Everything we know about classic economic theory suggests the U.S. economy should be experiencing Zimbabwe-like hyperinflation right now, thanks to the nearly $2.2 trillion the U.S. Federal Reserve has pumped into the system. But we’re not…yet. Classic economic theory says that money supply can be used to stimulate the economy and our ...read more

Are the Western Welfare States (the U.S., Japan, and EU nations) really going bankrupt? Things were headed that way before the credit crisis began. The Global Financial Crisis may be becoming a sovereign debt crisis and that will worsen an already bad situation. First, let’s check out the chart below from ...read more

Earthlings are all convinced that a financial crisis of cosmic proportions befell the planet last fall. Had the authorities failed to act with determination and speed, it would have been the end of the world. In the popular mind the politicians have saved capitalism from its own excesses. Our views are ...read more

One of the most important things to remember about socialism – or coercion of any kind – is it fails eventually because human beings have an innate desire for liberty and a strong need for personal property rights. In fact, the origins of government lie in the need of agricultural ...read more

Many people write of the imminent destruction of the U.S. middle class (of which I consider myself a member) but few have explained specifically how this occurs. Understanding the mechanism seems important if I hope to avoid the fate of most of my peers. An insight on this question came from ...read more

Most money managers have misdiagnosed what’s currently driving the global economy. The multiple that investors are willing to pay for next year’s earnings means more than any sentiment polling. The forward P/E multiple on the broad stock market is not nearly as high as it was during the Internet bubble, but ...read more

"He who goes a-borrowing, goes a-sorrowing." The quote comes from Ben Franklin. But it was recalled to us neither by America's president, nor Britain's Prime Minister. Instead, the Telegraph in London reported it from the mouth of Cheng Siwei, a "top member of the Communist hierarchy." What goes around comes around. The ...read more

Just imagine – two things you think can't possibly happen together suddenly happen together. Say like Coca Cola re-launches New Coke, but people actually like it. Would that mean the laws of physics had been repealed? Or would you need to change what you think...? "Gold and bonds do not usually go ...read more

“Recovery is here!” the Pollyannas shout. “This is the first sign. And soon all nations will be following with their rate increases.” They talking, of course, about the Australians decision to hike their central bank index rate. And instantly the howls of recovery were on the lips of all the pundits. But ...read more

Those people who have saved for the future could soon form our own generation of bankrupted, Babushka pensioners... Twenty-five years ago the Russians found themselves in a hole. They had an official price for petrol (gasoline) of 1 ruble. But the cost of providing it, for example by buying it on world ...read more