Europe’s Sovereign Debt Crisis

The collpase of stocks in Europe today shows that the European bank crisis over sovereign debt is deteriorating quickly.   When the debt-ceiling deal was announced, the stock market sold off.   The market understood that the deal was one more can kicked down a road filled with cans.   I sold some really good stocks before they dropped further.   [...]

Investing While the Fed Devalues the Dollar

This past week, the Fed began a $600 billion plan for a second round of “quantititative easing.” “Quantitative easing” is Fedspeak for “printing money.” This further proves that the Fed is devaluing the dollar and stimulating an inflationary environment. I suspect that the Fed is relying solely on mathematical models, and ignoring history. History says [...]

The Lords of Finance

I am currently in early 1929. Jeremiahs from Joe Kennedy and Bernard Baruch to some guy in England named Keynes are warning how the US stock market bubble is extremely dangerous, and interest rates should be raised.

What caused the May 6 market crash?

I have some students who work in the financial industries, and they have been discussing the market crash because they watched in happen. One saw his company, a hedge fund, make over $100 million last Thursday, only to give it back on Friday and Monday. What caused the crash last week? I expect it is [...]

Gold hits record (?) $1,092

Today, gold hit $1,092 per ounce. This is reported as a record. It is a record, but only in nominal prices. One must always distinguish between nominal prices and real prices. Nominal prices are not adjusted for inflation. Adjusted for inflation, gold won’t be in record territory until it reaches the $2,000/oz. level. The reason [...]

Inflation is coming: The economic crisis is just beginning

Once the United States was the world’s greatest creditor nation. Sometime in the early 1960s, the so-called “Greatest Generation” decided to spend the wealth that previous generations accumulated…..sometime about the first quarter of 1983, the U.S. had spent its wealth, and became a net debtor nation….The expansion of the money supply and the trillion-dollar deficits mean a great inflation is coming.”

Business cycle forecast says the economy has turned

Leading indicators USLLI and WLI say the economy is turning up.