D.C. Dysfunction and Central Bank Chaos

By Michael Pento – Re-Blogged From Pento Portfolio Strategies

On September 5th, the members of both houses of Congress of the United States cleaned the beach sand from between their toes and returned to work. Our public servants who occupy The House of Representatives have been working on their respective tans since July 29th. The Senate has had a little less time in the sun; they held their final vote on August 3rd despite their pledge to stay until August 11th.

Hopefully, they got a lot of rest, because they have a lot to do upon their return. By the end of September Congress will need to pass a budget bill to avoid a government shutdown. Expect Tea Party Republicans to hold their ground on spending cuts while Trump petitions for his wall. According to recent tweets, Trump is pushing for this fight and welcomes a government shutdown. Get out the popcorn this could get interesting.

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Bond Bubble has Finally Reached its Apogee

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

Boston Fed President Eric Rosengren recently rattled markets when he warned that low-interest rates were increasing the temperature of the U.S. economy, which now runs the risk of overheating. That sunny opinion was echoed by several other Federal Reserve officials who are trying to portray an economy that is on a solid footing. And thus, prepare investors and consumers for an imminent rise in rates. But perhaps someone should check the temperatures of those at the Federal Reserve, the idea that this tepid economy is starting to sizzle could not be further from the truth.

In fact, recent data demonstrates that U.S. economic growth for the past three quarters has trickled in at a rate of just 0.9%, 0.8%, and 1.1% respectively. In addition, tax revenue is down year on year, S&P 500 earnings fell 6 quarters in a row and productivity has dropped for the last 3 quarters. And even though growth for the second half of 2016 is anticipated with the typical foolish optimism, recent data displays an economy that isn’t doing anything other than stumbling towards recession.

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How Stupid Do You Have To Be

By John Rubino – Re-Blogged From http://www.Silver-Phoenix500.com

“Of course, there are true copper-bottomed mistakes, like spelling the word “rabbit” with three m’s, or wearing a black bra under a white blouse, or, to make a more masculine example, starting a land war in Asia.” — John Cleese

We all make mistakes, but some are bigger than others. An example of a serious one that’s both potentially catastrophic and easily avoided is to lend money for long periods during a time of rising debt and financial instability. Who, for instance, would commit capital for 30 years to Italy by buying that country’s long-dated government bonds? “No one” is the sane answer, yet those bonds do find buyers.

Even higher on the crazy scale is the following:

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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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555 TRILLION Reasons Why The Fed Won’t Let Rates Normalize

Guest Post By Graham Summers

The biggest question for investors today is that whether or not rates will rise in 2015.

The Fed may raise rates a token amount this year, but the move will be largely symbolic. With over $100 trillion in bonds and over $555 TRILLION in interest rate derivatives trading based on interest rates, the Fed will not be normalizing rates at any point in the future.

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