Meraglim Blog
Ice-Nine Comes to the Desert. Saudi Political Targets Scramble for Gold.
In my most recent book, The Road to Ruin, I describe a phenomenon called “ice-nine.” The idea is that in the next financial panic, regulatory authorities will not be able to print money or lower rates enough to stop the panic because they failed to normalize rates or balance sheets after the last recession. Liquidity will
With the Party Congress Over, China Cools Off Right on Schedule
We told readers not to expect financial fireworks in China through 2017. The reason had to do with a Communist Party Congress that happens every five years and just concluded. China’s President Xi Jinping wanted a second five-year term and expanded powers from the Congress, and he got it. He also wanted to make sure
After Ten Years of Easy Money, Investors May be in for a Shock!
It’s true that the Fed has been raising interest rates since 2015, and had engaged in tapering for two years before that. Yet, these actions hardly constitute tight money. The tightness or ease of monetary policy needs to be judged relative to financial and economic conditions. You can have “easy money” at a 10% interest
Signs of a Stock Bubble Are Everywhere. Here’s Another One.
The article above described the stock market (and other markets) as a bubble. Where’s the proof for this? Actually, it’s everywhere. The Shiller CAPE ratio is at levels only seen at the 1929 crash that started the Great Depression, and the 2000 dot.com bubble. Likewise, the market capitalization-to-GDP ratio is above the level of the 2008
You Know the Bubble is Bursting When the Last Bear Throws in the Towel.
To paraphrase one of the great gems of Wall Street wisdom, “Nothing infuriates a man more than the sight of other people making money.” That’s a pretty good description of what happens during the late stage of a stock market bubble. The bubble participants are making money (at least on a mark-to-market basis) every day.
Get Ready for a North Korean H-Bomb Test in the Atmosphere
North Korea is suffering an unusual and self-inflicted setback in its nuclear weapons development programs — “mountain fatigue.” North Korea uses underground facilities in Mount Mantap to test its nuclear detonations. The most recent test on Sept. 3 was of an H-bomb, North Korea’s most powerful yet, estimated to have produced a blast of up to 280