Economics

Peter Schiff Doubles Down on Inflation Prediction

"Schiff looked at Bureau of Labor Statistics price changes for 20 goods and services between 1970 to 1980 and again between 2002 and 2012, decades that Schiff says were both periods of large deficits and loose monetary policy. Schiff found that his basket of goods increased 61% faster than CPI for the period between 2002 and 2012. In contrast, his basket rose just 5% faster than CPI from 1970 to 1980. 'How can you believe these statistics when the numbers are so flawed?' Schiff asks in response to his research on CPI." Continue reading →

Continue ReadingPeter Schiff Doubles Down on Inflation Prediction

Sterling crisis looms as UK current account deficit balloons

"Some of the reasons for this need little explanation. Low growth has undermined attempts to reduce the fiscal deficit, which remains one of the highest in the OECD. This in turn is likely to lead to the loss of Britain’s prized triple A credit rating this year, making the UK comparatively less attractive to overseas investors. What’s more, capital flows from the eurozone to perceived 'safe havens' such as the UK are slowing as the crisis eases. There is also evidence of elevated concern among investors about Bank of England money printing." Continue reading →

Continue ReadingSterling crisis looms as UK current account deficit balloons

Colleges Lose Pricing Power

"Facing stagnant family income, shaky job prospects for graduates and a smaller pool of high-school graduates, more schools are reining in tuition increases and giving out larger scholarships to attract students. Moody's also attributed the enrollment decline at some public universities to a 'heightened scrutiny of the value of higher education' after years of tuition increases and stagnating family income. The credit-rating firm said in its report that more students are 'increasingly attending more affordable community colleges, studying part time, or electing to enter the workforce without the benefit of a college education.'" Continue reading →

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Bill Bonner: Zombie Nation

"When an industry is only profitable with government backing it means that the industry uses resources — labor, energy, raw materials — and turns them into finished products that are worth less than the inputs required to make them. The more of these zombie industries the government supports, the poorer the society becomes. 'Rentier' is a French word that has leaked into English. It describes people who have found a way to exploit the system for their own benefit — people who have legal entitlements to income streams. In other words, 'Rentier' describes a class of folks who contribute absolutely nothing to national prosperity — zombies." Continue reading →

Continue ReadingBill Bonner: Zombie Nation

America’s Platinum Express

"Even if you are Scott Sumner himself, you should be very alarmed when you’ve now got arguably the most prominent economist on Earth arguing that the government should start paying its bills with coupons that are then monetized by the Fed. That is just the barest step removed from having the Fed literally create new money to cover the government’s spending. Forget the macroeconomics for a second. Surely there is the faintest hint of Public Choice economics buried in the souls of the market monetarists. Can we all agree that Krugman’s flippant remarks above are downright alarming?" Continue reading →

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France’s Socialists Generate A New Class Of Tax Exiles

"The message could not be clearer: The number of requests by French citizens to leave France are suddenly up by 400 to 500 percent. As far as my tax law business is concerned, we used to have three to five such cases a year, and we are already facing more than 20 this year. We are witnessing an explosive rise in tax exile since April 2012. Currently, however, we are seeing a lot of young entrepreneurs, not necessarily wealthy, but who would like to get wealthy and will not hand over their wealth to the government. The hopeful tax exiles are therefore getting younger: today they are aged between 35 and 50, and not between 55 and 70, as was seen before." Continue reading →

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France’s Financial Transaction Tax Experiment Is Turning Into The Worst Kind Of Failure

"Investors who own French shares are selling them and taking positions on them through derivatives instruments such as contracts for difference, structured products and ETFs, according to a Paris-based lawyer. 'Most structured transactions remain outside the tax,' he says. 'It is due only if you have actually purchased the shares.' In other words, instead of curbing excessive speculation, the tax is simply forcing those speculative activities into darker, less-regulated corners of the market." Continue reading →

Continue ReadingFrance’s Financial Transaction Tax Experiment Is Turning Into The Worst Kind Of Failure