There are trillions of dollars of bonds in the world with negative yields – a fact with which future historians will find baffling. Until now those negative yields have been limited to the safest types of bonds issued by governments and major corporations. But this week a new category of negative-yielding paper joined the party: […]
Top Ten Videos — May 23
Peter Schiff: Will Tesla crash the corporate bond market? … Chris Martenson: We work for the company store … Gerald Celente: The woes of the status quo … Lynette Zang: How much gold is enough in a reset? … David McAlvany: US GDP growth would be negative without soaring debt … Alasdair Macleod: What will […]
The Terrifying Truth About Negative Interest Rates
Pushing interest rates below zero is both an act of desperation and something that in theory should have a huge, immediate impact of the behavior of borrowers and savers. The fact that negative rates have become the new normal in big parts of the world but haven’t caused the expected behavior change should scare the […]
Beef Just Lost Its Place In The Fast Food Burger World
Last year I read an article about the Impossible Burger, a plant-based patty that was supposed to rival the real thing. Intrigued, I called a friend who lives in a neighboring town and appreciates strange but environmentally cool things, and we met at a restaurant that served Impossible Burgers. They were good. Close to meat […]
Brutal Gold Futures Action Explains Last Week’s Big Price Decline
Just when it looked like gold futures — which still, unfortunately, dictate the price of physical precious metals — were ready to turn bullish, last week’s commitment of traders report (COT) revealed that commercial traders (usually right at big turns) had gone massively short while speculators (usually wrong at turning points) went aggressively long. That […]
Trump Is Turning Out To Be A Consequential President
The Donald’s personal failings make it hard to say nice things about his presidency. Yet contrary to most inside-the-Beltway expectations, he’s having an impact. Let’s start with abortion, something that divides the country in a visceral way, with one side seeing it as murder and the other side viewing its prohibition as the subjugation of […]
Top Ten Videos — May 16
Steve Keen: You don’t get asset prices at these levels without soaring leverage … Thom Hartmann: The coming war with Iran is yet another US false flag operation … Charles Hugh Smith: America’s next big crisis coming in June … Max Keiser: Gold would be $2,900 if it wasn’t being manipulated … […]
The Mixed Blessing Of Falling Birth Rates
The developed world is doing something unprecedented: It’s no longer reproducing. That’s great for the environment and very good for the work and housing prospects of the relative handful of kids that are being born (since fewer workers mean rising pay and fewer households mean cheaper real estate). But it’s bad for retirees who will […]
Tales From The Casino, Part 1: Funds That Bet On Volatility Might SPIKE Volatility, Crashing The Markets
It’s a measure of modern financial markets’ absurdity that bets on bets on bets have come to seem normal. Maybe acronyms like CLO and CDO make them sound scientific. Or maybe it’s the sense that if Wall Street’s “rocket scientists” create something it must be highly advanced and therefore beneficial for society. But in reality, […]
A Different Kind Of Wage Inflation Heralds This Cycle’s End
Towards the end of long expansions (this one is the longest on record) things get tight. Factories operate flat-out and start raising prices. Good workers become harder to find and companies start competing for them with higher wages and other perks. This story is about the “other perks” which, because they don’t show up in […]
What Blows Up First? Part 8: Leveraged Corporate Loans
By now just about everyone understands what junk bonds are and why they matter. But there’s a non-publicly traded version of this kind of debt that’s also soaring and has recently caught the Fed’s eye. Called leveraged loans, these are loans made by banks to companies with weak balance sheets – defined as debt exceeding […]
The Fed Is Paralyzed By Mixed Messages
The Fed tightens and stocks tank. The Fed promises to stop tightening and stocks soar. The Fed implies that it might actually cut rates and stocks soar some more. The Fed appears to take back the rate cut promise and the markets turn choppy. It’s been a wild ride. But during the past four months […]
We Give Up! Part 7: Now Even Republicans Want A Dovish Fed
Not so long ago, the major US political parties had very different views on monetary policy. Democrats, representing labor, wanted high government spending, low interest rates and generally easy money to create as many jobs as possible. Republicans, representing capital, wanted relatively small government, low debt and tight money to give entrepreneurs a predictable future […]
Top Ten Videos — May 1
Rick Rule: The macro environment is pretty constructive for gold … Kyle Bass: China’s house is on fire; if you have money invested in Asia I would seriously rethink that … Charles Hugh Smith: Debt continues to rise faster than income … Danielle DiMartino Booth: Why do central bank counterfeiters like gold? … David Morgan: […]
Negative-Yield Bonds Are Back In Style. Why That’s A Bad Thing
Paying someone in order to lend them money seems kind of pointless. Yet the practice of stashing wealth in places where it yields nothing (and maybe even costs a bit for storage) is more common than you might think. Chinese, Russians, and Brazilians, for instance, buy US and Canadian condos and leave them empty as […]
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