All Posts Tagged With: "U.S. Economy"

Before we say goodbye to 2011, let us pause to remember it…briefly. We spent 365 days with it – 365 days in a row. We can’t just move on to 2012 without a least a backward glance. What kind of a year was it? In what direction did it take the world, dear reader? Should we cheer that it is gone…or merely dry our eyes and hope for the best?

Happy New Year!

Normal Reckonings resume Tuesday, January 3rd. To tide you over, we’re continuing a tradition we started last year. We reflect on some of the more colourful predictions of 2011. What follows is a selection of musings from Dan Denning, Bill Bonner and the DR team.

“Poor America…” writes a French friend. “It’s not the land of the free anymore. Now, it’s the land of slaves.”

The FATCA law (Foreign Account Tax Compliance Act) will force banks across the globe to collaborate with the IRS. Here’s an explanation of the huge repercussions this legal precedent will have on banks and banking clients…

Trying to fix an economic depression is expensive…. The US government spends $1.60 for every $1 it receives in taxes. This is a recipe for a disaster, not for a recovery.

So far, the Great Correction has followed the usual script. Bond yields have fallen. Price inflation has generally come down. But demand for credit — as evidenced by $10 trillion government financing costs — is running hot. This is no typical downturn. And it wouldn’t be too surprising if all this demand for credit pushed up bond yields.

Basic economics of scarcity, supply and demand, and investment demand won’t be less important in supporting commodities. But in a world of collapsing financial asset values, tangible assets are about to become the hotly contested objects of a great global strategic game.

Figures from Credit Suisse’s World Wealth Report show that the typical American is a lot poorer than generally believed. The report compares average wealth to the median wealth.

All central banks are desperate to stop stress from building in the global banking system. Despite what they say, job No. 1 of every central bank is to do whatever it takes to prevent a disorderly collapse of banks caused by “bank runs.”