Tag Archives: Recession

Caution! A Stock Market Warning.

I have said that I expect a severe economic recession to kick in by the end of 2017. I still believe this. I’ll concede that it may be in 2018. Either way: soon. Read my thoughts on this here and here. Recessions are problematic. You probably don’t need me to tell you that. Employers lose […]

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Take a Hike: Federal Reserve Planning For Recession?

Last week, the Federal Reserve “raised rates”, as the mainstream financial media is apt to say. What this really means is that the Federal Raise raised the only interest rate that they have any direct control over: the rate of interest paid on excess reserves. The rate was increased from 0.5% – barely above zero […]

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Trump’s Next Crucial Campaign.

Republicans are holding a political double-edged sword. If they use it the wrong way, they risk chopping off their own limbs. Trump is president. And Republicans have held onto the Senate, which they can probably thank Trump for. This gives them enormous leverage. But with great power comes great responsibility, as one super hero’s late […]

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Red Alert! Recession and Corporate Mergers.

From Bloomberg, we read this: Forget merger Monday: October as a whole was a record month for dealmaking, with almost half a trillion dollars of mergers and acquisitions announced globally. CenturyLink Inc.’s $34 billion acquisition of Level 3 Communications Inc., as well as General Electric Co.’s deal to combine its oil and gas division with […]

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Economic Slowdown? Early Warning Indicators.

Two useful charts are great indicators of economic health, but are often ignored: the Cass Freight and Baltic Dry indices. Both are measures of shipping activity. I like these measures because they are based on hard numbers and represent the here & now. The Baltic Dry measures global shipping activity based on chartered shipping vessels. […]

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Implosion: The Coming Crash in China.

The Chinese economy is in for an enormous crash. It will be unlike anything else seen in modern history. Charles Hugh Smith has written an interesting article which shows us something important for the future: Few question the importance of private credit in the global economy. When households and businesses are borrowing to expand production […]

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The Next Great Crash: Auto Loans?

From 2001 to 2007, the Federal Reserve undertook inflationary money policies explicitly designed to encourage a major boom in housing. Mortgage loans went through the roof. The major bust in housing is what precipitated the economic crisis of 2008. Problem: Government bureaucrats, like those at the Federal Reserve, rarely learn their lessons. Similar policies pursued […]

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The Naked Empress.

On December 16th, The Federal Reserve Open Market Committee (FOMC) released a statement making a long awaited declaration: they are raising interest rates. What does this really mean in a practical sense? For all the talk of the Federal Reserve raising interest rates, there is actually only one interest rate which the Federal Reserve has […]

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Ho Ho Ho: Poor Christmas Sales?

Below is the Cass Freight Index, which tracks domestic freight shipping in North America. It bears ominous news. Notice where we were in October. The trend is down. Freight shipments are falling. It’s not a free-fall, but still a significant drop. The Cass Freight is the lowest it’s been at this time of year compared […]

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0% Interest On Your Bank Account?

The numbers below are 30-day and 90-day T-Bill rates. Take a look: What number is most common? “0.00”. To someone who understands T-Bills, this number should be significant. To someone who does not understand T-Bills, read the description here. There have been fluctuations, but the the rates have been mostly at or near zero for […]

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