Category: Economics & Investing

Trent sent us this: Gold is “fairly expensive” could fall to $800 if Fed moves Midas fund manager says. [JWR’s Comment: I’m dubious about a big correction in the near future. I don’t expect interest rates in the US to change radically anytime soon. If anything, they are headed lower, in a desperate attempt to turn the real estate market around, and boost equities. Also note that the funds have continued to be big gold buyers, even after gold topped $1,000 per ounce. There will be some dramatic dips, but gold is still in a bull market. You can quote …

Top U.K. Economist Dumas: Euro Will Collapse. (Thanks to GG for the link.) Also from GG comes some grim news from Forbes: The Global Debt Bomb: “If 2008 was the year of the subprime meltdown, 2010 will be the year entire nations start going broke.” Trent flagged this: Why Americans should care about the debt crisis in Greece Items from The Economatrix: Identifying Sure Signs of the Final Economic Plunge Banks Pull Another $1 Billion from Small Business Lending One Million Americans Give Up on Job Searches Chevron to Shrink Refining Business Ship Engine Maker Warstila to Lay Off 1,500 …

Flavio sent us this: Foreclosures Up 14% in December. Flavio’s comment: “I can tell you as a real estate broker for the past seven years that things are getting worse, not better. I began to notice years ago that the media is usually about 4 – 6 months behind in reporting what myself and associates are experiencing in the now. So judging by the how quiet the phones have become, and how quiet they remain the last couple months, I would say the ‘second leg down’ has already begun. It is no longer a matter of if anymore. I give …

“The 13 Worrier” sent a link to a very interesting YouTube video of Richard Maybury and Jim Powell discussing the possibility of a double dip depression and civil unrest in the United States. Country homes get an appetite for business Is the US Economy Being Tanked by Mistake or Intent? Illinois enters a state of insolvency Items from The Economatrix: Martin Weiss: 200 Bank Failures Expected in 2010 European Markets Lifted by Corporate Deal Hopes IMF Chief: Global Recovery Stronger than Expected Recession Takes Toll on University President Pay Oil Stays Near $78 on Demand Doubts, Weaker Dollar 2010-2020 Towards …

Two more banks fail, bringing year’s tally to three UK’s Only Options are “Default, Inflation or Belt-Tightening” Items from The Economatrix: US Gas Likely to Top $3+ in Spring, Summer Capital One US Credit Card Charge Offs Hit 10% US 2009 Foreclosures Shatter Record Despite Aid Doug Casey Says Stock Market Set to Crash Dr. Gary North: Why Deflation is Not Ahead

Is the American Economy Destined to Fail? Government Bonds — the New Junk? Items from The Economatrix: Dubai World Tries to Keep Banks at Bay with Six-Month Standstill on its Debts Horizon Bank of Bellingham, Washington First Bank Failure of 2010 Four Economic Scenarios You Better Hope Won’t Materialize For Every One Job There are Six Jobless Applicants Financial Markets and Economic Crisis Outlook 2010, When Hope Turns to Fear Dr. Gary North: Deflationists Predicting Price Deflation are Not Economists, They are Journalists What Happens When the Fed Stops Quantitative Easing Howard Ruff Preparing for Rough Times By Hedging Against …

California debt rating cut as cash crunch looms. (Thanks to GG for the link.) World Health Organization Eyeing Global Tax on Banking and Internet Activity Items from The Economatrix: UK: Consumer Confidence Takes a Dive US Jobless Rates to Stay High Until 2012 Barons of Wall Street to Face US Crisis Panel Consumers Are Squeezed as Inflation Outpaces Wages Obama Mortgage Relief Program Fails to Deliver

GG flagged this: Ambrose Evans-Pritchard: A global fiasco is brewing in Japan I spotted this piece by Pat Buchanan over at WND: Is America’s financial collapse inevitable? Items from The Economatrix: Ambrose Evans-Pritchard: A Global Fiasco is Brewing In Japan Fitch Warns US Must Cut Spending to Preserve AAA Rating How Nation’s True Jobless Rate is Closer to 22% Stocks Fall on JPMorgan Results, Sentiment Survey Oil Drops on More Signs of a Struggling Consumer Platinum to Beat Gold, Says Goldman Sachs Warning of Further Economic Crises Ahead

Tim B. sent this: Dollar Crisis Looms if US Doesn’t Curb Debt And in related news, GG sent us this: US must cut spending to save AAA rating, warns Fitch GG also sent this one: The Coming Sovereign Debt Crisis, by Nouriel Roubini and Arpitha Bykere Yet another from GG: A Season Of Discontent: The only alternatives for which majorities express “a lot” of trust to help manage financial risk are close family members (64 percent) and their own efforts (74 percent) Items from The Economatrix: Stocks Rise as Optimism Builds About Earnings Retails Sales Fall Unexpectedly; Jobless Claims Up …

Reader Pamela E. suggested this article: America’s vulnerable half-speed recovery Frequent content contributors GG and Charley S. both sent this piece by Jim Kunstler: Economy has Six Months to Live Items from The Economatrix: Japan Airlines to File for Bankruptcy and Cut 15,600 Jobs UK: Work Until 80 Under Plan to Abolish Retirement Venezuela: Devaluation Sparks Chaos in Caracas MyBudget360: The Capture of Our Government by Wall Street Federal Reserve Seeks to Protect US Bailout Secrets Wall Street, Politicians Still Don’t Get It

Keith B. liked this piece by Ambrose Evans-Pritchard: America slides deeper into depression as Wall Street revels; December was the worst month for US unemployment since the Great Recession began. (Gee: I thought that companies were supposed to avoid December layoffs. So how will the January and February employment stats play out?) Obama considers levy for rescued firms. (Thanks to Rory for the link.) From GG: How nation’s true jobless rate is closer to 22% 2010 Bank Failures Start with Two. (The FDIC could become insolvent in the near future–which would mean another huge bailout…) A tip of the hat …

Trent spotted this on Yahoo’s Tech Ticker: Survivor america “it’s only going to get worse” Gerald Celente says Courtesy of Cousin Al: How Barter Saved Russia Items from The Economatrix: Debt Collectors Doing Huge Business in New York Iceland Blocks Repayment Deal, Sparks Global Outrage All Of Pakistan’s Oil Refineries at or Near Default Energy crisis may cripple Pakistan by the 15th Oil Rises Above $83 Amid Strong Chinese Demand Road Projects Don’t Help Unemployment Second Wave of Mortgage Defaults, Part 1 Biggest Bond Trader Dumping UK Gilts as Well as US Treasuries We’re All Icelanders Now Japan Airlines “About …

Don’t Think That it Can’t Happen Here Department: Chavez devalues currency by 50%. (Thanks to Damon for the link.) Eric. C. mentioned the latest piece by Dan Denninger: A “Macro Level” Look At The Economy The Economist makes a Bubble Warning: Markets are too dependent on unsustainable government stimulus. Something’s got to give. (A tip of the hat to GG fro the link.) KAF sent this: China Overtakes Germany as World’s Biggest Exporter. But wait! You should also read this: Contrarian Investor Sees Economic Crash in China. (Thanks to Rick V. and Darryl C. for sending the latter link.) Items …

Reader Thomas B.was the first of several readers to reference this article by Jim Jubak: Anarchy in the UK (and US, too)? Al wrote to mention that just as I predicted, the base metal value of US five cent pieces (“Nickels”) have again risen to above their face value. ($1.01 for $1.00 face value) I stand by my position that nickels are a good hedge against future inflation. If you have sufficient secure storage space, then gradually accumulate nickels! Items from The Economatrix: 10 Jobs That Will Get a Raise in 2010 Greece Faces Intrusive EU Surveillance Amid Reports of …

A bit more of the truth comes out: Geithner’s Fed Told AIG to Limit Swaps Disclosure. (Thanks to Shale for the link.) From GG: U.S. regulators warn banks on interest rate risk Brett sent us this bit of confirmation for the prevailing sentiment amongst Rawlesians: Krugman: 40 Percent Chance of Double Dip Recession Items from The Economatrix: Fed Wants Florida Bank to Boost Equity or Find Buyer Construction Spending Down Seven Straight Months Bank Lending Poised to Pick Up Bernanke Says Confident in Fed Strategy for Exit Blackstone’s Wien Sees Strong 2010 US GDP, Profits Fed’s Kohn Says Economy, Jobs …