Barrons interview with Hugh Hendry:
The world is very fearful of hyperinflation. Pension schemes have a preponderance of real assets, from forestry to gold to TIPS [Treasury inflation-protected securities], because they are very fearful. The road to hyperinflation is via hyperdeflation. That is why it’s proving so difficult for hedge funds to make money. How does the rational mind that anticipates hyperinflation own 10-year government Treasuries yielding less than 2%? It can’t. That’s why people are struggling. To lay the seeds of hyperinflation, you need really, really bad things to happen. I thought the U.S. housing market having a massive crash would be hyperdeflationary. But then my Chinese friends pumped $1 trillion of credit into their $5 trillion economy, and created a global recovery, which has just come to an end. I’m speculating that hyperdeflation happens before hyperinflation. What’s the worst that could happen? But the sum of all my fears would be China having a real hard landing of minus 5% or minus 10% GDP growth. If we had that—and Europe—the Fed would be printing $20 trillion, and I would have gold at $5,000. You can have a modest amount of gold, but you can’t have all your assets in real assets, in case we get that hyperdeflation event.
The Great Escape:
Delivering in a Delevering World
Delivering in a Delevering World
- When interest rates cannot be dramatically lowered further or risk spreads significantly compressed, the momentum begins to shift, not necessarily suddenly, but gradually – yields moving mildly higher and spreads stabilizing or moving slightly wider.
- In such a mildly reflating world, unless you want to earn an inflation-adjusted return of minus 2%-3% as offered by Treasury bills, then you must take risk in some form.
- We favor high quality, shorter duration and inflation-protected bonds; dividend paying stocks with a preference for developing over developed markets; and inflation-sensitive, supply-constrained commodity products.
Apr 072012
Attention Apple fanboys and shareholders:
Apple Conundrum
Apr 072012
Apr 052012
Attend the full 9hr conference…free…and from the comfort of your home or office.
Description:
The Club of Rome and the Smithsonian Institution’s Consortium for Understanding and Sustaining a Biodiverse Planet are hosting a symposium on March 1, 2012 to celebrate the 40th anniversary of the launching of Limits to Growth, the first report to the Club of Rome published in 1972. This book was one of the earliest scholarly works to recognize that the world was fast approaching its sustainable limits. Forty years later, the planet continues to face many of the same economic, social, and environmental challenges as when the book was first published.
The morning session will start at 9:00 a.m. and will focus on the lessons of Limits to Growth. The afternoon session will begin at 1:45 p.m. and will address the difficult challenges of preserving biodiversity, adjusting to a changing climate, and solving the societal issues now facing the planet. The symposium will end with a thought-provoking panel discussion among the speakers on future steps for building a sustainable planet.
Guest post by Bulls, Bears and Pigs
If you aren’t a believer of the motto of my blog by now then you’ll never be. Who would have believed 3 years ago that the SPX would rally over 110% from it’s low in March 2009 and not too far away from making an ALL TIME HIGH? I’ll telll you who….absolutely nobody, not even the most bullish person you could find on the planet. So far this year Mr. Market has made even the bulls look foolish since they too have been calling for correction since January.
I was going to discuss in detail about how utterly asinine it is for people to have either missed out or lost money during a 3 year, 110%+ bull market and how the Schiffs, the Prechters, the Hussmans and the rest of the popular gurus du jour have zero credibility for being the broken clock permabears that they are but why bother? Why should I give a sh1t about what other people are doing anyways? Let them burn. I should be focusing more on what I’m doing and the opportunities that are out there to make money. It’s just that sometimes I feel the need to vent when I see pundits who have been nothing short of atrocious, refuse to acknowledge how wrong they have been. Instead, as the market makes new highs they just keep digging in their heels, wringing their fist saying “just you wait and see!”. You know what? They are wrong no matter what the market does at this point. Anyone who misses or even worse, loses money during a multi-year bull market of 110% has ZERO credibility and if you’re still following and worshiping the same people who have lead you astray it means you’re delusional just they are and you probably lost money too. Snap out of it! I’m not saying you should never be bearish again….just find another way….find a way to be bearish when being bearish is the correct thing to be. I think a lot of people out there need pearmabear detox.
Apr 032012
Apr 022012
An interview with Jack Rasmus, Professor of Political Economy at St. Mary’s College and Santa Clara University, CA.
Mar 312012
Click below to listen
Eric Sprott and David Baker break down the bull market that is apparently full of bull:
What a difference a month makes. Now that Greece has been papered over, the bulls are back in full force, pumping up the equity markets and celebrating every passing data point with positive exuberance. Let’s not get ahead of ourselves just yet, however. Very little has actually changed for the better, and it’s certainly too early to start cheerleading a new bull market.
Take the latest US unemployment numbers, for example. There was much excitement about the latest Bureau of Labor Statistics (BLS) report which announced that US unemployment remained unchanged at 8.3% during the month of February.2 The market was particularly enamored by the BLS’s insistence that non-farm payrolls increased by 227,000 during the month, as well as its upward revision of the December 2011 and January 2012 jobs numbers. Lost in all the excitement was the Gallup unemployment report released the day before, which had February unemployment increasing to 9.1% in February from 8.6% in January and 8.5% in December.3 Granted, the Gallup methodology is slightly different than that used by the BLS, but even if Gallup had applied the BLS’s seasonal adjustment, they would have still come out with an unemployment rate of 8.6%, which is considerably higher than that produced by the BLS.4 We all know which number the pundits chose to champion, but the Gallup data may have been closer to the truth.
Mar 282012
Mar 282012
