John Williams, who keeps track of what is really going on in the economy at his “ShadowStats” outfit, says to expect hyperinflation within 6 to 9 months. Seems too early to us. But a major turn in the bond market and much higher inflation rates are coming. And you don’t want to be holding US bonds.
September 16th, 2010 | Bill Bonner | 9 comments | ContinuedAll Posts Tagged With: "inflation"
US Real Estate Market Sits in the Waiting Room
…Maybe. We will leave the question dangling…and turn to real estate. Let’s imagine that Ben Bernanke succeeds. Let’s imagine that he nudges consumer price inflation upwards. What happens to mortgage rates? Well, they go up too. Then, what happens to the housing market?…
September 10th, 2010 | Bill Bonner | 87 comments | Continued
Speculating in Gold
So gold is now at “fair value” says Bill Bonner, long-time gold bug and my former boss/partner-in-crime at The Daily Reckoning’s London HQ. No, he won’t sell yet…if ever…says Bill. But gold’s huge under- pricing a decade ago has clearly passed by. Value-hungry investors got their “reversion to the mean,”…
September 8th, 2010 | Adrian Ash | 0 comments | Continued
The Needs Justify the Ends
Remember back in the good old days? Back when there was no government in Canberra and stocks rallied because investors knew there wouldn’t be any moron law makers to pass moron laws? Ah yes…the good old days. Sigh. If there’s a deal that puts a Labor/Greens/Independent government in place, you might expect that to be a negative for shares, inasmuch as it could mean mining tax and, down the track, some kind of carbon tax.
September 7th, 2010 | Dan Denning | 3 comments | Continued
Print Money and Be Damned!
Japan was the world’s most admired economy in the ’80s. Then it was the world’s most despised economy in the ’90s. By 1995, economists pointed their fingers and laughed – the world’s most admired businessman had lost his left shoe. But now, much of the world is barefoot.
September 6th, 2010 | Bill Bonner | 3 comments | Continued
How Much Gold is Enough?
For nearly two years, gold hasn’t had a serious decline. There have been pullbacks, of course, but nothing assumption-challenging. In fact, since October 2008, gold’s largest price drop is 10.6% (based on London PM fix prices), and yet the average of all declines since 2001 is 13% (of those greater than 5%).
August 27th, 2010 | Jeff Clark | 1 comment | Continued
Turning Against the Stock Market
The Fed has already said it will leave its key interest rate at a very low level for a very long time. The US Treasury has already announced a budget with more than $1 trillion of fiscal stimulus in it. “Cash for clunkers” …first time homebuyer tax credits…TALF – the “recovery” programs have all pretty much run their courses.
August 25th, 2010 | Bill Bonner | 1 comment | 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
Monetary Avalanche
Barron’s highlights the big one on this week’s cover:”Why the Fed will soon print $2 trillion,” is its headline. The idea behind the headline is simple enough. The recovery is a flop. All that stimulus spending has done nothing. Unemployment is not getting better. Consumers aren’t shopping. Banks aren’t lending. And the money supply is actually falling.
August 11th, 2010 | Bill Bonner | 22 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
Economic Deflation: The Blood on Bernanke’s Hands
We left off yesterday wondering what stock market investors were thinking. They bought stocks heavily on Monday. Then, yesterday, they sold them a bit – the Dow fell 38 points. Yesterday was largely uneventful. Gold rose a dollar. Oil climbed to $82. Maybe stock market investors are not really expecting to get rich.
August 5th, 2010 | Bill Bonner | 53 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
Trader Vic Explains Hyperinflation
Hmm. If everyone, including the RBA, is so sure that a hyperinflationary depression is not likely, then what is legendary trader Victor Sperandeo doing saying the exact opposite? If you don’t have time to watch the four minute segment on CNBC, his point is simple: long-term structural deficits in the US make it nearly inevitable that bond investors will cease funding US deficits and yields will rise, forcing debt monetisation by the Fed.
July 30th, 2010 | Dan Denning | 38 comments | Continued
The Many Faces of an Economic Correction
Wall Street is still in bull mode. Can you make money by joining it? Maybe. Is it worth it? Probably not.If you do decide to play the game…just be sure you remember what game you’re playing. This is a Great Correction. Over time, prices are going to work their way down until the Dow has dropped below its March 2009 low.
July 30th, 2010 | Bill Bonner | 0 comments | Continued
