Economy

The infographic below summarizes changes in economic indicators, relevant news stories, commodity and financial trends, and provides technical analysis. It is VERY informative.

Given the economic outlook, there seems little reason for stock prices to be as high as they are...This market could be called a "Madoff Market" in the sense that it is a Ponzi scheme, not the classic Ponzi scheme where exponential growth of new dupes is necessary to keep the scam going...but, rather, on exponential money creation. Fantasy is fun while it lasts but reality eventually intercedes and...[and it is] those way out in fantasy land [who] are especially vulnerable to disappointment [and] so it is for those betting on the stock market and an economic recovery. Let me discuss this further. Words: 1075

[The U.S. governments attempt to prevent the rating agencies (and Standard & Poor's in particular) from following through on their threats to further downgrade the credit worthiness of U. S. government debt] smacks of absolute desperation. It seems that Washington insiders have come to the conclusion that the stability of the U.S. government and financial system is threatened by the ratings agencies. In this case, it is threatened by creditors and citizens knowing the truth about the financial condition of the government.

How bad do things have to get before people realize that we are living through a nightmare? Sadly, most Americans still have faith in the system. They are still convinced that our politicians will somehow find a way to turn things around. Most Americans...[don't realize that] America is literally falling apart all around them. We have been living in the biggest debt bubble in the history of the world, and it is only a matter of time until it bursts. 2008 was just a "hiccup" compared to what is coming. I hope you're getting prepared to survive the economic horror show that is rapidly approaching. Words: 1310

There are literally thousands of economic blogs out there and most don't have much to offer. One exception is a blog by "Katchum" that is dedicated to monitoring breaking global economic news on a day to day basis and, as such, provides unique insights into, and analysis of, various aspects of the financial markets, commodities and the economies of the world. Below is his latest post. If you like it why not subscribe? Words: 642; Charts: 6

Never before in American history have we seen such a pitiful, pathetic, and anemic response to challenges and trials. We are truly a society of wimps. Spiritual wimps, devoid of any courage and conviction when it comes to speaking the truth, and milquetoast coelenterates for failing to look past our own materialism to accept the common truth that what we have been doing is simply not sustainable. You and me both. Let’s dig into the undeniable conclusions, shall we? Words: 1331; Charts: 3

Anybody who thinks the U.S. is in a so-called recovery isn’t listening to economist John Williams. He expects a negative reaction to the U.S. dollar in the next 3 or 4 months leading up to the mid-May deadline for Congress to get the budget and debt ceiling under control. If they do not get their financial house in order by then he believes "it will be the end of the road....as they are not going to have another opportunity".

Thanks to the endless barrage of feel-good propaganda that daily assaults the American mind the citizens have no idea how disastrous the country’s fiscal, monetary and economic problems truly are nor do they perceive the rapidly increasing risk of a totalitarian nightmare descending upon the American Republic. Below, we outline America’s troubling and compounding predicament, and urge you to think about how to protect yourself from its consequences, both financially and personally.

The price of gold, on a quarterly basis, is 86% correlated - yes, 86%! - to total government debt going back to 1975... and a shocking 98% over the past 15 years! [As such,] it would seem like a no-brainer investment thesis to buy gold... as a proxy for the not-otherwise-investable thesis that US total government debt will increase in the future. [But there is more - and it is disappointment for gold bugs - read on!]

[There is a major downside to] quantitative easing; it isn't free. There is a cost to the Fed's policy and the bill will be past due when the economy recovers and interest rates rise. Congress will then realize that the Federal Reserve System is the biggest financial black hole in the history of mankind [and that] the tab may be big enough to blow the Federal budget and plunge Washington into a new fiscal and political crisis. Words: 870