Financial Sense Blog

Europe has been pretty quiet lately. But apparently that was an illusion. The Eurozone’s slide down the slippery slope continues, but because the current stage involves colorless bureaucrats debating the terms of debt swaps rather than street riots and air strikes, it has been overshadowed by the chaos in the Middle East.

After a restless night, my mind darting about from one thought to the next, the battery-driven mechanical rooster lets loose with its rhythmic beep-beep-beep, announcing it’s time to stop pretending you are asleep, get out of bed, and get on with things.

Bad economic reports from China, Spain, and the U.S., sent stocks tumbling on Thursday to their biggest intraday loss since October.

In 1848, protests and revolutions swept through Europe. The specific causes were different in each country, but the underlying cause was the same everywhere: The middle and upper middle classes—politically powerless in these absolutist monarchies—wanted more control over their lives.

Warning signs that we are on the Threshold of Hyperinflation are multiplying. Riots caused primarily by Food Price Increases break out in several countries around the world. Oil prices shoot over $100/bblIf one considers the Real Numbers, and not the Bogus Official Statistics (see below) or Main Stream Financial Media Talking Heads’ Spin, one realizes that we are at The Very Threshold of Hyperinflation....

There is a lot of new-found enthusiasm for silver in certain parts of the blogosphere. And with the price up nearly 100% in six months, it is worth asking whether or not silver is about to tank between 30-50% the way it did after similar moves in 2006 and 2008. For reasons laid out below, I don't think so.

The key marker will be when almost all participants realize an economic downturn is at hand. The Fed will then counteractany economic weakness by promising even more damaging toxins (QE3 or QE 3 lite) for the inflation cancer-ridden patient.

On Valentine’s Day 2011, defensive assets began to show improving relative strength vs. the S&P 500.

Though the economy remains poised for continued recovery, the easy money has been made in the stock market rebound, as the rally celebrates its 2nd birthday.

Charting the Economy - GDP, Wages, and Wealth