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A faltering economy, a coalition government torn between spending cuts and tax rises, a sinking currency, money printing and 'unconventional' monetary policy. Britain in 2012? No, Argentina in 2002. The problems faced by Argentina a decade ago and by Britain are eerily similar. In each case the government believed that through its own sophistication and trickery it could defeat a debt crisis of its own devising. In Argentina, every government action served only to make the situation worse. We are following the same path. ....At each stage, Argentina's recovery was sabotaged by the actions of its own politicians, as can...

The preponderance of misrepresentations and fiction floated by most of the MSM in these frenetic final weeks of the Presidential election, may in the long term cause much harm to an already overburdened Nation. Making decisions with bad information never works out well. Near the top of our influence food chain we have Ben Bernanke fuelling inflation of risky assets through a continuation of the quantitative easing strategy. The markets have siphoned money from “savings” accounts where interest rates are at near zero. How great is that? The stock markets are booming, while anyone holding interest-bearing assets continues to...

Q.E. To Infinity: Unintended Consequences Interest-Rates / Quantitative EasingSep 23, 2012 - 07:53 AM By: John Mauldin There is an intense debate going on in the first-class cabin of Economics Airlines about the direction in which our plane should be pointed. And while those of us back in the cheap seats don't get to help decide, knowing where we will land is of intense interest to all of us. This week we listen in on the debate, in the form of speeches and academic postings passed back from first class for the rest of us to read. This type of...

Why QE3 Won’t Jumpstart The Economy And What Would Economics / Quantitative EasingSep 22, 2012 - 12:56 PM By: Ellen Brown The economy could use a good dose of “aggregate demand”—new spending money in the pockets of consumers—but QE3 won’t do it. Neither will it trigger the dreaded hyperinflation. In fact, it won’t do much at all. There are better alternatives. The Fed’s announcement on September 13, 2012, that it was embarking on a third round of quantitative easing has brought the “sound money” crew out in force, pumping out articles with frighting titles such as “QE3 Will Unleash’ Economic...

10 Quotes From Financial Experts About The Effect That QE3 Will Have On Gold And Silver By Michael Snyder September 19th, 2012 Do you want to know what QE3 is going to do to the price of gold and the price of silver? Well, you can read what the financial experts are saying below, but it doesn't take a genius to figure out what is likely to happen. During QE3, the Federal Reserve will be introducing 40 billion new dollars that have been created out of nothing into the financial system each month. So there will be more dollars chasing...

IT'S OFFICIAL: It's Been Announced That 'Currency Wars' Are Back On Joe WeisenthalSeptember 21, 2012, 4:32 AM Brazilian Finance Minister Mantega has just blasted the Fed's QE3 policy for setting off "Currency Wars". What he means by this is: The Fed has prompted every country to attempt to weaken the value of their currencies in order to boost exports. The reason Mantega is furious about this is that he believes it dangerously boosts inflation, especially in emerging markets like his, Brazil. He's made this charge before: In August 2010, the last time the Fed started to embark on QE, he...

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Last week, Fed Chair Ben Bernanke announced QE3 via monthly purchase of $40 billion per month of agency mortgage-backed securities (MBS). The intended consequences of QE-MBS is to move mortgage rates lower in the hopes of stimulating mortgage refinancings and home purchases. Given tight credit standards from Fannie Mae and Freddie Mac (and the lack of bank lending for their portfolios), it is doubtful that mortgage purchase applications will rise significantly. Clearly, The Fed has gone all out to support the Obama Administration’s 14 mortgage refinancing programs (HAMP, HARP, Attorneys General Settlement, etc.). I call this shadow fiscal policy by...

nterest rates will stay in current range through 2015 and the Fed will be buying $40 Billion worth of mortgage backed bonds per month...until morale improves. This is what makesthe biggest difference: the Fed isn't announcing a limited amount of purchases. It's an open-ended program to buy bonds until the economy improves. From the statement: "If the outlook for the labor market does not improve substantially, the Committee will continue its purchases of agency mortgage-backed securities, undertake additional asset purchases, and employ its other policy tools as appropriate until such improvement is achieved in a context of price stability." Fed...

On Sub-Zero And DecouplingBruce KrasteringSeptember 10,2012 On the IOER and Hilsenrath Bernanke has to do something this week. Most pundits are suggesting it will be more LSAPs (QE). I have trouble with this scenario. To be of any benefit, a new QE would have to be for $600Bn. If QE3 were to be only a paltry $200Bn, it would be received very poorly. I donÂ’t see Ben shooting off a pop-gun this week. He would be better off doing nothing, than something that will fall flat. I think he knows that. There is also the issue that there is no...

The Direction of Silver Prices before QE Forever Commodities / Financial Markets 2012Sep 03, 2012 - 07:53 AM By: Dr Jeff Lewis The price of silver has moved up from $27.50 seen just a week ago to stage a test of the $31.00 level. Although technical traders may consider this market currently over bought, the fact remains that a bull market can stay over bought for quite a long time. It will be interesting to look back on this rally that began in the wake of the Financial Times’ story about the CFTC’s lack of evidence and impending conclusion of...

Video Transcript: other reasons, too, which we'll talk about later. cme group, rick santelli. looking at some long-term effects of qe. indeed, there is another name for qe. and we'll get to that momentarily. one of the great things about the human race is they can assimilate and accommodate. we talked about the swiss psychologist in the 1930s, the 1960s, really doing a lot of work here. what it simply means is that we're very adaptable as humans. i think quantitative easing fits into that. it's something that really doesn't seem like it's the answer for problems, printing more money,...

Demand for U.S. capital goods such as machinery and communications gear dropped in July by the most in eight months, indicating companies are pulling back on investment. Bookings for non-military capital equipment excluding airplanes slumped 3.4 percent, a Commerce Department report showed today in Washington. Durable goods orders actually rose 4.2%, but that includes airplane sales. Qantas just cancelled a HUGE order from Boeing for 35 787 Dreamliners. This should result in a big DECREASE in the next month, so I am focusing on Capital Goods New Orders Nondefense Ex Aircraft & Parts MoM. US Flash PMI came out earlier...

FED MINUTES: MORE FED MEMBERS FAVOR EASING IF LOW GROWTH CONTINUES Eric Platt Aug. 22, 2012, 2:00 PM UPDATE: More Federal Open Markets Committee members say they favor additional quantitative easing if the economy cannot sustain growth, according to newly released minutes of the Fed's August meeting. Here's the most important part of the release: "A number of them indicated that additional accommodation could help foster a more rapid improvement in labor market conditions in an environment in which price pressures were likely to be subdued. Many members judged that additional monetary accommodation would likely be warranted fairly soon unless...

Goldman Sachs: The Economy Is Stronger Than You Think 08/17/2012 3:33 AM Cullen Roche Recent strategy notes from Goldman Sachs are consistent with my overall view of the US economy – it’s stronger than the recessionistas have long thought. So the good news is things aren’t yet contracting. The bad news is the economy is still too weak to substantially bring down the rate of unemployment. And the good/bad news is that this reduces the likelihood of QE this year. More from Goldman’s Jan Hatzius (via ZH): “The US economic recovery remains sluggish, but we believe that it will pick...

Like Dr. Evil in the movie “Goldmember,” Dr. Bernanke answered the question today about instant monetary relief: “How about NO!“ That is, no change in the Fed Funds Target. Or Twist or QE3. But he did say that he is willing to do additional monetary easing if necessary to boost economic growth. “The committee will closely monitor incoming information on economic and financial developments and will provide additional accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability.” Not surprising in the least. The US has morphed into...

The plan works in a fairly simple manner: In the UK`s case, the BofE is lending short-term government bills to banks, which use the securities as collateral to borrow money from the central bank at a rock-bottom rate - about 0.25% - and then make loans. Banks can borrow up to 5% of the value of their existing loan books, and the loans from the BofE are four years in duration. The program is similar to something the Fed tried, with considerable success, during the financial crisis that exploded in 2008. The Fed is meeting Tuesday and Wednesday and will...

The Bank of England announced this afternoon that it would attempt to flood banks with cheap cash in order to stave off tensions in the interbank credit markets, according to Dow Jones. This report followed rumors of coordinated central bank action to bolster liquidity across the world, however the BOE's plan appears to be much more U.K.-centric.

Out of nowehere, JPM announced 40 minutes ago that it would hold an unscheduled 5pm call to coincide with the release of its 10-Q. Rumors were swirling as to why. The reason is as follows: JPMORGAN SAYS CIO UNIT HAS SIGNIFICANT MARK-TO-MARKET LOSSES - "Fortress balance sheet" at least until Bruno Iskil gets done with it. JPMORGAN SAYS LOSSES ARE IN SYNTHETIC CREDIT PORTFOLIO - but, but, net is NEVER, EVER Gross. JPM WOULD NEED $971M ADDED COLLATERAL IF RATINGS CUT ONE-NOTCH JPM WOULD NEED $1.7B ADDED COLLATERAL IF RATINGS CUT 2 NOTCHES - how about three notches? JPMORGAN: MAY...

For several years now I have been sounding the alarm that if you want to be engaged in the financial markets you need to assume that markets are being managed (rigged) more aggressively than at any moment in any of our lives. The Bernank and others on Wall Street and the District of Criminals understand that the situation is pretty much hopeless.