Money Supply

This Week In 1971: President Nixon Closes the Gold Window

The removal of the restraint of gold redemption freed the Federal Reserve to engage in more inflationary monetary policy than ever. The effects of that on money supply and official price inflation figures are readily apparent.

5 Reasons Why Austrian Economics Is Better Than The Mainstream

Mainstream economics is fraying at both ends. At one end, heterodox and Austrian economists keep pulling on loose strands: pointing out the inconsistencies, failures, and absurdities of their unrealistic models. At the other end, top mainstream economists and mouthpieces are doing the same, but with a touch of deflection and embarrassment.

Don't Expect A Return To A Gold Standard Any Time Soon

Under the current academic environment, as generations have been misinformed, deceived, and lied to, it is unlikely that a return to a gold standard will take place.  Until the intellectual battle is won, paper money and the central banksters that manage it will continue their reign of financial terror.

Panic? China Is Hoarding Cash At The Fastest Pace Since Lehman

The last few months have seen trillions of dollars of fresh credit puked into existence in China to enable goal-seeked growth numbers to creep lower (as opposed to utterly collapse). The problem is... the Chinese are hoarding that cash at the fastest pace since Lehman as liquidity concerns flood through the nation.

"Something Is Not Right"

Overall, the “mixed signals” backdrop that has been in evidence for quite some time continues to prevail. And yet, we can see that a number of data points remain quite weak or are deteriorating further (particularly RGPDI). Strong payrolls data are not a reliable indicator of future economic growth – and considering that money supply growth remains at more than 8% y/y, current economic data look actually exceptionally poor (normally more pronounced boom conditions would be expected). Any slowdown in credit growth will quickly sink the good ship US economy.

Preview Of Key Events In The Coming Week

The coming week brings multiple macro data releases for July, including inflation, trade data, retail sales, IP, credit and money supply. A relatively light US data calendar next week with retail sales the main release on Friday but also import and producer prices and Michigan sentiment coming up. Retail sales will be closely watched to assess consumer spending growth for 3Q.

D-Day For Australia's Real Estate Bubble?

This rotting shack in Sydney and its tiny plot of land sold for nearly $1 million in May of 2014 – more than two years ago. Since then, house prices in Australia have increased even further. Yes, it is an insane bubble, no doubt about it... and now, it appears, the banks are finally realizing, and are pulling back.

Central Banks Are In A Lose-Lose Situation: Low-Rate-Policy "Has Rendered The System Profoundly Fragile"

"...abandoning the low interest rate policy would likely trigger a severe recession... but, continuing this policy would distort and corrode the economic structure even more, which would jeopardize the business model of pension funds, insurers and banks, and further inflate the real estate and stock market bubbles. The low interest rate policy has rendered the system profoundly fragile, with central banks virtually in a lose-lose situation."