Janet Yellen is a career academic. This is not necessarily a bad thing. However, unlike most career academics, Janet Yellen is in charge of the US economy. In this light, one has to ask aloud, “why would you put someone with absolutely zero experience in creating jobs, growing a business, lending money, hiring, firing, etc. in
The confidence in the people who are supposedly, as well as supposed to be “in charge” is doing more than just dwindling. It’s crumbling in Humpty Dumpty like fashion. For no matter how they try – it too may never go back together. Once confidence wanes, or is lost, regaining it can be just as monumental of a task than the actual crisis itself.
One systemic source of rising inequality is crony-capitalism/crony socialism: the vast array of insider deals, collusion, winners being picked by the central state, too big to fail banks bailed out with taxpayer money, etc. People are increasingly aware the Status Quo is rigged, and the playing field is tilted to favor the few inside the crony-capitalist castle (what we call the New Nobility in a Neofeudal economy). As a society, we will have to deal with the reality that the nature of work is fundamentally changing, and wages are no longer an adequate means of distributing the surplus of an economy.
News about the spread of the Ebola virus has been an increasing focus for market participants in recent days. Despite rising media coverage, Ebola seems to have had little discernible effect on consumer sentiment to date. However, as Goldman Sachs notes, the "fear factor" associated with Ebola appears more significant than in past instances of pandemic concern. While expert opinion sees the likelihood of a significant outbreak of Ebola in the US as very low, it is likely any negative macroeconomic consequences are most likely to be transmitted through fear or risk-aversion channels.
From Bitcoin to the Swiss gold referendum, and from Chinese trade and North Korean leadership, Jim Rogers covers a lot of ground in this excellent interview with Boom-Bust's Erin Ade. Rogers reflects on the end of the US bull market. citing a number of factors from breadth to the end of QE, adding that he agrees with Albert Edwards' perspective that now is the time to "sell everything and run for your lives," as the "consequences of [The Fed] are now being felt." Most notably though, Rogers believes the de-dollarization is here to stay as Western sanctions force many nations to find alternatives. Simply put, Rogers concludes, "we are all going to pay a terrible price for all this money-printing and debt."
Is It Fair to compare this sell off to the Great Recession of 2008 and 2009?
A correction of significant magnitude is currently “inconceivable” as the U.S. is now “clearly” on a trajectory towards stronger economic growth. This is the “frame of belief” that pervades in the financial markets currently. However, there are many risks investors should not ignore. Making up losses is much harder than reinvesting stored capital once a clearer picture emerges. While the current belief that a correction of significant magnitude in the markets is "inconceivable," We are not sure that word means what they think it means.
Politicians Try to Make Ebola a Partisan Issue for the Upcoming Election … But BOTH Parties Dropped the BallSubmitted by George Washington on 10/16/2014 13:25 -0500
Update: CDC Says Nurse Might Have Been SYMPTOMATIC While Flying ... And Study Says 21 Day Quarantine TOO SHORT
Expecting the state to truly reform the nation's engines of financialization is like asking the cocaine addict married to the wealthy dealer to divorce the dealer.
We know low interest rates and QE hasn`t worked, or they wouldn`t have to be re-initiated in the form of additional QE Programs, and we wouldn`t still be having this entire conversation 7 years after ZIRP began.
The systemic risks underlying the Financial Crisis are in no way resolved.
Most people that discuss the "economic collapse" focus on what is coming in the future. And without a doubt, we are on the verge of some incredibly hard times. But what often gets neglected is the immense permanent damage that has been done to the U.S. economy by the long-term economic collapse that we are already experiencing. But because unprecedented levels of government debt and reckless money printing by the Federal Reserve have bought us a very short window of relative stability, most Americans don't seem too concerned about our long-term problems. They seem to have faith that our "leaders" will be able to find a way to muddle through whatever challenges are ahead. Hopefully the following 12 charts will be a wake up call.
In the pantheon of utter political stupidity in our time, the competition is pretty fierce to see who ranks #1. But I have to imagine that, even with so many rivals, Argentina’s Cristina Fernandez de Kirchner makes a pretty compelling argument to be the champion. Exhibit A: Argentina’s new ‘supply law’, or Ley de Abastecimiento, (as we warned here) due to take effect in December next year.
While Greek leaders are proclaiming victory, intending to exit the bailout plan early and fund themselves in the public marketplace - just as they did in April (despite record poverty, unemployment, and suicides); it appears investors are a little less sanguine about the prospect. Greek bond yields have topped 7% for the first time since March and any gains from the 5Y bonds sold to hedge funds in April have now gone (and Greek stocks are at 13-month lows). The driver of recent weakness appears to be fears over whether Draghi's OMT will ever be real enough to monetize Greek debt and a re-rating based on more standalone risk if Greece were to exit the bailout program early.
Just when you think the selloff couldn’t get any scarier, it did. The last hour of trading took over 1% out of the S&P 500 in rapid fashion, reportedly on fears of an Ebola check at a major U.S. airport. Today we offer up a “Top 10” list of specific markets and indicators to watch for signs of a near term market bottom. They include the CBOE VIX Index (key levels at 26 and 32), the action in small cap stocks and crude oil, and the dollar. Less quantifiable issues – but important nonetheless – are headlines related to Ebola (probably getting worse before better), 10-year Treasury bond yields (2.0% and 1.5% possible here), and European policymakers addressing a host of difficult monetary and fiscal policy issues. Bottom line: this is unlikely to be a dramatic “V-bottom” low given the range of issues of concern to investors. Look for the majority of our “Top 10” to stop going down before calling a bottom.