LKofScotland

Still Wary of Those Financial Weapons of Mass Destruction

Stock market flat, economy roars to life and the government bond market at any meaningful level ceases to exist as inflation adjusted returns makes everyone a loser except muslim terrorists. having fun voting for losing yet?

Fed Does Nothing, Dollar Rallies

and there goes the "new open-ness of the Fed"! Gonna be an interesting dance as the Fed tries what every other government Agency does so well because the lie for living but the Fed usually does not--admit to making a mistake without actually admitting to it. Silence is always a good start!

Should Mexico Stop Exporting Oil?

hmm. oil or corn, corn or oil. methinks they'll choose corn and keep exporting their oil.

Why Interest Rates Will Continue to Rise

Actually the situation is far more deletrious than portrayed here. The fact that the only asset class being bought at the government level by private investors is the t-NOTE as opposed to the t-BILL is ominious indeed. the purchase seems like good money when one considers the past and crazy alan greenspan and his sudden envy that only oil companies had the ability to destroy "his" economy. he just had to pile on. unfortunately the mad banker trade is done so now we're left with just the mere insanity of its exact opposite. once people wake up to the fact that uncle sam is debasing ALL savings the movements out of the t-note will be MASSIVE and short term rates will soar making winners out of all those "crazy people still in cash." it will also send any business with even debt load AT ANY INTEREST RATE to the government for his/her needed bailout since they won't even be able to GET A QUOTE from wall street. And all done to fix the deflation problem! in the meantime consumers will have all the credit they want BECAUSE THEY HAVE NO MONEY. In other words, sure, the availibility will be there, but they won't take it because THEY'RE ALREADY BROKE. But isn't this what being rich is anyway? Having credit that we cannot afford to use?

Marc Faber on Hyperinflation in the U.S.

10-20% inflation is mild? How about 18% mortgage rates? Sound mild, too? I mean i'm all for doubling my money in the shortest period possible but Professor Ben never had a plan should QE fail. don't we all now know what happens when people's theories turn out to be incorrect? in other words DOUBT is the hallmark of wisdom for all you action heroes out there. so what does the failure of QE give us? well more QE of course. hence "no surprises in Fed statement" when in fact there were surprises GALORE! Number 1 of course was the torpedoing of a "new openness" with the Fed, no? And how about just out and out lying about economic prospects? "Neither this nor that," nothing, really, anything going on at all, right? And that cratering in the bond market was just a hiccup in the long and rosy road to prosperity for John Q. Public.

Obama's Housing Fix Falls Flat

so what happened to the 300 billion then?

Bond Expert: Wednesday Wrap

TWC at +260? Sounds pretty good. Maybe my internet access is about to get cheaper.

Markets Are Irrational, But Are They Inefficient?

this is a great article. people have been blasting away at "efficient market theory" by stating incorrectly of course that all it says is "all information is present." they always forget the other part of the definition, "at that time." in other words "ha, ha--lot's define it as stupid so we can call it that." people should understand that efficient market theory is not just "index" based but time based as well. in no way does it say markets can't become irrational and in fact it actually implies the exact opposite. the fact that markets for the most part don't do anything implies MASSIVE amounts of irrationality. HENCE THE IMPORTANCE OF EFFICIENT MARKET THEORY. It gives an investor the chance get around the "crazies" of which there loads on SA alone.

Fed Mostly Ignores Inflation

how's your property tax bill looking? cheaper?

Bond Expert: Tuesday Wrap

These spreads are absolutely gargantuan. I'd hoped for a stronger response from BO relative to Iran because besides making America safer it prevents nuclear terror over the world's oil supplies which is clearly what has been driving up oil prices for the past many years and wreaking havoc with our markets and banks. It sure seems a lot cheaper than a bailout, too! I think it important to rember that all those "government ecnomists" backdated this recession so don't be suprised if they back date the recovery, too. The Word Bank complaining about growth? They've been giving their money to "the third world" since the 60's. They last thing Mr. Rothschild's bank wants to do is worry about the Western World anymore even if it was all he did in his time. Here's my view: the government will declare the recession ended this spring sometime this fall so that it can rationalize all of this inflation by proclaiming "growth." Kinda neat, isn't, that all economics is just a matter of (political) perspective? In the meantime your story over a "rethinking" of Quantitative Easing is VERY OMINIOUS. If it turns out "the experiment" was a TOTAL FAILURE Uncle Sam is on the hook for AT LEAST another 10-20 TRILLION just to bail-out "the mistake." Obviously transferring the lessons of the Japanese economy to America's IS TOTALLY INSANE. I think it was a long time ago that Japan went to war. I think I read in a book somewhere it was called World War something or other. I have heard the good old USA has been beating the war drums a little over the last 50 years. Something about Iraq, Afghanistan and Middle Eastern oil or something. I know I voted against all that war stuff, though, so that shouldn't be a problem anymore. Right? And, gee, that double-fat latte is kinda gotten expensive lately...

How ETF Investors Fare

So will genius investors. Is that what makes them genius'?

The (In)Efficient Market Hypothesis

Is this the same Warren Buffet whose Berkshire Hathaway stock has been pummeled in this downturn? Wall Street and Buffet hate EMT because it destroys their and all the other market timers' time in the sun. Far from being some "academic excercise" it is the basis for index funds! Is it the sole basis for investing? OBVIOUSLY NOT! I don't think efficient market theory posits "stop thinking and be an idiot." It does however posit one VERY profitible theory, namely, that many an investment manager has made more money "sitting on his butt" than in buying this and buying that. It also fits very nicely into an economy such as the USA's which is BOTH commodity intensive AND capital intensive with EASILY the most efficient and extensive transportation network in the world. In short, WE ARE THE LOW COST LEADER. Buffet made his fortune making large bets on individual BLUE CHIP corporations. (American Express and Coke.) Where r they now? Steamrolled in the great debacle of 2008? Perhaps AmEx. Coke? Sugar water looks pretty good even now. Point being there is a wisdom in index funds that says "stop trying to be the manager of the company when all you know how to do is day trade and you don't even do that well." Capitalism (especially its aweful side) far from being put at risk by Obama and the Dems is now going to run us all into the ground. I can hardly wait for $2000 a barrel oil as Iran's counter-revolution turn violent, expansionist and nuclear.

Weekly Unemployment Claims Still Indicating a Bottom

umemployment is THE indicator. Should (God forbid, right?) wages stabilize then all eyes will be on Bernanke whose done nothing but print and borrow on an epic scale since he became chairman. Does he even have the inclination let alone will to take on the political classes which so far have been treating him and the Fed as though they were partners in crime? We'll see should these green shoots become undeniable.

Clarification of Gold Comments in Seeking Alpha Live Discussion

i'm struggling to see even a glimmer of Paul Volcker in Ben Bernanke. Granted we do not have the crisis we had in the late 70's with inflation consistently in double digits and a wage/price spiral (we only have the price spiral part so far.) But an aboslutley quiessent Fed in the face of surging commodity prices makes a good case for speculators in gold. Should the Fed be determined to have no inclination to raise interest rates and continue QE in the face of surging wages you will see gold surge well into the thousands of dollars. This will be the nail in the coffin of Volcker's sound money policy which he created and lasted up until Greenspan screwed it up when in a totally senile state he decided the obliteration of the Republican Party during an election was good for continuing sound money and low interest rates. We all know how that's turned out now. The question now then is will Bernanke destroy the economy in order to save it by NOT acting at all or will he be able to make the tough decision to keep this economy in a recession longer than the political classes demand so that prices will finally and maybe even merely STABILIZE.

Bond Expert: Thursday Wrap

Terrible combination of supply and what it's being spent on. Worst part is if you agree with Obama on the need for health care reform its so clearly DOA it's like "why bother." This spending gives profligacy new meaning. Worst part? It's for the LEAST deserving and MOST corrupt. I cannot fathom how a DEMOCRATIC government became "this." This regime is like the so called "Chinese communists" only without the work ethic. Again, not all taxes are created equal. Uncle Sam collects INCOME taxes which is obviously a HUGE problem right now. If you're collecting PROPERTY taxes as your main source of revenue, well, let's just say that's why the Warren Buffets of this world are more than willing to pile into municipal debt. It's SAFER government debt. I think it would be interesting to see if certain states decide that maybe they should start issuing their own currencies instead of relying on the worthless us dollar since what all the states will be doing soon is sending money to "the center" never to see it again. That includes, obviously, resource rich states like Wyoming, North Dakota and most importantly Alaska.