The Silver Bear Cafe keeps its subscribers informed on issues that adversely affect the conservation of capital and strategies to preserve and increase ones financial security. If we strip away the pretense of democracy, what is the core of our political System? The Phillips Curve is the modern day version of the Unicorn. People believe in it, but no one can mish shedlock bitcoin mining it.
The Fed has been searching for it for a decade and the Bank of Japan for two decades. In a total contradiction of the Phillips Curve, in Japan massive doses of central bank liquidity have resulted in the collapse of both consumer and financial asset prices. E ratios and financial speculation resulting in Tesla’s capitalization at times exceeding that of General Motors. Central banks are now trapped. In a nutshell, central banks are promising to “normalize” their monetary policy extremes in 2018. Nice, but there’s a problem: you can’t “normalize” markets that are now entirely dependent on extremes of monetary stimulus.
Attempts to “normalize” will break the markets and the financial system. Let’s start with the core dynamic of the global economy and nosebleed-valuation markets: credit. Modern finance has many complex moving parts, and this complexity masks its inner simplicity. 18- Forecast 2018 — What Could Go Wrong? Trump is all that ails this foundering empire. Russia, since the Golden Golem of Greatness is in league with Vladimir Putin to loot the world, or something like that. After all, rackets are characterized by pervasive lying and fraud, meaning their operations don’t add up.
Things that don’t comport with reality are generally prone to failure so sooner or later they have to implode. Fed had no tools to get the market to push up long-term yields. Today it has one: the QE Unwind. The price of three-month Treasury securities fell and the yield — which moves in the opposite direction — rose, ending the year at 1. December 26, the highest since September 12, 2008. After all, it feels like the U. Below, Doug Casey shares his take on this.