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  • The Great American Rot Is Ending  [View article]
    You are absolutely right. The Johnson admin and 1965 Medicare act was a turning point against liberty and towards statism. Mandatory payroll taxes set up the biggest boom/bust supercycle in the worlds history, namely the US medical system. The Medicare boom/bust cycle peaked around 2006 and will now drag workers into the abyss they try to support the aging boomers.
    Feb 11, 2016. 10:03 AM | 2 Likes Like |Link to Comment
  • The U.S. Will Not Follow In Japan's Footsteps  [View article]
    Great article! You made some really great points. Japan's demographic crisis and lack of creative destruction is their problem. The West, I think, will look more like Japan in the coming years/decades as entitlement spending increases, govt debts, increase, and baby boomers retire. The deflationary forces will continue to be a problem, I think, and I agree that the dollar will be the last strong currency standing. However, the Japanese scenario is a good lesson for debt fueled and dependent economies. It's hard to increase aggregate demand by pushing on a string with monetary policy. At some point you have to let the house of cards fall and let people liquidate assets, regroup, and start building (and borrowing) again. I especially liked the comparison graph of private bank credit comparing Japan and the US. There are still some drivers of credit expansion in the US, hopefully this will not reverse with the baby boomers retiring.
    Feb 1, 2016. 05:41 PM | Likes Like |Link to Comment
  • The Fed's Normalization And Gold  [View article]
    I enjoyed your artilce, and correct me if I'm wrong, but to simplify your analysis: In inflationary times:
    The FED will raise rates on excess reserves to combat inflation.
    The FED will buy up at all non-bank assets at inflated prices to combat inflation.

    "..since the quick normalization of the Fed's balance sheet would boost the real interest rates, which are negatively correlated with the price of bullion..."

    Isn't this backwards? The normalization of the Fed's balance sheet will only occur when lending starts to take off and cause some inflation. The inflation is a signal for better employment and a growing economy. Then the Fed would increase rates on the IOER and RR, and only after rates increase would we then see unwinding of the FEDs big balance sheet...correct? By that time gold would have benefitted and increased in value with respect to dollars BECAUSE of inflation. I mean, the price of gold is inversely related to interest rates because of inflation, usually low interest rates bring lots of money through the multiplier and inflation. BUt in this relatively deflationary environment, we aren't seeing gold prices rise up despite low interest rates.
    Feb 1, 2016. 03:49 AM | Likes Like |Link to Comment
  • The Bank Of Japan - Ringing In The Endgame?  [View article]
    When do you predict, how big will the BOJ balance sheet be when, SNAP it happens! Deflation turns into, I presume, hyperinflation
    Jan 31, 2016. 10:56 PM | Likes Like |Link to Comment
  • Central Banks Raise Risk Not Inflation  [View article]
    I think the author's point is well-taken. Negative rates on excess bank reserves can certainly encourage lenders to "seek alpha" via more risky asset allocation. Debt becomes essentially an appreciating asset rather than a liability; powerful incentive to expand one's balance sheet. I don't think it can end well.
    Jan 31, 2016. 10:45 PM | 1 Like Like |Link to Comment
  • Peak Gold And Silver - It's Here!  [View article]
    Doesn't Greshem's law dictate that we will continue to accept crapy fiat currency for transactions until complete destruction of that currency. The bad money chases out the good, right?
    Jan 31, 2016. 09:51 PM | 1 Like Like |Link to Comment
  • Peak Gold And Silver - It's Here!  [View article]
    The global fiat currency race to the bottom... I can't figure out if the market will eventually loose faith in the paper currncy and mass exit from govt bonds/securities causing a global crisis and exponential increase in precious metal value...or...will the central banks just unwind when eventually inflation takes off again and the sheeple continue to accept getting fleeced by limiting their liquid transactions and savings to fiat currency denominated assets.
    Jan 31, 2016. 09:48 PM | Likes Like |Link to Comment
  • The Bank Of Japan - Ringing In The Endgame?  [View article]
    Can't the central banks safely unwind and shrink their balance sheets very rapidly if there is signs of inflation? That should increase interest rates quite substantially and conversely make govt securities very cheap, that might cause even more problems with soveign debt burdens. Am I right?
    Jan 31, 2016. 09:38 PM | Likes Like |Link to Comment
  • The Bank Of Japan - Ringing In The Endgame?  [View article]
    With banks having excess reserves, more deposits than loans...when they finally do start lending again, how fast will the BOJ be able to unwind? Will they be able to keep inflation in check?
    Jan 31, 2016. 09:08 PM | Likes Like |Link to Comment
  • Kuroda Comes To Wonderland (Sort Of)  [View article]
    paying interest on excess reserves, even if negative in real terms, always seemed deflationary to me anyway
    Jan 31, 2016. 08:48 PM | Likes Like |Link to Comment
  • Kuroda Comes To Wonderland (Sort Of)  [View article]
    Shorting the Japanese yen seems like a good bet but what keeps the BOJ from keeping bond prices elevated by endless purchases, ie monetization?
    Jan 30, 2016. 10:33 PM | Likes Like |Link to Comment
  • BoJ NIRP Makes Fed Rate Hike Look Even More Foolish  [View article]
    Nominal interest rates are meaningless when you're having a lot of inflation or deflation. The Japanese, and soon the rest of the developed worlk are dealing with deflationary forces. When will we see Japanese bond yields on the 10 year notes go negative? Wouldn't there be a run on cash or run to other currency before that?
    Jan 30, 2016. 01:34 AM | Likes Like |Link to Comment
  • The Yield Curve Says No Recession  [View article]
    yes...they'll pay us with toilet paper!
    Jan 30, 2016. 12:11 AM | 2 Likes Like |Link to Comment
  • Free Money Friday- Japan Goes Negative And 'Saves' Asia (For Now)  [View article]
    Money is a liability now, get it off my balance sheet as quickly as possible!!!! What problems could that cause? Moral Hazard anyone?
    Jan 29, 2016. 03:18 PM | 2 Likes Like |Link to Comment
  • Market Corrections - The Single Most Important Feature  [View article]
    The buy and hold days of young professional baby boomers retiring on their diversified portfolios are over. There is a bubble of market participators/investors and about to burst.
    Jan 28, 2016. 08:20 PM | 2 Likes Like |Link to Comment