Federal Reserve

Blog

Charles Krupa

Sorry Losers!

How the Fed has screwed the many to benefit the few
Friday, September 2, 2016, 4:48 PM

By its actions, the Federal Reserve has selected a precious few winners and many, many losers.  Sadly, you are highly likely to be one of the losers.

Sorry!

I'm one, too, if that helps soften the blow.

But we have a lot of company. » Read more

Insider

This Is How Sentiment Shifts And Markets Crash

Once faith in the Fed is lost, things will get ugly fast
Friday, September 2, 2016, 4:47 PM

Executive Summary

  • The Facebook legions rip the Fed to pieces
  • The WSJ joins in the attack??
  • The 'smoking gun' showing how the Fed's only priority is to serve its banking masters
  • Why a revolt against the Fed is necessary, inevitable and just

If you have not yet read Part 1: Sorry Losers!, available free to all readers, please click here to read it first.

Facebook Fed Farce

The Fed, surprisingly, has a Facebook page.  While it’s not surprising that they have one because every organization is aware that they need a ‘social media presence’ it is surprising that the Fed seems to be completely unaware that Facebook is a social networking site, not a policy regurgitation platform.

Well, the Fed put up its policy aims and the responses from the public were consistently brutal or delightfully snarky. 

But I did not find a single one, out of hundreds, that was complimentary of the Fed or in any way demonstrating that the Fed has any sort of credibility left with the public.

These are priceless: » Read more

Insider

Off The Cuff: Should The Central Banks Just Buy Everything?

That's what they're on their way to doing
Thursday, September 1, 2016, 7:19 PM

In this week's Off The Cuff podcast, Chris and Mish Shedlock discuss:

  • Should The Central Banks Just Buy Everything?
    • Is that the plan? What would happen?
  • Turning Japanese
    • Japan is leading the way by monetizing all its assets
  • Putting The Fed On Trial
    • Chris fantasizes about holding up the mirror of truth to power
  • The Next Interest Rate Move
    • Up or down?

Click to listen to a sample of this Off the Cuff Podcast or Enroll today to access the full audio and other premium content today. » Read more

Insider

Mopic | Dreamstime.com

The Pension Time Bomb

Devastating shortfalls are manifesting everywhere
Monday, August 29, 2016, 7:39 PM

Among the many losers picked by the Fed (in favor of rewarding a very tiny and wealthy minority), perhaps the greatest victims are pensions.

Pensions have to make a couple of key assumptions.  One is how long you expect your cohort of pensioners to live. The second is the rate of return on the funds.  On both counts, pensions have been wrong, and wrong again.

People keep living longer and pension fund returns keep underperforming.  » Read more

Podcast

Esteban De Armas/Shutterstock

Mike Maloney: This Is The Peak

To be followed by 'one hell of a crisis'
Sunday, August 28, 2016, 3:09 PM

Precious metals dealer and monetary historian Mike Maloney is quite confident the liquidity-driven 'recovery' created by the world's central banks is now over. In his estimation, the path ahead is one of accelerating descent into inevitable currency destruction. » Read more

Insider

Hoping For A Market Crash

If we inflate much higher, the fall is likely to kill us
Thursday, July 28, 2016, 1:32 AM

We desperately need to have new national and global conversations about everything from how we’ll feed everyone in 2050, to developing a coherent sustainable energy policy, to the fact that each year is hotter than the year before, to the idea that we’re living with a soul crushing sense of scarcity in a world of abundance.

There’s lots that needs addressing, and the process should begin with letting go of the old narrative so that we can make space for assembling the new one. » Read more

Blog

Zacarias Pereira da Mata/Shutterstock

The Great Market Tide Has Now Shifted To Risk-Off Assets

A global sea-change in risk appetite & sentiment
Friday, July 8, 2016, 3:03 PM

In the conventional investment perspective, risk-on assets (i.e. investments with higher risks and higher potential returns) such as stocks are on a see-saw with risk-off assets (investments with lower returns and lower risk, such as Treasury bonds). When risk appetites are high, institutional managers and speculators move money into stocks and high-yield junk bonds, and move money out of safe-haven assets such as gold and U.S. Treasuries.

But recently, markets are no longer following this convention. Safe haven assets such as precious metals and Treasuries are soaring at the same time that stock markets bounced strongly off the post-Brexit lows.

Risk-on assets (stocks) rising at the same time as safe-haven assets is akin to dogs marrying cats and living happily ever after. 

What the heck is going on? » Read more

Insider

Photobank gallery/Shutterstock

Investing For Crisis

The future of stocks, gold & safe havens
Friday, July 8, 2016, 3:03 PM

Executive Summary

  • Which coming developments we can predict with certainty
  • Why the next crisis won't be like 2008
  • Why what worked post-2008 won't work this time
  • Where stocks and gold are headed
  • Where to find safe haven for your investment capital

If you have not yet read The Great Market Tide Has Now Shifted To Risk-Off Assets, available free to all readers, please click here to read it first.

In Part 1, we reviewed the market’s risk-on, risk-off gyrations and laid out the case for long-term declines in confidence, political stability and profits.  What does this new era of uncertainty mean for individual investors?

What’s Predictable?

We can start by asking—is there anything we can predict with any certainty?

I think we can very confidently predict that future central bank monetary policies will fail to generate sustainable growth or fix what’s broken in the global financial system.

I think we can predict that uncertainty will only increase with time rather than decrease. This rise of uncertainty will predictably lower the attractiveness of risk-on assets, other than as short-term speculative bets after some central banker issues yet another “whatever it takes” proclamation.

It’s also a pretty good bet that if central banks and states continue expanding credit/money that isn’t matched by a corresponding expansion of goods and services, the purchasing power of those currencies will decline.

We can very confidently predict that the authorities will continue to do more of what has failed spectacularly until they are removed from power or the system breaks down.

We can predict with some confidence that issuing more debt will provide little productive results.

I also think we can hazard a guess that the next financial crisis will be of a different sort than the 2008-09 Global Financial Meltdown.

Just as generals prepare to fight the last war, with predictably dismal results (unless the exact same war is replayed, which rarely seems to happen), central bankers are fully prepared to stave off a crisis like the one in 2008: a financial crisis that emerges from leveraged bets going bad in money-center investment banks.

My basic presumption is... » Read more

Insider

alphaspirit/Shutterstock

The Approaching Moment Of Market Capitulation

Can you feel it?
Wednesday, June 15, 2016, 9:42 PM

Today, on Wednesday June 15th, the Fed made its latest 'non-decision' and did not raise interest rates. The stock market first rose but then tumbled, likely indicating that the Fed's magic is all used up. As we all know, that’s about the only thing that’s been keeping the stock market levitated of late.

I’m on record as saying that not only would the Fed not raise rates this meeting, but that their next move, when it arrives, will be to lower rates; not raise them.

Got that? Down; not up. » Read more

Insider

wikimedia

Why The Fed’s Efforts Will End Badly

We've been down this road before. Quite recently, in fact
Wednesday, June 1, 2016, 2:26 PM

It’s no secret that I've taken the contrarian position for seven long (and frequently frustrating) years.

Look, we’ve been down this road before, and the sheer stupidity of our current situation is that we’ve been down it recently enough to know better.  It worked out poorly for us in 2000, again in 2008, and will soon enough again. That's why I'm currently short the US stock market and plan to increase that short position as time goes on.

I'm quite familiar with, and even sympathetic to, the idea that the central banks will not... » Read more