Turkey has major economic problems and it appears that their currency is on the verge of collapse. To keep the Turkish economy afloat, many European banks have extended credit to prevent the debacle. Spain’s second largest bank lent $18 billion and France’s BNP lent $40 billion. They question is, will this be enough. Since 2013, gold is up four times in relation to the Turkish lira. In addition, Turkish banks have amassed a sizable amountRead More →

This is a subject which has been talked about for at least a decade, it’s the wage gap between the 1%s and the rest of us. Center on Budget and Policy Priorities (CBPP) found that between 1979 and 2013 the percentage increase of the 1%s was 5 times larger than the middle 60% and 4 times larger than the bottom fifth. Since 2013, the divide has continued to grow. A subject which hasn’t been broachedRead More →

Trump signed three executive orders taking aim at federal workers and the employees are irate.  The orders will make it easier to dismiss employees whom are not performing up to expectations or are guilty of misconduct. The first order is meant to address the issue of dealing with workers demonstrating a history of poor performance.  It limits the amount of time an employee under investigation for misconduct could spend on probation. The second order targetsRead More →

The feds made the decision to stay the course with QT, this decision has very dire consequences.  The fed’s objective is to reverse the damage caused by years of QE.  It may seem logical but the loose money policy has engendered a financial market that no longer reacts normally, it has also skewed the amount of debt companies would normally hold. Starting with the bail outs, the companies especially the banks ignored the business modelRead More →

The US Dollar broke through resistance and now is currently at 94.4.  This is a measure of the strength of the dollar relative to the overall currency market. Some background on the effect a strong or weak dollar has on trade and the pricing of goods.  A strong dollar portends that another countries currency is weaker against the dollar so products which are import from that country will be cheaper because they are priced inRead More →

The inversion of the yield curve has preceded most recessions.  This is the reason trend forecasters use it as an indicator of the future when applied to business activity.  It has a valid basis when one considers the underlying factors that are used to evaluate the price of bonds. A yield curve is the relationship between the cost to purchase a bond to the amount an investor will receive over the term of the bond. Read More →

A neighbor of China, Kygyzstan has been amassing a sizable gold reserve in relation to the size of their country.  They have international reserves of about $2 billion and they have stockpiled about 16% of this reserve in gold, their goal is to build the percentage to 50%. The country’s Central Bank Governor said “The rules of the game are changing.  It doesn’t matter what currencies we have in our reserves;  dollars, yuan or rublesRead More →

It is easy to find a scapegoat, the most obvious is the student. The previous generation’s parents grew up in a world where a college education was a must, so they brought up their kids to believe that they needed a college education to succeed. These kids were duped so the next scapegoat is the parents. They were just following a tried and true rule that was true when they were growing up. Their parentsRead More →

Malls continue to lose stores and the trend for this year looks like it will be more of the same. I recently read articles indicating that the flagship stores are scuttling more of their locations. If you can call Dick’s Sporting Goods a flagship, I would anticipate that they will be downsizing after their decision to end selling assault rifles. Last year Dick’s was the only ray of hope for the malls, they opened largeRead More →

For an explanation of the title, back (even before my time) there was this saying that went ‘shave and a haircut – 2 bits’, I think 2 bits was a quarter. What’s taking place in Venezuela has gotten so money is pretty much irrelevant and produce is king. This is exactly what happens when a country goes into hyperinflation, money goes irrelevant. According to Fabiola Zerpa, a haircut now costs 5 bananas and 2 eggs.Read More →

Argentina’s Mauricio Macri raised the country’s interest rates to 40% in an attempt to defend the peso. Over the past months, the rate has risen from 27.25% in April. The peso is slumping because foreign investors are moving their money out of the peso and converting it to dollars. They are seeking the increased rates offered by the US federal reserve. Seeing the peso falling, local Argentinians are following by converting the pesos into dollars.Read More →

So money doesn’t grow on trees? At the end of 2015, the majority of the public were in favor of raising the minimum wage to $15. Politicians everywhere were including it in their platforms saying that it was only fair to make business owners responsible for providing their employees a living wage. It was the new talking point and surely it gained them votes. Given a population who are of the mind that they areRead More →

It is painful to read about the dire problems in Venezuela. A cup of coffee now cost 75,000 bolivars up from 1,800 bolivars, that rise took just over a year. That’s an increase of 4,067%. This is a textbook example of what happens when your government loses control over their economy. It can happen in many ways, one way is by printing money at will. I expect that soon the American dollar will go theRead More →

Source: giphy.com After 6 decades, Toys R Us is closing all its US stores. They filed for bankruptcy about 6 months ago as they tried to pay down around $8 billion of debt. They were not successful in finding a suitor and it is reported that they stopped paying their suppliers. They also announced that they are planning on closing all their UK stores. A bid was made on their Canadian stores. MGA Entertainment bidRead More →

The quick answer to the question posed in the title is no one. Two weeks ago the US Department of Treasure released its own internal projections for the federal government’s budget deficits. The Treasury anticipates it will need to borrow about $1 trillion this fiscal year, $1.1 trillion next year and $1.3 the following year. Based on their projection, the national debt will exceed $25 trillion by 2020. Where does the money come from? TheRead More →

Economically there is a mathematical equation the is meant to describe the relationship between the money supply, the velocity of money, the inflation and the economic output. This may seem a little complex but I will attempt to break it down. The equation is: MV = PQ where: M = money supply V = velocity of money P = inflation Q = economic output Looking at the equation in mathematical logic, if MP increases thenRead More →

Peter Boockvar thinks it is the end of QE. He explains that The Bank of England is keeping its benchmark rate at .5% while the CPI is at 3% to lay the groundwork for a future rate hike. The BoE said ‘monetary policy would need to be tightened somewhat earlier and by a somewhat greater degree over the forecast period than anticipated at the time of the November report’. If you read between the lines,Read More →