|Norman Pagett writes in The End of the Oil Age:
Pagett is another gloom-and-doomer who explains why the old growth model is totally busted. And, what that means for our species. But, is the ultimate outcome of our civilization to fail miserably? The probability seems high, but humans over history have shown that last-minute saves are our speciality. Perhaps when faced with extinction, we will change our model to fit the environment. Moreover, we may be able to change our environment to fit within it. Perhaps we can find a “living wage” that doesn't doom us to fall back into the Dark Ages.
One part of our solution is what Kent Moors calls “Space Energy.” Planet Earth is surrounded in space by vast amounts of energy. If we could tap this energy, it would dwarf the amounts we extract from the ground in the form of fossil fuels. Moreover, it's highly likely that we are going to tap this infinite source of power in the next few decades. Thus, one problem is solved: unlimited, virtually-free energy for our use, replacing dirty fuel with clean, sustainable energy. As Dr. Moors points out, Albert Einstein didn't win his Nobel Prize for relativity. He won it for “Space Energy.” Now, 110 years later, we are on the verge of “Space Energy” taking the lead in energy and eliminating fossil fuels entirely.
Friday, July 03, 2015
Thursday, July 02, 2015
|#SubscriberNotes have been updated on the website. Cash markets are closed on Friday, but CMEgroup futures will trade until 13:00.|
Wednesday, July 01, 2015
|#SubscriberNotes have been updated on the website. Illiquid markets going into Sunday's Greek referendum magnify risk for traders.|
Tuesday, June 30, 2015
Monday, June 29, 2015
|John Hussman writes in Durable Returns, Transient Returns:
This is not a Goldilocks market. No, this is a Roseanne Roseannadanna market (Gilda Radner’s character from Saturday Night Live). Though investors seem to believe that catalysts for a market plunge should be known ahead of time, they’re likely to learn in hindsight that the specific catalyst didn’t matter. History teaches that once obscene valuation is coupled with overvalued, overbought, overbullish extremes, and is then joined by deterioration in market internals, the outcome is already baked in the cake. Afterward, investors discover “Well Jane, it just goes to show you… It’s always something. If it’s not one thing, it’s another.”The market is on tap to lose half of its value multiple times in the next big half cycle. The last two half cycles took place during 2000-2003 and 2007-2009. The next one is likely to be even bigger.
Sunday, June 28, 2015
Thursday, June 25, 2015
|#SubscriberNotes have been updated on the website. Time for a rebound in stocks? Yes, but the trend remains down into July.|
Wednesday, June 24, 2015
|#SubscriberNotes have been updated on the website. Stock market correction looks a lot like March-April. Are we following Mercury's lead?|
|The government tells us that First Quarter GDP contracted at “just” -0.2%, but in doing so they revealed their lies once again. The deflator used to convert nominal GDP to real GDP was just about zero. However, the much more accurate Billion Prices Project shows that inflation was running at about 1.6%, so the real GDP figure should have been reported as contracting by -1.8%.
It's clear that the economy is doing just fine—only if you believe the government lies they tell.
Tuesday, June 23, 2015
Monday, June 22, 2015
Sunday, June 21, 2015
|The deniers have no place to hide.
Decoded Science reports:
Saturday, June 20, 2015
|There is no longer any doubt: We are entering a mass extinction that threatens humanity's existence. That is the bad news at the center of a new study by a group of scientists including Paul Ehrlich, the Bing Professor of Population Studies in biology and a senior fellow at the Stanford Woods Institute for the Environment. Ehrlich and his co-authors call for fast action to conserve threatened species, populations and habitat, but warn that the window of opportunity is rapidly closing. Read more: http://stanford.io/1RgQBMj|
Thursday, June 18, 2015
|#SubscriberNotes have been updated on the website. Long near the opening meant big profits on today's rally. Maintain sell stops on open stock index futures.|
Wednesday, June 17, 2015
Tuesday, June 16, 2015
Monday, June 15, 2015
Sunday, June 14, 2015
Saturday, June 13, 2015
|David Stockman explains why the global financial system is a Gargantuan Financial Trap in The Futility of Our Global Monetary Experiment:
Sometimes we get so caught up in the monthly so-called incoming data and the short-term releases — that are seasonally maladjusted anyway and get revised four times over — that we really lose track of where we are. So, the other day I said let's just look at two extended periods of time that occurred in different economic and policy environments and do an assessment of where we are.
I took 1953 to 1971, that representing the end of the Korean War and the beginning of the Great Prosperity in the middle century, ending in the August 1971 fatal mistake that Nixon made when he closed down Bretton Woods and the rest. I call that the Golden Era of Prosperity. During that period, the economy grew and I use real final sales to measure the growth because that takes out the inventory fluctuations and distortions that are in the GDP number per se. But, if you take real final sales for that eighteen-year period, it was 3.6 percent a year compounded during a time in which the Fed was run by William McChesney Martin, a survivor — or veteran, you might say — of the 1929 crash and the trauma of the 1930s. He was a man who wasn't necessarily, in the classic sense, a hard-money gold-standard advocate, but he certainly was a wise financial hedge who understood the dangers of speculation in the financial markets and of too much heavy-handed intervention in the financial system.
During that eighteen-year period from 1953 to 1971, the balance sheet of the Federal Reserve expanded by only $42 billion over eighteen years. (Now during QE, that was about two weeks worth of expansion at the peak.) More importantly, if you look at it in real terms — in inflation-adjusted terms — the balance sheet of the Fed in that period grew about 3 percent a year, and the economy grew at nearly 4 percent. Therefore, the Fed was engaged in a very modest light-touch policy allowing the mechanism of capitalism, including the financial markets at the heart of it, to function. The balance sheet of the Fed grew by 0.8 percent of the growth in the GDP.
Now, let's take the last fourteen years, we're in a totally different world. Greenspan has changed the whole notion of the role of the central bank, followed by Bernanke and Yellen. During that period, GDP growth of the economy has down shifted sharply to 1.8 percent a year over the last fourteen years, half of what occurred during the golden era. By contrast, the balance sheet of the Fed grew from $500 billion to four and a half trillion. But look at it in the same annual terms: 17 percent a year growth in the balance sheet, and 15 percent after adjusting for inflation.
That means that the Fed's balance sheet grew eight times more rapidly than the economy during the last fourteen years. That's just the inverse of the relationship that occurred back in the Golden Era.
So, I think if you need any proof at all of this massive intrusion into the financial system isn't working; the huge amount of money printing and balance sheet expansion; the unremitting financial repression and pegging of interest rates; look at the fundamental comparison that I just made. It's not working in the real economy. That is, it's not generating expansion and giving standard gains on Main Street.
The only thing it's really doing is simply inflating the serial bubble that ultimately reach unsustainable peaks and collapse. We've had two of them this century already from that policy and we're now overwhelmingly — if you really look at the evidence — in a third great bubble that is in some ways more fantastic than the earlier two. It's only a matter of time before it bursts and implodes and we'll then be back to square one.
Hopefully on the third strike, the people who gave us these bubbles will be out. I think that might be a fair metaphor or proposition to make. Hopefully, when this next big bust comes — and surely it will when you look at the degree of speculation of the stock market in the high yield market or many other sectors that we can talk about — there will be a great day of reckoning in the country in terms of demanding a fundamental change in monetary policy and we'll see the resignation of all the people who are sitting on the Fed today that have led us right into this gargantuan financial trap.
Friday, June 12, 2015
|A new lab study found that a daily dose of aspirin was effective at blocking breast tumor growth. Previous studies have already shown a similar effect on colon, gastrointestinal, prostate, and other cancers.
Thursday, June 11, 2015
Wednesday, June 10, 2015
|#SubscriberNotes have been updated on the website. Today's rally in stocks was tipped by our best indicator on Monday. Are rising bond yields kryptonite for stocks?|
Tuesday, June 09, 2015
Monday, June 08, 2015
|Snapchat's CEO Evan Spiegel points out that tech stocks are in a bubble and doomed to crash at some point in time. This is refreshing since it comes straight from a CEO of an obscenely-valued tech stock.
Mises Institute writer Ryan McMaken reports:
Spiegel said the investment bubble is being fueled by an "easy money policy" and low interest rates, which may not last a whole lot longer according to recent economic indicators. Those low interest rates are funneling investments toward stock markets, hedge funds and, yes, startups.John Hussman explains that valuations based upon interest rates are only weakly related to reality in Why Stocks are Not "Cheap Relative to Bonds":
We're near the third peak in a Fed-induced bubble in equities and wondering why the economy can't grow at its historic rate. The answer is simple: you can't create wealth out of an ink pot. That's a lesson many investors have yet to learn even after three major stock market bubbles of the last fifteen years.
Sunday, June 07, 2015
Friday, June 05, 2015
|David Stockman calls it Another Paint-By-The-Numbers Friday:
Thursday, June 04, 2015
|#SubscriberNotes have been updated on the website. Has the Dow formed a major top in May? And, which index will be the weakest?|
EWI Asian-Pacific markets editor Mark Galasiewski always finds compelling indicators to support his forecasts -- indicators that few others see. This past December he highlighted a little-followed sector index to help support his outlook for Chinese stocks. You can read his analysis in Elliott Wave International's new free report.
Wednesday, June 03, 2015
|#SubscriberNotes have been updated on the website. Bonds growing more attractive to value investors by the day while stocks struggle.|
Tuesday, June 02, 2015
Monday, June 01, 2015
Sunday, May 31, 2015
Friday, May 29, 2015
|They scoffed when we said that the economy was in recession. But, when the governments of both Canada and the US reported Q1 GDP actually falling, they aren't scoffing anymore. Canada's GDP fell by 0.6% while the US fell by 0.7%, both subject to substantial revisions in the future. You may recall that during the last recession, the first reports had GDP shrinking by a similar amount. Years later, the government confessed that the economy was in freefall in the early days of the recession.
Now, GDP being negative isn't a definition of recession. But, it certainly isn't a vote of confidence. With stock prices having been pushed to nosebleed levels for the third time in the last two decades, there's a cliff and the stock market is looking awfully unsteady with the prospect of a recession. And, remember, the Fed is out of bullets, only having QE to stimulate asset prices, not the real economy. There's a reason why the Fed wants to raise interest rates—to be able to lower them if a recession strikes—but it may just be too late in the business cycle for that to happen. If so, expect the Fed to trot out QE and push stocks further toward orbit.
Thursday, May 28, 2015
|#SubscriberNotes have been updated on the website. Pay attention to the leaders, not the laggards, and you'll find it pays off.|
|With obscene valuations, US stocks are far too expensive and promise to fail to advance over the next decade. That's the conclusion of value investors, who see the current business cycle as greatly extended and due for a crash in the stock market.
The reasons why are easy to see: stock buybacks have boosted prices while reducing capital investment and productivity. The US stock market is in for a long decline.
The details can be read in Wall Street Gamblers At Work—–U.S. Firms Spend More On Buybacks Than Factories. Here's the bottom line:
An analysis conducted for The Wall Street Journal by S&P Capital IQ shows that companies in the S&P 500 index sharply increased their spending on dividends and buybacks to a median 36% of operating cash flow in 2013, from 18% in 2003. Over that same decade, those companies cut spending on plants and equipment to 29% of operating cash flow, from 33% in 2003.
At S&P 500 companies targeted by activists, the spending cuts were more dramatic. Targeted companies reduced capital expenditures in the five years after activists bought their shares to 29% of operating cash flow, from 42% the year before, the Capital IQ analysis shows. Those companies boosted spending on dividends and buybacks to 37% of operating cash flow in the first year after being approached, from 22% in the year before.
Capital spending by businesses accounts for about one-eighth of all spending in the U.S. economy. Historically, it has been an important driver of long-term growth, as upgrades make workers and companies more productive, says Michael Feroli, chief U.S. economist at J.P. Morgan Chase & Co.
Money plowed into dividends and buybacks doesn't disappear from the economy. Its recipients can spend it, too.
But Washington University's Mr. Fazzari says that most stock is owned by the wealthy, who tend to save more of their income. By contrast, he says, many kinds of business investment—from building construction to equipment maintenance and purchases—involve payments to contractors and suppliers who pay wages to middle and low-income workers.
Many companies have made changes while under no direct threat from activists. General Electric Co.'s institutional investors had long urged the conglomerate to scale down its large lending business. In April, GE said it would sell off that business and buy back $50 billion of its stock.
The surge of activism has sharpened the debate about the fundamental purpose of a company. Does it exist to satisfy shareholders or does it have an imperative also to try to build for the long term?
The answer is far from settled. If the activists are right, they are stopping companies from throwing good money after bad. "If they aren't, then we have to worry about the impact," says Yvan Allaire, the executive chairman of the Institute for Governance of Private and Public Organizations. "It has to be a fairly significant impact on the economy.
Wednesday, May 27, 2015
|#SubscriberNotes have been updated on the website. Traders bought the dip today. It's why we use trailing buy stops on short positions to take profits.|
|Mike Stasse is looking for a global collapse. He re-blogs Tom Lewis, who says:
What’s wrong with the global consumer? In the immortal words of Howard Davidowitz, a leading expert on retail, consumers “don’t have any f’ing money.” It is slowly — way too late — dawning on the Masters of the Universe that unless ordinary people have money to spend — and by that we mean real money, not more credit cards or a third mortgage — the Masters are toast.
There is the ultimate explanation for why the global economy peaked in 2008: the consumer, 70% of the economy, got hit with the inevitable. We're now suffering through a central banker-induced coma of forced liquidity which isn't repairing anything, just keeping the patient, the global economy, on life support.
Lewis states what's ahead:
Now, even if you believe, as I do, that the notion of infinite growth on a finite planet is ridiculous, and the notion that all growth is always good is suicidal, you still live, as I do, in a system that will crash if its faith on growth is broken. So pay attention to these idiots. They’re driving.The consumer knows that the system is broken. It may take a while to convince the Masters of the reality of that statement. When will they finally admit the system is so broken it can never be fixed? That's the bottom line truth: the economy is dead and artificial money creation only borrows time from the future. The system is in a state of collapse under the surface. It's only a matter of time before it becomes clear to the Masters that their time is up.
Tuesday, May 26, 2015
|Deniers will deny it, but they've proven themselves better called liars than deniers.
Weather pattern Government, named by Decoded Science, has been dumping huge amounts of rain accompanied by numerous tornadoes on Texas. This is causing flash flooding in a state which has been suffering from drought for several years. Is this a consequence of global warming? Yes, it is.
Global warming's effects go beyond just making the temperature rise. One effect is stalling the jet stream in place for many days, or even several weeks, at a time. Thus, the weather you get just keeps on keeping on. Government is just the latest version of a stalling in the atmosphere caused by global warming. A few years ago, global warming caused the average summertime temperatures in Texas to reach levels normally seen in Tucson, Arizona, or about 115° day after day. Normally, midsummer temperatures in central Texas only reach about 95°, so we saw a 20° rise in daily maxima. That was another example of the effects of global warming. Now, Government is forcing a trough in the upper atmospheric winds to dump rain for weeks at a time, overflowing drainage systems which were never designed to handle such extremes.
Since we know that burning fossil fuels is the cause of global warming, we should be demanding that those who have caused this disaster pay for it. But, of course, that would only be the right thing to do. It won't happen because those who own fossil fuels are protected by government from the effects of Government. Ideally, government should seize the assets of fossil fuel companies to protect citizens from further damages. We don't think keeping oil in the ground is the right answer, however. Oil is good for many other uses that don't involve burning. Adding CO2 to the atmosphere just isn't something any sane race would condone.
If you had a 10 percent chance of having a fatal car accident, you'd take necessary precautions. If your finances had a 10 percent chance of suffering a severe loss, you'd reevaluate your assets. So if we know the world is warming and there's a 10 percent chance this might eventually lead to a catastrophe beyond anything we could imagine, why aren't we doing more about climate change right now? We insure our lives against an uncertain future--why not our planet?|
In Climate Shock, Gernot Wagner and Martin Weitzman explore in lively, clear terms the likely repercussions of a hotter planet, drawing on and expanding from work previously unavailable to general audiences. They show that the longer we wait to act, the more likely an extreme event will happen. A city might go underwater. A rogue nation might shoot particles into the Earth's atmosphere, geoengineering cooler temperatures. Zeroing in on the unknown extreme risks that may yet dwarf all else, the authors look at how economic forces that make sensible climate policies difficult to enact, make radical would-be fixes like geoengineering all the more probable. What we know about climate change is alarming enough. What we don't know about the extreme risks could be far more dangerous. Wagner and Weitzman help readers understand that we need to think about climate change in the same way that we think about insurance--as a risk management problem, only here on a global scale.
Demonstrating that climate change can and should be dealt with--and what could happen if we don't do so--Climate Shock tackles the defining environmental and public policy issue of our time.
Sunday, May 24, 2015
Saturday, May 23, 2015
|Dave Kranzler collects the fundamentals which point toward the US economy being |
Note that the stock market will be falling 50% or more in the future. The decline could start at any time, even overnight when US investors are sleeping.
|The Fed is threatening to hike interest rates to “normalize” them. That's just exactly the wrong thing to do as the economy has already plunged into a recession—a recession that remains unrecognized by mainstream pundits.
First quarter GDP slowed at a -0.7% rate according to CNBC. And, the second quarter hasn't gotten off to a great start, either. The latest GDPNow projection has GDP growing at a tepid +0.7% rate. Within that figure, business investment is actually going in reverse at a -2.3% rate of decline. That's a picture of an economy in recession.
The latest bit of confirmation that a recession is in progress comes from truckers. According to the latest reports:
Thursday, May 21, 2015
|#SubscriberNotes have been updated on the website. When investors fail to see the reason to hedge, a major top could be near.|
|When we look at the cost of fossil fuels versus renewables, we have to take massive subsidies into account. The IMF finds governments subsidize fossil fuels to the tune of $10 million per minute. Moreover, that figure exceeds the amount governments pay for health care.
And, to add insult to injury, that's a lowball estimate which doesn't include the effects of Climate Change caused by the burning of fossil fuels into account.
The Guardian newspaper reports:
It's clear that we need to end subsidies for energy in general. Without the flow of public money into fossil fuels, the free market will steer the course toward replacement by renewables. It's the natural way the free market steers us toward a healthy fossil fuelless future.
Wednesday, May 20, 2015
|#SubscriberNotes have been updated on the website. The bond market has raised rates already. When will the Fed follow?|
Tuesday, May 19, 2015
Monday, May 18, 2015
Sunday, May 17, 2015
Saturday, May 16, 2015
|Robert Reich makes the case for expanding Social Security and making it more solvent at the same time. How? Hint, anyone making over $118,500 per year pays no more Social Security tax above that level at all! By eliminating the cap on Social Security, the system can not only be made more solvent, the payout can be raised for all:|
Friday, May 15, 2015
|From worst to first, Hawaii is on track to get 100% of its energy from renewable sources. Exactly when that goal will be achieved isn't certain, but there is an unstoppable trend at work there.
Thursday, May 14, 2015
|#SubscriberNotes have been updated on the website. Final rally? Probably, but patience is required in this bubble market.|
|David McWilliams | Punk Economics |
Wednesday, May 13, 2015
|#SubscriberNotes have been updated on the website. On track for some fireworks, both directions, in stocks and in bonds.|
|Reblogged from GreenTech Media:
The Energy Gang chats about how to make America a storage powerhouse.
Tesla’s new stationary storage units have everyone talking about distributed batteries. But is the U.S. market ready for them?
This week, we’ll talk about what needs to happen on a regulatory level to take distributed storage beyond the hype.
Sky Stanfield, an attorney representing the Interstate Renewable Energy Council, joins us to chat about proactive approaches to storage integration. We’ll also look at a new bill introduced in Congress that would implement best practices for interconnection nationwide -- and what it means for batteries and solar.
Then, we’ll look more specifically at the cost and applications of and reaction to Tesla’s new storage units.
We’ll end with a discussion on whether fracking wastewater can be economically used as a geothermal resource.
This podcast is sponsored by ReneSola, a Tier 1 solar cell and module manufacturer with a decade of experience in the cleantech industry.
The Energy Gang is produced by Greentechmedia.com. The show features weekly discussions between energy futurist Jigar Shah, energy policy expert Katherine Hamilton and Greentech Media Editor Stephen Lacey.
Tuesday, May 12, 2015
Monday, May 11, 2015
Sunday, May 10, 2015
Thursday, May 07, 2015
|#SubscriberNotes have been updated on the website. Our breadth indicators' buy signals yesterday were very timely today as the market rallied. When will this short term rally top out?|
|Last night, the Texas House of Representatives Criminal Jurisprudence Committee approved a bill that would end marijuana prohibition in the state by a vote of 5-2. HB 2165, introduced in March by Rep. David Simpson (R-Longview), would strike references to marijuana offenses from Texas statutes, resulting in marijuana being treated similarly to other legal crops.
Nearly three out of five Texas voters (58%) support making marijuana legal for adults and regulating it like alcohol, according to a statewide survey conducted by Public Policy Polling in September 2013.
Four states have adopted laws that regulate and tax marijuana similarly to alcohol. Two of them, Colorado and Washington, have established regulated systems of marijuana cultivation and sales. Alaska and Oregon are in the process of implementing similar systems.
Wednesday, May 06, 2015
|#SubscriberNotes have been updated on the website. A major opportunity in stocks and bonds. See today's Notes for details.|
Tuesday, May 05, 2015
Monday, May 04, 2015
|Electricity from the local utility in Hawaii is so expensive that customers can save money by cutting the cord. According to Siddharth Dalal, SolarCity Fires Warning Shot At Hawaii Utility: The Future Is Here:
As the Tesla Gigafactory progresses and prices drop further, it will make solar plus storage a very compelling solution. Any utilities making noises about eliminating net metering will soon have to face a behind-the-meter solution that will significantly reduce consumption from the utility and the utility will lose the solar power provided by the consumer.
It is a lose-lose proposition for the utility. For places like Hawaii, where power is very expensive and the utility was delaying solar connections to the grid, going off grid is now a viable proposition. Maybe they knew exactly what was coming when they approved all the delayed applications recently. Now SolarCity has fired their first warning shot directly at the Hawaiian utility inviting customers to go off grid starting next year.
Sunday, May 03, 2015
Friday, May 01, 2015
Thursday, April 30, 2015
Wednesday, April 29, 2015
|#SubscriberNotes have been updated on the website. The market takes no prisoners as bears have been having trouble getting the downtrend rolling.|
|Today's government report of First Quarter GDP growth should be taken with a large helping of salt. That's because the government has a horrible record at tracking the economy.
For instance, in 2008, with the economy a half-year into the worst recession since the Great Depression, the government reported the economy was growing at a +0.6% rate. After numerous revisions over the next 64 months, they finally decided that the economy was declining at a -2.7% rate!
That's why the government's report that the economy grew in the first quarter could just as easily be revised to a huge decline over the next 64 months. As it is, the government tells us that GDP was growing at a +0.25% rate. Garbage in, garbage out.
|Harry Dent calls it what it is in The Curse Of The 'Mini' Bubble: China's Period Of Worsening News.|
Tuesday, April 28, 2015
Monday, April 27, 2015
|By Ron Paul|
One of the great ironies of American politics is that most politicians who talk about helping the middle class support policies that, by expanding the welfare-warfare state, are harmful to middle-class Americans. Eliminating the welfare-warfare state would benefit middle-class Americans by freeing them from exorbitant federal taxes, including the Federal Reserve’s inflation tax.
Politicians serious about helping middle-class Americans should allow individuals to opt out of Social Security and Medicare by not having to pay payroll taxes if they agree to never accept federal retirement or health care benefits. Individuals are quite capable of meeting their own unique retirement and health care needs if the government stops forcing them into one-size-fits-all plans.
Middle-class families with college-age children would benefit if government got out of the student loan business. Government involvement in higher education is the main reason tuition is skyrocketing and so many Americans are graduating with huge student loan debts. College graduates entering the job market would certainly benefit if Congress stopped imposing destructive regulations and taxes on the economy.
Politicians who support an interventionist foreign policy are obviously not concerned with the harm inflicted on the middle-class populations of countries targeted for regime change. These politicians also disregard the harm US foreign policy inflicts on Americans. Middle- and working-class Americans, and their families, who join the military certainly suffer when they are maimed or killed fighting in unjust and unconstitutional wars. Our interventionist foreign policy also contributes to the high tax burden imposed on middle-class Americans.
Middle-class Americans also suffer from intrusions on their liberty and privacy, such as not being able to board an airplane unless they submit to invasive and humiliating searches. Even children and the physically disabled are not safe from the Transposition Security Administration. These assaults are justified by the threat of terrorism, a direct result of our interventionist foreign policy that fosters hatred and resentment of Americans.
Some “military Keynesians” claim that middle-class workers benefit from jobs in the military-industrial complex. Military Keynesians seem to think that the resources spent on militarism would disappear if the Pentagon’s budget were cut. The truth is, if we reduced spending on militarism, those currently employed by the military-industrial complex would be able to find new jobs producing goods desired by consumers. Even those currently employed as lobbyists for the military-industrial complex may be able to find useful work.
Few things would benefit the middle class more than ending the Federal Reserve. The Federal Reserve’s inflationary policies erode middle-class families’ standards of living while benefiting the financial and political elites. Middle-class Americans may gain some temporary benefits from Federal Reserve created booms, but they also suffer from the inevitable busts.
As I write this, the dollar still reigns as the world’s reserve currency. However, there are signs that other economies are moving away from using the dollar as the reserve currency, and this trend will accelerate as the Federal Reserve continues to pump more fiat currency into the economy and as resentment toward our foreign policy grows. Eventually, international investors will lose confidence in the US economy, the dollar will lose its reserve currency status, and the dollar bubble will burst.
These events will cause a major economic downturn that may even be worse than the Great Depression. The main victims of this crisis will be average Americans. The only way to avoid this calamity is for the American people to force Congress to free them from the burdens of the warfare state, the welfare state, taxation, and fiat currency.
Sunday, April 26, 2015
Saturday, April 25, 2015
|Some of the critical climate issues that need to be headed off within the next 20
to 30 years if massive impacts are to be avoided:|
Source: Safe Climate Restoration Scenarios
|The USA won't fall to terrorists. No, the USA is being destroyed from within by traitors in charge.
Don't believe it? Just read the latest report from MIT entitled “The Future Postponed: Why Declining Investment in Basic Research Threatens a U.S. Innovation Deficit" to be released Monday, April 27th.
|As we all know, the human race is delusional. We push asset prices in the stock market to the sky and never expect them to collapse. Yet, in the last 15 years, that has happened twice. Why would we expect the third time to avoid a collapse?
But, crashing stock markets are just a minor blip on the radar compared to Climate Change. The deniers have kept us from taking any meaningful action to avoid a collapse of life on this planet. It may be too late to avoid that collapse right now.
The politicians have set an unreasonable goal for warming—2°C above pre-industrial temperatures. That goal, which we are not on target to stay below, may actually be too high to avoid catastrophe. At the present time, with temperatures having warmed by just below 1°C so far, we are seeing Arctic ice gradually disappear, superstorms like Sandy hitting northern latitudes, seas rising and flooding coastal communities, and many more. The effects are obvious. They are facts, not debatable. Yet we have done nothing to stop Global Warming. It's as if we're in a car racing down the highway with no working brakes.
David Spratt makes it clear what action we should be taking:
The catastrophic and irreversible consequences of 2°C of warming demand a strong risk-management approach, with a low rate of failure. We should not take risks with the climate that we would not take with civil infrastructure.
Friday, April 24, 2015
Energy Gang podcast this week:
|The future is in capacitors, not batteries. By the time the Tesla Gigafactory is up and running, it will be obsolete.
The future will see capacitors replace batteries everywhere. A hint of what's coming is given by the fact that researchers at UCSD have tripled the capacity of graphene in Charged holes in graphene increase energy storage capacity:
Why 2 of U.S. Dollar's Recent Bottoms Have 1 Thing In Common
Register now, 100% free, and get instant access to 3 insight-packed introductory trading lessons.
Then each day through April 28 we will email you more free trading lessons that you can apply to your trading immediately.
Thursday, April 23, 2015
Wednesday, April 22, 2015
|#SubscriberNotes have been updated on the website. Bonds plunged today and boosted stocks, which is why we currently favor the third alternative.|
Tuesday, April 21, 2015
Monday, April 20, 2015
Sunday, April 19, 2015
Saturday, April 18, 2015
|Solar City is offering bonds with up to a 5¾% yield based upon solar energy. They write:
Solar Bonds are open to everyone. They offer attractive returns and you can invest directly with no fees. Best of all, you’re helping to support the growth of clean solar energy.It's yet another way to “Get Paid By the Sun.”
Thursday, April 16, 2015
Wednesday, April 15, 2015
|#SubscriberNotes have been updated on the website. Internal deterioration in the stock market at new all-time highs bodes ill.|
|Why are we back in recession? Professor Steve Keen explains what economists in general simply don't understand:|
Tuesday, April 14, 2015
By Elliott Wave International
Editor's note: This article is from Elliott Wave International's brand-new investment report, "U.S. Investors Face a Giant, Historic Bubble." It originally appeared in the April issue of The Elliott Wave Financial Forecast, published March 27, 2015. For a limited-time, EWI has agreed to give our readers exclusive free access to the full report. Please click here to read it now.
In March, we covered the return to a popular fascination with technology.
The striking resemblance to 2000's technology mania is not going unnoticed. How can it? With the NASDAQ's much heralded return to 5000 and magazine covers proclaiming "Google Wants You To Live Forever," concern about an "asset bubble" is being raised. But this is actually another throwback to early March 2000, when the NASDAQ reached its all-time high and the Financial Forecast remarked on a "public ambivalence toward warnings of any kind."
The March issue of The Elliott Wave Theorist explains that while people may remember some of the details, they "forget their prior mood and rationalize present extremes into normality."
This March 7 headline from a major financial paper offers a perfect example of how this "normalization" works: "Forget 2000. It's a Different Investing Ballgame." Really? Yeah, really. "It really is different this time," says another. "The crazy valuations seen at the turn of the millennium -- when silly concepts, such as collecting eyeballs, attracted billions of dollars from breathless speculators wanting to get in on the new, new thing -- are absent."
There's just one problem with this assessment, it's not accurate. Here's the reality, or should we say surreality, as depicted in Bloomberg on March 17:
The Fuzzy, Insane Math That's Creating
The article discloses how companies are shooting to "astronomical valuations," mostly with Internet ideas that capture people's bullish imaginations and, as in 2000, cause them to look beyond mundane things such as cash flow and profits. Once again, such stone-age metrics are less important than "the number of people using the product" and "whether they pay for it. Investors salivate over what's called 'hockey-stick' growth curves, indicating massive uptake. Costs, especially operations costs, are largely ignored."
As in 2000, the fever has been spreading fast. According to Bloomberg, start-ups with billion-dollar valuations were once dubbed "unicorns" because of their rarity. Now, Bloomberg counts more than 50 of them. Many have expanded ten-fold, so a new buzzword, "decacorn," now applies to those with capitalizations of more than "$10 billion, which includes Airbnb, Dropbox, Pinterest, Snapchat and Uber."
Of course, the driving force behind many of these investments is the same--a fear of missing out (FOMO).
"A severe case of FOMO can cause some to do crazy things to get into the hottest deals," says Bloomberg. This is exactly what the Financial Forecast said in March 2000, when we explained why people fail to heed ample warnings in the final throes of a mania: "Acting on such an opinion might mean missing something on the upside. 'The average person must ride it out,' says [a] Nobel Prize winner. Quotes such as these will deserve preservation in bronze when the bear market is mature." Clearly, that time still lies ahead.
For compelling Elliott wave evidence of a culmination of the Mania Era, see the five-wave advance in the share price of the current technology leader, Apple Inc., on page 3 of the March Elliott Wave Theorist. As the Theorist notes, after rising more than 14,500% over the past 12 years, S&P Dow Jones Indices added the stock to the Dow Jones Industrial Average on March 19.
This is one more remarkable parallel to the prior technology mania, as Microsoft was added to the Dow Industrials just prior to its January 2000 top. Here's how EWFF interpreted its addition in November 1999:
The ultimate concession to technology is due November 2, when Microsoft will be inducted into the Dow Jones Industrial Average. For most of the bull market, the world's most dominant stock was excluded from the world's premier blue-chip average. But just as RCA was added to the Dow in October 1928 (and removed in 1932), Microsoft has assumed its rightful place at the head of the pack, in time to lead the way down.
Apple has just been acknowledged in the same way and for the same reason. The pressure to pile onto the technology bandwagon has proved irresistible to the Dow's purveyors. This has generally happened when the most important stock market reversals were at hand.
Editor's note: This article is from Elliott Wave International's brand-new investment report, "U.S. Investors Face a Giant, Historic Bubble." It originally appeared in the April issue of The Elliott Wave Financial Forecast, published March 27, 2015. For a limited-time, EWI has agreed to give our readers exclusive free access to the full report. Please click here to read it now.
Monday, April 13, 2015
|The US economy is now firmly in recession despite what the TV Talking Heads tell us.
More evidence of this fact comes from the National Association of Credit Management (NACM), whose latest report reveals:
"We now know that the readings of last month were not a fluke or some temporary aberration that could be marked off as something related to the weather," said NACM Economist Chris Kuehl. "These readings are as low as they have been since the recession started and to see everything start to get back on track would take a substantial reversal at this stage."
|The global financial crisis of 2008 (GFC) is gearing up for another appearance. Get ready to hand the Too Big To Fail banks more of your hard-earned cash to compensate them for failure.
According to the Federal Reserve Bank, whose role as Big Daddy Warbucks protects the Little Orphan Annie banks from failure, the banks passed their latest stress test with flying colors. But, the Fed is making the same mistake it did last time and that's overcounting the value of derivatives. According to Thomas Hoenig, vice chairman of the Federal Deposit Insurance Corporation, and former Fed governor, capital at the TBTF banks averaged only 4.97% at the end of 2014. The Fed itself, however, calculates that capital level at 12.9%.
The difference is substantial. In fact, a similar discrepancy occured just before the GFC. The late Fed governor Edward Gramlich warned of a similar discrepancy of capital—and was ignored. Will history repeat itself? Maybe not. But it could certainly rhyme. Will the Congress bow down to the TBTF banks again? We suspect that the fury of the taxpayer will eliminate another bailout.
But, if the banks truly own the government, we should expect the same result, unfortunately.
Sunday, April 12, 2015
|The deal with Iran could drop prices by $5-15/bbl according to the US government agency EIA. That's according to notes in their Short Term Energy Outlook (STEO). They say: