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evan37

evan37
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  • Here's What Happened The Last Time The Fed Owned All Outstanding Treasuries [View article]
    It's hard to extrapolate trends from a pre Gold standard era to todays fiat madness. In the 1940s the FED couldn't monetize, they had to unwind. Not so today. We won't see any unwinding from this FED, we will see monetization instead.
    Apr 4, 2013. 05:19 PM | 25 Likes Like |Link to Comment
  • The True Cost To Mine Silver - Complete 2012 Figures [View article]
    Most silver mined is a byproduct of other metal gathering. If silver goes above $50/oz then the miners will get better at mining it! It won't cost as much per oz to get when the miners start to specialize.
    Mar 27, 2013. 11:49 AM | 1 Like Like |Link to Comment
  • Inflation Will Not Take Off Until This Happens [View article]
    Maybe demand side economics works better when you inject from the bottom rather than hoping to trickle money down from the banks through cheap loans?
    Mar 27, 2013. 11:45 AM | 1 Like Like |Link to Comment
  • Top Line Sales And Profit Growth Falter As The Dow Approaches All Time Highs [View article]
    Thank you for the reply. That is really disconcerting, I wouldn't believe it...kind of like LIBOR.
    Mar 3, 2013. 02:45 AM | Likes Like |Link to Comment
  • Incomes Fall $505.5 Billion, Expenses Rise - Can You Say Stagflation? [View article]
    Good Pont King Jefferson, I guess it depends on how successful the FED is at increasing the money multiplier, so far not very. Maybe the US is headed for stag deflation? It seems our monetary policy is pushing on a string. Look at Japan, credit contraction and decreased money velocity are making it very difficult for BOJ to create 2% targeted inflation. Similarly, the FED ZIRP crowds out private lending by decreasing available high quality collateral that can be repoed by shadow banks. The FED in essence has cartelized lending and banks are, so far, not playing the game the way they're supposed to. Politicians have to address the production side of the equation. Why don't producers want to borrow money and grow the economy?
    Mar 3, 2013. 02:15 AM | Likes Like |Link to Comment
  • Incomes Fall $505.5 Billion, Expenses Rise - Can You Say Stagflation? [View article]
    RS
    The FED got us into this mess in the first place with all of these artificially low interest rates through the 1990s, now they can't raise interest rates without crashing the whole economy. Central banks were supposed to suppress volatility but, since 1917 we've had more volatility than before. The central planners can't get the money supply right. I say, gold standard, competitive currencies, no central bank, Austrian all the way!
    I'm young, I'm not a baby boomer. I don't care about my portfolio, and my nominal retirement gains, I want my country to exist for my daughter to have the potential to succeed. Scrap Medicare turn it into a voucher program, make social security optional, cut defense by 50% (close 450 of our 900 military bases), congressional term limits, flat tax, and then you would see growth my friend! In the long run ZIRP isn't gonna help us much, just prolong the agony (look at Japan).
    Mar 2, 2013. 06:52 AM | 5 Likes Like |Link to Comment
  • Incomes Fall $505.5 Billion, Expenses Rise - Can You Say Stagflation? [View article]
    Datadave, LOL! Thank you for the constructive feedback, I will try to be more tactful in my criticism of our government. By the way you are too married to your liberal ideology, try to open your mind a little bit. Republicans = bad, Democrats = good, is so.... 1990s.
    Mar 2, 2013. 05:30 AM | 4 Likes Like |Link to Comment
  • Valuing The Yen [View article]
    Jeremy, i really enjoyed your article, it has given me something to really think about and try to learn better. I always wondered how the Japenese system has avoided collapse for so long. How does a country remain solvent when interest on debt becomes greater than revenue? Isn't that a recipe for hyperinflation or default? If the BOJ stopped or slowed it's purchases of Japenese treasuries today and yields on the 10 year went from 0.7 to say 2%, then you'd see 85-90% of all govt revenue going to just service the debt. This in light of a demographic collapse, a new budget deficit, and the population starting to desave. It seems to me the Japenese fiat experiment is coming to an abrupt end.
    Mar 2, 2013. 04:27 AM | 1 Like Like |Link to Comment
  • Valuing The Yen [View article]
    I thought yields increased as an issuers debt becomes less attractive.
    Mar 2, 2013. 04:16 AM | Likes Like |Link to Comment
  • Why The Price Of Gold Is Falling [View article]
    My concern is that central banks have gotten it wrong so many times before (Greenspan in 2000 leading up to the dot com bubble and then again in 2007 with the housing bubble). CPI can remain tepid while the economy expands/contracts so the FED can inadvertently cause asset bubbles by keeping rates too low for too long. IMO distorting price discovery mechanisms for credit and causing moral hazard!
    Mar 1, 2013. 11:59 PM | 4 Likes Like |Link to Comment
  • Why The Price Of Gold Is Falling [View article]
    Kyle,
    I'm not so sure about #4, why would the issuer of the world's reserve currency necessarily have to run a deficit? The US is enabled to run deficits due to our treasuries being in demand, but that doesn't mean we have to run deficits.
    What do you think about Japan. Soon the INTEREST on their debt will be greater than their revenue, especially if yields go up. The BOJ is stuck, they can't stop buying up debt and printing or else the yields will raise and cause the Japanese Treasury to go insolvent. This is where the US is headed.
    In Chartalism, people seem willing to still purchase govt backed debt even with guaranteed losses, it's unbelievable to me. It's the liquidity preference. The question is, at the margin, when does this liquidity preference end?
    Mar 1, 2013. 11:12 PM | 5 Likes Like |Link to Comment
  • Incomes Fall $505.5 Billion, Expenses Rise - Can You Say Stagflation? [View article]
    Adam,
    Unintended consequences of the FED's actions are becoming more apparent and more severe. The low rates are hurting savers, money markets, and pension plans. Investors are being pushed into taking higher risks seeking a ROI wherever they can find one. Creative destruction and reallocation of wealth is being suppressed by maintaining the status quo. The Phillips curve only holds true when the economic fundamentals of price discovery are allowed to work. Our economy will start growing again when business regulations, tax laws, unemployment, disability, and entitlement reform takes place in a smart way. Unfortunately, given the retards that are running this country, we're in for decades of stagflation. Japan is our model, we will follow their lead.
    Mar 1, 2013. 11:01 PM | 7 Likes Like |Link to Comment
  • Top Line Sales And Profit Growth Falter As The Dow Approaches All Time Highs [View article]
    Nice article. I am wondering if you could shed light on just how exactly is the FED backstopping equity prices? This does seem like a conspiracy theory, I'd be interested to hear exactly how the FED is accomplishing this, perhaps the banks are investing their deposits into equities via repo agreements?

    It seems to me that investors don't want to miss out on this bull market in equities and are just rotating out of cash and bonds and into equities. Never mind that the bull market in equities has been engineered by the FED, where else are you going to put your money? I agree though, that investors have their finger on the trigger, ready to pull out of stocks at any time!
    Mar 1, 2013. 10:23 PM | Likes Like |Link to Comment
  • How Obamacare Could Harm Growth In 2014, Part II [View article]
    soleprop,
    I can see that you are very passionate about this topic, and that is good. A solution to the Medicare problem is probably the single best thing we could do to increase our federal govt's efficiency and solvency. Healthcare financing in the US, as it is now, is a disaster. It is an unholy combination of government control and free markets. The reason healthcare is so expensive in the US is from the following:
    1. 3rd party payers divorce the consumer from direct exposure to the cost of care (no price discovery mechanism).
    2. Employer-based insurance benefits are tax-decuctible, causing an arms race in private insurance.
    3. Litigation, some studies put the cost of litigation as high as 33 cents for every dollar (defensive medicine, over-consultation, over-testing).
    4. CMS reimburses for quantity, reimburses procedures more than primary and preventative care.
    The dentists are all starting to fall into the same trap we did in the 1970s, becoming dependent on 3rd party payers. Just wait, dental care (just like student loans) will get bid up and up and up once you remove price discovery from the equation. This is classic, moral hazard, the central planners would do much better allowing the free market to work. I'm happy to use govt money for healthcare for the poor but it needs to be done in a much smarter way. CMS has done a terrible job, and Obamacare will carry the torch in 2014 of doing a horrible job of making economic decisions from 30,000 feet. It just doesn't work.
    Mar 1, 2013. 08:59 PM | 5 Likes Like |Link to Comment
  • How Obamacare Could Harm Growth In 2014, Part II [View article]
    HJ,
    You are exactly right about the Medicare act of 1965 driving up costs, I wrote a little instablog on that very topic.
    http://seekingalpha.co...
    Mar 1, 2013. 12:04 AM | 3 Likes Like |Link to Comment
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