Yesterday in our article about gold’s price going down we discussed gold and the shadow banking system. Today we’ll explain how it all fits together and what it means for the markets and your investments.
December 16th, 2011 | Greg Canavan | 2 comments | ContinuedAll Posts Tagged With: "deflation"
Which Stock Investment Decisions Will You Make in a Credit Depression?
What stock investment decisions should you make when you recognise: government debt is no longer risk free, bank failures resulting from bond defaults by governments will feed asset deflation and lower stock prices and real money is better than unsound money.
December 12th, 2011 | Dan Denning | 0 comments | Continued
The Legacy of the Current Recession
Epithet for a doomed economy…What will they say? How will they describe the ’00s and ’10s? Irish Prime Minister Brian Cowen was accused of being drunk when he gave a “croaky” radio interview two weeks ago. He denied it. But we’d be tempted to turn to the bottle too…
September 30th, 2010 | Bill Bonner | 0 comments | Continued
Why the Price of Gold Goes Up in a Struggling Economy
Our dear readers who bought gold back in 1999 have made about 4 times their money. This year alone it is up 15% – a very respectable return. Most of that has come as a result of paper currencies going down. Investors are buying gold to protect themselves.
September 17th, 2010 | Bill Bonner | 16 comments | Continued
No Doubt About the Road Ahead
Another week gone by. Nothing has been learned. Nothing has been proven. Nothing has been decided.In the markets, we mean. It looks like the stock market is finally rolling over. After a big drop on Wednesday, the Dow followed up with a modest drop yesterday – down another 58 points. Is the market really headed down?
August 16th, 2010 | Bill Bonner | 0 comments | Continued
Debunking Deflation
You will recall that during the bottom of the previous bear-market, most of the pundits were shunning ‘risky assets’ (stocks and commodities) and they were advocating a heavy exposure to cash and fixed income assets. Back then, the vast majority of strategists and their devotees were erroneously fretting about deflation.
August 13th, 2010 | Puru Saxena | 8 comments | Continued
Incredible Threat
Last week, Mr. James Bullard was being both cagey and clairvoyant. The president of the St. Louis Federal Reserve Bank noticed what everyone else has seen for months; the US economic recovery is a flop. GDP growth was last measured pottering along at a 2.4% rate in the second quarter, less than half the speed of the last quarter of ’09.
August 9th, 2010 | Bill Bonner | 3 comments | Continued
When Good Falling Prices Go Bad
What’s happening with prices is hard to tell. The official tally puts consumer price inflation at less than one-third the level it was at when Ben Bernanke told us he had it under control. Targeting 2%…the CPI now measures 0.5%…which means either Mr. Bernanke missed the target by 300% or he can’t really control inflation after all.
August 4th, 2010 | Bill Bonner | 0 comments | Continued
Three Out of Four Economists are Wrong
The thing economists said was nearly impossible actually happened last week. Yields on 2-year US debt hit a record low just as the Treasury prepares for another record-setting deficit. The supply of Treasury debt and the demand for it hit new highs – together. Stranger things have happened.
August 2nd, 2010 | Bill Bonner | 0 comments | Continued
Spending Cuts in the Age of De-Leveraging
It appears that the neo-Keynesians Krugman and Wolf are right about at least one thing. Cutting government spending while the private sector is de-leveraging is a hard way to go. What happens is that as the feds cut back it reduces income to the private sector, which is itself in cutback mode. This then causes tax revenues to fall – which increases the deficit…
July 28th, 2010 | Bill Bonner | 0 comments | Continued
A Look Back at the Future of America
Wall Street suffered its first reversal in eight days yesterday. The Dow dropped a modest 7 points. For its part, gold rose $1.30 and the dollar fell. More importantly, the latest news is that inflation rates continue to fall. Producer prices went down 0.8% in the last two months – and the rate of decline is accelerating. It won’t be long before the US is in outright deflation – just like Japan.
July 19th, 2010 | Bill Bonner | 1 comment | Continued
How to Cure an Economic Depression
“As recently as two years ago, anyone predicting the current state of affairs (not only is unemployment disastrously high, but most forecasts say that it will stay very high for years) would have been dismissed as a crazy alarmist.” That was Paul Krugman in today’s newspaper. Thomas Friedman is fixing problems in the Middle East, so we’ll have to make do with Krugman to entertain us on economic matters.
July 14th, 2010 | Bill Bonner | 2 comments | Continued
The ‘flations
Why would gold go down so much? Because people are finally realizing that deflation is the real risk, not inflation. Gold could continue to slip and slide for a long time now… It’s hard to say. It can rise in a deflation. But it depends on how volatile and uncertain the markets appear. In a stable, Japanese-style slump, gold could go down and stay down for many years.
July 5th, 2010 | Bill Bonner | 3 comments | Continued
Where Debt Goes to Die
But the meandering action in the markets has caused us to step back and assess where we are at in the whole scheme of things (other than level one of an office on Fitzroy Street in a wintery St Kilda, nibbling at a chicken and bacon sandwich). Financially and historically speaking, we’re into phase two of a global debt crisis brought about by the fraud that is fiat money.
June 29th, 2010 | Dan Denning | 76 comments | Continued
Bailout Shmailout
One day the world is convinced that the central bankers and financial meddlers of Europe have the secret to success. The next day, they change their minds. Turns out, the euro feds don’t seem to have the problem solved after all. The euro is going down again.
May 13th, 2010 | Bill Bonner | 0 comments | Continued
