Archive for August 2021
The Political Realities of the Taper
This past week, after the Federal Reserve’s Jackson Hole, Wyoming symposium, Fed Chair, Jerome Powell commented on Fed policy. It was widely anticipated that the Fed Chair would discuss the ‘taper’, or the Fed’s plan to slow the rate at which currency is being created. The Fed Chair, in many respects, disappointed. This is…
Read MoreIs a Stock Crash Imminent?
For more than a couple of years, I have been of the opinion that stocks have been overvalued. Over that time frame, except for early 2020, stocks have continued to rise. For the record, I don’t believe that this continued rise in stock prices invalidates my initial opinion about stock valuations; instead, it…
Read MoreThe Fed to Raise Interest Rates? I Wouldn’t Hold Your Breath
Many of the world’s central banks are beginning to raise interest rates in response to higher levels of inflation. The chart, from “Bloomberg”, shows which countries’ central banks have increased interest rates, cut interest rates, or left interest rates unchanged. The blue-shaded countries on the chart have not changed interest rate policy, the…
Read MoreFifty Years of Fiat
An important anniversary is approaching this week. Although it won’t be widely observed or likely even mentioned, it’s the anniversary of the event that led to current economic and investing conditions. This coming Sunday, August 15 will mark 50 years since the US Dollar became a fiat currency. On August 15, 1971, President…
Read MoreArtificial Economy and the Ultimate Outcome
For many years now, I have been commenting on how artificial the financial markets have become. Conditions that would have never existed a few, short years ago now exist and are explained away by many pundits as the “new normal” as if the basic laws of economics and finance have somehow recently changed. …
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