Archive - Oct 8, 2009 - Blog entry

Will the next asset bubble come sooner than we think? Will it be in cleantech? Biotech? Nanotech? Infrastructure? Oil? Gold? Bonds? BRIC economies? Or will the next bubble be Canada? Yes, Canada! Nobody really knows, but big bets are being placed by some very big funds. The only thing I know is the world is awash with liquidity, a bubble is forming and we won't know about it until it's too late.

FHFA's new top cop spoke before the Senate Banking Committee. Strong words. None of them sounded so good to me. Those that think that America's RE and mortgage crisis are behind us should read this. It will get worse before it gets better according to DeMarco. The good news is that he promised the problems at his Agency will come up for discussion before the end of the year. This is going to get interesting.

Did Greenspan know exactly what he was doing?

I do not profess that the main structural arguments of the following essay are mine. Rather they belong to a rather famous former Chairman of the US Federal Reserve named Alan Greenspan as noted in his rather seminal 1966 essay titled “Gold and Economic Freedom”. However, I have taken the specific arguments of that very prescient essay and modified and reinterpreted them to fit into the contemporary situation of our current global and financial crisis (that it its core, is a monetary crisis).

Gold is only about half of its real high.

Overnight, we have learned that multiple Asian central banks intervened to prevent rapid appreciation of their own currencies against the US Dollar. Could we be witnessing the beginning of a currency crisis, or is this simply more water under the bridge?