Italian yields have recently lost their minds and will directly impact the sanity of U.S. wallets if you’re not paying attention right now. Bonds are our thing. We’ve traded and tracked them for decades, as they are the true signposts... Read more »
Welcome back to What’s Happening Now, your weekly guide to what’s going on right now and why it matters to you – and your money. In our last column on compressed yields, we prefaced the long Labor Day Weekend with... Read more »
We released two seminal reports: one on the relationship between gold and a strengthening US Dollar, and another which unmasked the latest fantasy theory gaining traction in DC, otherwise known as MMT, or “Modern Monetary Theory.”09 Meanwhile, in our nation’s... Read more »
All of us at Critical Signals Report, and I in particular, am grateful for the exceptional commentary, feedback, and questions we’ve received from our recent reports. I was even touched to see some words in French as well (Merci!). Ideally,... Read more »
There’s much talk these days about a future with no more interest-rate hikes and, thus, a world that will never see a recession-at least not in the U.S. Good news, eh? A recession-free tomorrow is indeed a warm thought. Santa... Read more »
The media cheerleaders are back at it again, this time giving us more good news out of China.
Such Chinese "good news" sends investor fears, and hence the VIX, to the floor:
Although China's growth in 2018 was the slowest since 1990, the gist of this recent media "rah-rah" stems primarily from China's Q1 "rising growth," driven entirely by its central bank's recent decision to ease banking reserve requirements, which it has done by allowing more debt "stimulus."
Folks, debt-based "growth" in an already debt-soaked China is not good news, it's merely a postponed hangover and thus postponed bad news.
But given the financial media's 24/7 misunderstanding of context, such longer-term perspectives are effectively non-existent today.
I've written elsewhere of the correlation between bad economic reality and false media hope in our daily headlines.
In the sad "new normal" of a world awash in $250 trillion of global debt created and maintained by a desperate cadre of "supportive" central banks, a key tool for keeping investor faith alive in the backdrop of this ticking, debt time-bomb is a perverse string cite of fictions masquerading as data and financial "news."
The recent "growth story" about China is no exception to this sad trend.
Toward that end, I'll open with a metaphor -a device I do so enjoy...and it's the same one I offered to my wine owner.
The image I have is a beautiful little desert village with fruit stands in the streets, children running through sun-bathed flower beds, and yuppies driving blissfully about in convertibles listening to Michael Bolton's Greatest Hits.
The sun is shining, not a cloud in the sky. All is well, as far as the eye can see. And up there, on the distant horizon, sits a massive dam, behind which millions upon millions of gallons of deadly river water are pushing.
And somewhere, hidden among the walls of that great dam, is a group of very nervous folks - dangling from repelling ropes, with their stubby little fingers desperately plugging holes which are now appearing with increasing frequency.
The image I like to use includes Ben Bernanke, Alan Greenspan, Mario Draghi, and Janet Yellen scurrying from hole to hole to hole, shouting for more corks, fingers, or even silly putty to keep the great dam from, well, crushing them (and the village below) to death...
I landed recently in Paris only to see the Notre Dame Cathedral burning in flames, a deeply sad event as the larger European Union itself slides slowly into a recession lead by France's neighbor Italy. Notre Dame will eventually rise from these tragic ashes, and for this I am pleased at a deeply personal level. Read more »