This post was published at The Young Turks
The US economic boom is still in progress, where a boom is defined as a period during which monetary inflation and the suppression of interest rates create the false impression of a growing/healthy economy*. We know that it is still in progress because the gap between 10-year and 2-year Treasury yields – our favourite proxy for the US yield curve – continues to shrink and is now the narrowest it has been in 10 years.
Reiterating an explanation we’ve provided numerous times in the past, an important characteristic of a boom is an increasing desire to borrow short to lend/invest long. This puts upward pressure on short-term interest rates relative to long-term interest rates, which is why economic booms are associated with flattening yield curves. The following chart shows the accelerating upward trend in the US 2-year yield that was the driving force behind the recent sharp reduction in the 10yr-2yr yield spread.
This post was published at GoldSeek on Sunday, 3 December 2017.
The U. S. Senate on Saturday narrowly approved a tax reform, moving Republicans and President Donald Trump a big step closer to their goal of slashing taxes which will create an economic boom in the United States and draw-in capital from around the globe.
This will put tremendous pressure upon Europe, Canada, and even Japan which all tax their economies significantly to the suppression of economic growth. The United States will have the lowest unemployment rate if this passes compared to the lost generation in Europe of high unemployed youth.
This post was published at Armstrong Economics on Dec 2, 2017.
In other words, we’ll be left with officially generated and sanctioned fake news and “approved” dissent.
We’ve all heard that the problem with the web is fake news, i.e. unsubstantiated or erroneous content that’s designed to mislead or sow confusion.
The problem isn’t just fake news–it’s the homogenization of the web, that is, the elimination or marginalization of independent voices of skepticism and dissent.
There are four drivers of this homogenization:
1. The suppression of dissent under the guise of ridding the web of propaganda and fake news–in other words, dissent is labeled fake news as a cover for silencing critics and skeptics.
2. The sharp decline of advertising revenues flowing to web publishers, both major outlets and small independent publishers like Of Two Minds.
3. The majority of advert revenues now flow into the coffers of the quasi-monopolies Facebook and Google.
4. Publishers are increasingly dependent on these quasi-monopolies for readers and visibility: any publisher who runs afoul of Facebook and Google and is sent to Digital Siberia effectively vanishes.
This post was published at Charles Hugh Smith on FRIDAY, NOVEMBER 17, 2017.
Crooner Don Ho almost got it right in his signature song ‘Tiny Bubbles.’ But it is now ‘BIG BUBBLES in the economy, make me nervous all over, with a feeling that I’m gonna lose it it all.’
Check it out. Home prices are seemingly unstoppable and the S&P500 index is relentless. The unstoppable asset price bubbles started in the mid-1990s when M2 Money Velocity peaked. The housing bubble burst then rallied back it bubble levels again, but the stock market has outpaced its former glory.
This post was published at Wall Street Examiner by Anthony B Sanders ‘ November 1, 2017.
There are many critics of the Fed’s recent money supply expansion, especially since 2008, whose chief criticism is that it will result in consumer price inflation. While proponents of the Austrian School agree that high consumer price inflation is one possible result of an expansionary monetary policy, we neither hold it as necessary nor as the worst consequence of money creation.
For the Austrian, who defines inflation as an expansion of the money supply, rising consumer prices only take place to the extent that this new money drives demand for more consumer goods. But as Mises pointed out, new money does not enter the economy neutrally; that is, it enters in specific ways and in accordance with specific mechanisms. This affects where the rising prices will show up first. And if it takes decades for the newly created money to reach consumers, then it will take decades for the consumer prices to rise.
Secondly, rising consumer prices are by no means the primary evil of monetary expansion. The primary evil of monetary expansion under our money and banking system is the harm done to the capital structure. The artificial suppression of interest rates that results from the expansion of the money supply has an eroding effect on the economy’s capital stock. When interest rates are suppressed below what they would have been without the monetary expansion, investments in unprofitable projects suddenly appear to be profitable. This is the basis for the Austrian Theory of the Business Cycle. Capital is allocated to projects that the economy cannot in actuality support and is therefore squandered.
This post was published at Ludwig von Mises Institute on Oct 31, 2017.
IRD Note: For nearly two decades, GATA has seized on Frank Veneroso’s original research which provided first-hand evidence that Central Banks were actively operating to suppress the gold and has presented direct evidence of precious metals manipulation. Beyond this, there are public admissions from Henry Kissinger and Alan Greenspan acknowledging this fact. Unfortunately, those who deny that gold/silver are manipulated have never offered any response to the direct proof that Central Banks intervene directly in gold trading. The article below presenting just the facts was published by GATA.
Newsletter writer Steve Saville of The Speculative Investor, who long has denied that manipulation of the monetary metals markets means much, has seized on the recent essay by Keith Weiner of Monetary Metals as the conclusive refutation of silver market analyst Ted Butler’s longstanding complaint that JPMorganChase has been rigging the silver market.
Weiner’s analysis, headlined ‘Thoughtful Disagreement with Ted Butler’ and posted here – LINK – argued that JPMorganChase is undertaking only ordinary arbitrage in the silver market, exploiting spreads between bid and ask prices.
Saville, in commentary headlined ‘A Silver Price-Suppression Theory Gets Debunked’ – LINK – cheers Weiner’s essay and goes on to remark: ‘Entering a debate with someone who is incapable of being swayed by evidence that invalidates his position is a waste of time and energy, so these days I devote no commentary space and minimal blog space to debunking the manipulation-centric gold and silver articles that regularly appear.’
This post was published at Investment Research Dynamics on October 9, 2017.
“Like watching paint dry,” is how The Fed describes the beginning of the end of its experiment with massively inflating its balance sheet to save the world. As former fund manager Richard Breslow notes, however, Yellen’s decision today means the risk-suppression boot is on the other foot (or feet) of The SNB, The ECB, and The BoJ; as he writes, “have no fear, The SNB knows what it’s doing.”
As we reported previously, In the second quarter of the year, one in which unlike in Q1 fund flows showed a persistent and perplexing outflow from US stocks, a trading desk rumor emerged that even as institutional traders dumped stocks and retail investors piled into ETFs, a “mystery” central bank was quietly bidding up risk assets by aggressively buying stocks.
The answer was revealed this morning when the hedge fund known as the “Swiss National Bank” posted its latest 13-F holdings. What it showed is that, as rumored, the Swiss National Bank had gone on another aggressive buying spree in the second quarter, and following its record purchases in the first quarter, the central bank boosted its total equity holdings to an all time high $84.3 billion, up 5% or $4.1 billion from the $80.4 billion at the end of the first quarter.
This post was published at Zero Hedge on Sep 20, 2017.
Chris Powell and Bill Murphy formed the Gold Anti-Trust Action Committee in 1998 and they’ve been stalwart allies in the fight against gold price suppression and manipulation ever since. What a pleasure it was today to get caught up with Chris and get his thoughts on the current state of the global market for gold.
As you listen, you’ll quickly be reminded that Chris is still one of the most informed and well-spoken advocates for our cause. Over the course of this webinar, he addresses a number of current issues including:
the most important lesson he’s learned in the 20 years he’s followed the gold market the strange occurrence of SecTreas Mnuchin visiting Ft Knox and the equally strange television interview of Terry Duffy, the CEO of the CME Group whether the US government would financially benefit from revaluing the price of gold how physical demand will paly a role in finally ending the tyranny of the central banks and bullion banks and much, much more!
This post was published at TF Metals Report on Thursday, August 31, 2017.
[This post is a slightly-modified excerpt from a recent TSI commentary] The US economic boom that followed the bust of 2007-2009 is still in progress. It has been longer than average, but at the same time it has been unusually weak. The weakness is even obvious in the government’s own heavily-manipulated and positively-skewed data. For example, the following chart shows that during the current boom* the year-over-year growth rate of real GDP peaked at only 3.3% and has averaged only about 2.0%. Why has the latest boom been so weak and what does this say about the severity of the coming bust?
Before attempting to answer the above question it’s important to explain what is meant by the terms ‘boom’ and ‘bust’.
An economy doesn’t naturally oscillate between boom and bust. The oscillations are related to fractional reserve banking and these days are driven primarily by central banks. When I use the term ‘boom’ in relation to an economy I am therefore not referring to a period of strong and sustainable economic progress, I am referring to a period during which monetary inflation and interest-rate suppression bring about an unsustainable surge in economic activity.
Booms are always followed by and effectively give birth to busts, with each bust wiping out a good portion (sometimes 100%) of the gain achieved during the preceding boom. Putting it another way, once a boom has been set in motion by the central bank a bust becomes an inevitable consequence. The only unknowns are the timing of the bust and how much of the boom-time gain will be erased.
This post was published at GoldSeek on Monday, 21 August 2017.
Bill Murphy of GATA.org returns with key insights on the PMs market. The world’s largest gold producing / consuming nation, China just announced a 10% decrease in production and a 10% increase in consumption. Our guest suggests a gold price target of $3,000-$5,000 to compensate for underlying real inflation levels. Bill Murphy sees signs that indicate price suppression schemes are failing – the PMs could begin the next leg of an epic ascent. Key takeaway: the cartel is losing control, it may be merely a matter of time before the physical gold market overcomes the paper gold schemes as early as Fall of 2017.
This post was published at GoldSeek on 13 August 2017.
It’s been a while, years in fact, but suddenly it’s gold’s time to shine again.
The yellow metal – insurance against systemic collapse, hyperinflation and infinite political stupidity – which in recent years has seen its popularity fade as the younger generation has gravitated toward the far faster moving crypto currencies – is once again back in the spotlight.
As UBS’ strategist Joni Teves, who has been recommending the precious metal for a long time despite the BOJ’s relentless suppression, writes “gold bounces from recent lows in line with other safe havens amid risk-off sentiment across markets following geopolitical headlines over the past 24 hours.” Below are the key considerations from today’s UBS note:
Key technical levels come into focus for gold, triggering some decent market activity in the middle of this typically quieter summer period.
This post was published at Zero Hedge on Aug 10, 2017.
Accepting an academic honor last week at a ceremony at the Russian embassy in Mexico City, Hugo Salinas Price, president of the Mexican Civic Association for Silver, argued that Mexico’s central bank should purchase a portion of the country’s silver production for monetary reserves just as China is buying the whole of that country’s gold production. Salinas Price discloses that he has urged Russia to issue a silver ruble in anticipation of replacement of the U.S. dollar standard with a metallic money standard in the world financial system. Salinas Price also discusses the suppression of gold and silver prices by a cabal of U.S.-led central banks and financial institutions.
This post was published at Plata.com.mx
The “fixes” to the stagnation of postwar Capitalism in the 1970s were financialization, globalism, and the sustained expansion of debt–all have run out of steam.
Many of us have written about cycles in the past decade: Kondratieff economic cycles, business/credit cycles, the Strauss – Howe generational theory (an existential national crisis arises every four generations, as described in their book The Fourth Turning), and long-wave cycles of growth and decline, as described in seminal books such as The Great Wave: Price Revolutions and the Rhythm of History and War and Peace and War: The Rise and Fall of Empires.
There is another Rhythm of American History that few recognize: the economic, social and political crises sparked by exploitive Elites. There are two dynamics that drive these crises:< 1. The exploitation of commoners by financial/political Elites reaches extremes that create systemic instability as commoners no longer have the means to improve their conditions. 2. The economic mode of production that generated Elite wealth no longer functions, but the Elites cling to the failing system and enforce it with increasingly violent suppression of dissent.
Here are the previous Crises of Exploitive Elites:
1. Slavery, 1850 to 1865. Though the toxins generated by slavery are still with us, the existential political, social and economic crisis arose in the years between 1850 and the end of the Civil War in 1865
This post was published at Charles Hugh Smith on SUNDAY, JUNE 18, 2017.
Two weeks ago we asked a question: maybe behind all the rhetoric and constant (ab)use of sophisticated terms like “gamma”, “vega”, CTAs, risk-parity, vol-neutral, central bank vol-suppression, (inverse) VIX ETFs and so forth to explain why despite the surging political uncertainty in recent years, and especially since the US election…
… global equity volatility, both implied and realized, has tumbled to record lows, sliding below levels not even seen before the 2008 financial crisis, there was a far simpler reason for the plunge in vol: trading was slowly grinding to a halt.
That’s what Goldman Sachs found when looking at 13F filings in Q1, when it emerged that the gross portfolio turnover of hedge funds had retreated to a record low of just 28%. In other words, few if any of the “smart money” was actually trading in size.
This post was published at Zero Hedge on Jun 4, 2017.
In a series of articles posted on http://www.paulcraigroberts.org, we have proven to our satisfaction that the prices of gold and silver are manipulated by the bullion banks acting as agents for the Federal Reserve.
The bullion prices are manipulated down in order to protect the value of the US dollar from the extraordinary increase in supply resulting from the Federal Reserve’s quantitative easing (QE) and low interest rate policies.
The Federal Reserve is able to protect the dollar’s exchange value vis-a-via the other reserve currencies – yen, euro, and UK pound – by having those central banks also create money in profusion with QE policies of their own.
The impact of fiat money creation on bullion, however, must be controlled by price suppression. It is possible to suppress the prices of gold and silver, because bullion prices are established not in physical markets but in futures markets in which short-selling does not have to be covered and in which contracts are settled in cash, not in bullion.
Since gold and silver shorts can be naked, future contracts in gold and silver can be printed in profusion, just as the Federal Reserve prints fiat currency in profusion, and dumped into the futures market. In other words, as the bullion futures market is a paper market, it is possible to create enormous quantities of paper gold that can suddenly be dumped in order to drive down prices. Everytime gold starts to move up, enormous quantities of future contracts are suddenly dumped, and the gold price is driven down. The same for silver.
This post was published at Investment Research Dynamics on May 31, 2017.
“Gamma”, “vega“, CTAs, risk-parity, vol-neutral, central bank vol-suppression, the soaring popularity of (inverse) VIX ETFs , and so on: over the past year there have been countless attempts to explain why despite the surging political uncertainty in recent years, and especially since the US election…
… global equity volatility, both implied and realized, has tumbled to record lows, sliding even below levels not even seen before the 2008 financial crisis.
There may be a much simpler reason.
This post was published at Zero Hedge on May 20, 2017.
Sprott Asset Management founder and philanthropist Eric Sprott, honored last night in Toronto at a retirement testimonial dinner sponsored by the company, praised GATA’s work and called on GATA Chairman Bill Murphy and your secretary/treasurer to stand and be recognized. Some people in the audience of about 200 actually applauded, through the audience consisted mainly of ordinarily respectable people from the Canadian financial industry. Of course they may have just been trying to be polite and to humor Sprott. But some later confessed to following GATA’s work and to have been persuaded by it.
Sprott went on mischievously to contrast what he called “the GATA table,” at which Murphy and your secretary/treasurer were seated with Sprott Asset Management’s John Embry and economist Ian Gordon of Longwave Group, with what he called “the World Gold Council table,” at which two former chairmen of the council were seated: Franco-Nevada founder Pierre Lassonde and Goldcorp Chairman Ian Telfer. Sprott noted that during the dinner no rolls had been thrown from the GATA table toward the World Gold Council table.
Civility and cordiality were maintained though Lassonde repeatedly has dismissed complaints of gold market manipulation and has insisted that central banks couldn’t care less about gold while GATA has dismissed the World Gold Council as an accomplice with central banks in gold price suppression, a facilitator of “paper gold” and the shorting of the monetary metal.
This post was published at GATA