This is how Deflation operates. The budget cuts are impacting the unemployment benefits which have been cut to the states and how they pass that on will vary. Nevertheless, when the economy turns down after 2015.75 and unemployment continues to rise thanks to cutting mainly state and local government jobs, we begin to create the […]

To try to explain the markets and how there can be a rising stock market with rising bonds, analysts characterize this weird trend as a US monetary experiment of the past four years, which has been caused by the Fed’s endless monetary injections (and pent up inflation expectations) while the bond rally has been due […]

QUESTION: Interested in your comments regarding real estate and capital flows. I live in manila Philippines and the price of property in the financial district makati is quite mind boggling. For a third world country prices for a 2 bedroom condo can be close to 300k usd and for a 3 bedroom edging on close to […]

  JP Morgan, Jr Senate Hearing 1933 A Flash Crash in silver is no different than a flash crash in stocks, bonds, or anything else. It is the same root cause of all panics – the lack of bids. Every  stock market crash ever since 1907 has been followed by an investigation with the theory that […]

Three regional Federal Reserve officials have called on the central bank to stop buying mortgage-backed bonds, citing the recent improvement in the U.S. housing market. Indeed, the US economy has improved and the rise in the stock market has the talking head talking to themselves in disbelief. The 800 pound monkey remains the German elections […]

Germany is drawing a bright line between proprietary trading in banks and customer deposits. They are not merely separating the two, but they imposed criminal sentences for directors of banks and insurance companies if they fail to fulfill their supervisory duties in risk management or contravene an array of banking supervision. Germany will at least prosecute […]

We are in one of the most complex conundrums in financial history. On the one hand we have vast amounts of cash that creates tremendous liquidity with interest rates at virtually zero, G7 finance ministers at least alarmed about the high level of liquidity yet it is becoming obvious even to them that monetary policy can not […]

The private sector continues to expand albeit modestly. This is not a long-term trend. The US economy will turn down 2015.75 for a host of reasons, rising dollar, declining sales to Europe and its recession turns into depression. This is what we have been warning about. Not all countries implode at the same time. It […]

Nigel Farage is spot on. This was forwarded to us today. It was his recap of the truth about the Euro. This is very much part of the dollar rally. There becomes little choice. Some have asked: 1)      I understand your argument regarding currency and agree with you on the dollar.  I understand why that […]

QUESTION: In your most recent post you mention dollar demand off setting Fed Printing. But fairly often we hear about new international trade agreements that have excluded the dollar. How does this figure into the equation of dollar demand? ANSWER: Trade agreements are actually irrelevant. That is separate and distinct from reserves and the huge amount of dollar […]