There might not have been a second round of quantitative easing, if Federal Reserve Chairman Ben Bernanke shopped at Walmart.
A new pricing survey of products sold at the world’s largest retailer showed a 0.6 percent price increase in just the last two months, according to MKM Partners. At that rate, prices would be close to four percent higher a year from now, double the Fed’s mandate.
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John Maynard Keynes thought he had pretty well killed gold as a monetary standard back in the 1930s. Governments of the world did their best to help him. It took longer than they thought. Gold in the money survived all the way to Nixon, and it was he who finally drove the stake in once and for all. That was supposed to be the end of it, and the beginning of the glorious new age of paper prosperity.
It didn’t work out as they thought. The 1970s was ... (more)
Even with all of the massive economic problems that the United States is facing, if the government would just get off our backs most of us would do okay. In America today, it is rapidly getting to the point where it is nearly impossible to start or to operate a small business. The federal government, the state governments and local governments are cramming thousands upon thousands of new ridiculous regulations down our throats each year. It would take a full team of lawyers just to even try t... (more)
L: Good evening Doug. The Fed's new $600 billion liquidity injection pushed gold to new records, at least in current dollars, topping our $1400 target for this year. Our gold stocks are up even more. Even the World Bank is suggesting that a return to some sort of gold standard might be worth considering. Does the market feel "toppy" to you? What do you make of the latest numbers?
Doug: Well, first, it's fascinating that the head of the World Bank is actually talking about gold. Th... (more)
World Bank president Robert Zoellick has stirred up a hornet's nest with his recent call for a return to a gold anchor[1] in the global financial system.
The usual suspects immediately denounced him, with Keynesian Brad DeLong anointing Zoellick the "Stupidest Man Alive."
In the present article I'll explain the resurging interest in the yellow metal.
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In a surprise move, the co-chairs of Barack Obama's national debt commission released their preliminary proposals to the media on Wednesday. The proposals are actually quite modest - they recommend that nothing be implemented until 2012 because of the weak economy, and their plan would not balance the federal budget until 2037 - but almost as soon as it was released Democrats and Republicans both started screaming bloody murder about how they would not support it. The truth is that virtually n... (more)
As a mortgage broker during the manic years of the housing boom, I witnessed reckless financial practices on a wide scale. As a result, I was not surprised by the “robo-signing” mess that now threatens the mortgage sector. Unfortunately, the scandal is only a small tip of the iceberg that threatens to take down the entire US banking system.
Over the past several decades, the U.S. dollar and other major currencies around the globe have been continually devalued, but they have still remained stable enough for trade to flourish and for the world to enjoy an unprecedented era of prosperity. However, that all may now be changing. Many analysts now fear that the new $600 billion program of quantitative easing by the U.S. Federal Reserve may set off a round of "competitive devaluations" across the globe that could precipitate a global c... (more)
While it’s true that history repeats itself, the patterns should always be separated by a generation or two to keep things respectable. Unfortunately, in today’s economic world, it seems the cycle can be counted in months.
On July 24, 2009, just as the Federal Reserve unleashed its first quantitative easing campaign (now called “QE1” – an echo of the reclassification of the Great War after still more destructive subsequent developments), Fed Chairman Ben Bernanke wrote an opinio... (more)
Even as Barack Obama and Ben Bernanke publicly defend the Federal Reserve's new $600 billion quantitative easing program, top finance officials around the globe are expressing alarm and outrage. But what did Obama and Bernanke expect? "Quantitative easing" is little more than legalized cheating. For a moment, imagine that the global economy is a giant game of Monopoly. Essentially what Bernanke has done is that he has just reached under the table and has slipped another $600 billion on to hi... (more)
Before the Internet, Robert Zoellick’s brief outline of suggested topics for the G20 meeting this week in Seoul, Korea, might have been considered just an interoffice memo. It appeared in London’s Financial Times, contained obscure references to arcane subjects that would be of interest only to international bankers determined to push their agenda for a world currency, and was written ... (more)
Some years ago, I was watching and listening to a communist poetry/rap group in a public park and rather enjoying the spirited rhythmic presentation. Hundreds of people were enjoying it too. The message was goofy but harmless in some way, essentially a bunch of tuneful hectoring on how we need to come together and share and be one, etc. At some point, the lead singer said that the best path to utopia was a direct one. We should throw away our cell phones! Well, at that point, the crowds lost int... (more)
It seems the Fed has given up on the idea that the country can build a viable and stable economy through the conventional means. Instead, our central bank has resorted to once again growing GDP and increasing employment by the creation of asset bubbles. This is a dangerous game that no one, least of all the Fed, knows how to play.
We learned this past Wednesday that the FOMC decided to increase its purchases of longer-dated Treasuries by $600 billion within the next eight months.... (more)
