Category: Economics & Investing

G.G. sent this: Another Illinois Bank Fails. KAF flagged a Fox Business new report: Fed’s Hoenig: Record-Low Rates a ‘Dangerous Gamble’ Andrew H. spotted this: 800 interested in 5 jobs Items from The Economatrix: Economic Growth Prospects Dim in US After Retail, Trade Reports US Cities Face Up to Massive Cuts Stocks Rise On Earnings, Economic Reports Oil Breaks Losing Streak, Prices Climb Wheat is New US Gold “Hindenberg Omen” and Imminent Market Crisis Savings Accounts Will Become Obsolete if Inflation Rises Next Week Greek Economy Deeper in Recession than Forecast

Chris in Virginia liked this piece over at Sharon Astyk’s blog: Things Fall Apart – Slowly California’s economic crisis de jour: We Want Our IOUs Morris S. liked this piece by James Rickards at The Financial Times: Fannie and Freddie’s bond market upheaval. “OSOM” recommended a piece over at the GATA about the silver exchange traded fund (ETF) – SLV. OSOM’s comment: “Both SLV (and GLD for Gold) are not safe investments! I would not touch either of them with a ten foot pole.” G.G. sent this: Schiff: The Fed Is Feeding An Addiction By Continuing Quantitative Easing Also from …

Peter Schiff: “We’re in the Early Stages of a Depression” (A hat tip to B.B. for the link.) Another from B.B.: Morning Bell: Under Obamanomics, Government Workers Win, You Lose Yet another from B.B.: Jobs picture dims as unemployment claims rise Items from The Economatrix: Poll: Americans Grim Over Economy Before Elections Gerald Celente: Double-Dip Depression Will Lead Us Into War Watchdog Panel Cites Global Impact of US Bailout Medicare’s Chief Actuary Blasts Rosy Report

AmEx sent this: Debts Rise, and Go Unpaid, as Bust Erodes Home Equity item: TARP Billions Shipped Overseas Can’t Halt Global Slowdown David B. suggested this article: Judge orders Wells Fargo to pay back $203 Million in fees Taleb Says Government Bonds to Collapse, Avoid Stocks. (Thanks to G.G., SurvivalBlog’s Poet Laureate, for the link.) Items from The Economatrix: Stocks Fall After Cisco Earnings, Jobless Data Jobs Picture Dims as Unemployment Claims Rise Mortgage Rates Hit 4.44% as Economy Sours Oil Price Slide Continues on Grim Economic Data Markets Dive As Depression Fears Grow Stock Market “Perfect Storm” Cuts Pension …

G.G. flagged this: Californians’ income falls for first time since WWII. Also from G.G.: US Federal Reserve starts ‘QE-lite’ to placate markets. Don W. sent us this: Mexico’s Crashing Oil Industry Items from The Economatrix: Stocks Fall for Fourth Day After Retail Sales Report In a Sluggish Economic Summer, No Easy Fix Ahead Auto Sales Boost Otherwise Weak Retail Sector Aid Helps States Avoid Layoffs, But or How Long? Jobs Picture Dims as Unemployment Claims Rise Mortgage Rates Hit 4.44% As Economy Sours Oil Price Slide Continues on Grim Economic Data Markets Dive as Depression Fears Grow Stock Market “Perfect …

Fortune magazines asks: Is this finally the economic collapse? (Thanks to Jeff L. for the link.) G.G. suggested this article over at Forbes: Collapse In Internet Time. Also from G.G.: America Is ‘Bankrupt Mickey Mouse Economy’: CIO B.B. was the first of several readers to send an article by Laurence Kotlikoff: Is Bankrupt and We Don’t Even Know It? Items from The Economatrix: Major Leading Indicator in Free Fall Stocks Retreat as Fed Grows More Cautious Trade Deficit Widens to $49.9 Billion in June US Dollar Falls to 15-Year Low Against the Yen China’s Industrial Growth Slows, Inflation Jumps Bank …

G.G. suggested this piece by veteran economist Howard J. Ruff: Why Gold and Silver Seem Stuck Also from G.G.: Chorus of QE calls is deafening. Stand by for price inflation, folks! K.T. sent a link to an interview with Gerald Celente: Double Dip Depression Will Lead Us Into War Readers of my novel “Patriots” might find this familiar: Fed Looks to Spur Growth by Buying Government Debt. ( A hat tip to Wade C. for the link.) This is a highly inflationary move! And speaking of inflation: Wal-Mart Prices Are Rising: JP Morgan Study. A 5.8% increase in one month! …

Watch This Interview Clip! Charles Biderman Fox Business July 30, 2010–Collapse Ahead? (Thanks to Mac H. for the link.) B.B. recommended the American Thinker essay The Death of the Dollar by Vasko Kohlmayer. This comes as no surprise: States Raising Cigarette, Gas and Sales Taxes to Cover Shortfalls. Why the US keeps minting coins people hate and won’t use. OBTW, don’t bother stockpiling them, since they are 88.5% copper, and hence it would take Weimar scale inflation to make their metallic content worth more than the coins’ face value. J.B.G. sent this: Commodity spike queers the pitch for Bernanke’s QE2. …

I’ve recently been asked by several blog readers and consulting clients about my predictions for the economy for the next few years. Here they are, in a nutshell: The US economy will remain weak for for at least five years. Both the commercial and residential real estate markets are unlikely to recover before 2018, especially as interest rates begin to increase. Noticeable inflation should begin around the Spring of 2011 and will become uncomfortably high by 2012. If the announced Federal income tax and capital gains tax increases do indeed go into effect, they will stifle the economy for the …

G.G. sent this: Economy Heading for a Systemic Collapse into Hyperinflationary Great Depression. Jonas mentioned a fascinating news segment filmed by a Dutch journalist, in Indonesia: Gold Dinar, Silver Dirham. AmEx sent this: Food Prices up as Consumers Feel Economic Pinch Another from G.G.: Chicago Bank Fails, 2010 Tally Hits 109 Job Figures Just Part of a Grim Economic Picture. (Thanks to AmEx for the link.) B.B. forwarded a link to a New York Times article: Jobless and Staying That Way RBS flagged this: One-fourth of Idaho work force’s paychecks cut

The Worrying Numbers Behind Underwater Homeowners. A bit of good housing news came in a recent report issued by real estate analytics firm CoreLogic: The number of mortgaged residential properties with negative equity declined slightly to 11.2 million by the end of the first quarter this year, down from 11.3 million at the end of 2009. The bad news: Those 11.2 million loans are 24% of all U.S. mortgages. Add the 2.3 million borrowers who are close to slipping underwater (those with less than 5% equity), and the numbers rise to 13.5 million — 28% of mortgages. B.B. sent this …

Chris G. mentioned: ACTA: The War on Progress, Freedom, and Human Civilization An interesting piece over at The Daily Bell: Why Bankers Didn’t See Collapse. Frequent contributor K.A.F. says: “States are taking on more debt. Here’s your state’s burden per capita“. JWR Adds: What I found amazing is Massachusetts. How can they tax their citizens so much, yet still end up short of funds? Lee C. recommended a 25 minute long BBC Radio Interview on the Credit Crisis and the Risk of Another Crash.

B.B. was the first of several readers that sent us this: Commodities – Wheat Soars; Rogers Sees ‘Much Higher’ Food Prices. Got your wheat yet? Stop dawdling! L.J. in England sent this: Food prices to soar 10% in time for the New Year. Reader J.C. sent this: Global Wheat Shortage Feared. “Boosters” spotted this: Is the End Game Hyperinflation or Debt Implosion? James Altucher: 7 Reasons Not to Send Your Kid to College. (A hat tip to L.L. for the link.) Allen E. forwarded a news item: A Run on Spanish Banks? K.A.F. sent this: World oil prices approach $82 …

Reader Brian B. wrote to re-emphasize the importance of the recently-released CBO report titled: Federal Debt and the Risk of a Fiscal Crisis. Brian’s comment: “Many people submit links to economic news to alternative media, but when the CBO (government entity) unveils a document that reaffirms the poor state of the economy, it becomes completely unnoticed by mainstream media. Perhaps your readers can reassure themselves how the outlook of the next decade might shape up to be.” From M.E.W.: Greenspan Says Home-Price Drop May Bring Back Recession M.M. sent us this editorial by former Reagan White House staffer David Stockman: …