The growth of the last 30 years came from the government spending money we didn’t have. In Europe, the government spent it. In America, households spent it. In Britain, both spent it.
December 6th, 2011 | Bill Bonner | 0 comments | ContinuedAll Posts Tagged With: "debt"
Why Liquidity Solutions for Solvency Problems Won’t Work
Once again, the Fed is distorting the signals the private market is trying to send. The market is saying there is a solvency problem and the Fed is saying it’s just a matter of liquidity.
But that’s the question – liquidity or insolvency?
December 2nd, 2011 | Greg Canavan | 1 comment | Continued
A Debt to the Living
Nothing much happened in the markets yesterday. Which is a good thing. We’re too exhausted to reckon with it.
We went to a funeral yesterday. Dead people wear us out. They are like debt. They don’t just go to their graves and disappear. There’s always more to the story. They leave debts…accounts with the living that must be settled.
December 1st, 2011 | Bill Bonner | 1 comment | Continued
The Staying Power of Debt
It doesn’t matter what you say…too much debt is too much debt. And someone will have to pay for it.
All of the crisis and hoopla of the last 4 years has been just an attempt to avoid facing up to reality. Christmas comes but once a year…but investors have looked under the tree every day…hoping Santa paid an un-announced visit.
November 30th, 2011 | Bill Bonner | 3 comments | Continued
Commodity Correction
Excellent. Australia has a brand new mining tax just in time for a huge correction in commodities. Yesterday we mentioned the probability that the bond crisis in Europe was inherently deflationary. Europe’s debt reckoning will result in massive deleveraging in the financial system. And the last time that happened, a lot of long-term speculative bets on commodities were liquidated.
November 23rd, 2011 | Dan Denning | 1 comment | Continued
Tangible and Irreplaceable Assets
Take a deep breath and relax. Today’s issue of the Daily Reckoning is not about the Reserve Bank. Maybe it will raise the cash rate to 4.75% tomorrow and maybe it won’t. But frankly we are tired of pretending to take the RBA seriously as it pretends to know how to perfectly manage the price of money. Instead, then, let’s talk about the upcoming float of Queensland Rail. It’s a great exercise in understanding how to value assets and why the private sector manages better than the public sector.
October 4th, 2010 | Dan Denning | 0 comments | Continued
Stimu-less
Sunday will be the day Germany pays its final reparations for the conflict which began in 1914. Bond holders under the Treaty of Versailles will receive their final payment and it will all be over. A small milestone for the revered austerian herself, Chancellor Angela Merkel, in paying off Germany’s debts.
October 2nd, 2010 | Nickolai Hubble | 1 comment | Continued
Attachment “G” is Too Dangerous to Be Seen
There may be a simple economic explanation for the best September on Wall Street in 71 years. No double dip recession…improving labour market numbers…rebounding house prices. Except none of that is true. So what is left? Well, as near as we can tell, everyone seems to be front running central banks. Is the Fed buying stocks? Not yet.
October 1st, 2010 | Dan Denning | 3 comments | Continued
Day Care or Default?
So far, almost everything that we thought ought to happen is happening. More or less. The crisis. The feds’ reaction. The market’s lack of reaction to the feds’ over reaction. Then, the feds’ reaction to the markets failure to react. One dumb thing begets another.
September 29th, 2010 | Bill Bonner | 0 comments | Continued
Funds Flowing, But For How Long?
We’ve made this point before, but we’ll make it again. Today’s modern financial system depends critically on continued debt growth to stop asset prices from collapsing. In modern economies dominated by governments and their agents, central banks, money is debt and debt is money.
September 24th, 2010 | Greg Canavan | 43 comments | Continued
Rising Debt and the Great Market Waiting Game
In practice, free information turned out to be worth no more than people paid for it…and the dot.com revolution blew up in January 2000…leaving only a handful of survivors (who have done very well, thank you.) In our view, the stock market has been in a bear trend ever since…
September 15th, 2010 | Bill Bonner | 25 comments | Continued
Losing Faith in the Zombie-Run Government
Zombies join government because it’s a good place to work if you’re brain dead and all you can do is slouch and shuffle. The feds can earn a living without actually doing very much. Well, no one knows whether they are doing anything or not. That’s the beauty of government.
September 14th, 2010 | Bill Bonner | 0 comments | Continued
You say Obama; I say Ozawa! You say boom; I say ka-boom!
The Nobel Prize committee has never withdrawn a prize. It might want to consider it. In Tuesday’s New York Times, prizewinner in economics, Paul Krugman reveals either that he knows nothing about economics…or that there is nothing worth knowing in it. We’re beginning to think it’s the latter.
September 13th, 2010 | Bill Bonner | 0 comments | Continued
Labor-ious to Watch
Did anyone watch the live coverage of the independent’s decision to back Labor? We caught the last few minutes. They were remarkable enough. It went something like this: “Why do you think that the coalition would be more likely to go to [back to] the polls?” a reported asked.
September 11th, 2010 | Nickolai Hubble | 13 comments | Continued
Let it Be
Watch the bonds… We could be seeing the first crack in the bond market. But it seems too early to us. It seems more likely that the bond market will stretch this out…bringing more and more hapless investors on board before finally sinking. Everything takes longer than you expect.
September 9th, 2010 | Bill Bonner | 0 comments | Continued
