Aug 11

Wall Street Aristocracy Got $1.2 Trillion in Secret Fed Loans

by Bradley Keoun and Phil Kuntz | Bloomberg | August 22, 2011

Bernake Lying to Congress

Citigroup Inc. (C) and Bank of America Corp. (BAC) were the reigning champions of finance in 2006 as home prices peaked, leading the 10 biggest U.S. banks and brokerage firms to their best year ever with $104 billion of profits.

By 2008, the housing market’s collapse forced those companies to take more than six times as much, $669 billion, in emergency loans from the U.S. Federal Reserve. The loans dwarfed the $160 billion in public bailouts the top 10 got from the U.S. Treasury, yet until now the full amounts have remained secret.

Read the entire article

Jul 11

Well that didn’t take long

CNBC:  Bernanke: Fed May Launch New Round of Stimulus

Gold is hitting a new high on the news and silver is also rallying.

May 11

Unemployment back on the rise

The unemployment rate for April rose to 9.0% reversing the ever so slight down trend seen since November.  Of course, our friendly league of economic forecasters was expecting the number to hold at 8.8%.  The upside is 244,000 new jobs were created.  Unfortunately, 62,000 of them came from McDonald’s.

I guess the Fed & C0. were hoping that so many who left the workforce did not return to looking for a job.  The headline unemployment number does not include those that have given up looking for a job, nor those that have settled for part time work.  When including them, the real under/unemployment is closer to 22 or 23%.


May 11

Silver Update

Despite the recent significant correction in silver, the precious metal is still up over 25% this year.  Silver has led the commodity bull market over the past couple of years, significantly out-performing gold.  This sudden drop may be the beginning of a deflationary episode resulting from the Fed’s indication that QE2 will end in June.  However, I do believe that any deflation will soon result in falling asset prices across the board, including housing and equities, as well as an increase in long term interest rates and more struggles in the employment situation.  It is safe to say that the Fed will not allow that to go on for long.  The only question is not will, but when will QE3 begin.  In the mean time we can expect a consolidation in commodities over the coming months.

May 11

FOREX-U.S. economic data pushes dollar down vs euro, yen

by Steven C. Johnson | Reuters via Yahoo! | May 4, 2011

The dollar fell to a fresh three-year low on Wednesday and the euro briefly rose above $1.49 as weaker-than-expected U.S. employment data convinced investors that U.S. interest rates would remain low this year.

The yen also hit a six-week high against the dollar after data showed the pace of growth in the dominant U.S. services sector also slowed unexpectedly in April, another sign the U.S. economy may be hitting a soft patch.

With markets worried about a yawning U.S. budget deficit, traders said signs of slower growth will only add to trouble for the dollar, which fell to a three-year low against major currencies Wednesday. It has lost 7.7 percent in 2011.

“The dollar got beat up pretty badly against the euro,” said Firas Askari, head of foreign exchange trading at BMO Capital Markets. “The U.S. fiscal situation is a concern. Now it seems the U.S. economy isn’t just tepid but actually cooling off again. That’s not encouraging.”

Read the full article

Apr 11

Economic Update

For the week ending April 23, 429,000 people applied for new unemployment benefits.  This is a jump of 25,000 from the previous week.  It is the highest total since January.  The four-week average rose for the third straight time to 408,500.  Economists – you know, the ones like Ben Bernanke – expected claims to drop to 390,000. Continue reading →

Apr 11

Dollar continues its decline

The dollar index hit a 15 month low today.  Of course, that index is based on a basket of other “funny money” currencies.  Measure against gold and silver – real money for most of history – it is hitting historic lows.  Against gold it is at an all time low and a 31 year low against silver. Continue reading →

Apr 11

Inflation Actually Near 10% Using Older Measure

by John Melloy | CNBC | April 12, 2011

After former Federal Reserve Chairman Paul Volcker was appointed in 1979, the consumer price index surged into the double digits, causing the now revered Fed Chief to double the benchmark interest rate in order to break the back of inflation. Using the methodology in place at that time puts the CPI back near those levels. Continue reading →

Apr 11

The Nanny State Can’t Last

by Ron Paul | Campaign for Liberty | April 12, 2011

Last week, Congress and the administration refused to seriously consider the problem of government spending. Despite the fear-mongering, a government shutdown would not have been as bad as claimed.  Continue reading →

Apr 11

Oil near 2-1/2-year peak on Middle East, weak dollar

by Dmitry Zhdannikov | Reuters | April 6, 2011

Oil prices held near a 2-1/2 year peak on Wednesday, supported by unrest in the Middle East and North Africa and dollar weakness ahead of an expected European Central Bank interest rate increase. Continue reading →