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Image | Francis Koster: Deploying Our Investment Capital Locally Yields Better Returns for All
Francis Koster: Deploying Our Investment Capital Locally Yields Better Returns for All
by Adam Taggart

We are conditioned to think that financial "investing" means sending your capital to Wall Street. There it will be put into paper securities (stocks, bonds, etc.), and hopefully when your next statement arrives, the dollar total is higher than you put in.

There's no connection between the investor and the investment. And in today's market, where safer investments offer nearly no return, investment capital is increasingly paying to chase risk it has little understanding of. And all the while, the middlemen — with their 100% perfect trading quarters and record bonus payouts — demonstrate that the system really exists to siphon off money from this 'dumb capital'.
Francis Koster: Deploying Our Investment Capital Locally Yields Better Returns for All
 by Adam Taggart

We are conditioned to think that financial "investing" means sending your capital to Wall Street. There it will be put into paper securities (stocks, bonds, etc.), and hopefully when your next statement arrives, the dollar total is higher than you put in.

There's no connection between the investor and the investment. And in today's market, where safer investments offer nearly no return, investment capital is increasingly paying to chase risk it has little understanding of. And all the while, the middlemen — with their 100% perfect trading quarters and record bonus payouts — demonstrate that the system really exists to siphon off money from this 'dumb capital'.
Image | Off the Cuff: The Age of Delusion
Off the Cuff: The Age of Delusion
 PREVIEW
by Adam Taggart

In this week's Off the Cuff podcast, Chris and Mish discuss:

  • Fuzzy Fed Math
    • Housing-cost methodology understates true inflation
  • China's Gold Hunger
    • Vacuuming up 50% of total world production
  • Market Madness
    • Any news – good, bad, or worse – drives stock prices higher
Off the Cuff: The Age of Delusion
 PREVIEW by Adam Taggart

In this week's Off the Cuff podcast, Chris and Mish discuss:

  • Fuzzy Fed Math
    • Housing-cost methodology understates true inflation
  • China's Gold Hunger
    • Vacuuming up 50% of total world production
  • Market Madness
    • Any news – good, bad, or worse – drives stock prices higher
Image | Bill Fleckenstein: Hold Tight To Your Gold
Bill Fleckenstein: Hold Tight To Your Gold
by Adam Taggart

 

The bond market is an accident waiting to happen.
 

When the bond market finally does crack, it is going to be one epic nightmare that is going to make 2008 and 2009 seem like a picnic. It will be a different kind of a crisis; but it will be an enormous crisis. These people that are bullish about stocks and bonds and the bond market, they do not understand anything.
Bill Fleckenstein: Hold Tight To Your Gold
 by Adam Taggart

 

The bond market is an accident waiting to happen.
 

When the bond market finally does crack, it is going to be one epic nightmare that is going to make 2008 and 2009 seem like a picnic. It will be a different kind of a crisis; but it will be an enormous crisis. These people that are bullish about stocks and bonds and the bond market, they do not understand anything.
Image | This Gold Slam is a Massive Wealth Transfer from Our Pockets to the Banks
This Gold Slam is a Massive Wealth Transfer from Our Pockets to the Banks
by Chris Martenson

I am very disappointed by, but not surprised at, the latest transfer of wealth to the bankers from everyone else.  The most recent gold bear raid has vastly enriched the bullion bankers, once again, at the expense of everyone trying to protect their wealth from global central bank money printing.

The central plank of Bernanke's magic recovery plan has been to get everybody back borrowing, spending, and "investing" in stocks, bonds, and other financial assets.  But not equally so, as he has been instrumental in distorting the landscape towards risk assets and away from safe harbors.
This Gold Slam is a Massive Wealth Transfer from Our Pockets to the Banks
 by Chris Martenson

I am very disappointed by, but not surprised at, the latest transfer of wealth to the bankers from everyone else.  The most recent gold bear raid has vastly enriched the bullion bankers, once again, at the expense of everyone trying to protect their wealth from global central bank money printing.

The central plank of Bernanke's magic recovery plan has been to get everybody back borrowing, spending, and "investing" in stocks, bonds, and other financial assets.  But not equally so, as he has been instrumental in distorting the landscape towards risk assets and away from safe harbors.
Image | How to Survive the Mother of All Bubble Burstings: A Collapse of the Bond Market
How to Survive the Mother of All Bubble Burstings: A Collapse of the Bond Market
 PREVIEW
by Chris Martenson

Executive Summary

  • The three main signs presaging a bond-bubble collapse are now evident
  • Why the Fed will fail to get new credit debt growth at the rate it needs
  • The return of CDOs and other risky tactics that show market participants have returned to reckless thinking
  • How a bond market collapse will play out
  • How to product yourself and your wealth during the extreme pain of a bond market collapse

If you have not yet read Part I: Investors Beware: Market Risks Today Are Higher Than Ever, available free to all readers, please click here to read it first.

The dangers growing in the bond market are, of course, all the result of the Fed, et al., cramming the real rate of interest on Treasury bonds into negative territory, starving investors for income, and forcing them to chase yield whenever and wherever it can be found.  Given a long enough time without a serious disruption in the markets, you eventually find yourself exactly where we are, with everyone chasing yield because they have to. Hey, everybody else is, and nothing bad has happened yet, right?

Of course, the odds of this ending well are practically zero.

How ridiculous has it become?  How about a company currently in bankruptcy proceedings able to sell bonds at investment-grade yields?

AMR Bankruptcy Yields Record-Low Bond Coupon

Mar 13, 2013

American Airlines is selling investment-grade debt even as it spends a 15th month in bankruptcy while bond buyers look ahead to the merger with US Airways Group Inc. (LCC) that will create the world’s largest carrier.

The AMR Corp. (AAMRQ) unit issued $663 million of so-called enhanced equipment trust certificates yesterday that included a portion paying 4 percent, matching the record low coupon for similar airline debt, which was first awarded to United Continental Holdings Inc. in September, according to data compiled by Bloomberg. American is also seeking to refinance about $1.3 billion of bonds backed by aircraft after receiving court approval to do so in January.

By the time you have 'investors' offering money to a perpetual basket-case like AMR – a company that also happens to be in bankruptcy proceedings at present – at investment-grade 4% yields, you know you are in the midst of a crazy bubble. Consider this anecdote to be the bond market equivalent of a hairdresser from Las Vegas buying her 19th house…

How to Survive the Mother of All Bubble Burstings: A Collapse of the Bond Market
 PREVIEW by Chris Martenson

Executive Summary

  • The three main signs presaging a bond-bubble collapse are now evident
  • Why the Fed will fail to get new credit debt growth at the rate it needs
  • The return of CDOs and other risky tactics that show market participants have returned to reckless thinking
  • How a bond market collapse will play out
  • How to product yourself and your wealth during the extreme pain of a bond market collapse

If you have not yet read Part I: Investors Beware: Market Risks Today Are Higher Than Ever, available free to all readers, please click here to read it first.

The dangers growing in the bond market are, of course, all the result of the Fed, et al., cramming the real rate of interest on Treasury bonds into negative territory, starving investors for income, and forcing them to chase yield whenever and wherever it can be found.  Given a long enough time without a serious disruption in the markets, you eventually find yourself exactly where we are, with everyone chasing yield because they have to. Hey, everybody else is, and nothing bad has happened yet, right?

Of course, the odds of this ending well are practically zero.

How ridiculous has it become?  How about a company currently in bankruptcy proceedings able to sell bonds at investment-grade yields?

AMR Bankruptcy Yields Record-Low Bond Coupon

Mar 13, 2013

American Airlines is selling investment-grade debt even as it spends a 15th month in bankruptcy while bond buyers look ahead to the merger with US Airways Group Inc. (LCC) that will create the world’s largest carrier.

The AMR Corp. (AAMRQ) unit issued $663 million of so-called enhanced equipment trust certificates yesterday that included a portion paying 4 percent, matching the record low coupon for similar airline debt, which was first awarded to United Continental Holdings Inc. in September, according to data compiled by Bloomberg. American is also seeking to refinance about $1.3 billion of bonds backed by aircraft after receiving court approval to do so in January.

By the time you have 'investors' offering money to a perpetual basket-case like AMR – a company that also happens to be in bankruptcy proceedings at present – at investment-grade 4% yields, you know you are in the midst of a crazy bubble. Consider this anecdote to be the bond market equivalent of a hairdresser from Las Vegas buying her 19th house…

Image | Investors Beware: Market Risks Today Are Higher than Ever
Investors Beware: Market Risks Today Are Higher than Ever
by Chris Martenson

After the shot across the bow in 2008, you might have expected regulators and market participants would use the experience to change for the better, to become more prudent, and to reduce the sorts of risky behaviors that almost crashed the entire system.

Unfortunately, you'd be wrong.
Investors Beware: Market Risks Today Are Higher than Ever
 by Chris Martenson

After the shot across the bow in 2008, you might have expected regulators and market participants would use the experience to change for the better, to become more prudent, and to reduce the sorts of risky behaviors that almost crashed the entire system.

Unfortunately, you'd be wrong.
Image | Bob Fitzwilson: Charting a Safe Course Through A Market Gone Insane
Bob Fitzwilson: Charting a Safe Course Through A Market Gone Insane
by Adam Taggart

The Dow Jones has had 10 consecutive days closing in the green, a streak not seen since the mid-1990s. Both the Dow and the S&P are at or near all-time record highs.

That's what happens when you flood the markets with liquidity, which the Federal Reserve has done with trillions of newly-printed money over the past several years. It's currently juicing the money supply to the tune of $85 billion per month. All those dollars have to go somewhere.

So, has the Fed won? Has the crisis been averted?
Bob Fitzwilson: Charting a Safe Course Through A Market Gone Insane
 by Adam Taggart

The Dow Jones has had 10 consecutive days closing in the green, a streak not seen since the mid-1990s. Both the Dow and the S&P are at or near all-time record highs.

That's what happens when you flood the markets with liquidity, which the Federal Reserve has done with trillions of newly-printed money over the past several years. It's currently juicing the money supply to the tune of $85 billion per month. All those dollars have to go somewhere.

So, has the Fed won? Has the crisis been averted?
Image | Let’s Stop Fooling Ourselves: Americans Can’t Afford the Future
Let’s Stop Fooling Ourselves: Americans Can’t Afford the Future
by Adam Taggart

The truth is: The three adult generations in the U.S. are suffering, and their burdens are likely to increase with time. Each is experiencing a squeeze that is making it harder to create value, save capital, and pursue happiness than at any point since WWII. At that point, we were a creditor nation with an economy exploding into dominance on the world stage. Now, however, the U.S. is the largest debtor nation and our economic hegemony is increasingly at seige across a number of fronts.

A continuation of the status quo is a decision to sleepwalk face-first into the constraints hurtling towards us.

Instead, shouldn't we stop fooling ourselves and ask: What should we be doing differently?
Let’s Stop Fooling Ourselves: Americans Can’t Afford the Future
 by Adam Taggart

The truth is: The three adult generations in the U.S. are suffering, and their burdens are likely to increase with time. Each is experiencing a squeeze that is making it harder to create value, save capital, and pursue happiness than at any point since WWII. At that point, we were a creditor nation with an economy exploding into dominance on the world stage. Now, however, the U.S. is the largest debtor nation and our economic hegemony is increasingly at seige across a number of fronts.

A continuation of the status quo is a decision to sleepwalk face-first into the constraints hurtling towards us.

Instead, shouldn't we stop fooling ourselves and ask: What should we be doing differently?
Image | Why Our Current Way of Living Has No Future
Why Our Current Way of Living Has No Future
by JHK

All of the sordid and spellbinding rackets working their hoodoo on the financial scene have obscured a whole other dimension of the fiasco that America finds itself in, namely the way we have arranged the logistics of everyday life on our landscape – the tragedy of Suburbia.

I call it a tragedy because it represents a sequence of extremely unfortunate choices made by our society over several generations. History will not forgive the excuses we make for ourselves, nor will it shed a tear for the tribulations we will induce for ourselves by living this way. History may, however, draw attention to our remarkable lack of a sense of consequence in transforming this lovely, beckoning New World continent into a wilderness of free parking. In any case, we’re stuck with what we’ve done, and the question naturally arises: What will we do now?
Why Our Current Way of Living Has No Future
 by JHK

All of the sordid and spellbinding rackets working their hoodoo on the financial scene have obscured a whole other dimension of the fiasco that America finds itself in, namely the way we have arranged the logistics of everyday life on our landscape – the tragedy of Suburbia.

I call it a tragedy because it represents a sequence of extremely unfortunate choices made by our society over several generations. History will not forgive the excuses we make for ourselves, nor will it shed a tear for the tribulations we will induce for ourselves by living this way. History may, however, draw attention to our remarkable lack of a sense of consequence in transforming this lovely, beckoning New World continent into a wilderness of free parking. In any case, we’re stuck with what we’ve done, and the question naturally arises: What will we do now?
Image | Off the Cuff: Things are Getting Interesting
Off the Cuff: Things are Getting Interesting
 PREVIEW
by Adam Taggart

In this week's Off the Cuff podcast, Chris and Mish discuss:

  • The FOMC Freak-out
    • Why markets dove after the Fed minutes were released
  • Stocks Slip, PMs get Slaughtered
    • Why the markets look very treacherous from here
  • The Sinister Sequestration
    • What will likely result if it happens
Off the Cuff: Things are Getting Interesting
 PREVIEW by Adam Taggart

In this week's Off the Cuff podcast, Chris and Mish discuss:

  • The FOMC Freak-out
    • Why markets dove after the Fed minutes were released
  • Stocks Slip, PMs get Slaughtered
    • Why the markets look very treacherous from here
  • The Sinister Sequestration
    • What will likely result if it happens
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