Does anyone realize how far stocks rallied from 2009 to 2021? The Dow Jones Industrial Average was under 7000 in 2009 and hit over 36,000 in 2021. What is stretched so far one way eventually snaps back the other way? Of course, much of this performance was due to debt, money printing, and abnormally low […]
Tag Archives: interest rates
The Federal Reserve is expected to lower interest rates again with another ‘insurance’ rate cut. Some economists say it will help keep growth afloat, others say the lower interest rate will have little impact on the economy since rates are already near historic lows. No one really knows what will happen until later. What you […]
What’s the new risk-free? That’s the question during this time when government bonds can’t provide the safe haven they traditionally offer as an asset class. In 1998, when equities fell, if you had bonds, you did really well. Because bond prices went up when equities fell. If you did your portfolio rebalancing and sold out […]
Gold wins as a store of value for money when the time value of money collapses. What is the time value of money? The time value of money means money available now is worth more than the identical sum in the future due to the possibility of making money by placing it somewhere to earn […]
The Federal Reserve interest rate cut was applauded by Wall-Street; they called it an ‘insurance’ rate cut. Maybe stock investors intend to behave recklessly. Economists’ opinions differ on the rate cut.
Last week was the 75th anniversary of the Bretton Woods agreement. The agreement was collapsing in the 1960s and finally ended during the 1970s when the US abandoned the gold standard. Since then the price of gold has risen to over $1,350 an ounce from the value at the congressionally set price of $35 per […]
If you want to save money you need to think about why the Federal Reserve will be whipping out your cash savings Around the world, people are paying for the privilege of lending money to governments. This may seem a bit odd to you, but it is true. If you think that is it basically […]
Central bank financial repression policy leaves savers around the world with few choices. Last week the price of gold soared to a five year high after central banks around the world indicated they would push interest rates lower and print more money to keep interest rates low. Essentially either pushing savers to or keeping them […]
The European Central Bank shockingly slashed the 2019 Euro economic outlook from 1.7% to 1.1%. ECB President, Mario Draghi, told reporters, The weakening in economic data points to a sizeable reduction in the pace of economic expansion that will extend into the current year.