by
Adam Taggart
qe3
by
Adam Taggart
One of the most perplexing mysteries to us is that right as the Federal Reserve embarked on QE3 — which was a huge, enormous, $85 billion a month experiment — commodities began a multiyear decline within two weeks of that announcement. Concurrently, the world’s central banks plunged the world into steeply negative real interest rates, a condition that has almost always resulted in booming commodity prices — but not this time. Today, the ratio between commodity prices and equities is at one of, if not the most, extreme points in history.
To explain that gap, we talk this week with Brien Lundin, publisher of Gold Newsletter and producer of the New Orleans Investment Conference (where Chris and Adam are speaking on Oct 25-28):
Brien Lundin: If They Don’t Want You To Own It, You Probably Should
by Adam TaggartOne of the most perplexing mysteries to us is that right as the Federal Reserve embarked on QE3 — which was a huge, enormous, $85 billion a month experiment — commodities began a multiyear decline within two weeks of that announcement. Concurrently, the world’s central banks plunged the world into steeply negative real interest rates, a condition that has almost always resulted in booming commodity prices — but not this time. Today, the ratio between commodity prices and equities is at one of, if not the most, extreme points in history.
To explain that gap, we talk this week with Brien Lundin, publisher of Gold Newsletter and producer of the New Orleans Investment Conference (where Chris and Adam are speaking on Oct 25-28):
by
Adam Taggart
by
Gregor Macdonald
Executive Summary
- Why household balance sheets are worse off than advertised
- Why the recent rosy BLS jobs numbers actually mean bad news
- How the Fed is squeezing investor capital out of other traditional asset pools and into the stock market
- Expect to see the stock market moving higher in 2013; that is, until QE3 fails
- What to expect if QE3 fails sooner than anticipated
If you have not yet read Part I: The Future of Gold, Oil & the Dollar, available free to all readers, please click here to read it first.
Market historians have recently started to point out that the current advance in the S&P500 is now 40 months old and has made gains of over 115% since the March 2009 lows. In other words, the doubling from the lows in price and the duration of the advance now late in its third year together suggest that a cyclical top is near. Furthermore, despite some noise in U.S. macro data – which has been briefly more hopeful, yet remains well within the phase of stagnation – earnings estimates have been coming down as the world economy continues to shift into lower gear.
Perhaps for the first time in a while, we can actually say that the Fed's decision to start QE3 was moderately anticipatory, in contrast to its ad-hoc and reactive policymaking over the past five years. It is not merely that the Fed soberly accepted that the economy was not getting better. The stagnant, tractionless macro data over the past year has spoken quite loudly to that fact. Indeed, the U.S. economy is merely treading water, and the Fed's move to QE3 serves as a sharp retort to those who would relentlessly attempt to portray stagnation as recovery.
Where Stock Prices Are Headed Over the Next Year
PREVIEW by Gregor MacdonaldExecutive Summary
- Why household balance sheets are worse off than advertised
- Why the recent rosy BLS jobs numbers actually mean bad news
- How the Fed is squeezing investor capital out of other traditional asset pools and into the stock market
- Expect to see the stock market moving higher in 2013; that is, until QE3 fails
- What to expect if QE3 fails sooner than anticipated
If you have not yet read Part I: The Future of Gold, Oil & the Dollar, available free to all readers, please click here to read it first.
Market historians have recently started to point out that the current advance in the S&P500 is now 40 months old and has made gains of over 115% since the March 2009 lows. In other words, the doubling from the lows in price and the duration of the advance now late in its third year together suggest that a cyclical top is near. Furthermore, despite some noise in U.S. macro data – which has been briefly more hopeful, yet remains well within the phase of stagnation – earnings estimates have been coming down as the world economy continues to shift into lower gear.
Perhaps for the first time in a while, we can actually say that the Fed's decision to start QE3 was moderately anticipatory, in contrast to its ad-hoc and reactive policymaking over the past five years. It is not merely that the Fed soberly accepted that the economy was not getting better. The stagnant, tractionless macro data over the past year has spoken quite loudly to that fact. Indeed, the U.S. economy is merely treading water, and the Fed's move to QE3 serves as a sharp retort to those who would relentlessly attempt to portray stagnation as recovery.
by
Gregor Macdonald
The ability of reflationary policy to mute the worst risks of debt deflation has been a source of enormous frustration for stock market bears ever since the 2008 collapse. Yes, the initial moderate rally out of the S&P500’s black hole was perhaps not so surprising in 2009. Bombed-out stock markets can always manage some sort of rally. But the ability of the rally to continue through 2010, and then 2011, and now 2012 has been quite vexing and painful for bearish investors.
Indeed, the entire post-2008 market phase has now produced an era of consistently poor performance for hedge funds. Recent data, for example, shows that an incredible 90% of hedge funds are underperforming the S&P500 through mid-September.
Will the pain continue?
The Future of Gold, Oil & the Dollar
by Gregor MacdonaldThe ability of reflationary policy to mute the worst risks of debt deflation has been a source of enormous frustration for stock market bears ever since the 2008 collapse. Yes, the initial moderate rally out of the S&P500’s black hole was perhaps not so surprising in 2009. Bombed-out stock markets can always manage some sort of rally. But the ability of the rally to continue through 2010, and then 2011, and now 2012 has been quite vexing and painful for bearish investors.
Indeed, the entire post-2008 market phase has now produced an era of consistently poor performance for hedge funds. Recent data, for example, shows that an incredible 90% of hedge funds are underperforming the S&P500 through mid-September.
Will the pain continue?
by
Adam Taggart
by
Adam Taggart
by
Adam Taggart
by
Chris Martenson
Executive Summary
- We've now entered a new era of economic and fiscal descent; expect the next stage to be prolonged and bumpy
- Why only two possible economic outcomes remain at this point (and one of them has a 90%+ chance of occurring)
- How the recent liquidity measures announced by the world's largest central banks will impact:
- stocks
- bonds
- gold & silver
- other commodities
- real estate
- Why adopting a wealth preservation strategy is critical right now (and why so many will fail to do so)
- Why this is not (yet) the moment to go "all in" in exchanging paper assets for hard ones (but do get started if you haven't already!)
If you have not yet read Part I: The Trouble with Printing Money, available free to all readers, please click here to read it first.
A Process, Not an Event
Okay, the ECB and the Fed are now in the game with unlimited, open-ended commitments to print as much money as necessary to get back to the same rates of GDP growth we had in prior decades. I should note that the ECB actions, at least, will be fully sterilized, meaning that they won't boost the money supply – at least that's the plan right now. Soon enough, Japan is going to have to join the fray simply because it cannot afford a stronger yen here; it will have to print because it is first, second, and last an export economy…
After that, it is anybody's guess as to how long China will put up with its massive $3.2 trillion in foreign exchange reserves being debased willy-nilly, but my vote is 'not long.'
These latest rounds of QE are certainly unnerving and may prompt many of you to want to accelerate your own private efforts at financial, emotional, and physical resilience. By all means, use these moments to focus your attention and efforts. But also be aware that we are experiencing what is certain to be a very long process rather than some dramatic event.
Understanding the Implications of QE3
PREVIEW by Chris MartensonExecutive Summary
- We've now entered a new era of economic and fiscal descent; expect the next stage to be prolonged and bumpy
- Why only two possible economic outcomes remain at this point (and one of them has a 90%+ chance of occurring)
- How the recent liquidity measures announced by the world's largest central banks will impact:
- stocks
- bonds
- gold & silver
- other commodities
- real estate
- Why adopting a wealth preservation strategy is critical right now (and why so many will fail to do so)
- Why this is not (yet) the moment to go "all in" in exchanging paper assets for hard ones (but do get started if you haven't already!)
If you have not yet read Part I: The Trouble with Printing Money, available free to all readers, please click here to read it first.
A Process, Not an Event
Okay, the ECB and the Fed are now in the game with unlimited, open-ended commitments to print as much money as necessary to get back to the same rates of GDP growth we had in prior decades. I should note that the ECB actions, at least, will be fully sterilized, meaning that they won't boost the money supply – at least that's the plan right now. Soon enough, Japan is going to have to join the fray simply because it cannot afford a stronger yen here; it will have to print because it is first, second, and last an export economy…
After that, it is anybody's guess as to how long China will put up with its massive $3.2 trillion in foreign exchange reserves being debased willy-nilly, but my vote is 'not long.'
These latest rounds of QE are certainly unnerving and may prompt many of you to want to accelerate your own private efforts at financial, emotional, and physical resilience. By all means, use these moments to focus your attention and efforts. But also be aware that we are experiencing what is certain to be a very long process rather than some dramatic event.
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