for life and liberty

The Fed’s Dreaded Dilemma: A Weak Economy Plus Inflation

"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 →

Continue ReadingThe Fed’s Dreaded Dilemma: A Weak Economy Plus Inflation

Fed Still on Red Alert

"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 →

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Bill Bonner: The Greatest Fraud Ever

"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 →

Continue ReadingBill Bonner: The Greatest Fraud Ever

U.S. Economy Shrank in First Quarter by Most in Five Years

"The U.S. economy contracted in the first quarter by the most since the depths of the last recession as consumer spending cooled. Gross domestic product fell at a 2.9 percent annualized rate, more than forecast and the worst reading since the same three months in 2009, after a previously reported 1 percent drop. It marked the biggest downward revision from the agency’s second GDP estimate since records began in 1976. Business investment fell at a 1.2 percent annualized rate, compared with a previously reported 1.6 percent annualized drop. Companies reduced their spending on structures at a 7.7 percent pace, and spending for equipment fell 2.8 percent, today’s report showed." Continue reading →

Continue ReadingU.S. Economy Shrank in First Quarter by Most in Five Years

On The Fed’s (Tentative) End to Bond Purchases in October

"The current plan is that–so long as the economy doesn’t crash–the Fed will taper to $25 billion in August, then $15 billion in September, and then wipe out the remaining $15 billion in October. Here’s a chart showing the behavior of the S&P500 versus the monetary base. It used to be the case that the stock market bounced around with little relation to the Fed’s asset purchases. But since early 2009 and the introduction of QE programs, the stock market and the Fed’s bond buying have moved in virtual lockstep. Let me ask you this: Do you think the S&P should be hitting all-time highs because of how great the underlying economic fundamentals have been the last few years?" Continue reading →

Continue ReadingOn The Fed’s (Tentative) End to Bond Purchases in October

Federal Reserve likely to end QE stimulus program in October

"The Federal Reserve is set to end its economic stimulus program in October, bringing to an end the controversial five-year-old scheme even as officials said there were signs that the US economy was still in trouble. Officials have been winding down their monthly purchases of Treasury bonds and mortgage-backed securities since January, but had not set an end date for the scheme. Controversial from the outset, QE was designed to keep long-term interest rates down and encourage investors to back stocks or corporate debt in order to stimulate the economy. Stock markets have hit record highs under QE yet the unemployment rate remains high and there are continuing signs of weakness." Continue reading →

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Corporate Bonds Are The IEDs Of Monetary Central Planning

"The Fed’s sustained, heavy-handed financial repression has generated the greatest ever scramble for yield, and it is now entering its seventh year. Consequently, speculators and bond fund managers are all in the same side of the boat. And all but the most intrepid traders are scared to death to short the Fed, fearing that any day it might uncork yet another round of bond market repression. So we have basically a highly artificial one-way market in corporate bonds—both investment grade and high yield. Very recently yields in the latter touched an all-time low of 4.87%, meaning that after inflation and taxes there is virtually no room for losses on securities that are called 'junk bonds' for a reason." Continue reading →

Continue ReadingCorporate Bonds Are The IEDs Of Monetary Central Planning

My Email Debate with a Columnist Who Wants Feds To Arrest Cancer Patients

Kansas Star columnist Mary Sanchez wants the federal government to arrest suffering cancer patients using marijuana for pain relief and lock them up in cages. Granted, she’s not likely to admit it, but I think I stand on pretty solid ground making that assumption because she hates nullification. She said so in a recent column…

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Gerald Celente on Marijuana Legalization and OccupyPeace

"We're initiating a project called OccupyPeace.us. And it's based on three words: No foreign entanglements. Those are the three words spoken by the Founding Fathers of this country. We want to rebuild America and the way we want to do it is we're working to build an OccupyPeace movement based on no foreign entanglements and we're working to push the United States more in line with a direct democracy like Switzerland. You want to go to war? Let the people vote. You want a defense budget? Let the people vote on it. You want to bail out the banks? Let the people vote. If we can bank online we can vote online. It could be more open than any other system in the world." Continue reading →

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23 and Counting: New York Nullifies Unconstitutional Federal Marijuana Ban

ALBANY, NY – New York officially became the twenty-third state to effectively nullify the federal ban on medical marijuana after Gov. Cuomo signed historic legislation into law allowing for sick patients to access cannabis as a treatment option last Monday. Program Bill 57 passed through the New York state legislature on Jun. 20. The law…

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