Category: Economics & Investing

From G.G.: Brace For Hyper-Inflation Spotted in the Drudge Report news links: Magazine Ad Pages Decline Almost 26% in First Quarter G.G. also sent a link to yesterday’s Dilbert cartoon strip. G.G.’s comment: Dilbert is channeling [economist Gerald] Celente. Items from The Economatrix: How Consumers Can Take Smart Advantage of Falling Prices Fed Finds Faint Signs Economy Starting to Level Off Ron Paul: Audit the Fed Art Market Crashes 401(k) Losses Devastate Retirees Glamour Dims as Hecklers Hit Auto Shows Gasoline Expected to Remain Cheap this Summer Food Auctions Thrive During Recession General Growth, 2nd Largest Mall Owner, Fails Historic …

Laura H. sent this: In uncertain times, all that glisters is a gold standard Chauncey sent this Five Bailout Absurdities Items from The Economatrix: “Green Shoots” a Mirage in Economic Desert US Taxpayers’ Costs Likely to Rise After AIG-FP Staff Quit Wall Street Holds its Breath as 1st Quarter Results Come In GM Told to Prep for “Surgical Bankruptcy” HSBC Faces Crisis Over US Credit Cards Consumer Prices Drop Unexpectedly in March Swiss Bank UBS Cutting 7,500 More Jobs Singapore Devalues Its Fading Dollar Obama’s Economic Optimism Falls on Deaf Ears US to Reveal Results of Stress Tests on 19 …

Reader HPD: suggested this piece by Mish Shedlock: Nationwide Tax Revolt is Coming Dave (at Captain Dave’s) mentioned an interesting article on Why our current credit crisis mirrors Weimar, over at the Seeking Alpha site. G.G. sent us this: Bernanke sees signs of economic stability “I can assure you that monetary policy-makers are fully committed to acting as needed to withdraw on a timely basis the extraordinary support now being provided to the economy, and we are confidence in our ability to do so,” Bernanke said in remarks prepared for delivery at Morehouse College in Atlanta.” G.G.’s comment: “Of course, …

G.G. sent a link to a piece in The Financial Times about the threat of mass inflation: Germany warns on ‘crisis after crisis’ “‘I am concerned that the countermeasures we are seeing around the world, financed by enormous amounts of debts, could be paving the road to the next crisis,’ Mr Steinbrück told Bild, a tabloid daily.” G.G. also forwarded a link to a Barron’s article: The Lessons of the Savings-and-Loan Crisis: “The current bank scandal dwarfs the 1980s savings-and-loan crisis — and could destroy the Obama presidency.The scale of fraud is immense.” “This whole bank scandal makes Teapot Dome …

From Greg C.: Fed Said to Order Banks to Stay Mum on Stress Test Results KAF forwarded this video link: Stop Spending Our Future – The Crisis From Richard R.: Two more banks fail, lifting this year’s tally to 23

HPD mentioned a piece in Mish’s Global Economic Trend Analysis: Bartering Services to Combat the Recession David V. sent this: Social Security Bomb About To Explode Items from The Economatrix: Economic Crisis: No End In Sight; Worse Than The Great Depression. “Today five US banks according to data in the just-released Federal Office of Comptroller of the Currency’s Quarterly Report on Bank Trading and Derivatives Activity, hold 96% of all US bank derivatives positions in terms of nominal values, and an eye-popping 81% of the total net credit risk exposure in event of default.” (JPMorganChase, BofA, Citibank, Goldman Sachs, HSBC, …

I heard about this piece over at the Dr. Housing Bubble blog: Marketing Consumerism in the Boom and Bust Economy: Four Advertisements Showing the Shift in Consumer Buying Habits: Pizza, Airlines, Real Estate, Toxic Assets, and the Simpsons. The bit about Homer Simpson’s home equity line of credit (HELOC) was priceless. Eric H. flagged this one: Chinese re-embracing Marx and Mao in face of economic woes. Eric’s comment: “So much for all those ‘relax, they are becoming more like us and our differences are disappearing’ stories we were told in the past decade or so.” HPD alerted us to a …

From reader H.P.D. Mish’s Global Economic Trend Analysis: Treasury to Delay Reporting Bank Stress Test Results G.G. sent this: Businesses Gird for Depression Also from G.G.: IMF gold sale may push down prices below $800 Items from The Economatrix: Wed. Stocks End With Modest Gain CEOs Expect More Job Cuts Through End of Year Coupons.com Sees 190% Increase Over Last Year Cereal and baby food top the list Few US Cities Escape Recession’s Reach Treasury to Offer Limited Aid to Certain Insurers (Only if the insurers own banks or savings & loans) New Jobless Claims Fall More Than Expected to …

Matt B. suggested this video clip of Argentinean economist Adrian Salbuchi: Global Financial Collapse Greg C. sent this item from McPaper: Communities print their own currency to keep cash flowing D.G. suggested this from Eric Margolis at The Toronto Sun: Wall Street Ticks Off the World From G.G.: A Night with the Bears: Meredith Whitney, Nouriel Roubini, Ian Gordon and Eric Sprott put on quite a show this evening in Toronto. Items from The Economatrix: Derivatives, the New Ticking Time Bomb Politicized Accounting: No End to the Scams Soros: “Zombie” Banks Could Suck Lifeblood Out of Economy The Question that …

Laura H. suggested this Wall Street Journal piece: From Bubble to Depression?, by Steven Gjerstad and Vernon L. Smith Kevin A. sent us this: Geithner’s Stress Test “A Complete Sham,” Former Federal Bank Regulator Says Items from The Economatrix: West Must Deal with $600 Trillion in Derivatives Bernanke’s Financial Rescue Plan: The Growing Prospect of a US Default. Here are two keyquotes: “It is impossible to know what the long-term effects of Bernanke’s excessive spending will be, but his plan has the potential to trigger hyperinflation or spark a run on the dollar.”, and: “The recent 22 percent uptick in …

G20 Summit Recovery Package: A Global Plan of Unprecedented Scale Derivatives will have to go through a central clearinghouse. Concern Grows Over New IMF Power G20: Fat Cats Brought Down to Earth with a Bump ” …the declaration shows how little political influence is now wielded by the once powerful vested interests of Wall Street and the City of London.” President of European Commission Warns Millions More Europeans Will Lose Jobs G20 Laid Foundation for Next, Bigger Crisis Banks Could Bet on Toxic Assets with Taxpayers’ Money “Making Work Pay” Won’t Change Many Spending Habits (Most won’t notice a $10 …

Laura H. suggested this WND article: Families learning of $163,000 tax ‘bomb’, Economics prof says deficits heading toward ‘banana republic levels’ From reader AC: Social Security Surplus Already Gone Reader Jon M. flagged this, over at Seeking Alpha: Did the ECB Save COMEX from Gold Default? Items from The Economatrix: Congress, Bankers Just Don’t Get It “Changing the way you account for losses on bad assets doesn’t mean the losses have gone away. If anything, the obfuscation of those losses will drive investors away because balance sheets in the financial sector will become more opaque.” What to Buy Before the …

Courtesy of reader D.D.: Faint signs the economy has a pulse? Better-than-expected factory orders, but job market still a worry. From G.G.: U.K. News: Interest Rates Set to Soar, Warns Bank’s Chief Economist M.A.M. suggested a piece that was linked at the Naked Capitalism blog: On the Urgency of Restructuring Bank and Mortgage Debt, and of Abandoning Toxic Asset Purchases. (Hussman’s approach is a bit interventionist for my taste, but at least it underscores the broad implications of the current crisis.) In my view, malinvestment must be worked out the system naturally, through bankruptcies. The fractional reserve credit system and …