What Could Possibly Go Wrong

Bill Bonner: It’s a dangerous time of year

"A stream of income – either from a stock or a bond – is a promise. The value of it depends on how much you trust the promisor and his money. That is the problem. As much as we like Ben Bernanke as a human being, we find grave fault in him as a god. Only a god could know more than the sum of all the knowledge held by all people who are active in the world economy. Only a god could select an interest rate better than the one they select for themselves. And only a god-awful economist could claim to do such a thing with a straight face. The galling thing is that he may be able to keep the whole shebang going for many years more." Continue reading →

Continue ReadingBill Bonner: It’s a dangerous time of year

Bloody Scenes from the Next Episode of Economic Crisis

"Stand by for round two of the global economic crisis, coming soon to a screen near you. It’s going to be as bloody and chaotic as the scenes on your TV from Cairo and Damascus. Yet, as ever, the chorus on Wall Street manages to keep a straight face and sing the same tune while robbing investors blind. Just listen to them on Bloomberg or CNBC and you would think the Fed has this all under control and the U.S. economy is recovering. Now, admittedly, economists are all facing the wrong way too. There is hardly a man or woman willing to stick their neck out and say the inflation-distorted figures that purport to show a recovery are turning in the opposite direction." Continue reading →

Continue ReadingBloody Scenes from the Next Episode of Economic Crisis

Near the Debt Ceiling, No One Can Hear You Scream

"Let’s put these clues together. We have another fiscal crisis imminent with a looming debt ceiling drama. We have a Federal Reserve that is already doing a huge and unsustainable amount of 'stimulus' buying. And we have an economy far weaker than it’s been in more than a decade despite the bluster over GDP. The bigger concern is that the market doesn’t have any of this priced in at all. It’s true that August was the worst month for stocks since May 2012. Yet the market fell just 3.1% and is only 4.5% off its all-time high. That’s barely a scratch." Continue reading →

Continue ReadingNear the Debt Ceiling, No One Can Hear You Scream

Investors (Suckers) Say They Have Things Under Control

"Today, 56% say they are confident about the future. This means that 44% aren’t confident. Today, 42% say they have increased their tax-deferred retirement savings. This means that 58% haven’t. Today, 55% say they are better prepared for retirement than in 2007. This means that 45% don’t think they are. Today, 42% have increased the size of their emergency fund. This means that 58% haven’t. We are asked to believe that people’s personal savings rate is up since November 2007, the month before the recession is said to have begun. Yes, it is — by a percentage so tiny that it is barely visible." Continue reading →

Continue ReadingInvestors (Suckers) Say They Have Things Under Control

Maybe This Is Why We Now Have a Serial-Bubble Economy

"If there is any one strikingly obvious feature of the U.S. economy in the past 15 years, it's the serial asset bubbles, one after another. Take a look at this chart. Why did our economy become dependent on asset bubbles for 'growth'? One way to find an answer is to ask: cui bono, to whose benefit? Correspondent Jeff W. has the answer: the financial sector and the central government." Continue reading →

Continue ReadingMaybe This Is Why We Now Have a Serial-Bubble Economy

Retire at 65. Become a Ward of the State.

"PBS had a recent article about retirees who stay in the work force beyond age 65. It interviewed economists. What it did not do was provide statistics on how many Americans work until age 75. The answer is: hardly any. Most Americans do not have enough savings. They retire anyway. Most Americans believe in the tooth fairy: the federal government. They think the checks will keep coming. They will not budget. They will spend their $120,000 long before they die. Then what?" Continue reading →

Continue ReadingRetire at 65. Become a Ward of the State.

With Three Weeks to Go, Nobody Knows What ObamaCare Will Cost.

"So far, 17 states have issued estimates. The exchanges are supposed to be ready for business on October 1. Coverage begins on January 1. Where are the missing 33 exchanges? The federal government must run them. The federal government is staying mute. With three weeks to go, there is no real understanding of what the costs will be for most premium payers. This is going to be an administrative disaster. It is a programming disaster. It is going to prove to millions of voters that the federal government does not know what it is doing. This will become evident on October 1, the day the new fiscal year begins." Continue reading →

Continue ReadingWith Three Weeks to Go, Nobody Knows What ObamaCare Will Cost.

David Galland: Wars and Rumors of Wars

"This article is about why I think interest rates are heading higher, viewed through the context of the politics of the US government's next war. While I'd prefer to convince the world to change its course toward a more peaceful future, given the futility of trying to do so, I'll use my time with you today presenting data, analysis, and a few opinions about the economic consequences of the march toward war that US policy is now set upon. The chart below combines defense, veterans benefits, homeland security, the State Department, and defense-related interest payments, to create a more comprehensive picture of our military spending." Continue reading →

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Russia warns of nuclear disaster if Syria is hit

"A military strike on Syria could lead to a nuclear catastrophe if a missile were to hit a reactor containing radioactive uranium, a Russian Foreign Ministry spokesman warned. The remark comes as the US continues to push for a military strike on Syria. 'If a warhead, by design or by chance, were to hit the Miniature Neutron Source Reactor (MNSR) near Damascus, the consequences could be catastrophic,' Aleksandr Lukashevich said in a Wednesday statement. Russia’s Foreign Ministry urged the UN International Atomic Energy Agency (IAEA) to complete a risk evaluation as the US continues to seek support for military action." Continue reading →

Continue ReadingRussia warns of nuclear disaster if Syria is hit