What makes the recent crisis particularly interesting is the role of the government. The U.S. government has been unequivocal in its intention to promote universal home ownership and thereby lessen inequality in the attainment of the American dream.
The talking heads and so-call analysts that are advocates of this being a new bull market have simply not done their homework. In my opinion, as is the case with the public, they too are being lead by emotion.
As kids, not knowing that we were being politically incorrect on so many levels, we would shout “Geronimo!” when we were playing war or getting ready to do something reckless.
Last Friday was one of those days when so many markets move so dramatically that it’s hard to know what to focus on.
I think a lot about thinking in an attempt to improve my ability to make good decisions. I also work hard to avoid linear thinking, which tends to extend present conditions “linearly” into the future.
The latest issue of the NFIB Small Business Economic Trends is out today. The June update for May came in at 94.4, which, despite a 3.2 point gain, remains in the lowest quartile of this indicator across time at the 22nd percentile in this series.
Earlier this month, in an article for “Project Syndicate” famous American economist Nouriel Roubini joined the chorus of those who declare that the multi-year run up in the gold price was just an almighty bubble, that that bubble has now popped and that it will continue to deflate.
There are two market warning signs which have just recently been triggered and which have gotten a lot of press attention due to their catchy names. The Titanic Syndrome was created in 1965 by the late Bill Ohama.
Three factors – volcanic debris, more variable polar jet streams and increased human habitation in high-risk areas – are creating extreme weather and high insurance payouts. Some of these are temporary while other factors will last for decades.
Back in 2002 Warren Buffet famously proclaimed that derivatives were ‘financial weapons of mass destruction’ (FWMDs). Time has proven this view to be correct. It is difficult to imagine that the US housing and general global credit bubble of 2004-07 could have formed without the widespread use of collateralized debt obligations (CDOs) and various other products of early 21st century financial engineering.
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