investment

Peter Schiff: The Fed’s Tightening Pipe Dream

"The Fed Chairman has been talking about tightening for some time. In 2010, he said, 'As the expansion matures, the Federal Reserve will need to begin to tighten monetary conditions to prevent the development of inflationary pressures.' Back then, the same mainstream analysts were predicting recovery and a reversal of quantitative easing (QE). Instead, we have subsequently seen QE2, Operation Twist, and now QE3 to eternity. While these mainstream commentators are at best guessing as to why or when the Fed might reverse course, I understand that it is extremely unlikely to do so for the foreseeable future. In fact, I've bet my net worth on it." Continue reading →

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Fannie Mae and Freddie Mac to begin merging operations

"The regulator of mortgage finance giants Fannie Mae and Freddie Mac detailed plans Monday to begin contracting their business while merging their securitization operations. Federal Housing Finance Agency acting director Edward DeMarco said the two, rescued by the government in 2008 in a $180 billion bailout after the housing market collapse, needed to begin reducing their dominance of the market as private financing makes a comeback. One effort planned for this year is to raise the fees they charge to mortgage lenders for guaranteeing their loans, reducing the market’s near-complete dependence on the two." Continue reading →

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Whence the Housing Bubble?

"The chart below shows the ratio of the average existing home sales price to average household income. The long term average (LTA) of this ratio has been slightly above 3.0. At the beginning of 2001, however, it began to rise rapidly, reaching a peak 33 percent higher than the LTA during 2005, and then declining precipitously back to its LTA during 2008. Peshut’s chart also shows that, as of the beginning of 2012, Fed monetary policy had been unable to restart a bubble in the housing market unlike it had done in financial asset, farmland, and commodities markets. In fact housing prices were still falling both absolutely and in relation to household income." Continue reading →

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Challenge for Keynesian Anti-Sequester Hysterics

"Here’s some data from the International Monetary Fund showing that the Canadian economy enjoyed very strong growth when policymakers imposed a near-freeze on government outlays between 1992 and 1997. By the way, we also have a more recent example of successful budget reductions. Estonia and the other Baltic nations ignored Keynesian snake-oil when the financial crisis hit and instead imposed genuine spending cuts. The result? Growth has recovered and these nations are doing much better than the European countries that decided that big tax hikes and/or Keynesian spending binges were the right approach." Continue reading →

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Epic investor debate featuring faceoff between Peter Schiff and John Mauldin

"An epic debate about the creation and preservation of wealth featuring Rick Rule, Peter Schiff, John Mauldin and Grant Williams. The highlight is a classic faceoff between Peter Schiff and John Mauldin that takes place around 7:30 in and goes on for several minutes and really heats up at 9:30. The debate took place February 24, 2013 at Cambridge House's California Resource Investment Conference in Palm Springs." Continue reading →

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Jump in Swiss jobs good news for expats

"The number of jobs offered in Switzerland has jumped by seven percent since the start of the year, offering encouragement to those considering a move to the country. The latest Michael Page Swiss Job Index shows more jobs being advertised across the country, with western Switzerland leading the way. Demand for engineers grew significantly and the negative trend in IT jobs reversed from last year. Other sectors showing big increases were the metal industry and health and social services. Swiss SMEs are generally hiring more than multinationals, 'which remain slightly conservative and cautious due to their greater exposure to global difficulties', Semeraro notes." Continue reading →

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China “fully prepared” for currency war: central banker

"Yi Gang, deputy governor of China’s central bank, issued the call after G20 finance ministers last month moved to calm fears of a looming war on the currency markets at a meeting in Moscow. Those fears have largely been fuelled by the recent steep decline in the Japanese yen, which critics have accused Tokyo of manipulating to give its manufacturers a competitive edge in key export markets over Asian rivals. South Korea’s incoming president Park Geun-Hye has also signalled her willingness to step in to stabilise the won and protect exporters battling a stronger Korean currency and a weaker yen." Continue reading →

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