Inflation Continues to Trend Downward in May

The inflation rate in a core CPI excluding shelter has been -0.2 percent over the last three months. Inflation in both the overall and core Consumer Price Index (CPI) showed evidence of slowing in May. The overall CPI actually fell by 0.1 percent in May, driven by a 2.7 percent drop in energy prices. The overall CPI is now up by 1.9 percent over the last year. The core index rose by 0.1 percent. It has increased by 1.7 percent over the last year. Both indices are showing lower rates of increases in May than they had earlier in the […]

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Deflation: There’s an App for That

Once in a while I see a financial news headline so obviously ridiculous, I feel I should look at the writer with pity in my eyes and pat them on the head, the way you might comfort a child that just dropped his ice cream cone on the floor. “Inflation is Right Around the Corner, Yellen Insists.” Of course it is… In defense of the columnist who wrote the story, these weren’t necessarily his views. He was simply relaying the Fed Chair’s comments from Wednesday. My real pity is reserved for Ms. Yellen herself. If she actually believes that inflation […]

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The Great Deflation, Gold, and the Dollar

The coming GREAT DEFLATION will impact the value of Gold and the Dollar much differently than what most analysts are forecasting. Unfortunately, most analysts do not understand the true underlying value of gold or the U.S. Dollar, because they base their forecasts on information that is inaccurate, flawed or imprecise. This is due to two faulty theories: monetary science supply-demand market forces While some aspects of monetary science and supply and demand forces do impact the prices of goods and services (on a short-term basis), the most important factor, ENERGY, is totally overlooked. You will never hear Peter Schiff include […]

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HARRY DENT: Our Money Velocity Sucks

Harry Dent Dr. Lacy Hunt has been featured more than any outside speaker at our IES conferences. Why? Because he’s the only classical economist I fully admire and he is a successful bond investment manager in the real world that understands the trend towards deflation, despite unprecedented money-printing. I love the gold bugs for being realistic and honest about the debt and financial asset bubble we’re in, especially when most mainstream economists and analysts are blind to it. What kills me about the gold bug types is that they always see hyperinflation from unprecedented money-printing, and they don’t go back […]

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The Standard 60/40 Stock & Bond Portfolio Won’t Survive The Next Decade

Everyone’s familiar with the classic 60/40 investment portfolio. If you’ve ever dealt with financial advisors, this is the standard allocation they’ll recommend. 60% of your money in the stock market, and 40% in bonds. This has no doubt been a great strategy the past few years. Check out the statistics from Jan. 1 2010 to Jan. 1 2016 below: The standard 60/40 portfolio grew an average of 9.88% per year. And not only that, but the Sharpe ratio was at a stellar 1.33! The Sharpe ratio is a standard industry measure for calculating risk-adjusted return. Sharpe ratio = (Mean portfolio […]

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Fiscal and Monetary Madness

Global Currencies Madness: When central banks and politicians “manage” global currencies, we can expect: Exponentially increasing debt and currency devaluations Massive inflations and deflationary crashes. Transfer of wealth from the many to the few. Derivatives exceeding $ 1,000 Trillion and eventually a crash. A mathematically inevitable financial collapse. Monetary and fiscal madness. Booms and busts. Much higher gold and silver prices. It has happened before and it will happen again… Last Century Madness: Weimar inflation in Germany 1921-1923: The exchange rate for Marks changed from 90 Marks to the US dollar in 1921 to over 4 Trillion Marks to the […]

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Silver Prices in Five Years?

What will the price of silver be in 2021?  You can find articles suggesting the price of silver will be over $ 1,000 and under $ 10.  Perhaps this is the wrong question. A better approach:  The global financial system is increasingly unstable and fragile, more so than in 2008.  The important question is: How will governments, central banks and financial systems respond to the ongoing crisis?  Future prices for silver are dependent upon the answer to that question.  I suggest three possible scenarios. Scenario One – status quo:  The next five years could look much like the last 20 […]

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(Interview) Europe: Why It’s Going to Get a Lot Worse Before It Gets Better

New interview with Elliott Wave International European markets expert. Brian Whitmer, the editor of our monthly European Financial Forecast, explains what indicators helped him anticipate market volatility. You’ll also learn what he’s expecting for the year ahead in European stocks. You can read Brian’s commentary comparing Germany to the Greek god Atlas as part of our report, Deflation and the Devaluation Derby. Here’s what you will learn: How Europe’s biggest economies are screeching to a halt Currency devaluation’s role in the developing global crisis How the self-reinforcing aspect of deflation is already apparent in commodities trading Why the top 1% […]

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Can the Fed Drop Interest Rates Below 0%?

For the financial markets, the biggest event of the week starts tomorrow: On Wednesday and Thursday (Feb. 10-11) Fed chair Janet Yellen will appear before Congress to deliver her semi-annual Monetary Policy Report. “It’s huge.” That’s how one strategist put it this morning, in a CNBC interview about the importance of Yellen’s testimony. Why are all eyes on Yellen? Maybe because by now, almost everyone has forgotten how powerless the Fed appeared in 2007-2009, when none of its measures could stop the financial crisis. Despite the recent market chaos, six years of rising stock prices reaffirmed the notion that the […]

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Zero Percent Inflation: Next Up, Deflation

During World War II, the Fed bought its own bonds to keep interest rates low and demand high enough to finance the war effort. Back then, the Fed’s efforts did what you’d expect: they caused a modest level of inflation. So you’d expect the unprecedented stimulus of today to create substantially higher inflation. In fact, with the greatest money printing in history, it wouldn’t be unreasonable to fear hyperinflation. That’s what most gold bugs fear. It’s what most everyone seems to fear. They’re completely wrong. Inflation is low… will stay low… and there will be no hyperinflation to speak of. […]

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