Congressional efforts to fortify dragnet domestic surveillance advanced last week when a Senate committee approved the Cyber Intelligence Sharing and Protection Act (CISA). CISA is an addition to the current National Security Act of 1947 creating a subsection 1104 which incorporates private companies into the intelligence community under voluntary measures. It is intended to make…
No protesting the government? No freedom of the press? Lawmakers jailed? Is this the story of the Soviet Union during the Cold War? No. It describes the United States in 1798 after the passage of the Sedition Act. The History Channel describes it as one of the “most egregious breaches of the U.S. Constitution in…
The people of the state of Kansas are under attack and the weapon being deployed is aimed at depriving them of their right to keep and bear arms, and their right to enact state laws protecting that right. On Wednesday, July 9, the Brady Center to Prevent Gun Violence filed suit in the U.S. District…
"Not bad, if you like perks, 8-hour days, and bureaucratic security. This is the opinion of two-thirds of its employees who responded to the GlassDoor inquiry. It’s fat city in Fat City. And why not? Working for the Federal Reserve is a license to print money . . . literally. Click the link to see what the good life is like for America’s legal counterfeiting operation." Continue reading →
"Last year, SNP chief Thomas Jordan requested a [buffer] to be introduced for Swiss banks, forcing them to hold an additional one percent of risk-weighted assets to stave off the potential dangers of the housing boom. Earlier this year, as worries about a bubble increased, the SNB instigated a number of policies to prevent any more dramatic rises. This included doubling the capital buffer requirement to two percent. However, despite a partial slowdown since January, Jordan told reporters in March that the work was not yet done. 'The pace has slowed, but we are far away from the soft landing we want. We don’t yet see the slowdown that we would like to see.'" Continue reading →
"Sweden’s economy, which it oversees, grew three times faster than the euro zone’s in 2010 and dodged Europe’s double-dip recession in 2012-13. The Riksbank felt confident enough in recovery to start raising interest rates in 2010. The Riksbank worried that rising household borrowing and soaring house prices could lead to trouble down the road. It therefore opted to 'lean against the wind', in central bankers’ parlance, and deflate the credit boom before it burst catastrophically. It seems instead to have taken the air out of everything but exuberant markets. Unemployment in Sweden has held steady, while Swedish private-sector debt as a share of GDP is higher now than it was in 2010." Continue reading →
"Central banking has taken interest rate reduction to its absurd conclusion. If observers thought the ECB had run out of room by holding its deposit rate at zero, Mario Draghi proved he is creative, cutting the ECB’s deposit rate to minus 0.10 percent, making it the first major central bank to institute a negative rate. Can a central-bank edict force present goods to no longer have a premium over future goods? Armed with high-powered math and models dancing in their heads, modern central bankers believe they are only limited by their imaginations. More than half a decade of zero interest rates has not lifted anyone from poverty or created any jobs—it has simply caused more malinvestment." Continue reading →
"The fact that the Fed’s PCE index is showing inflationary pressure is significant, since it is essentially designed to lowball price increases. The CPI gives a 31 percent weighting to shelter costs and a 17 percent weighting to transportation (read as rent and gasoline), which the PCE basically cuts in half. By reducing the volatility of its preferred inflation gauge, the Fed essentially gives itself the leeway to maintain a looser policy longer. But the fact that the PCE is on the rise leaves the Fed in a conundrum, having said for years now that it would act when inflation reaches an annualized 2 percent, a level that is fast approaching." Continue reading →
"It’s bad enough that central bankers create money out of nowhere to buy bonds. Now it turns out that’s not all they’re buying. A study by global research firm Official Monetary and Financial Institutions Forum (OMFIF) states global public investors 'as a whole appear to have built up their investments in publicly quoted equities by at least $1 [trillion] in recent years.' The percentage of financial advisors who are bullish on the stock market jumped to 62.2%, the fifth straight week this indicator has been above the key 55% level. Other noteworthy tops came in August 1987 (60.8%), October 2007 (62%), and December 2004 (62.9%)." Continue reading →
"Banks – with the happy connivance of the Fed – create new money. Corporations use it to buy their own shares. Central banks buy shares too. Besides, buying stocks seems to please everyone who matters. Investors are happy. Speculators are happy. Economists are happy. Politicians are happy, too. After all, a rising stock market means the economy is getting better, doesn’t it? But there is a heavy price to pay, dear reader. The financiers end up owning more of the real businesses… the real enterprises… the real houses… the real output of the real economy. Wall Street firms own more houses. And more stocks. All are bought with money that they – or their cronies – created." Continue reading →