Keyword: deflation

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  • Oil Is On 'An Incessant March Downwards'

    12/10/2014 5:06:02 AM PST · by blam · 57 replies
    BI - Reuters ^ | 12-10-2014 | Adam Rose
    Adam Rose, Reuters December 10, 2014 Brent crude remained above $66 barrel on Wednesday, after resuming its drift downward amid a glut of oil on the market, following a short-lived reprieve the previous day when a weaker dollar had provided some support to prices. Worries about oversupply have pushed Brent down 40% since June. "Notwithstanding day-to-day movements, the fundamental picture hasn't really changed, and that is one of supply outstripping demand growth for most of the year," said Phin Ziebell, a senior analyst at National Australia Bank. "It's an incessant march downwards, and it would be interesting to see where...
  • ECB paralyzed by split as irreversible deflation trap draws closer

    12/05/2014 6:07:09 PM PST · by Lorianne · 8 replies
    Telegraph (UK) ^ | Ambrose Evans Pritchard
    The European Central Bank has dashed hopes for quantitative easing this year and acknowledged for the first time that the institution’s elite board is split on plans for a €1 trillion liquidity blitz. Equity markets fell across southern Europe,with Italy’s MIB off 2.77pc, led by sharp falls in bank stocks. Spain’s IBEX dropped 2.35pc. The euro surged by more than 1pc to $1.2455 against the dollar in early trading as speculators rushed to cover short positions. Expectations for immediate stimulus had been riding high after the ECB’s president, Mario Draghi, pledged action “as fast as possible” last month. The bank...
  • GOLD! (Exploding Higher $1219 Oz)

    12/01/2014 10:59:53 AM PST · by blam · 17 replies
    BI ^ | 12-1-2014 | Myles Udland
    Myles Udland December 1, 2014 Gold is exploding higher. In afternoon trade on Monday, gold futures were up better than 3.5% in the last 24 hours to around $1,215 an ounce, moving back above $1,200 for the first time in more than a week. The spike in gold reverses a plunge in gold late last week that was continued on Sunday night as the futures market re-opened after voters in Switzerland rejected a measure that would have required the Swiss National Bank to increase its gold holdings from 8% to 20%. Oil, which also got crushed last week, is also...
  • Gold Surges Over $50 Off Overnight Lows; Commodities Bouncing As Dollar Weakens

    12/01/2014 7:05:44 AM PST · by blam · 12 replies
    Zero Hedge ^ | 12-1-2014 | Tyler Durden
    Tyler Durden 12/01/2014After last night's big flush across commodities, they have rallied notably. Gold is now up over $50 from those lows, with Silver, copper, and even crude bouncing hard (after testing below $64 overnight). The USD is notably weaker, stocks lower, and bond yields testing mid-October flash-crash Bullard lows...(snip)
  • Deflation Is Going To Cause A Scary New Kind Of Debt Crisis

    12/01/2014 6:37:55 AM PST · by blam · 19 replies
    BI - Money Week ^ | 12-1-2014 | Merryn Somerset Webb
    Merryn Somerset WebbDecember 1, 2014 Russell Napier is a financial historian and the founder of ERIC, an online research firm that aims at connecting analysts and investors. Here he talks to Merryn Somerset Webb about the next deflationary bust – why it’s coming, what it means for you, and how you can survive it. Merryn Somerset Webb: Let’s start at the beginning. You are a firm believer, as I understand it, in the idea that we live in a deflationary environment and there’s almost nothing that central banks can do to change that. So, maybe talk a little bit about...

    11/30/2014 5:02:41 PM PST · by blam · 100 replies
    BI ^ | 11-30-2014 | Myles Udland
    Myles Udland November 30, 2014 On Sunday night, gold was down more than 4% to as low as $1,143 an ounce after voters in Switzerland on Sunday rejected a measure that would have required the Swiss National Bank to increase its gold reserves from 8% to 20% of its holdings. The vote failed by a margin of 78%-22%. In addition the drop in gold, crude oil prices are resuming their tumble, and the price of other precious metals — silver and platinum — were also down sharply. Silver futures were down 12% early Sunday night and platinum futures were down...
  • OIL KEEPS PLUNGING ($66.15 Bl)

    11/29/2014 6:49:24 AM PST · by blam · 109 replies
    BI ^ | 11-29-2014 | Myles Udland
    Myles Udland November 28, 2014Oil is still falling. In afternoon trade on Friday, West Texas Intermediate crude prices in the US dropped more than 10% to settle at $66.15 a barrel, a more than $7.50 drop in just 24 hours. At one point on Friday, WTI futures briefly breached $66. Brent crude prices, which are the global benchmark, also cracked $70 a barrel on Friday. Earlier this week, WTI prices were at around $76 and Brent prices were near $80. (snip)(snip)

    11/28/2014 7:01:49 AM PST · by blam · 26 replies
    BI ^ | 11-28-2014 | Mike Bird
    Mike Bird November 28, 2014 Eurozone inflation figures just released put the rate at 0.3% in November, down from October's 0.4% and in line with estimates. With the recent impact of oil prices, that means deflation isn't just a possibility for the eurozone: markets are now suggesting it's the most likely outcome in a few months' time. Analysts had forecast that that the rate would come in at 0.3% again, though some suggested it could fall as low as 02% The ECB currently targets 2% inflation, but that target was last reached in the summer of 2012. These numbers increase...
  • Falling inflation a worry for Europe but also the world

    11/23/2014 6:55:14 PM PST · by Tolerance Sucks Rocks · 60 replies
    Reuters ^ | November 23, 2014 | Ross Finley
    (Reuters) - European Central Bank President Mario Draghi has moved closer to launching sovereign debt purchases and data this week will show just how dangerously low inflation has fallen in the $13 trillion euro zone economy. A sickly Europe has held back global economic growth for years, and now it is contributing significantly to powerful forces already dragging down inflation across the globe. A spectacular drop in crude oil prices over the past month will be the center of discussion when ministers from the world's top oil exporters meets in Vienna on Friday.
  • What Are The Odds In 2015: Inflation Or Deflation?

    11/13/2014 12:04:54 PM PST · by blam · 11 replies
    TMO ^ | 11-13-2014 | TCE
    The Cultural Economist Nov 13, 2014 TCE ( The Cultural Economist) writes: Like other Central Banks, the U. S. Federal Reserve has “printed” copious quantities of money. Despite better GDP numbers and positive media commentary, much of the American economy continues to be lethargic. The Eurozone appears increasingly vulnerable to recession. Financial and geopolitical risks could derail economic growth. What are the long term trends that will shape the outcome? The Case for Inflation Oil As I have documented several times, the rate of inflation is sensitive to the price we pay for a barrel of oil. Political turmoil in...
  • ECB ready to pump €1 trillion into euro zone economy

    11/07/2014 3:51:45 PM PST · by TigerLikesRooster · 16 replies
    Irish Times ^ | Fri, Nov 7, 2014
    ECB ready to pump €1 trillion into euro zone economy Central bank ramps up efforts to rescue single currency bloc from deflation risk The European Central Bank is ready to inject up to €1 trillion of new liquidity into the euro zone economy as it ramps up efforts to rescue the single currency bloc from the risk of Japanese-style deflation, Mario Draghi confirmed yesterday. The ECB president also said the central bank’s governing council was unanimous in its commitment to use further unconventional tools, including quantitative easing, should economic conditions deteriorate. He added that the central bank had stepped up...
  • Gold Price Falls, Stocks Record Highs As Japan Goes ‘Weimar’

    10/31/2014 5:52:01 PM PDT · by blam · 30 replies
    The Market Oracle ^ | 10-31-2014 | Gold Core
    Gold Core October 31, 2014 Stocks globally surged, while gold fell sharply today despite renewed hopes that the Bank of Japan’s vastly increasing money printing will fill some of the gaps left by the apparent end of Federal Reserve bond buying. The BOJ decided to increase the pace at which it expands base money to a whopping 80 trillion yen ($726 billion) per year. Previously, the BOJ targeted an annual increase of 60 to 70 trillion yen. The BOJ sailed into deeper uncharted monetary territory with the announcement that they would triple annual purchases of exchange-traded funds (ETFs) and Japanese...
  • Japan's central bank shocks markets with more easing as inflation slows

    10/31/2014 6:39:04 AM PDT · by TigerLikesRooster · 1 replies
    Reuters ^ | Oct 31, 2014 | Leika Kihara and Tetsushi Kajimoto
    Japan's central bank shocks markets with more easing as inflation slows By Leika Kihara and Tetsushi Kajimoto TOKYO Fri Oct 31, 2014 10:47am GMT (Reuters) - The Bank of Japan shocked global financial markets on Friday by expanding its massive stimulus spending in a stark admission that economic growth and inflation have not picked up as much as expected after a sales tax hike in April. BOJ Governor Haruhiko Kuroda portrayed the board's tightly-split decision to buy more assets as a preemptive strike to keep policy on track, rather than an admission that his plan to reflate the long moribund-economy...
  • The dangers of deflation The pendulum swings to the pit

    10/23/2014 10:43:12 AM PDT · by expat_panama · 89 replies
    The Economist ^ | Oct 25th 2014 | [editors]
    [snip]The lowflation of being consistently below an already low target is bad in itself; the deflation it could easy lead to is even worse. There are several reasons. The belief that money made tomorrow will be worth less than money today stymies investment; the belief that goods bought tomorrow will be cheaper than goods bought today chokes consumption. Central bankers can no longer set real (that is, inflation-adjusted) interest rates low enough to restore demand. Wages, incomes and tax revenue all stall, undermining the ability of households, businesses and governments to pay their debts—debts which, in real terms, will grow...
  • EU's triple whammy: Recession, deflation, and debt

    10/16/2014 7:34:02 AM PDT · by SeekAndFind · 5 replies
    American Thinker ^ | 10/16/2014 | Rick Moran
    Here we go again. Another sovereign debt crisis on the periphery of the EU is underway and many of the same factors that led to previous debt meltdowns are present. Germany is headed for a triple dip recession. Continent-wide deflation is nearly a reality. And many EU nations are smashing the debt limits demanded by treaty, thus threatening the Euro itself. All of this is impacting the percentage of debt in relation to GDP in several countries, making government bonds more expensive and debt servicing a nightmare. The Hill: Among Europe's most recent economic tremors has been the growing evidence...
  • Dam breaks in Europe as deflation fears wash over ECB rhetoric

    10/11/2014 4:43:05 PM PDT · by Chgogal · 39 replies
    The Telegraph (UK) ^ | October 10, 2014 | Ambrose Evans-Pritchard
    'We are reaching the end game in Europe. If they don’t launch real QE soon, the consequences are too awful to contemplate,' warns RBS. A key gauge of deflation risk in Europe is flashing red, dropping to record lows on fears of fresh recession and lack of decisive action by the European Central Bank. The sudden lurch downwards came as Bank of America warned that France’s debt ratio could rocket to 120pc of GDP within five years, unless the EU authorities take radical steps to reflate the region’s economy. Italy’s debt could threaten 150pc even earlier. The 5-year/5-year forward swap...
  • ALBERT EDWARDS: A $1,000 For A Wicker Basket? Sell Everything And Run For Your Lives!

    10/09/2014 7:01:06 AM PDT · by blam · 15 replies
    BI ^ | 10-9-2014 | Myles Udland
    Myles UdlandOctober 9, 2014Uber-bear Albert Edwards, a strategist at Societe Generale, is out with a new note to clients about market tops and expensive baskets. Edwards highlights the following comment from this weekend's Financial Times that said the following: Sir: The next financial apocalypse is imminent. I know this to be true because the (FT Weekend) House and Home section is now assuming the epic proportions last seen before the great crash. Twenty four pages chock full of adverts for mansions and wicker tea trays for $1,000. You’re all mad. Sell everything and run for your lives.(snip)
  • Will Gold Crash With The Dow... Or Soar?

    10/06/2014 8:01:10 PM PDT · by blam · 44 replies
    Zero Hedge ^ | 10-6-2014 | Tyler Durden
    Tyler Durden 10/06/2014 In 2008, we projected that the crash in the market was in fact a mini-crash and that the day would come when a more major crash would occur - one that reflected the level of debt. In recent months, this prognostication has been gaining traction - that a second, more severe crash is inevitable. There are two primary camps amongst economists with regard to the economic direction that a crash will generate: inflationists and deflationists. Inflationists tend to feel that the governments of the world that are now in debt over their heads will do what governments...
  • A New Interest Rates Record Is Set... And It Is Foreboding

    08/17/2014 9:08:33 PM PDT · by blam · 20 replies
    Market Oeracle ^ | 8-17-2014 | Daily Wealth
    August 17, 2014 DailyWealth Dr. Steve Sjuggerud writes: A new record was set in Germany yesterday... The interest rate on a 10-year government bond in Germany fell below 1%. This number is shocking... Interest rates have never been this low in German history. What does it mean? Why would people agree to lend money to a government for 10 years with almost no return on that money? What is the message that we should take from this? Aren't things supposed to be getting back to "normal"? And doesn't "normal" mean something like this: By 2020, the Federal Reserve has short-term...
  • Negative Nominal Interest Rates: Highway to a Cashless, Statist Hell

    06/26/2014 10:26:02 PM PDT · by GraceG · 13 replies ^ | 06-26-2014 | Ann Barnhardt
    I warned about this in part two of my 2.5 hour Economics Video Presentation back in November of ARSH 2012, and, sure enough, it has now happened. Because, as I have been saying all along, for anyone who knows ANYTHING about ANYTHING having to do with economics, finance and/or banking, and who does not have their brain bucket completely and firmly inserted up their rectal vault, it is obvious what is happening and how the chain of events will unfold. If a mouthy broad with a mere bachelor’s degree in animal husbandry from a land-grant university can see this stuff...
  • Kyle Bass On China's "Contraction" And "The Fed's Worst Nightmare"

    05/27/2014 6:18:45 AM PDT · by blam · 5 replies
    Zero Hedge ^ | 5-27-2014 | Tyler Durden
    Tyler Durden 05/26/2014 For the last several years, nobody has been more outspokenly bearish on Japan than Kyle Bass. In a recent talk, Bass reiterated his doubts about Japan’s chances of averting a debt crisis. What’s more, he also said China’s economy will fall below expectations. Bass changed one aspect of his outlook on Japan. Instead of predicting a collapse of the Japanese bond market, he focused on a severe weakening of the yen – without predicting when that might happen. His predictions for China were equally distressing. He said that its banks will be saddled with non-performing loans and...
  • Weapon of Last Resort: ECB Considers Possible Deflation Measures (European Central Bank)

    04/23/2014 7:01:40 PM PDT · by Olog-hai · 1 replies
    Der Spiegel ^ | April 23, 2014 – 06:18 PM | Christian Reiermann and Anne Seith
    One of European Central Bank President Mario Draghi’s most important duties is watching his mouth. One ill-considered utterance is enough to sow panic on the financial markets. But during a press conference earlier this month, Draghi allowed himself a telling slip. Speaking to gathered journalists at the Spring Meetings of the International Monetary Fund and the World Bank, Draghi twice almost uttered a word he has been at pains to avoid. “Defla…”, Draghi began, before stopping himself and continuing with the term “low inflation.”Yet despite Draghi’s efforts, the specter of deflation was omnipresent in Washington during the meetings. And it...
  • Deflating the Deflation Myth

    04/02/2014 3:55:29 PM PDT · by BfloGuy · 28 replies
    The Mises Institute ^ | 4/2/2014 | Chris Casey
    The fear of deflation serves as the theoretical justification of every inflationary action taken by the Federal Reserve and central banks around the world. It is why the Federal Reserve targets a price inflation rate of 2 percent, and not 0 percent. It is in large part why the Federal Reserve has more than quadrupled the money supply since August 2008. And it is, remarkably, a great myth, for there is nothing inherently dangerous or damaging about deflation. Deflation is feared not only by the followers of Milton Friedman (those from the so-called Monetarist or Chicago School of economics), but...
  • Harry Dent Video

    03/22/2014 11:05:18 AM PDT · by Arthur McGowan · 10 replies
    Harry Dent Video ^ | March 22, 2014 | Harry Dent
    Harry Dent predicts mild inflation, then massive deflation, then mild inflation.
  • Eurozone in Deflation; Monetarist Mouthpieces Will Scream

    03/01/2014 11:36:11 AM PST · by Kaslin · 12 replies ^ | March 1, 2014 | Mike Shedlock
    Forget all the talk about CPI or as they call it in Europe HIPC (harmonized index of consumer prices) floating just under 1%. The true measure of inflation is credit expansion. And for the second month, credit contracted in the Eurozone. Reuters reports Euro zone lending contraction compounds ECB headache. Lending to households and firms in the euro zone fell again in January and money supply growth remained subdued, adding to pressure on the European Central Bank to take action next week to support the economy. The ECB has cut interest rates to a record low, pumped extra liquidity into...
  • Deflation Theory Reality Check and the "Feel Good Effect"

    02/13/2014 10:11:48 AM PST · by Kaslin · 3 replies ^ | February 13, 2014 | Mike Shedlock
    If you repeat something completely inane enough times, do people, even economic writers, believe it?
  • A 'tsunami' of store closings expected to hit retail

    01/22/2014 1:59:17 PM PST · by EBH · 99 replies
    CNBC ^ | 1/22/2014 | Krystina Gustafson
    Get ready for the next era in retail—one that will be characterized by far fewer shops and smaller stores. On Tuesday, Sears said that it will shutter its flagship store in downtown Chicago in April. It's the latest of about 300 store closures in the U.S. that Sears has made since 2010. The news follows announcements earlier this month of multiple store closings from major department stores J.C. Penney and Macy's. Further signs of cuts in the industry came Wednesday, when Target said that it will eliminate 475 jobs worldwide, including some at its Minnesota headquarters, and not fill 700...
  • Coming 'oil glut' may push global economy into deflation

    01/18/2014 10:12:50 AM PST · by Kennard · 63 replies
    The Telegraph (UK) ^ | 8:52PM GMT 15 Jan 2014 | Ambrose Evans-Pritchard
    One piece of the jigsaw puzzle is missing to complete the deflation landscape across the West: a slide in oil prices. This is becoming more likely each month. Turmoil across the Middle East and parts of Africa has choked supply over the past two years, keeping Brent crude near $110 a barrel despite a broader commodity slump. Cotton and corn prices have halved, as has the UBS index of industrial metals. Such anomalies rarely last. "We estimate that crude oil is now the mostly richly priced commodity in the world," says Deutsche Bank in a fresh report. Michael Lewis, the...
  • Gold’s Real Problem: Deflation

    12/26/2013 6:31:56 AM PST · by SeekAndFind · 13 replies
    Barrons ^ | 12/26/2013 | Brendan Conway
    Forget the Federal Reserve — the real threat to gold’s price is deflation.That’s the argument over at Societe Generale this morning. No, not runaway, Depression-style deflation — but rather the threat of a stubborn resilience in the value of major currencies, which would be a clear negative for an “alternative currency” like gold. It would happen on account of investors’ unwillingness to behave like they usually do in economic normalcy. It would also happen as a result of stocks’ surging prices. At minimum, a lack of inflationary pressure of the sort investors are seeing lately, and may well see...
  • Fed could set off year-end fireworks

    12/17/2013 4:26:01 AM PST · by Lucky9teen · 16 replies
    Reuters ^ | Sun Dec 15, 2013 2:09pm EST | By Jonathan Spicer
    (Reuters) - The possibility that the Federal Reserve could finally start to trim its extraordinary stimulus for the economy could make this week an explosive one for financial markets. Though the odds still point to no major policy change when U.S. central bankers meet December 17-18, most of the recent domestic economic data suggest the beginning of the end of their massive bond-buying program is coming sooner than later. If it acts it may reflect as much a growth in confidence in the global economy, for whom the withdrawal of the flow of cheap dollars will be a shock, as...
  • Deceleration Nation: Declining Real Income, Homeownership, Labor Force Participation And Velocity

    12/02/2013 5:08:38 PM PST · by whitedog57 · 10 replies
    Confounded Interest ^ | 12/02/2013 | Anthony B. Sanders
    Several economic indicators for the US show deceleration. Yet the stock market and house prices continue to grow. Here is a chart of three economic indicators with clear downward momentum: civilian labor force participation (blue), the US homeownership rate (red) and real median household income (green). homessss And Goldman Sachs just downgraded Q4 2013 real GDP growth to 1.3%. These downward indicators compliment the declining M1 Money Multiplier and M2 Money Velocity. m1m2vel120213 Why? There are enormous excess reserves in the Fed system that aren’t leaking out to Main Street. And The Fed’s Balance sheet has exploded! (in terms of...
  • Bernanke Wants 2% Inflation in a Deflationary World (Long article)

    09/20/2013 9:55:10 AM PDT · by Kaslin · 9 replies ^ | September 20, 2013 | Mike Shedlock
    Steen Jakobsen, Chief economist at Saxo Bank in Denmark, pinged me today with his thoughts on "the morning after" and "price discovery". In my opinion these two paragraphs of the FOMC Statement are the key ones: The Committee sees the downside risks to the outlook for the economy and the labor market as having diminished, on net, since last fall, but the tightening of financial conditions observed in recent months, if sustained, could slow the pace of improvement in the economy and labor market. The Committee recognizes that inflation persistently below its 2 percent objective could pose risks to economic...
  • The Bernanke Fed Is Playing With Deflationary Fire

    06/26/2013 8:42:19 AM PDT · by blam · 18 replies
    The Telegraph (UK) ^ | 6-26-2013 | Ambrose Evans-Pritchard
    The Bernanke Fed Is Playing With Deflationary Fire By Ambrose Evans-Pritchard June 24th, 2013 I hope the Fed knows what it is doing. It has chosen to tighten monetary policy even though core PCE inflation is actually lower right now than it was when the Fed previously thought it dangerous enough to launch further QE. America is one shock away from a slide into outright deflation, and the eurozone is half a shock away. Anyone who still thinks the Fed has not just tightened significantly – or that markets have overreacted – should read this lament by St Louis Fed...
  • Ben Bernanke Has Burst The 'Euphoria' Bubble

    06/26/2013 8:14:28 AM PDT · by blam · 6 replies
    Business Insider ^ | 6-26-2013 | Walter Kurtz, Sober Look
    Ben Bernanke Has Burst The 'Euphoria' Bubble Walter Kurtz, Sober LookJune 26,2013Credit Suisse Risk Appetite Index Sober Look ď‚ž The last time we discussed the Credit Suisse Global Risk Appetite Index, it was headed for "euphoria" (see this post from May 21). Around May 22 something changed, and it was all downhill from there. It was Bernanke's first hawkish statement. May 22; Bernanke: - WeÂ’re trying to make an assessment of whether or not we have seen real and sustainable progress in the labor market outlook. If we see continued improvement and we have confidence that that is going to...
  • A Whole New Group Of People Is Going To Start Worrying About The Gold Crash

    06/26/2013 7:56:28 AM PDT · by blam · 30 replies
    Business Insider ^ | 6-26-2013 | Joe Weisenthal
    A Whole New Group Of People Is Going To Start Worrying About The Gold Crash Jow WeisenthalJune 26, 2013, 5:26 AMBack in the day, a few years ago, when gold was soaring, anti-Fed types saw this as indication that Bernanke was blowing bubbles and creating hyperinflation. Of course, the price of gold is just the price of gold, but it didn't stop people from making bold statements about how gold was "voting" against Fed policy so to speak. Well now gold is totally crashing. At the start of April it was near $1600/oz. This morning it's not much above $1200/oz....
  • The Deflationist Error

    06/24/2013 9:47:17 AM PDT · by blam · 9 replies
    The Market Oracle ^ | 6-24-2013 | Alasdair Macleod
    The Deflationist Error Economics / Deflation June 24, 2013 - 05:52 PM GMT By: Alasdair Macleod Many people believe there is a significant risk that the Irving Fisher debt-deflation theory of great depressions is still an economic threat today. They overlook the fact that Fisher published his theory examining debt-deflation events under a gold standard, which does not apply today. Financial credit contractions therefore take a different appearance. The events he described arose as a consequence of the earlier expansion of bank credit in a fractional reserve system when the currency being used was convertible into gold. This was the...
  • We Are Witnessing A Rare Across-The-Board Selloff In The Global Markets

    06/20/2013 6:39:33 AM PDT · by blam · 34 replies
    Business Insider ^ | 6-20-2013 | Sam Ro
    We Are Witnessing A Rare Across-The-Board Selloff In The Global Markets Sam Ro June 20, 2013 Usually, when one asset class sells off, another rises. And when a lot of asset classes fall, the so-called "safe havens" will rise. These include things like U.S. Treasuries, gold, and a handful of other currencies like the Swiss Franc or Japanese Yen. However, everything is selling off right now. "Rare to see every futures market I follow down," tweeted bond trader Ed Bradford. Here's a look at a bunch of futures via FinViz.
  • It's A Mistake To Worry About Inflation

    06/08/2013 1:37:51 PM PDT · by blam · 63 replies
    It's A Mistake To Worry About Inflation Kenneth Rogoff, Project Syndicate June 8, 2013, 3:30 PM CAMBRIDGE – The world’s major central banks continue to express concern about inflationary spillover from their recession-fighting efforts. That is a mistake. Weighed against the political, social, and economic risks of continued slow growth after a once-in-a-century financial crisis, a sustained burst of moderate inflation is not something to worry about. On the contrary, in most regions, it should be embraced. Perhaps the case for moderate inflation (say, 4-6% annually) is not so compelling as it was at the outset of the crisis, when...
  • Deflation Smackdown: Bernanke’s Madcap Money Printing Fails To Boost Inflation

    06/03/2013 7:00:24 AM PDT · by blam · 10 replies
    TMO ^ | 6-3-2013 | Mike Whitney
    Deflation Smackdown: Bernanke’s Madcap Money Printing Fails To Boost Inflation Economics / Deflation Jun 03, 2013 - 02:25 PM GMT By: Mike Whitney “Under a fiat money system, a government… should always be able to generate increased nominal spending and inflation, even when the short-term nominal interest rate is at zero.” Ben S. Bernanke, “Deflation: Making Sure It Doesn’t Happen Here”, November, 2002" The US economy is in a liquidity trap which means that the demand for credit is weak even though the Fed is increasing the monetary base (via the creation of reserves at the banks) and interest rates...
  • Lowest Core PCE in History; "Flation" Perspective

    06/02/2013 3:55:03 AM PDT · by Kaslin · 20 replies ^ | June 2, 2013 | Mike Shedlock
    Doug Short at Advisor Perspectives has a pair of interesting reports on price inflation as measured by the CPE and PCI. Please consider PCE Price Index Update: Sorry Fed, The Disinflationary Trend Continues. The latest Headline PCE price index year-over-year (YoY) rate of 0.74% is a decrease from last month's adjusted 1.01%. The Core PCE index of 1.05% is decrease from the previous month's adjusted 1.17%. It is the lowest Core PCE ever recorded; the previous all-time low was 1.06% in March 1963, fifty years ago. The continuing disinflationary trend in core PCE (the blue line in the charts below)...
  • Will It Be Inflation Or Deflation? The Answer May Surprise You

    05/23/2013 9:13:00 AM PDT · by blam · 28 replies
    TEC ^ | 5-23-3013 | Michael Snyder
    Will It Be Inflation Or Deflation? The Answer May Surprise You By Michael Snyder May 22nd, 2013 Inflation Or DeflationIs the coming financial collapse going to be inflationary or deflationary? Are we headed for rampant inflation or crippling deflation? This is a subject that is hotly debated by economists all over the country. Some insist that the wild money printing that the Federal Reserve is doing combined with out of control government spending will eventually result in hyperinflation. Others point to all of the deflationary factors in our economy and argue that we will experience tremendous deflation when the bubble...
  • MORGAN STANLEY: And Now It's Time To Worry About Deflation Again

    05/19/2013 6:56:44 AM PDT · by blam · 21 replies
    TBI ^ | 5-19-2013 | Joe Weisenthal
    MORGAN STANLEY: And Now It's Time To Worry About Deflation Again Joe Weisenthal May 19, 2013, 7:04 AMWe were just talking about how the wrongest prediction of the past 5 years was the call for "inflation" or "hyperinflation" due to aggressive monetary easing. In his latest US Macro Dashboard note, Morgan Stanley economist Vincent Reinhart points out that the real story now is the return of deflation risk. With evidence building that the Q2 soft patch is upon us, worrisome chatter about deflation is taking center stage. Our outlook for some time has been that mounting fiscal drag would show...
  • The Case Against Economic Deflation

    05/07/2013 10:42:39 AM PDT · by blam · 3 replies
    The Market Oracle | 5-7-2013 | Alasdair Macleod
    The Case Against Economic Deflation Economics / DeflationMay 06, 2013 - 06:54 PM GMT By: Alasdair Macleod Regular readers will know I am in the inflation, possibly hyperinflation camp; but there are those that think the future is more likely to be deflationary. In the main this is the view of neoclassical economists, Keynesians and monetarists, who generally foresee a 1930s-style slump unless the economy is stimulated out of it. Rather than repeatedly go into the errors of their ways, we must accept that they are in charge. They have decided that prices must not fall, and they see moderate...
  • The Theory Of Deflation

    04/23/2013 10:15:23 AM PDT · by blam · 8 replies
    The Market Oracle ^ | 4-23-2013 | Andrew McKillop
    The Theory Of Deflation Economics / DeflationApr 23, 2013 - 06:13 AM GMT By: Andrew McKillop CLASSIC THEORIES This holds that deficiency of aggregate demand leads to over-production and unemployment, further depressing demand, and deflating the economy. By aggregate demand, this means personal and business as well as State consumption spending, and aggregate investment expenditure. Staying with classic theories, private investment is governed by the marginal efficiency of capital and the real rate of interest. Deflation will occur when investment declines, for three main reasons, which are low marginal efficiency of capital, low profitability of capital and high real rates...
  • United States Decaying From Within! Stocks, Gold and Dollar Outlook

    04/21/2013 8:57:21 PM PDT · by blam · 23 replies
    The Market Oracle ^ | 4-21-2013 | Robert M Williams
    United States Decaying From Within! Stocks, Gold and Dollar Outlook Stock-Markets / Financial Markets 2013April 21, 2013 - 06:58 PM GMT By: Robert M Williams No one seemed to notice or care that on June 28, 2012 the City of Stockton, California filed a petition for chapter 9 bankruptcy protection with the United States Bankruptcy Court, Eastern District of California, Sacramento, Case No. 2012-32118. On Monday, April 1, 2013, a federal judge ruled that Stockton was eligible for bankruptcy protection, over the objection of creditors who argued the city could come up with more money. U.S. Bankruptcy Judge Christopher Klein...
  • Is Bernanke’s Worst Nightmare Just Around The Corner?

    04/16/2013 3:20:08 PM PDT · by blam · 24 replies
    The Market Oracle ^ | 4-16-2013 | Graham Summers
    Is Bernanke’s Worst Nightmare Just Around The Corner? Economics / DeflationApr 16, 2013 - 09:17 PM GMT By: Graham Summers First off I want to say that all of us here at Phoenix Capital Research are sending our prayers to the victims of the Boston Terror Attacks. We sincerely hope none of you, our readers, or your loved ones were injured or harmed by these events. The markets today are snapping back from yesterday’s sharp drop. However, in the bigger picture we believe that Ben Bernanke must be terrified. The Fed and other Central banks of the world have done...
  • The day gold died--Commentary: Gold is history and history showed the run would end

    04/16/2013 9:37:05 AM PDT · by Ernest_at_the_Beach · 39 replies
    Marketwatch ^ | April 16, 2013, 7:01 a.m. EDT | By David Weidner, MarketWatch
    Monday’s crash in the gold market has been a long time coming. Buying opportunity? Only if you enjoy pain. And a few of you do. I know it. I could hear the howling from the mercantile exchanges. I don’t want to write I told you so, but I did. Many of us warned against the modern gold rush. But we weren’t looking at a crystal ball, it was history talking.
  • “Watch The Metals, When They Dip. It Will Be A Good Indication That Things Are About To Happen.”

    04/15/2013 10:07:30 AM PDT · by blam · 61 replies
    SHTF Plan ^ | 4-15-2013 | Mac Slavo
    “Watch The Metals, When They Dip. It Will Be A Good Indication That Things Are About To Happen.” Mac Slavo April 15th, 2013 As of this print the price of gold is reaching fresh two year lows, down nearly 25% from its all time high just six months ago. Though uninformed onlookers and financial pundits may see this as the popping of the proverbial gold bubble, the velocity and scale of the take-down in precious metals suggests that there is a massive assault in the works. According to former Assistant Treasury Secretary Paul Craig Roberts, last Friday’s price drop was...
  • Draghi/Merkel as Goldfinger: Commodities (Gold, Silver, Oil) Plunge, Fear or DEFLATION?

    04/15/2013 7:01:38 AM PDT · by whitedog57 · 3 replies
    Confounded Interest ^ | 04/15/2013 | Anthony B. Sanders
    Gold, silver and other commodities are plunging this morning. Could it simply be that the bloom if off the commodity rose? Or is there a scent of panic about sovereign expropriations of gold and hard assets? On April 12th, European Central Bank President Mario Draghi said the profits of any gold sales by the Cypriot central bank must be used to cover losses it may sustain from emergency loans to Cypriot commercial banks. How there are rumblings of wealth taxes and seizures rumbling around the Eurozone. Wealthy households would face new taxes on property and other assets under German plans...
  • Gold In The Crosshairs (Peter Schiff)

    04/15/2013 9:35:07 AM PDT · by blam · 12 replies
    Euro Pacific Capital ^ | 4-15-2013 | Peter Schiff
    Gold In The Crosshairs Peter SchiffMonday, April 15, 2013 In the opening years of the last decade, most mainstream investors sat on the sidelines while "tin hat" goldbugs rode the bull market from below $300 to just over $1,000 per ounce. But following the 2008 financial crisis, when gold held up better than stocks during the decline and made new record highs long before the Dow Jones fully recovered, Wall Street finally sat up and took notice. The new devotees helped to push gold to nearly $1,900 by September of 2011. For the next year and a half it held...