Financial Sense Blog

The US national debt is now over $16 trillion — and growing at the rate of more than $1.2 trillion a year. This is clearly unsustainable. But how to cut the debt? One way is to cut entitlements, which are growing exponentially. Will they cut Medicare? Cut food stamps? Cut any entitlements at all? No politician would dare make extensive cuts in entitlements.

If there is any demarcation with profound implications going forward, it isn't the line between the 1% and the 99% or the line dividing the Status Quo into two safely complicit ideological camps: it is the divide between those who squarely face the burden of knowing the present is unsustainable and those who flee into the comforts of denial.

When money is debased, social cooperation is hampered. There is even more to this in fact: the fiat money system, which has become such an indispensable feature of the modern-day welfare-warfare State, severely erodes peoples moral values. This is because it enables the belief that one can get something for nothing to become ever more entrenched.

A near-death experience isn’t something one gets over right away. So it’s no surprise that the US leveraged speculating community was a tad more cautious than usual for a while. Real estate investors, for instance, still bought houses, but only on very favorable terms where rental income would clearly exceed expenses.

The ISM nonmanufacturing index was better than expected for the month of September. The index increased to 55.1. This the highest level since March. While manufacturing numbers have not been stellar lately the number today shows improvement in the service side of the economy. ADP employment data gave a reading of 162,000 private sector jobsadded in September.

New census bureau data show the direct link between percentage of bachelor’s degrees and median income in urban areas.

Today the Institute for Supply Management published its August Non-Manufacturing Report. Today's headline NMI Composite Index is at 55.1 percent, registering its third month of faster growth and its best level since March. The Briefing.com consensus was for 53.0 percent.

The Federal Reserve is probably not ready to take the aggressive plunge into Nominal GDP Targeting, but it likely will.

Even amid a rising stock market individual investors in the U.S. continued to pull money out of equity mutual funds in July, handing those funds their 15th consecutive monthly net outflow.

Spot market old prices rallied to $1781 per ounce ahead of Wednesday's US session, recovering from slight losses earlier in the day to stay in line with recent trading, while stock markets were broadly flat and the Euro reversed earlier gains, as analysts speculated on when and whether Spain will request a bailout.