As it turned out, Mr. Whipple used to get more of a squeeze out of a roll Charmin than the great 2021 silver squeeze. The price went from $25 an ounce to $30 and back down within a couple of days. “Is that all there is?” Peggy Lee once sang.
All in Economics
Infinite Confidence
Financial complexity has far outstripped the knowledge and imaginations of central bankers. Same think, group think, derivatives and herd mentality have caused markets to far overshoot reasonable valuation. Citigroup Inc.’s chief U.S. equity strategist Tobias Levkovich “panic/euphoria” index illustrates the point. On this measure, euphoria is its highest on record, exceeding even the tech bubble, reports Bloomberg.
Fed Fiddles While Dollar Burns
It’s no secret Mr. Putin initiated the strategy to “de-dollarize” Russia’s economy. The yellow metal is now the second-largest component of the central bank’s reserves after the euro, which make up a third of its reserves. Chinese yuan reserves make up 12 percent.
Tweeting "Fire"
Facebook, Twitter, Instagram and social media company XYZ own the platforms that Trump communicates from and these firms have every right to accept and reject users as they see fit. Even in the case of the person who yells “fire” in a crowded theatre, that person “has no right to do so because he is aggressing against the contractual property rights of the theater owner and of the patrons of the performance,” Rothbard wrote.
The Upside of Lockdowns
Rosenberg’s first line sounds like John Maynard Keynes’s “Paradox of Thrift” theory which claims that personal savings are a net drag on the economy during a recession. The second line sounds more like Ludwig von Mises, who wrote, “Capital is not a free gift of God or of nature. It is the outcome of a provident restriction of consumption on the part of man. It is created and increased by saving and maintained by the abstention from dissaving.”
Low Rates, Limited Liability, Hot Markets
Referring to Dizard’s FT piece in a series of tweets just after Christmas, Bank analyst Chris Whalen said, “"With 30-year conventional mortgage rates closing in on 2.5% APR and the FOMC buying 1.5% MBS coupons as part of quantitative easing, this is a good time to take cash off the table in IMBs and REITs, and go buy a well-located residential home."
Negative Rates Path to Natural Poverty
ADG consulted interest rate historians Sidney Homer and Richard Sylla who opined “nominal negative yielding debt had never been seen in material size in the 4,000 years of interest rate history prior to the current cycle.” Economist Ludwig von Mises never imagined such a thing,
Rich Millennials Plot the End of Civilization
“He wants to put his inheritance toward ending capitalism,” Zoë Beery wrote for the NYT, “and by that he means using his money to undo systems that accumulate money for those at the top, and that have played a large role in widening economic and racial inequality.” Wow, that is some self-loathing. If only Ludwig von Mises were able to counsel young Jacobs, whose grandfather founded Qualcomm, and is set to inherit $100 million. In his book Epistemological Problems of Economics, Mises wrote, “Through all the changes in the prevailing system of social stratification, moral philosophers continued to hold fast to the fundamental idea of Cicero’s doctrine that making money is degrading.”
The Weirdest, Most Distorted Economy Ever
The US economy is split into “the weirdest economy ever” when writing about The Trucking Boom and Online sales, and “the most distorted economy ever” when addressing the record low junk bond yields.
Consumers Drive COVID Response Not Government
Libertarians who claim the government’s actions are worse than the disease, are giving the government too much credit. Consumers are driving the slow-down, not governments.
Central Banks Put Wind at Bitcoin's Back
In investmentland, it’s “Bitcoin, Bitcoin, Bitcoin,” again knocking on dollar door number 20,000, where it ventured in late 2017. Bloomberg’s November 21st edition features this flashy headline sure to inspire FOMO (fear of missing out) the predecessor of the more quaint Keynesian Animal Spirits
Novices Chase Stocks, Gold goes Unloved
Meanwhile, the ever-unloved asset, gold, goes unnoticed by the stock trading debutantes. After a sprint upward in price above $2,000, the yellow metal hangs listlessly around $1,870 these days, while the aforementioned Bitcoin is repeating a parabolic move toward $20,000.
Judy, Judy, Judy
Trump’s lady in waiting for the Federal Reserve, Judy Shelton, is losing Republican support by the day. The Washington Post unleashed its comeliest columnist, Catherine Rampell, to finish off Ms. Shelton, who’s primary negative is her past support for the gold standard, and her questioning the need for the central bank at all.Adherents of the Austrian School of Economics have been cuckoo for Shelton for those very reasons, but, Ms. Rampell describes the Fed nominee as “a demonstrably unqualified partisan quack.”
With Biden in The White House and Yellen at Treasury, Do You Own Enough Gold?
Think about it; with Joe Biden in the White House, Janet Yellon at Treasury and Jerome Powell at the Eccles Building, do you own enough gold?
Fed Balance Sheet Heading Towards $40-$50 Trillion?
Maybe the economy wasn’t so hot. Dannielle DiMartino Booth, who once worked for Richard Fisher at the Dallas Fed, told Raoul Pal on Real Vision, “September the 16th [2019], when they launched Not QE. Because the inversion of the 2s 10s had passed the 30-day mark, and they're like, oh my god, history says that we're in recession.
Enterprising, Economics Savvy, BYU-Idaho Students Try to Collect Valuable Plasma
This may be overblown. BYU-Idaho administrators might be clairvoyant and issuing warnings just to head off any bright ideas students might have to raise a little money. WRCBtv reports, “Mimi Taylor, spokeswoman for Eastern Idaho Public Health, told CNN that she believed the school put out the statement as a preemptive measure intended to keep students from getting any ideas.”
Banker's Wishful Thinking.
Benoit points out that the banks used a bit of financial hocus pocus to improve their earnings. “The results were boosted because the banks didn’t have to put aside as much money to cover future loan losses,”
Entrepreneurship on the Fly
Masks of all shapes and sizes are everywhere. But now, just in time for halloween, a company called 3wishes, the very morning after a fly landed and stayed on VP Mike Pence’s grey carefully coiffed hair during last night’s Vice Presidential debate has created the Debate Fly Wig. T
Plagues and Bubbles
While speculators in London’s Exchange Alley furiously bid up the price of South Sea Company shares, word came that two dock workers unloading wool were overcome by dizziness.
Protecting Wealth: Under the Mattress vs. FAANG Shares
“The trend could put more Americans on a path to greater wealth and financial security,” Krantz writes, presumably with a straight face. “But it remains to be seen if the beginning investors will stick around for the long haul — or if they'll have the investing skills to avoid losses when stocks take a tumble.”