- the source for market opinions


June 22, 2019 | The Financial World’s Most Popular Delusion

DUBAI – “What do people do here?” we asked a local. “Well, they go out to dinner. And they go shopping. We have the nicest malls in the world.” The whole city depends on air-conditioning. Without it, it would be uninhabitable… like Antarctica. Or West Baltimore. Yes, there were people here before AC was invented, […]

June 10, 2019 | How Hot Money Put America in Hot Water

YOUGHAL, IRELAND – Two newsworthy things happened on Friday. As to the first, we were right after all. Mr. Trump isn’t going “Full Retard” in his trade war. At least, not with Mexico. His dramatic declaration of an escalating tariff… until the flow of illegal immigrants “STOPS”… must have been just another of the showman’s […]

June 4, 2019 | Stocks Have a Rendezvous With Destiny

DUBLIN, IRELAND – Stocks couldn’t decide where to go yesterday. Up? Down? So, they went nowhere. Nowhere is about as good as it gets in this market. Because signs of an impending slowdown are arriving in the news every day. The latest item was a sharp drop in the Purchasing Managers’ Index (PMI), which measures […]

May 28, 2019 | Have We Passed “Peak Prosperity”?

YOUGHAL, IRELAND – There are three important decisions in life: What you do… with whom you do it… and where you do it. What. Who. Where. Keep it simple. And you only have a limited amount of time; you want to make sure you get those basics right. Otherwise, you arrive as one of those […]

May 21, 2019 | How America Goes Full-Venezuela

LONDON – We first came to London a half-century ago. Back then, the city was tired and drab. We stayed in a hotel, where we had to put coins in a heater to get any warmth and use the bathroom down the hall. Now, London is a different city, full of young people, energy, and […]

May 17, 2019 | Here’s What Uber Is Really Worth

PARIS – Wall Street continued its recovery yesterday, the Dow rising 116 points. Investors believe – as we do – that the trade war will blow over… or at least calm down into tweety skirmishes. The Donald himself is already backing off, calling it only a “squabble.” The Trump administration also signaled that it would […]

May 16, 2019 | Here’s What Uber Is Really Worth

PARIS – Wall Street continued its recovery yesterday, the Dow rising 116 points. Investors believe – as we do – that the trade war will blow over… or at least calm down into tweety skirmishes. The Donald himself is already backing off, calling it only a “squabble.” The Trump administration also signaled that it would […]

May 15, 2019 | The Nice Thing About Donald Trump…

In the fire of spring Your winter garment of repentance fling: The bird of time has but a little way To flutter – And the bird is on the wing. – Omar Khayyám, Rubáiyát PARIS – We are sitting at a sidewalk café in the 7th arrondissement. The sun is shining. People come and go; endless streams from the […]

May 14, 2019 | Should Alabama Impose Tariffs on California?

YOUGHAL, IRELAND – We bet that Trump would never go full retard in his trade war with China. Were we wrong? Maybe.   Out of the Money Last week, our no-real-trade-war bet was moving further and further out of the money. Team Trump didn’t yet go full retard, but – raising tariffs on $200 billion of Chinese […]

May 10, 2019 | The Only Real Way to “Fix” Capitalism

YOUGHAL, IRELAND – World stock markets are already down more than $2 trillion – supposedly on “trade war worries.” And now, Friday has come. Tariffs have gone up. $200 billion worth of Chinese imports now face levies of 25%, up from 10%. And the trade negotiations with China continue. Foreign markets are selling off a […]

May 5, 2019 | Are We Finally Beaten?

YOUGHAL, IRELAND – Sound a recall! Spike the cannon! Haul down the colors! Sauve qui peut! Yes, it’s time to turn tail and run. We’re outnumbered. Outgunned. Outfoxed. Outmaneuvered. And outsmarted.   Fighting Claptrap We’ve been writing this Diary (previously known as the Daily Reckoning) for the entire 21st century… and then some. Our battle has never been […]

May 2, 2019 | How the Feds Will Cover Up Their Next Larceny

PORTLAW, IRELAND – Yes, Dear Reader… markets are unpredictable. But you always know which way politicians will go; they will take the low road.   Big Hit Which is why MMT is going to be a big hit in Washington – with both parties. Recall that MMT (Modern Monetary Theory) states that governments can, and should, print […]

May 1, 2019 | Who Will Push America Over This Cliff?

DUBLIN, IRELAND – We’ve made three bold predictions in this space: The Fed would never voluntarily normalize monetary policy. The Donald would never go Full Retard on his trade war with China. Republicans and Democrats would both come to embrace Bernie Sanders’ Modern Monetary Theory (MMT).   So Far, So Good As to the first – check. […]

April 30, 2019 | How the Financialization Scam Works

YOUGHAL, IRELAND – Financialization is our subject… What is it? How does it happen? Does it matter? Who cares? Let’s begin with the last question: Who cares? Answer: Nobody… until it blows up.     Fantasy World Financialization creates a fantasy world… funded by a mis-priced, rigged credit market. Here is how. Imagine that you are 12 […]

April 29, 2019 | The Wall Gave Way, and We Fell…

YOUGHAL, IRELAND – “Really… at your age… you should know better.” We had just come back from working on our derelict cottage on Sunday. We were recounting a heroic tale, with your editor as its leading man. We explained how we were setting roof rafters in place, walking along the top of the wall, when […]

April 26, 2019 | The Financialization of the American Economy

YOUGHAL, IRELAND – The sea is moody. We are in a hotel room overlooking Ardmore Bay. It is like a cruise ship, beached on the shore. We see the sea, with its changing tempers, but we are not part of it. One day it is angry, with white-capped waves slapping against the rocks. Another day, […]

April 25, 2019 | The Real Reasons Stocks Go Up

YOUGHAL, IRELAND – Word on the street yesterday was that stocks were going up to record highs “on earnings.” The casual listener was invited to believe that corporate America was earning more money; therefore, it should be worth more. Why else would people pay more for stocks? Earnings come from Main Street. With hard work […]

April 24, 2019 | We’re Raising the Crash Flag

YOUGHAL, IRELAND – Shhh…! Take off your shoes. Walk on tiptoe. Be quiet. In front of us lies inflation. It hasn’t moved for years – rising only about 1.5%-2% – despite all the prodding from the feds. The Fed tried to shock it awake with $3.6 trillion in stimulus money. And Congress hit it with […]

April 13, 2019 | What America’s Elite Have Planned for Your Money

PARIS – Yes, it is heartwarming, isn’t it? Almost inspiring. We mean… seeing our leaders finally get together… embracing warmly… and agreeing on something. No more trouble. No more strife. Oh, Lord, they’ve seen the light! They are all on board now – Trump, AOC, Bernie Sanders, Powell, The New York Times… and hundreds, thousands of […]

April 8, 2019 | The Real Threat Is in Washington

PARIS – What’s going on now? In all the excitement we risk losing the plot. Close the border with Mexico? A trade deal with China? A WWE wrasler punched in the mouth? No news report is so foolish and so obviously insipid that it fails to be taken seriously. But what matters? What doesn’t? Let’s […]

March 28, 2019 | How the Feds Sedated American Capitalism

GUALFIN, ARGENTINA – A Diary Dictum: People are neither always bad nor always good, but always subject to influence. Want to know why tax cuts, spending increases, and EZ money from the Fed don’t work? Wonder how the feds could add $4 trillion in new money, suppress interest rates below zero for an entire decade, add $13 […]

March 26, 2019 | Trump Has Found His “Stimulus Guy”

GUALFIN, ARGENTINA – Let’s see… …the yield curve inverted… …the feds’ monthly deficit hit a new record… …the trade deficit hit a new annual record… …the Fed said the economy was weaker than expected… so it said it would lay off the rate increases… …home sales are falling to new lows… with the sales/population ratio […]

March 25, 2019 | A Bomb Cyclone Is Headed for Stocks

GUALFIN, ARGENTINA – Oh, Dear Reader… last week’s news from the Fed reminded us of those home videos where someone gets hurt. Fun to watch. But painful if you’re in the picture. And now, front and center, is the U.S. financial system. Have a seat. Get a beer. How often do we get to see […]

March 21, 2019 | Three Reasons Why America Can’t Get a Grip

GUALFIN, ARGENTINA – First, we discover that inflation here in the Andes is worse than we thought… Economist Steve Hanke in Forbes: [Last week] Argentina released its February inflation statistics. Inflation spiked, again. Indeed, the official annual inflation rate jumped to 51.3%/yr. While this spike caught most observers off balance, it didn’t surprise me. Each day, […]

March 20, 2019 | Paul Volcker Can’t Save Us This Time…

Still no visible crack in the stock market. But the economy may be breaking down. First, there is growing recognition that the Obama/Trump recovery has been a flop. A headline at Yahoo Finance: Jamie Dimon: The U.S. economy should have grown 40% in the last decade, not 20% Hardly a week has gone by since […]

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