rose at its Fukushima reactor so did Japan’s monetary base – at the rate of 100% per week! What happens to all this new, hot money? No one knows, exactly. But today, at The Daily Reckoning, we have advice for everyone – central planners, politicians, and householders, too: if you have money, pretend you robbed a bank.
[Read more...]Stopping Inflation, the Federal Reserve Way
April 8, 2011 By Leave a Comment
I was explaining to my boss that firing me would not solve the company’s problems, as the corporate rot goes a lot farther than that, mostly due to the stupid Human Resources department hiring so many morons, a dismal fact I have proved over the years by merely asking each one, in turn, “Do you own any gold and silver to protect yourself from the horrendous inflation in prices that is guaranteed by the evil Federal Reserve creating so impossibly much money, and which will destroy the currency, the economy, and everyone who is not an owner of the aforesaid precious metals, to wit, gold and silver, or are you some kind of moron?”
[Read more...]Beware the Demon of Inflation
April 1, 2011 By Leave a Comment
The 5-Minute Forecast came to me in an email with the subject line reading “5-Minute Forecast – Everybody Panic.”
Naturally, as a guy who is always on the verge of panic because of the fact that all the monstrously excessive amounts of money that the Federal Reserve is creating will cause inflation in prices, this affected me greatly.
[Read more...]The Real Victims of Fed Monetary Policy
March 31, 2011 By Leave a Comment
The Dow went up more than 70 points yesterday. The higher it goes, the more dangerous it becomes.
What’s the matter with this downturn? Shouldn’t it lower stock prices? Shouldn’t it empty tables at fancy restaurants? Shouldn’t it close down some of these luxury shops and make it easy to upgrade to business class?
[Read more...]US Government Redefines “Fixing the Economy?
August 6, 2010 By Leave a Comment
The keen-eyed David Galland, Managing Director of Casey Research and regular contributor to The Daily Reckoning, notices something amiss.
[Read more...]Incredible Threat
August 6, 2010 By Leave a Comment
Last week, Mr. James Bullard was being both cagey and clairvoyant. The president of the St. Louis Federal Reserve Bank noticed what everyone else has seen for months; the US economic recovery is a flop. GDP growth was last measured pottering along at a 2.4% rate in the second quarter, less than half the speed of the last quarter of '09. At this stage in the typical post-war recovery, GDP growth should be over 5% with strong employment. Instead, the “Help Wanted? pages are largely empty. Homeowners are still underwater. And shoppers are still largely missing from the malls that once knew them. Whatever is going on, it is not the “V? shaped recovery that economists had expected. Many now worry that the recovery might have a “W? shape – a “double dip recession? form, with GDP growth dropping down below zero in this quarter or the next.
[Read more...]When Good Falling Prices Go Bad
August 3, 2010 By Leave a Comment
The Dow stood up on its hind legs yesterday – up 208 points. Gold rose $1.
The dollar continues to fall.
What to make of it?
Well, it could be we're wrong about this market. There seems to be a lot of money eager to get into stocks. It's mostly fund managers and institutions. They can't risk missing out on a stock market rally – even a small one. If they fail to get in, what will they tell investors at the end of the quarter?
[Read more...]Inflate Your Debts Away
August 2, 2010 By Leave a Comment
The stock market in the US was flat on Friday. Gold rose $13. China edged out Japan to become the world's second largest economy. Bonds rose. And the dollar fell.
The Bloomberg report:
The Institute for Supply Management-Chicago Inc.'s business barometer rose to 62.3 this month, exceeding the median forecast of economists surveyed which anticipated the measure would drop to 56. The June reading was 59.1 and figures greater than 50 signal expansion.
[Read more...]
Stay Short!
The global economic backdrop continues to provide many reasons to sell stocks, but very few reasons to buy them — gold stocks being one of the few exceptions.
The weight of US economic data points to a recessionary environment over the next few quarters. Analysts have not cut their 2011 and 2012 earnings estimates far enough to reflect the recent dramatic deterioration in economic conditions.
[Read more...]