Japan’s Lemming Syndrome

By Michael Pento – Re-Blogged From http://www.gold-eagle.com

The financial world is buzzing about former Fed chairman Ben Bernanke’s recent trip to Japan, where he advised Japan’s central bank chief Haruhiko Kuroda on how to manage his nation out of multi-decades of stagnant growth. Channeling economist Milton Friedman, Bernanke warned that Japan was vulnerable to perpetual deflation and stagnate growth and that helicopter money–where the government issues non-marketable bonds with no maturity date and the Central Bank buys them with counterfeited credit–was the most useful tool in overcoming this condition.

Bernanke encouraged Japan to carry on with the Abenomics policies that have failed to date by supplementing monetary policy with even more fiscal stimulus—as if Japan’s 230% debt to GDP ratio wasn’t enough. And he assured Abe and his staff that the Bank of Japan (BOJ) has instruments to ease monetary policy yet further.

And in case this village needed another idiot, Nobel laureate Paul Krugman, also chimed in. Arguing that Japan should raise its inflation target to 4 percent and embark on a significant but temporary fiscal stimulus to boost prices in the economy. Speaking at a conference on Thursday in Singapore, Krugman called for “a big burst of government spending and maybe also cash donations.”

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“Clinton Prosperity” Of The 1990s Is A Myth

By David Stockman – Re-Blogged From Contra Corner

That Hillary Clinton has—–unaccountably——stood by her man for 40 years is her particular foible. But now she wants 320 million Americans to stand by him, too, by electing her President so she can make Bill the nation’s economic czar:

During a speech in Kentucky Sunday she referred to “my husband, who I will put in charge of revitalizing the economy ’cause he knows what he’s doing.”

Actually, he doesn’t.

Herein follows a two-part essay on why Bill and Hillary Clinton had precious little to do with the vaunted prosperity of the 1990s, and why another twofer would be exceedingly bad for the nation.

In truth, it was the doing of Alan Greenspan, and not in a good way.

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Sell The Bonds, Sell The Stocks, Sell The House —–Dread The Fed!

By David Stockman – Re-Blogged From http://www.DavidStockmansContraCorner.com

There is going to be carnage in the casino, and the proof lies in the transcript of Janet Yellen’s press conference. She did not say one word about the real world; it was all about the hypothetical world embedded in the Fed’s tinker toy model of the US economy.

Yes, tinker toys are what kids used to play with back in the 1950s and 1960s, and that’s when Janet acquired her school-girl model of the nation’s economy.

But since that model is so frightfully primitive, mechanical, incomplete, stylized and obsolete, it tells almost nothing of relevance about where the markets and economy now stand; or what forces are driving them; or where they are headed in the period just ahead.

In fact, Yellen’s tinker toy model is so deficient as to confirm that she and her posse are essentially flying blind. That alone should give investors pause—-especially because Yellen confessed explicitly that “monetary policy is an exercise in forecasting”.

Accordingly, her answers were riddled with ritualistic reminders about all the dashboards, incoming data and economic system telemetry that the Fed is vigilantly monitoring. But all that minding of everybody else’s business is not a virtue—-its proof that Yellen is the ultimate Keynesian catechumen.

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Clueless Fed?!

By Axel Merk – Re-Blogged From http://www.merkinvestments.com

“The Fed doesn’t have a clue!” – I allege that not only because the Fed appears to admit as much (more on that in a bit), but also because my own analysis leads to no other conclusion. With Fed communication in what we believe is disarray, we expect the market to continue to cascade lower – think what happened in 2000. What are investors to do, and when will we reach bottom?

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Newsflash From The December ‘Jobs’ Report—–The US Economy Is Dead In The Water

By David Stockman – Re-Blogged From David Stockman’s Contra Corner

Here’s a newsflash that CNBC didn’t mention. According to the BLS, the US economy generated a miniscule 11,000 jobs in the month of December.

Yet notwithstanding the fact that almost nobody works outdoors any more, the BLS fiction writers added 281,000 to their headline number to cover the “seasonal adjustment.” This is done on the apparent truism that December is generally colder than November and that workers get holiday vacations.

Of course, this December was much warmer, not colder, than average.  And that’s not the only deviation from normal seasonal trends.

The Christmas selling season this year, for example, was absolutely not comparable to the ghosts of Christmas past. Bricks and mortar retail is in turmoil and in secular decline due to Amazon and its e-commerce ilk, and this trend is accelerating by the year.

So too, energy and export based sectors have been thrown for a loop in the last few months by a surging dollar and collapsing commodity prices. Likewise, construction activity has been so weak in this cycle—-and for the good reason that both commercial and residential stock is vastly overbuilt owing to two decades of cheap credit—–that its not remotely comparable to historic patterns.

Never mind. The BLS always adds the same big dollop of jobs to the December establishment survey come hell or high water. In fact, the seasonal adjustment has averaged 320,000 for the last 12 years!

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The Fed’s Academic-Based Theories Are Creating A BRUTAL Economic Reality

By Graham Summers – Re-Blogged From http://www.Gold-Eagle.com

One of the most frustrating aspects of today’s financial system is the fact that the Fed is being lead by lifelong academics with no real world banking or business experience.

Consider the cases of Ben Bernanke and Janet Yellen. Neither of these individuals has ever created a job based on generating sales of any kind. Neither of them has ever had to make payroll. Neither of them has ever run a business. What are economic realities for business owners (e.g. operating costs, capital and profits) are just abstract concepts for Bernanke and Yellen.

Moreover, there is a particular problem with academic economists. That problem is that a major percentage of their “research” is total bunk made up in order to make tenure.

This is not our opinion… it is fact based on research published by the Fed itself.

According to a paper published by researchers from THE FEDERAL RESERVE BOARD, it was not possible to replicate even HALF of the results found in economics papers EVEN WITH THE ASSISTANCE OF THE INDIVIDUALS WHO WROTE THE PAPER.

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If This Really Is A Recovery, Why Aren’t We Using More Electrical Power?

(Mark uses a “Bird’s Eye View” chart style, which shows the change from the previous high. All new high’s are at 100%, with pullbacks obviously less than 100%. It’s different, but informative. Bob)

By Mark J Lundeen – Re-Blogged From http://www.Gold-Eagle.com

Janet Yellen may not have raised interest rates this week, but Mr Bear couldn’t care less.  We can see it in the market.  In bull markets double-digit declines from an all-time high are reasons to buy.  But EARLY in bear markets, recoveries from double digit declines are reasons to sell as we’ve seen since about mid-July.  In the table below recoveries from double-digit Dow Jones declines last just a day or so before the market comes under selling pressure, again driving the Dow Jones down 10% or more from its May 2015 last all-time high.

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