Even while the Fed and Treasury are fighting deflation and a serious recession, they are laying the ground work for a new liquidity bubble with the potential for devastatingly high inflation. While the current news is dominated by recessionary GDP, falling consumer confidence, banking rescues, incredible stock market volatility and frozen short term money markets, […] [read full story]
Category Archive: Leverage
INFLATION, FED POLICY AND THE LIQUIDITY TRAP – THERE’S STILL TIME!" rel="bookmark">INFLATION, FED POLICY AND THE LIQUIDITY TRAP – THERE’S STILL TIME!
While many believe that Federal Reserve policy over the past year has been inflationary, there is clear evidence that money supply is falling in real terms and there is a strong monetary bias to deflation and GDP shrinkage. In February, 2008 I was on FOX Business Network and discussed the implications of deleveraging the financial system […] [read full story]
FREDDIE MAC AND FANNIE MAE – THE ONLY SURPRISE IS THAT ANYONE IS SURPRISED" rel="bookmark">FREDDIE MAC AND FANNIE MAE – THE ONLY SURPRISE IS THAT ANYONE IS SURPRISED
I don’t understand why anyone is surprised at the likely collapse of Freddie Mac and Fannie Mae. It has been inevitable for a long time that they are destined to fail and the sooner the government realizes this inevitability the better. While Freddie Mac and Fannie Mae are generally referred to as “government sponsored entities” […] [read full story]
BROKERAGE FIRMS – THE BUSINESS MODEL DIED DECADES AGO WITH THE ROTARY TELEPHONE" rel="bookmark">BROKERAGE FIRMS – THE BUSINESS MODEL DIED DECADES AGO WITH THE ROTARY TELEPHONE
Here’s a news flash for executives at brokerage firms; changes in technology reduce margins and make business models obsolete and the brokerage industry doesn’t have special immunity from technology change. Barron’s front page article on June 30 (subscription required) suggesting that “Wall Street does have a future – one that looks surprisingly bright…” doesn’t understand […] [read full story]
MINIMUM STANDARDS FOR CEOs OF GLOBAL BANKS – WHAT SHOULD THEY KNOW ABOUT LEVERAGE?" rel="bookmark">MINIMUM STANDARDS FOR CEOs OF GLOBAL BANKS – WHAT SHOULD THEY KNOW ABOUT LEVERAGE?
I have been an outspoken critic of too much leverage in the financial system for the past several years. On CNBC and Fox Business Network I have spoken out against the dangers of bank and brokerage over leverage and suggested that such over leverage could cause a repeat of the Great Depression. Like a giant […] [read full story]