central banks

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Off The Cuff: Buy The @%&^ Dip!

This phrase will be a widow-maker in the next downturn
Thursday, May 25, 2017, 5:20 PM

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

  • Fake, Fictitious Markets
    • None of today's prices is justified by the underlying data
  • Death By Drowning
    • Too much liquidity is killing our markets
  • Housing Bubble Trouble?
    • Prices now declining in the San Francisco Bay Area
  • Buy The @%&^ Dip!
    • What will happen when this universal strategy no longer works?

After last week's brief re-emergence of volatility in the financial markets, the world's various sovereign plunge protection teams have been hard at work flooding liquidity into the system to push prices back up. Losses will not be tolerated!

And so the "Buy the dip!" crowd is victorious once again. This strategy, mindless as it is, has worked extremely well over the past 6 years -- due to an ever-present influx of 'thin air' $billions supplied by the central banks. But for many reasons, that mindless approach can't -- and won't -- continue forever. And likely not for much longer.

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

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How Long Can The Great Global Reflation Continue?

And what will happen when it ends?
Friday, May 19, 2017, 8:01 PM

Given the extraordinary failure of both Keynesian stimulus and private-sector credit growth to create a self-sustaining cycle of expansion whose benefits flow to the entire workforce rather than to the top few percent, what can we expect going forward? Can we just keep doubling and tripling the economy’s debt load every few years? What if household incomes continue declining? Are these trends sustainable?

In the near-term, is this Great Reflation running out of steam, or is it poised for yet another leg higher? Which is more likely? » Read more

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Off The Cuff: Too Many Balls In The Air

Why the central banks will ultimately crash the markets
Friday, May 12, 2017, 3:26 PM

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

  • Too Many Balls In The Air
    • The central banks are losing control of them all
  • Growing Risk In Europe
    • Macron's victory masks huge looming problems
  • Without Continued Central Bank Balance Sheet Expansion...
    • ...The markets will crash
  • Things Don't Matter Until They Do
    • Why the crash will happen unbelievably quickly

This week Chris and Mish enumerate how completely dependent today's financial market prices are on the continued expansion of central bank balance sheets around the world.

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

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The End Of Money

Our first live event on our new webinar platform
Wednesday, May 10, 2017, 3:27 PM

Today's lofty asset prices are dependent on one thing far beyond all else: continued massive amounts of liquidity injected each and every month by the world's central banks.

Over $12 trillion in "thin air" money has been printed up by the world's central banks since the start of the Great Recession. And so far in 2017, a fresh $200 billion is added to the pile each month(!)

This makes the future price trajectory for stocks, bonds, real estate and nearly every other asset class more dependent on central bank policy than at any time in history. Investors need to ask: What are the central banks most likely to do next, and what will the repercussions be? » Read more

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Keep Your Eye On The Ball

What the France election tells us about the world economy
Monday, April 24, 2017, 4:13 PM

For investors and regular folks just trying to protect and growth their wealth, now is the hardest of all possible times.

As we've written extensively about here at PeakProsperity.com, we're living through the Mother of all Financial Bubbles. Simply maintaining this sham is requiring the world's central banks to inject an enormous amount of thin-air money into the markets. Every. Single. Day.

Everything has become distorted. Price signals are completely broken and mean nothing. Fundamentals? They haven't mattered for nearly a decade. It’s very, very hard to maintain one’s perspective during such a time.

And things get even more nuts each time a critical election occurs, as we just had yesterday in France. » Read more

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G. Edward Griffin: Exposing The Creature From Jekyll Island

Hard truths from the man who wrote the book on the Fed
Sunday, April 23, 2017, 3:25 PM

G. Edward Griffin, the author of the seminal book on the formation of the Federal Reserve, The Creature of Jekyll Island, joins the podcast this week to add his perspective to our ongoing critical examination of the Fed and the impact its actions are having on society.

Ed's decades of research and critique of the Federal Reserve, sadly, have left him with conclusions that corroborate our own. Despite its carefully-crafted image as an essential public servant, Griffin concludes it is anything but. It is a private cartel that has connived its way to tremendous advantage and power, secretly (and not-so-secretly) plundering the American people of their treasure and freedoms. » Read more

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The Coming Conflagration

Prepare for it before things explode
Friday, April 21, 2017, 8:26 PM

Executive Summary

  • Have overt central bank propping efforts created a bubble in asset prices?
  • Will these overinflated markets EVER collapse?
  • What to expect when today's smoke turns into tomorrow's conflagration
  • Which assets are most sensitive to a price correction if the central banks' efforts fail?

If you have not yet read Part 1: Where there’s smoke... available free to all readers, please click here to read it first.

Question #2: How much does overt central bank propping have to do with their elevated prices?

Overt propping of the stock and bond markets also happens with some regularity.  First, at the macro level, dumping hundreds of billions of freshly printed currency units into the financial markets each month without any question whatsoever, plays a huge role in keeping them elevated.

One the one hand you have the central banks talking at every turn about how they are confident in the economy, that they feel the data is good, if not solid, and yet you have them dumping money into the financial “”markets”” (double quote marks because one is no longer sufficient to convey how unreal they’ve become) at the fastest pace in all of recorded history through the first 4 months of 2017; $1 trillion dollars(!!).

(Source)

If you were wondering why these markets are having such a difficult time going down, $250 billion a month goes a long way towards helping you appreciate why that’s the case.

It’s an astonishing number, and I want you to appreciate the fact that central banks would not be dumping record amounts of thin-air money into the ““markets””

The next point is that... » Read more

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Where There’s Smoke...

...There’s central bank manipulation
Friday, April 21, 2017, 8:26 PM

Many questions surround the elevated financial asset prices we are faced with today.

I'm talking not just about the sky-high prices of stocks and bonds, but also of the trillions of dollars’ worth of derivatives that are linked to them.  All are intricately linked together. For instance, stocks are elevated, in part, because bond yields are so low. 

These questions are important to consider because -- if central banks have been too involved and gotten themselves mixed up in trying to ‘wag the dog’ by using elevated financial asset prices as a means to drive economic expansion -- then the risk is a big implosion in financial asset prices if their efforts fail. » Read more

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Off The Cuff: The Era Of Easy Money Is Over

Debt-funded stimulus no longer yields an increase of GDP
Thursday, April 20, 2017, 8:44 PM

In this week's Off The Cuff podcast, Chris and John Rubino discuss:

  • Sovereign Sabre-Rattling
    • Suddenly, the world became a lot less safe
  • Market Misdirection
    • The central planners are doing their utmost to paint a positive picture
  • The Era Of Easy Money is Over
    • Debt-funded stimulus no longer results in an increase of GDP
  • How This All Will End
    • Exploring the likely pins that will pop this "mother of all bubbles"

Chris and John look at the disconnect between world events and stock prices and urge folks not to misled: risk is high, and getting higher. There is *no* rational reason for the current price levels in financial markets -- only gobs and gobs of liquidity being force-fed into the system by the world's central banks.

But the data is increasingly showing that the era of "easy money" we've lived under since the Great Recession has reached its inevitable terminus. Shoving more debt into the system is no longer boosting GDP. We are now simply blowing bigger asset bubbles that will monumentally destructive when they burst -- as they must.

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

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Banks Are Evil

It's time to get painfully honest about this
Friday, March 17, 2017, 8:05 PM

I don't talk to my classmates from business school anymore, many of whom went to work in the financial industry.

Why?

Because, through the lens we use here at PeakProsperity.com to look at the world, I've increasingly come to see the financial industry -- with the big banks at its core -- as the root cause of injustice in today's society. I can no longer separate any personal affections I might have for my fellow alumni from the evil that their companies perpetrate.

And I'm choosing that word deliberately: Evil. » Read more