Gross Domestic Product

Another Volcker Moment? Guessing The Future Without Say's Law

If the dollar’s purchasing power falls much further, the market will expect higher interest rates, so this then becomes the likely outcome. The question will then arise as to whether or not the Fed will dare to raise interest rates sufficiently to stabilise the dollar's purchasing power. If the Fed delays, it could find itself facing a difficult choice. The level of interest rates required to stabilise the dollar’s purchasing power would not be consistent with maintaining the record levels of debt in both government and private sectors. Thirty-six years on it could be another Volcker moment.

How To Trade Tomorrow's ECB Meeting

The European Central Bank promised in January to "review and reconsider" its monetary stance this week. The question, as BloombergBriefs notes, is not if policy makers will ease but how. Haruhiko Kuroda's humbling in FX markets shows what Mario Draghi is up against tomorrow: namely, that even the most forceful policy decisions can be overwhelmed by events, positioning, or sentiment. Draghi has a number of options (some more and some less priced in) but most crucially there two large gaps to be filled in European Stock indices - the question is which is filled first?

Where Have We Seen This Before: Hungary Central Bank Will Prop Up Economy By Boosting Stock Market

Today the Budapest stock exchange, now majority-owned by the central bank - just a few conflict of interest there - approved a new strategy on Wednesday to boost new listings and attract new investors, helping the government's efforts to buoy the economy. The bourse will aim for five share or corporate bond listings per year and boost stock market capitalisation to about 30 percent of gross domestic product from less than 20 percent today.

Peter Schiff: The Establishment Is Peddling Fiction, Ignoring Fact

Janet Yellen is in a very difficult spot. If she continues to ignore the growing signs of recession, she runs the risk of letting one develop prior to the election. This would favor the Republican challenger who would be disinclined to reappoint her as Fed Chairwoman, if elected. Allowing the Greenspan bubble to bust on Bush’s watch sealed John McCain’s fate, allowing Obama to ride a wave of voter outrage into the White House in 2008. Yellen does not want Trump to catch a similar wave in 2016. As a result, we expect the Fed to soften its rhetoric in the very near future.

Prices Matter - Why Central Bank 'Fiddling' Is A Bad Idea

Call us old fashioned, but we still think prices matter. When prices are right, money flows to the most productive endeavors and economies work efficiently. When prices are wrong, crazy things eventually happen, with potentially dire consequences. That’s why we should be very worried about Japan, where things are getting crazy.

The Price Isn't Right - How Central Banks Are Fixing To Ambush The Casino

Indeed, what party other than the BOJ could be buying negative coupon debt? The answer is exactly why the coming financial crash will be so severe and long-lasting. To wit, it is front-runners expecting to cop a capital gain, and then get out before the house of cards collapses. That’s what might otherwise be called an ambush. The trillions of speculator dollars crowded into trades of this type throughout the global financial markets will never get through the narrow door of liquidity that remains in the casinos. The dotcom and the post-Lehman meltdowns were only the rehearsal.

Furious Rally Fizzles Overnight As Futures Follow Oil Lower

Following yesterday's torrid 2.4% March opening rally, which resulted in the biggest S&P gain since January and the best first day of March in history on what was initially seen as very bad news, and then reinterpreted as great news, overnight futures have taken a breather, and erased a modest overnight continuation rally to track the price of oil lower.

Gold Money's picture

In his annual newsletter to shareholders, Buffett makes the argument that $56,000 today is six times better (even after his adjustment for inflation) than the $858 of GDP per Capita each US Citizen earned in 1929 but forgets to mention that $858 in 1929 was equivalent to 41.5 Troy Ounces of Gold in 1929. When measuring on an apple to apples comparison, there has been little to no gain in GDP per capita over the last 86 years in the United States. We show you the math.

The Evil Empire Has The World In An Economic "Death Grip"

A decade ago John Perkins exposed the world to the ugly reality of Washington's "Economic Hit Men." Now he is back, exposing the fact that the evil empire has the world in the grip of a "death economy," concluding that "we need a revolution" in order "to bury the death economy and birth the life economy." But, as Paul Craig Roberts adds, don’t look to politicians, neoliberal economists, and presstitutes for any help.

"There Will Be Hyperinflation" Japanese Lawmaker Warns "Kuroda Got It Wrong" With NIRP

Following The Bank of Japan's voyage into NIRP never-never-land, the market has sent a clear signal of its displeasure and now a growing number of Japanese officials (and former officials) are questioning Kuroda and Abe's Peter-Pan-ic dream that 'they' can fly. Having called for sub-zero rates more than two decades ago, Takeshi Fujimaki, the Japanese banker turned opposition lawmaker, warns "The BOJ is trapped," now that QQE efforts have flattened the yield curve, since "if the curve is steep, banks can make profits even at negative rates. It was a mistake to adopt negative rates after QQE." But it is Fujimaki's parting comment that should have most concerned, "Japan has ballooning debt and the BOJ is financing debt, that’s the problem... it will bust and there will be hyperinflation."