Rig For Stormy Weather

By Gary Christenson – Re-Blogged From Deviant Investor

What storm? The Dow Jones Industrial Average (DOW) reached another all-time high. Interest rates in the U.S. are yielding multi-decade lows, some say multi-century lows. Trillions of dollars in global sovereign debt have negative yield and European junk bonds yield less than 10 year U.S. treasuries. “Official” unemployment is low. Borrowing is inexpensive. Things are good, so they say!

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David Stockman: Soaring Federal Deficits

By Rob Williams – Re-Blogged From Newsmax

David Stockman, the former budget director for President Ronald Reagan, said the spending plan now being hammered out in Congress will add trillions of federal debt and smother the U.S. economy.

Congress on Wednesday night released the text of the 652-page budget deal that will raise strict spending caps on domestic and military spending in this fiscal year and the next one by about $300 billion. It includes almost $90 billion in disaster relief in response to last year’s hurricanes and wildfires, and would lift the federal debt limit until March 2019, the New York Times reported.

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Global Synchronized Bond Collapse

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

We have all heard, in ad nauseam fashion, Wall Street’s current favorite mantra touting a global synchronized economic recovery. For the record, global GDP growth for 2017 was 3.7%, according to the International Monetary Fund. And, although this is an improvement from recent years, you must take into account that in 2004 it was 4.4%, in 2005 it was 3.8%, in 2006 it was 4.3%, and in 2007 it was 4.2%. The Point being, it’s not as if the current rate of global growth has climbed to a level never before witnessed in history—it’s not even close.

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Unsound Money Is Crucifying Pensions

By Alasdair Macleod – Re-Blogged From http://www.Silver-Phoenix500.com

Deficits are mounting in pension obligations. It is a global problem over which pension trustees are helpless. It is also a problem that’s brushed under the carpet, with prospective and current pensioners generally unaware of the threat to their retirement. Investors in companies with defined benefit schemes, schemes which promise an inflation-adjusted entitlement based on final salary, generally ignore this important issue, as do most stock market analysts. Analysts know the deficits are there, but so long as they are buried in the notes to the accounts and not actually represented in-your-face on balance sheets, the assumption appears to be they can ignore them.

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The Truth About Trade

By Alasdair Macleod – Re-Blogged From http://www.Silver-Phoenix500.com

The one subject, which became a headline issue last year, and even divides experts is trade. It will become increasingly important in 2018 as the US develops her trade policy, particularly with respect to China, and as the UK negotiates her Brexit terms with the EU.

Ignorance dominates this subject. Surely, people say, industry should be protected from unfair trade practices, such as goods manufactured in foreign sweat-shops, or unfair dumping of commodities, such as steel. If President Trump can protect American business from unfair competition, it would be good for the American economy. Then there’s the business of currency rates. Doesn’t a lower currency help restore the trade balance, by making exports cheap, and imports expensive? And surely, Britain leaving the EU risks trade tariffs being set up against British business. This means sterling must fall against the euro to rebalance trade.

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China Officials View Treasuries Less Attractive

By Bloomberg – Re-Blogged From Newsmax

Officials reviewing China’s foreign-exchange holdings have recommended slowing or halting purchases of U.S. Treasuries, according to people familiar with the matter.

China holds the world’s largest foreign-exchange reserves, at $3.1 trillion, and regularly assesses its strategy for investing them. It isn’t clear whether the recommendations of the officials have been adopted.

Image: China Officials Are Said to View Treasuries Less Attractive

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Soaring Deficits Force Treasury into Foolish Gamble

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

As mentioned last week in Part I, the U.S. National debt is now at a record $20.5 trillion. And the first month of fiscal 2018 showed a deficit increase of nearly 38% over fiscal 2017. The total amount of Non-Financial Debt is up nearly $15 trillion during the 2007-2017 timeframe. In addition, the Federal Reserve Bank of New York reported that household debt totaled $13 trillion in the third quarter ended September 30th, which is a record high and the 13th straight quarterly increase. And, CNBC recently reported that the debt of nonfinancial corporations has grown by $1 trillion in just the last two years and now totals over $8.7 trillion, which is also a record 45% of GDP.

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