The Stock Market Economy

By Peter Schiff – Re-Blogged From Euro Pacific Capital

Currently, some market watchers have begun to openly question whether the bull market in stocks has finally come to an end. They certainly have cause to worry. Valuations are frothy after a record run-up in the last few years. Bond yields across the yield curve are rising sharply, as the Fed Funds Rate breaks into territory not seen since before the market crash of 2008. Much higher costs of capital are already putting pressure on rate-sensitive industries such as housing and autos. The boost to earnings provided by the corporate tax cuts will fade and rising prices resulting from past monetary policy and import tariffs may be expected to slow consumption and take a toll on balance sheets. All this points to possible lackluster performance, with stocks essentially flat so far this year.

Continue reading

Advertisements

Greenspan Seeing ‘First Signs’ of Inflation

Re-Blogged From Newsmax

Former Federal Reserve Board Chairman Alan Greenspan warned that he is “beginning to see the first signs” of inflation in the U.S. economy.

“We’re seeing it basically in the tightening of the labor markets first, which, as you know, have gotten very tight now. We’re beginning finally to see average wages rise, and clearly there’s no productivity behind it,” Greenspan told Bloomberg TV.

Greenspan said a lack of productivity growth meant “you’re getting into a system now which has no outcome that’s in equilibrium other than inflation and no productivity growth.”

Continue reading

Prices When Gold Is Money

By Alasdair Macleod – Re-Blogged From GoldMoney

We are getting ahead of ourselves here. Gold does not circulate as money – yet. It might never do so. Perhaps the end of government currency, fiat money imposed on us by government laws, may never be replaced by what for millennia has been the people’s money, gold. Do we even wish it? Given what we have to do to get there, probably not.

It is hard to think of a life without Nanny State giving us her money-tokens to buy our sweets, telling us what to eat and what medicine to take. But Nanny State is getting long in the tooth. When she was younger, she was less controlling. Her constant refusal to allow us, the ordinary people, to do what we want is an increasing source of friction.

Continue reading

How “Free Money” Helped Create Sizzling Housing And REIT Gains In Recent Years

By Dan Amerman – Re-Blogged From Silver Phoenix

Housing prices and the associated REIT returns have worked very differently in the United States since the recession of 2001. The increasing financialization of the real estate markets by Wall Street, and the aggressive and unconventional interventions by the Federal Reserve over that time, have combined in multiplicative fashion to produce new and volatile sources of housing profits and losses.

One such change has been the creation of an extremely powerful profit engine for housing, that most real estate investors have not been taking into account. Indeed, there is a strong mathematical case to be made that “yield curve spread compression” has supported and enabled the substantial majority of housing price gains for homeowners and investors on a national average basis since the beginning of 2014.

Continue reading

Dow Jones’ Earnings Are At Record Highs

By Mark J. Lundeen – Re-Blogged From Gold Eagle

The Dow Jones saw some action this week. Wednesday, the day after the mid-term elections it advanced by 2.13% from its previous day’s closing price, our fourth day of extreme volatility since early October. Everyone was happy about the nice daily gain. But I’m only noting that days of extreme market volatility (Dow Jones 2% days) are in the main bear-market phenomenon, be they negative or positive.

Continue reading

Are US Bonds Overvalued?

By Arkadiusz Sieron – Re-Blogged From Gold Eagle

“We are in a bond market bubble that’s beginning to unwind.” This is the statement of Alan Greenspan. Is he right? We invite you to read today’s article about the US bond market and find out whether it is in bubble or not – and what does it all mean for the precious metals market.

Bond yields are in an upward trend since 2016/2017. And they hit the accelerator again last month. The 10-year Treasury yield topped 3.2 percent, the highest level since May 2011. Other yields have also increased recently: on 30-year Treasuries hit 3.40 in October, while on 5-year US government bonds jumped above 3 percent, as one can see in the chart below.

Continue reading

The Election’s Finally Over. Now Things Can Go Back To “Normal”

By John Rubino – Re-Blogged From Dollar Collapse

As contentious as the US midterm elections were, there was never a scenario in which they mattered. Any possible configuration of Republicans and Democrats in the House and Senate would have yielded pretty much the same set of economic policies going forward: Ever-higher debt, upward trending interest rates and (through the combination of those two) rising volatility.

So with the sideshow now in the rear view mirror, we can get back to our new normal. From this morning’s media reports:

Continue reading