"...the tragedy is that, on the contrary, we are already suffering the long-run consequences of the policies of the remote or recent past. Today is already the tomorrow which the bad economist yesterday urged us to ignore."
"We've got to fight this battle, if for no other reason than principle," Merkel said, referring to Germany's commitment to the free trade, and asking German business to "join her in defending liberal democracy and trade", saying “in every generation one has to fight for one’s ideals.”
"Sane Indians should stay a step ahead of their rapacious government and the evolving totalitarian society, which are less and less inhibited by any institutions or values in support of liberty... India will become a police state, likely with the full support of most Indians. The glue of reason that the British have applied is flaking, and it is doing so rapidly under the catalyst by name of Narendra Modi."
Barack Obama is one of the biggest “Keynesians” of all time, but unfortunately most Americans don’t even understand what that means. By propping things up in the short-term, he has absolutely demolished our long-term economic future. But like most politicians, Obama has been willing to sacrifice the future for short-term political gain.
If governments allow banks to shut down bank accounts of individuals or companies without a fair trial and due legal process, it will create a very dangerous situation indeed. In this environment, buying gold is rational behaviour to even the biggest paper-bugs out there. The current monetary experiment of massive QE is no longer the main concern of prudent investors and institutions, it is now combined with negative interest rates and bail-ins.
Unwittingly, the Fed has now become co-dependent on the markets. If they move to tighten monetary policy, the market sells-off impacting consumer confidence and pushes economic growth rates lower. With economic growth already running below 2%, there is very little leeway for the Fed to make a policy error at this juncture. Therefore, the Fed remains trapped between keeping the financial markets happy and trying to resolve their monetary dilemma. The problem is that eventually something has to give and it will likely not be the outcome the Fed continues to hope for.
"the fact that negative rates would be temporary and deployed only during severely adverse economic conditions would be an advantage. Like quantitative easing, which was also unpopular in many quarters, a period of negative rates would probably be tolerated by politicians if properly motivated and explained" - Ben Bernanke
To the economic and political detriment of the Western world and those economies beyond which have adopted its precepts, 2016 marks the eightieth anniversary of the publication of one of, if not, the most influential economics books ever penned. Despite its outlandish theoretical flaws and nonsensical economic jargon and the catastrophic empirical evidence of its failure to prevent financial downturns or “stimulate” sustainable growth, Keynesianism remains the ruling paradigm of economic thought... Why?
"This is the peak – we have passed the peak of the bubble. It's now deflating. There is usually a little tiny roll over and then a huge crash. And the little tiny roll over is just starting right now. We are seeing it first in the top end (like luxury real estate), where the currency that was created by the central banks went to that 0.1% first. Within the next few years you are going to see probably the greatest crash in history. I have often said that the crisis of 2008 was just a speed bump on the way to the main event. We are in the process right now of seeing this unwind."
Citing a government official speaking on condition of anonymity, Reuters reports that Bernanke will be in Japan next week. It has been arranged for him to meet officials including Abe and Bank of Japan Governor Haruhiko Kuroda. "Some market players speculate Kuroda might decide, in a surprise, to provide "helicopter money."
James Traub’s call is for the ‘elites’ to rise up against the ‘ignorant masses’. Yes, indeed, please do. But be careful what you wish for. You just might discover that we are having the very same argument had between Thomas Jefferson and Alexander Hamilton at the beginning of the Republic.