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February 28, 2021 | Doug Noland: “Fed Credibility Is Evaporating Along With Bond Prices”

Doug Noland is out with his latest Credit Bubble Bulletin, following a week in which some of the things he’s been warning about began to happen. Definitely read the whole thing (especially the exchange between Representative Warren Davidson and Fed Chair Jerome Powell). But in the meantime here’s a brief excerpt: Global bond markets have […]

February 26, 2021 | Well This Looks Disturbingly Familiar

Last March, the financial markets were rocked by a disease that public health officials defined as a pandemic. Stocks and gold both tanked, and the locked-down economy went into free-fall. Here’s the Nasdaq … … and gold: This flash-crash was brutal but ultimately short-lived, as the world’s governments immediately stepped in with tens of trillions […]

February 23, 2021 | Welcome To The Third World, Part 32: Texas, Really??

California and Texas were, until very recently, the two best US states. The former is the richest and highest-profile, and home to Silicon Valley and Hollywood, while the latter is both huge and the place to which millions of Californians want to move. It’s not an exaggeration to say that as these two go, so […]

February 22, 2021 | If This Isn’t A Blow-Off Top …

Financial history includes plenty of extreme years. That’s not surprising, since we’re emotional beings with short memories. Combine those two traits and you get cycles, many of which end with a bang. Even so, this one stands out. A full accounting of the ways in which today’s financial markets have exceeded previous bounds of rationality […]

February 11, 2021 | The Number That Blows Up The World, “Everything Bubble” Edition

We’re deluged with numbers these days, many of them huge, ominous departures from historical norms. But one matters more than the others. To understand why, let’s start with some history. In the 1970s the US decided to enter the expensive and divisive Vietnam War, while simultaneously creating major entitlement programs including the also very expensive […]

February 8, 2021 | Is This The Biggest Financial Bubble Ever? Hell Yes It Is

If you’re over 40 you’ve lived through at least three epic financial bubbles: junk bonds in the 1980s, tech stocks in the 1990s, and housing in the 2000s. Each was spectacular in its own way, and each threatened to take down the whole financial system when it burst. But they pale next to what’s happening […]

February 2, 2021 | Reddit Giveth, And Reddit Taketh Away

For just a little while – literally a couple of days – silver stackers saw the light of sudden riches at the end of the tunnel. The Reddit/Robinhood hoards had noticed that the metal was cheap and blatantly manipulated, and therefore ripe for an epic short squeeze. They were piling into SLV and PSLV, forcing […]

January 28, 2021 | When Predator Becomes Prey

Wall Street traders have traditionally played hardball with each other. They’ll take a position and then “talk their book” on CNBC, or short a competitor’s favorite stock while spreading negative rumors about it, or do any number of other ethically-dubious things to profit at the expense of their peers. When they end up on the […]

January 21, 2021 | Is Bitcoin Strangling The Other Cryptos? Part 2: The Little Guys Are Soaring

The idea that “bitcoin is its own asset class” and should therefore be judged based on its own highly-constrained supply rests on the assumption that the rest of cryptospace consists of “shitcoins” that will evaporate as bitcoin, with its first-mover advantage, network effects, etc., eats the rest of the currency world and becomes the one […]

January 17, 2021 | Why Hardly Anyone Trusts The Virus Experts

Early in the pandemic, “trust the science!” could actually be used in a debate without attracting derisive laughter. But as the flip-flops, mistakes and, yes, lies have accumulated, a consensus seems to be forming that the health care authorities are no more trustworthy than the people running Congress or the Fed. For proof, let’s start […]

January 14, 2021 | Social Media Purge 2021: Here Come The Unintended Consequences

As corporate social media platforms try to sterilize the global conversation, some funny-if-they-weren’t-so-scary statistics are emerging. Here, for instance, is a recent screenshot of conservative pundit Ann Coulter’s Twitter account. Note that her activity and notoriety are soaring (which you’d expect during a presidential election), while her followers diminish by 81,000. Does this make sense? […]

January 9, 2021 | The Bailout Binge Begins

Incoming president Joe Biden just proposed that $10,000 of student debt be forgiven for each borrower. This sounds generous but is actually just the opening bid in a negotiation that will end in a very different, much more expensive place – and that will be repeated for many, many other groups of borrowers. Here’s how […]

January 8, 2021 | Extreme Charts – January 8

This week’s theme is “spikes and crashes,” and why they’re great for gold and silver. Let’s begin with inflation, which is suddenly spiking after decades of illusory quiescence. What actually happened was that there was raging inflation, but only in “good” sectors like stocks, bonds, and real estate. Now price increases are migrating to the […]

January 7, 2021 | Another Nail In The Coffin Of Big Cities

The riots, political turmoil, and other banana republic embarrassments seem to be ending – for now. So let’s get back to examining the real problems of this hyper-leveraged, dangerously-complex world. Like how big cities might soon be obsolete: Pretend it’s 2019 and you’re living in a major US city. You, your spouse and two kids […]

January 3, 2021 | Overconfidence Meets Impatience To Set Up The Crash Of 2021

Commentary on America’s overvalued stock market can be found pretty much everywhere these days. These arguments are compelling, and are becoming more so as stocks keep rising. The latest clue that we’re in yet another bubble is margin debt, which is money that investors borrow against their existing stocks to buy even more. A spike […]

December 22, 2020 | Extreme Charts – December 22

It’s official: This has been the weirdest year in US economic history. Starting with the shape of the recent recession, even 2007 — an odd one in its own right — looks almost normal when compared with 2020, Labor force participation and the Federal Reserve’s balance sheet have veered in opposite directions. The government is […]

December 20, 2020 | Is Bitcoin Strangling The Other Cryptocurrencies?

Bitcoin has had a helluva week. And many of its fans see its recent spike as just the beginning of a run that converts it from cult favorite to global reserve currency. That’s an exciting prospect for a lot of reasons. But it’s not yet a done deal. One of the many concerns that non-HODLers […]

December 11, 2020 | Extreme Charts – December 11

Calling the US stock market “expensive” is like calling the sun “warm.” It really doesn’t do it justice. “Insanely overvalued” is more accurate, as the following charts illustrate: Stocks are now more expensive than ever versus commodities… … and versus their own long-term price trend … … and versus GDP … Meanwhile, short sellers – […]

December 7, 2020 | Inflation Is Back, Big-Time

The conventional view of inflation is that it’s not only low, but dangerously low and in need of aggressive encouragement. But that view is becoming increasingly hard to defend, given all the things that are soaring in price. Consider: The above charts show the price action in industrial commodities that, while not something individual consumers […]

December 4, 2020 | Extreme Charts — December 4

It’s one thing to hear someone claim that the world is spinning out of control. But it’s a lot more impactful to see the underlying trends laid out visually. With that in mind, welcome to a new weekly series that highlights the charts, tables, and images of our descent into financial madness. The small print […]

November 25, 2020 | Technologies Of Freedom, Substack Edition

Imagine that you’re trying to do actual investigative journalism at, say, the New York Times or Fox, and you propose a story that threatens the interests of your outlet’s audience or advertisers. Chances are you’ll be shut down by your editors, if not fired and blacklisted for going beyond the boundaries of permissible reporting. Your […]

October 23, 2020 | This Is How A State Goes Bankrupt, Illinois Edition

Somewhere back in the depths of the 20th century, a bunch of governors, mayors, and public sector union leaders got together and cooked up one of history’s greatest financial scams. They would offer teachers, cops, and firefighters extremely generous pensions but would avoid raising taxes to fund the resulting future obligations. Grateful workers would vote […]

October 22, 2020 | One Table And Two Charts Show Why Stocks Are A Bad Place To Be

US stocks are behaving amazingly well given the political and economic near-chaos of the past few months. This is probably the first recession that inflated rather than popped financial asset bubbles. Why? Because panicked governments and central banks are dumping trillions of play-money dollars into the system, a big part of which flow directly into […]

October 9, 2020 | Well Played, Mr. President. Sorry To Have Doubted You

The political and financial worlds were baffled by President Trump’s decision, just hours after being released from the hospital, to suspend coronavirus stimulus bill negotiations “until after the election.” Leaving aside the stupidity of massive new borrowing and spending on top of the past year’s multi-trillions, walking away from those talks seemed like a really […]

October 6, 2020 | So No Stimulus Bill This Month … Really?

Less than 24 hours after beating the apparently wimpiest case of covid-19 ever, Donald Trump decided that his subjects’ lives aren’t exciting enough. So he called off Congressional talks on the latest stimulus bill. Never a dull moment in pre-apocalypse America. There’s just one problem: Virtually everyone from small businesses, to renters, to mortgage holders, […]

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