The froth before another stock market crisis: Stock market is overvalued by 27 percent based on historical price to earnings ratio.
The stock market has once again become an overvalued casino where only the large financial players can use massive leverage to enjoy short-term rewards. Even looking at historical price-to-earnings (PE) ratios we find that stocks are dramatically overpriced. Yet the stock market is a sham for most Americans. In fact 53 percent of Americans don’t […]
US households cannot avoid soft default consequences of deleveraging: While US households continue to unwind debt total public debt soars out of control.
The US is walking in a financial minefield. The recent government shutdown simply highlighted the mega dysfunction in our Congress run by millionaires. The government is in a deep capture by large financial interests. The IMF now has an indicator looking at household debt measured against GDP. Since the recession, US households have undergone a […]
What is the Federal Reserve’s end goal? Follow the money and you will find no intention of tapering, out of control public debt, and financial steroids for stocks. Fed balance sheet up $55 billion in one week.
The Federal Reserve is known for producing convoluted and purposely hard to decipher messages. The media is driven by what the Federal Reserve says but fails to analyze what is truly happening. The Fed is driving in a car with no brakes. This is clear given that the Fed balance sheet increased by $55 billion […]
Blue pill of debt exchanges temporary increase in debt for inflation: Taking the blue pill of a fabricated world addicted on debt as US standard of living hits 10-month low.
Most of you have seen The Matrix where Neo is given the choice between taking the blue or red pill. The red pill would allow Neo to escape The Matrix and enter reality whereas the blue pill would allow him to stay wandering in the fabricated world of the Matrix. The US government in essence […]
Nothing left to financially lose: Biggest drop in confidence since Lehman Brothers and why some are unmoved by government shutdown.
The government isn’t the only thing that shutdown. Economic confidence in the US has also apparently shutdown as well. Many people, in particular those in the media, seem perplexed as to why and how this can happen. Unfortunately the current financial system has disenfranchised a large number of Americans. Enough to the point that politics […]
A road to unsustainable debt: CBO reports that US is on unsustainable budget course as spending exceeds revenues.
A recent CBO report came out with a rather sobering outlook of our governmental spending habits. The word “unsustainable” is probably not something you want uttered in a report about meeting a budget. Yet that has been our recent trajectory when it comes to spending. The massive financial crisis and subsequent bailouts have resulted in […]
To taper, or not to taper. Not the question if you are the Fed: Austerity intact while Fed balance sheet continues to expand.
The Federal Reserve has hinted at slowing down its Quantitative Easing machinery but that might face some challenges as the stock market experienced one of its worst months in over a year. This is not to say that the Fed should respond to the stock market when it sneezes but it makes it more unlikely […]