Economy

The deterioration of the federal budget began in slow fashion over a year ago, and it's now become obvious. The deficit is still quite manageable but spending is firming while revenues are stagnating. The public sector is growing while the private sector struggles. Here are some updated charts that speak for themselves:

When numbers get into the billions or trillions, they start to lose context. The U.S. national debt is one of those numbers. It currently sits at $19.5 trillion, which is actually such a large number that it is truly difficult for the average person to comprehend so today’s data visualization plots the U.S. national debt against everything from the assets managed by the world’s largest money managers, to the annual value of gold production.

Trying to gauge where the economy is headed is almost always a waste of time. Instead, focus on the emotion and trend (price action); the trend is always your friend.

We're hurdling toward a massive financial crisis, and all we have to show for it are financial asset bubbles destined to burst, and when they do, they'll wipe out the artificial wealth they've created for many decades in just a few years, as they did from late 1929 into late 1932!

I believe it is too late to reverse the tidal wave of our financial system’s failure that has been brewing for three decades now. As such, in the next few weeks, an election event will take place that I believe could trigger major volatility ending in a market crash - a speculator implosion.

There is a strong belief that independent measures of inflation are false and not trustworthy. I address this issue and show how the rate of inflation is measured today, the historical background of it, and compare different methods to find out which one is closer to the truth.

Inflation does not reliably depend on employment so what other model could we depend on? Check out the model below that I have developed which strongly suggests core inflation has stabilized at around 2.2%.

Retail sales numbers for July came in at a disappointing 0.0% and, after backing out auto sales, retail sales actually declined by 0.3%. That's in spite of much lower gas prices and (supposedly) an improving job market so my guess is that American consumers are simply running into a brick wall of too much debt. This article suggests 9 companies that could prosper from such financially stressed-out consumers.

The Fed is considering raising its inflation target above 2% annually. This shift pushes the FOMC in a dovish direction and will reduce the market odds of interest rate hikes this year. It is positive news for the gold market.

Getting the inflation call right is one of the most important decisions an investor can make today. This article explains how the U.S. inflation outlook is becoming clearer with the use of a number of charts.