Posts Tagged ‘ interest rates ’
Everyone who has held a job and a bank account understands the potential benefit of postponing consumption today in order to enjoy greater consumption in the future. However, many people — if pressed — would explain this increase in saver’s income by an offsetting reduction in the income of a ...read more
Collateral Damage in the War on Depression
Mar 11th, 2010 | By Adrian Ash | Category: Featured, Gold
"Just allow it...just admit it. It doesn't matter where the inflation comes from. Just let it stay..."
SLASHING the Bank of England's base interest rate to an historic low of 0.5% was supposed to "rebalance" the economy...tipping it away from galloping consumption towards an export-led recovery.
But all that the Pound's slump ...read more
Gaming Imaginary Money
Mar 1st, 2010 | By Linda Brady Traynham | Category: Featured, Morning Whiskey
Tuesday the Fed auctioned off another $37 billion in 4-week T-bills. My first thought was that this is reminiscent of "payday loans" shops, except the rate of interest is far lower when the question is, "Buddy, can you spare $37 Bil' until next month?" but the mechanics were very interesting ...read more
Debt to GDP Ratios Indicate Governments Going Bankrupt
Nov 5th, 2009 | By Dan Denning | Category: Featured, Macro Economics
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
Inflation, Deflation and Reflation at Once
Oct 21st, 2009 | By Adrian Ash | Category: Featured, Gold, Macro Economics
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 Would that mean the laws of physics had been repealed?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
U.S. Dollar Retreating Against Commodities
Dec 24th, 2008 | By Dan Denning | Category: Featured, Gold, Macro Economics
Like a giant laxative in the world's monetary system, the Federal Reserve's quantitative easing is starting to have an effect. You wouldn't necessarily call it the desired effect. After all, we're talking about the eventual destruction of the U.S. dollar and the global monetary system upon which it's based. But ...read more
The Fed’s War on Cash
Dec 9th, 2008 | By Dan Denning | Category: Featured, Macro Economics, Politics
Markets are dithering their way to the end of the year. It doesn't look like much is happening. But some interesting things are going on. Pressure is building. For example, the dividend yield on the S&P 500 is 3.48%. The yield on a 30-year U.S. bond is 3.16%.
According to Mark ...read more
Gold Price Dip
Jun 30th, 2008 | By Adrian Ash | Category: Gold
It’s hard to be bullish on gold when there’s so much bad news in the world.
After all, gold offers a refuge against bad times ahead. Like all good insurance, it’s best bought before trouble arrives — not during or after.
And just how much worse can the news get from here?
1. ...read more
Central Bank Mistakes
May 27th, 2008 | By Adrian Ash | Category: Macro Economics
When Albert Hofmann — the Swiss chemist who discovered LSD — passed away at the start of this month, newspaper editors the world over reported it as the death of the man “who experienced the first ever bad trip.”
But Hofmann’s hallucinations seem little worse than most acid-induced visions. Or so ...read more
Focus on Currencies, Part II
Feb 13th, 2007 | By Michael Shedlock | Category: Currencies
Let's kick this section off with the question: What is the carry trade?
The answer comes from the San Francisco Fed in an article entitled, "Interest Rates, Carry Trades, and Exchange Rate Movements":
"What is the carry trade?
"In the most common version of this strategy, an investor borrows a given amount in ...read more

