Category: Economics & Investing

I very rarely post lengthy excerpts from other sources. However, I am essentially forced to in this case. You see, this prematurely archived article was posted at The Australian newspaper web site for just a few hours, earlier today. (Actually late afternoon on the 28th in the U.S., due to the time difference and being on the other side of the International Date Line). It was briefly on their “The World” page–one of their main pages. But it now shows up only in their archives. No explanation was given why it has mysteriously disappeared from their “The World” page. It …

Nowadays after all the 3rd quarter write-off announcements from many banks, sub-prime has been mentioned less on television and newspapers. The market has returned to the old high and some more. Is this credit crunch crisis over? What might be coming next? The sub-prime is only the 1st layer of the onion being peeled; there is much worse danger yet to be revealed. It is amazing to see the high growth in all kinds of fixed income products during last 10 years called SIVs (structured investment vehicles) such as RMBSs (residential mortgage backed securities), CDOs (collateralized debt obligations), ABS (asset …

Consider the case of a lad that tried using some $1 US Mint Presidential series proof coins as spending money at a restaurant. And now consider the hung jury in the tax evasion trial of a building contractor that paid his employees in US Eagle one ounce (“$50”) gold coins, at their face value. So if I understand these stories correctly, the U.S. Treasury wants us to accept their “legal tender” coins at face value, when the face value is more than the metal value of a coin, but they’d happily see us thrown in jail when when use a …

Jim, I know you get a lot of mail so I’ll be brief. I highly value your information and input on the current economy. I also have read your book “Patriots”, and your current assessment of our economy’s future terrifies me. What are the probable chances of this turning into a worse case scale as seen in your novel? Even if it is not worse case, I have no idea what a Moderate case would look like. Your wisdom would be greatly appreciated. Thank You.- William JWR Replies: In the context of America’s current economic situation (namely, the implosion of …

I’m sure that most of you remember back in the first week of August when CNBC market analyst Jim Cramer was screaming hysterically: “Open the discount window!” Well, it seems that Bernanke and Company have done exactly what he asked. As of the past week, commercial banks are now taking $2.7 billion in loans per day from the Federal Reserve discount window. With just this lending from the discount window, the increase in the U.S. money supply has jumped to an annualized rate of more than 50%! I’ve said this before: The biggest red flag imaginable for pending economic catastrophe …