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Living Two Lives

And what to do about it
Friday, July 12, 2013, 3:12 PM

You know that something is very wrong.

Even if you ascribe to the recovery meme and ingest the current narrative that the economy is about to take off and that stocks and houses will once again make us all rich, you know deep down that the story of perpetual exponential growth has an ending.

Maybe not immediately, but someday, certainly, the doctrine of endless growth will have to end. And you know that in all likelihood it won't end on human terms, in a manner of our careful choosing, but on some other terms set by exhausted ecosystems and depleted resources interacting with our highly complex economic and financial systems. » Read more

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The Dead Weight of Sluggish Global Growth

Weighing heavier each year
Tuesday, July 9, 2013, 1:04 PM

Global Slowdown

The U.S. economy weakened appreciably in the first quarter of 2013. But what if this weakness persists into the second quarter just completed, and worsens still in the second half of this year? Q1 GDP, as reported on June 26th, was revised lower to just 1.8%. And various indications suggest that Q2 could come in slightly lower still, at 1.6%. Might the U.S. economy be guiding to a long-term GDP of 1.5%? That’s the rate identified by such observers as Jeremy Grantham the rate at which we combine aging demographics, lower fertility rates, high resource costs, and the burdensome legacy of debt. Well, after a four-year reflationary rally in just about everything, and now with an interest-rate shock, the second half of 2013 appears to have more downside rather than upside risk. Have global stock markets started to discount this possibility? » Read more

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Wikimedia commons

Why the Bullwhip Effect All But Guarantees Another Poorly-Handled Liquidity Crisis

Complex systems break under stress
Monday, July 1, 2013, 11:54 AM

One of my more memorable moments in business school came during an Operations class. The topic for the day was the Bullwhip Effect, a very real and vexing phenomenon that occurs in forecast-driven distribution systems.

Essentially, when there are multiple parties in a distribution system, the imperfections in each player's forecasts (no forecast is consistently perfect) compound to wreak increasing havoc over time, even if demand stays relatively stable.

Grasping how this works is somewhat non-intuitive... » Read more

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Europe's Precarious Banks Will Determine the Future

Ticking time bombs
Tuesday, June 25, 2013, 5:09 PM

Crying Wolf?

It is easy to get the impression that the naysayers are wrong about Europe. After all of the predictions of Armageddon, ten-year government bond yields for Spain and Italy fell to the 4% level, France (which is retreating into old-fashioned socialism) was able to borrow at about 2%, and one of the best-performing bond investments has been until recently – wait for it – Greek government bonds! Admittedly, bond yields have risen from those lows, but so have they everywhere. It is clear, when one stands back from all the usual euro-rhetoric, that, as a threat to the global financial system, it is a case of "panic over." » Read more

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Everything Is Being Sold

Market crash warning
Thursday, June 20, 2013, 3:55 PM

Global financial markets are now in a very perilous state, and there is a much higher than normal chance of a crash. Bernanke's recent statement revealed just how large a role speculation had played in the prices of nearly everything, and now there is a mad dash for cash taking place all over the world. » Read more

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PeakProsperity.com

A First-Hand Account of The Peak Prosperity Seminar

Sharing, learning, and putting plans into action
Friday, June 14, 2013, 11:27 PM

Have you ever wondered what happens at one of our Peak Prosperity weekend seminars? Every year, Chris and the Peak Prosperity team host two weekend-long retreats to explore topics related to the Crash Course, up close and personal. So what are these retreats like? » Read more

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Is Gold at a Turning Point?

Precious metals investors' heartbreak may soon be over
Wednesday, June 12, 2013, 9:18 PM

There's no way to sugarcoat the dismal performance of the precious metals in recent months. But a revisitation of the reasons for owning them reveals no cracks in the underlying thesis for doing so.

In fact, there are a number of new compelling developments arguing that the long heartbreak for gold and silver holders will soon be over. » Read more

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Ward Hooper

Finding Your Way to Your Authentic Career

Transition to the fulfilling work you were meant to do
Thursday, June 6, 2013, 10:22 PM

Unfulfilled by your job? Wish the work you do on a daily basis were more aligned with the person you are (your interests and values)?

You're not alone.

In fact, the majority of workers would chose a different career path if given the chance. » Read more

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Housing Prices Are Being Dangerously Distorted by Big Institutional Money

Do we really want to live through Housing Bubble 2.0?
Tuesday, June 4, 2013, 10:20 AM

The airwaves are full of stories of economic recovery. One trumpeted recently has been the rapid recovery in housing, at least as measured in prices.

The problem is, a good portion of the rebound in house prices in many markets has less to do with renewed optimism, new jobs, and rising wages, and more to do with big money investors fueled by the ultra-cheap money policies of the Fed. » Read more

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America the Vulnerable

History warns we're sleepwalking towards collapse
Monday, May 27, 2013, 8:13 PM

For most people, the collapse of civilizations is a subject much more appetizingly viewed in the rearview mirror than straight ahead down whatever path or roadway we are on.

Jared Diamond wrote about the collapse of earlier civilizations to great acclaim and brisk sales, in a nimbus of unimpeachable respectability. The stories he told about bygone cultures gone to seed were, above all, dramatic. No reviewers or other intellectual auditors dissed him for suggesting that empires inevitably run aground on the shoals of resource depletion, population overshoot, changes in the weather, and the diminishing returns of complexity.

Yet these are exactly the same problems that industrial-technocratic societies face today, and those of us who venture to discuss them are consigned to a tin-foil-hat brigade, along with the UFO abductees and Bigfoot trackers. This is unfortunate, but completely predictable, since the sunk costs in all the stuff of daily life (freeways, malls, tract houses) are so grotesquely huge that letting go of them is strictly unthinkable. We’re stuck with a very elaborate setup that has no future, but we refuse to consider the consequences... » Read more