Tag Archives: treasury

  • Blog

    Why 2022 is Going to Suck

    But Doesn’t Have To
    by Chris Martenson

    Monday, January 3, 2022, 9:25 PM


    A good friend called me up in tears last week.  “My dad just tested positive for Covid and has symptoms, and now that we’re home from Christmas, my kids are sick now too. What should I do?” After we discussed the usual and ordinary early treatment options – which are as numerous as they are…

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  • Blog

    The Federal Reserve Is Directly Monetizing US Debt

    In a very real way, MMT is already here
    by Chris Martenson

    Friday, November 15, 2019, 3:30 PM


    The Federal Reserve is now directly monetizing US federal debt.

    Sure, it’s not admitting to this. And it’s using several technical jinks and jives to offer a pretense that things are otherwise.

    But it’s not terribly difficult to predict what’s going to happen next: the Federal Reserve will drop the secrecy and start buying US debt openly.

    At a time, mind you, when US fiscal deficits are exploding and foreign buyers are heading for the exits.

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  • Blog

    The Dollar May Remain Strong For Longer Than We Think

    Why demand for it is higher than other fiat currencies
    by charleshughsmith

    Wednesday, September 17, 2014, 2:50 AM


    I have long been a dollar bull, not for any over-arching reasons based on inflation, deflation, rising geopolitical multi-polarity or any of the other issues that touch on the dollar’s valuation vis-à-vis other currencies. My analysis focuses on a few basics:  the dollar’s status as the global reserve currency, Triffin’s Paradox (a.k.a. Triffin’s Dilemma) and global capital flows into the dollar and dollar-denominated assets such as U.S. Treasury bonds.

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  • Blog
    Peak Prosperity

    Money Creation: The Fed – Crash Course Chapter 8

    Creating money out of thin air since 1913...
    by Adam Taggart

    Saturday, August 9, 2014, 12:49 AM


    Chapter 8 of the Crash Course is now publicly available and ready for watching below.

    As a follow-on to the two previous chapters — one explaining the nature of fiat money, the other showing how money is loaned into existence through our fractional reserve banking system — this week’s video details the Fed’s near-magical ability to create money out of thin air (literally!).

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  • Insider
    Kunal Mehta/Shutterstock

    Why Your Own Plan Better Be Different

    Because the cavalry isn't coming
    by Chris Martenson

    Tuesday, January 21, 2014, 7:40 PM


    Executive Summary

    • Why the insolvency hole the U.S. is in may be much deeper than appreciated.
    • Current 'best case' assumptions show us doubling the size of our economy TWICE over the next 75 years. Why that's just not achievable.
    • Why the above assumptions get even worse when the energy story is taken into account.
    • Why action at the individual level is your best bet now.

    If you have not yet read Part I: "Endless Growth" Is the Plan & There's No Plan B available free to all readers, please click here to read it first.

    A Big Hole

    When the Treasury Department estimates that the U.S. has a ~$65 trillion NPV (Net Present Value) shortfall in its main accounts, it's saying that using its assumptions, the U.S. government would need to have $65 trillion today in an account, earning a stated rate of interest, in order to be solvent.

    Since the U.S. government don't have that have that kind of scratch, it's insolvent. 

    But the real picture is likely worse. The Fed calculates the NPV shortfall to be closer to $100 trillion. And if you believe Lawrence Kotlikoff's math, the figure is closer to $200 trillion. Either way $65 trillion, $100 trillion, or $200 trillion the sum cannot be paid.

    So it won't be.

    And the real trouble is that all of these numbers make the same implicit assumption: The future will more or less resemble the past. That is, some form of future growth exponential future growth of the economy is at the heart of every single calculation.

    But we might question that, because somewhere between here and there, economic growth will have to come to an end. Or at least a pronounced deceleration. Why? Quite simply, because the earth is finite.

    Now, we might comfort ourselves with the belief that our future date with hard limits is lifetimes away. But when we do, we shortchange ourselves (if we're wrong) and our progeny (if we're right). After all, the time to make an adjustment is when the resources and energy exist to make that change.

    And that's now. Or, really, decades ago…

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  • Blog

    The Fed Matters Much Less Than You Think

    It can't control the real economy
    by charleshughsmith

    Thursday, August 1, 2013, 5:18 AM


    This lemming-like belief in the power of the Federal Reserve generates its own psychological force field, of course; the actual power of the Fed is superseded by the belief in its power. We can thus anticipate widespread disbelief at the discovery that the Fed is either irrelevant or an impediment to the non-asset-bubble parts of the economy.

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  • Insider
    © Steve Mann | Dreamstime.com

    Off the Cuff: Turbulence Ahead!

    Rising bond yields are an ugly portent
    by Adam Taggart

    Thursday, May 30, 2013, 3:01 PM


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

    • Weakness in U.S. Treasurys
      • The mother of all powder kegs
    • The Japan Bug
      • Finally finding its windshield
    • The Pain in Spain
      • A preview of what's coming to the rest of the EU
    • The Odds of a Euro breakup
      • Getting higher all the time
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  • Daily Digest
    Image by EpSos.de, Flickr Creative Commons

    Daily Digest 5/23 – Big Wind’s Trail Of Wings, Living Buildings For Tomorrow’s Cities

    by DailyDigest

    Thursday, May 23, 2013, 2:22 PM

    • Gold ETFs Are Liquidating By The Ton
    • Schizophrenic investors expect slump: bet on boom
    • Clients Denied Gold At Major Banks As Shortage Intensifies
    • Thanks To QE Bernanke Has Injected Foreign Banks With Over $1 Trillion In Cash For First Time Ever
    • Gramm and McMillin: The Debt Problem Hasn't Vanished
    • Want to Save the Environment? Build More Cities
    • Republic of Ireland calls for international tax action
    • US Treasury secretary says he has begun tapping federal retiree pension fund to avoid default
    • Millions falling into poverty in recession-racked Italy: report
    • Seven Ways Today's Economy Is Like The NHL Playoffs
    • PBS Killed Wisconsin Uprising Documentary "Citizen Koch" To Appease Koch Brothers
    • Court upholds B.C. mining company’s use of temporary foreign workers from China
    • Big Wind’s trail of wings
    • Living buildings for tomorrow’s cities
    • Food swapping: The movement taking off in the UK

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  • Blog
    © Skypixel | Dreamstime.com

    QE for Dummies

    Understanding the most outlandish monetary experiment ever c
    by Chris Martenson

    Tuesday, February 5, 2013, 3:25 PM


    A PeakProsperity.com reader recently lamented:

    I have been trying to get my head around the mechanism of QE. Not being an economist or experienced investor I don't really understand a lot of the jargon. The usual simple definition of QE as "thin air money printing" does not satisfy my need for understanding either. Have hunted for a description of QE for dummies that leaves me feeling like I get it, but with no luck. My difficulty is in understanding how thin air money gets into circulation.

    So I'm going to do my best to answer this plea in as intuitive and straightforward a manner as I can. I, too, share the need to understand the mechanism of a process in order to feel like I have a grasp of it.  And I think it's critically important to understand QE (also known by its full name, "quantitative easing") and what it really represents. Because it is, without a doubt, one of the largest market-shaping forces of our times.

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