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CHART: Why This Time It IS Different

CHART: Why This Time It IS Different

See how violently interest rates are exploding upwards

Podcast

elmercurio.com

Michael Pento: When The Yield Curve Inverts Soon, The Next Recession Will Start

Expected timing: this Fall
Wednesday, June 27, 2018, 3:34 PM

Some day, today's era of insane asset price bubbles will end. But how? Will it unwind in an orderly and polite way, as the world's central planners hope? Or will be disorderly, resulting in painful portfolio losses and mass layoffs?

Michael Pento, fund manager and author of The Coming Bond Bubble Collapse returns to the podcast this week to offer his prediction that events will most likely take the latter route. In fact, he sees the developing inversion of the yield curve as a dependable precursor to the US economy entering recession as soon as this Fall: » Read more

Blog

Reuters

It's Looking A Lot Like 2008 Now...

Did today's market plunge mark the start of the next crash?
Friday, February 2, 2018, 9:57 PM

Economic and market conditions are eerily like they were in late 2007/early 2008.

Remember back then? Everything was going great. Home prices were soaring. Jobs were plentiful.

The great cultural marketing machine was busy proclaiming that a new era of permanent prosperity had dawned, thanks to the steady leadership of Alan Greenspan and later Ben Bernanke. And only a small cadre of cranks, like me, was singing a different tune; warning instead that a painful reckoning in our financial system was approaching fast.

It's fitting that I'm writing this on Groundhog Day, as to these veteran eyes, it sure has been looking a lot like late 2007/early 2008 lately... » Read more

Blog

Aperture51/Shutterstock

The Dollar May Remain Strong For Longer Than We Think

Why demand for it is higher than other fiat currencies
Tuesday, September 16, 2014, 10:50 PM

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. » Read more

Blog

Peak Prosperity

Money Creation: The Fed - Crash Course Chapter 8

Creating money out of thin air since 1913...
Friday, August 8, 2014, 8:49 PM

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!). » Read more

video

This chapter of the new Crash Course series has not yet been made available to the public.

Each week over the rest of 2014, in sequential order, a new chapter will be made publicly available (we've currently published up to Chapter 7)

If you don't want to wait, you can:

 

 

 

 

 

Insider

Kunal Mehta/Shutterstock

Why Your Own Plan Better Be Different

Because the cavalry isn't coming
Tuesday, January 21, 2014, 3:40 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... » Read more

Blog

The Fed Matters Much Less Than You Think

It can't control the real economy
Thursday, August 1, 2013, 1:18 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. » Read more

Insider

Off the Cuff: Turbulence Ahead!

Rising bond yields are an ugly portent
Thursday, May 30, 2013, 11:01 AM

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
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

Thursday, May 23, 2013, 10:22 AM
  • 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