Financial Sense Blog

A Harbinger of Things to Come?

The Federal Reserve’s Vice-Chair Janet Yellen provided a spirited defense of the Fed’s quantitative easing program at the American Economic Association annual meeting last week. She laid out what clearly seems to be the conventional wisdom inside the Fed as to the effects of its crisis programs, the results of the current additional $600 billion of additional asset purchases, and the hoped-for path of employment flowing from those policies.

Yearly Cycle Low Approaching

Sometime between early February and early April the market should drop down into a major yearly cycle low. Last year that cycle low came during the first week of February.

Spot the Bubbles

Let the truth be known, the world is being held hostage by powerful bankers. Thanks to the fiat-money fractional reserve system, bankers have become the ruling elite and as a result, entire nations are going bust.

Budget Battles Ahead

I began writing this note on New Year’s Day; the holiday season is over all too early for me as I contemplate the coming year. Along with other investors, I have many worries, but at the top of my list is the budget battle that will be fought in Washington, every state capital and most capitals of high-income countries abroad. As I finish this note, Republicans are now in charge of the House of Representatives.

The Key Asset Classes For 2011

Will be: oil, gold, And stocks.

Economic growth will be fine. The debt overhang will be handled by continuing and accelerated quantitative easing. Looking ahead, we are quite optimistic about demand for stocks, gold, and commodities in 2011.

Gold Outlook 2011

Irreversible upward pressures and the China effect

Good afternoon. It is a pleasure to return to the Empire Club to discuss the outlook for gold and precious metals in 2011. I know this may appear to some to be an enviable job—getting to speak about the one asset class that seems to continually out-perform all others year after year—but it is a double edged sword.

Agri-Food Thoughts

ONIONS! Will the onion shortage in India bring down another government, as was the case in 1998? Onions in India are much like garlic in Italy, an essential part of the good life. In India, onion demand is exceeding the ability of the nation to supply onions. Price of onions has doubled(AFP, 22 December 2010).

As China Market Corrects...

Rare earth crisis takes center stage

History is replete with seemingly unexpected and catastrophic appearance of events that nobody saw coming. In the old days, we have Biblical prophets who sounded clarion alarms. Now we are past the age of prophecy. As in historical watersheds, we suddenly find ourselves congealed in the volcanic ash of a modern Vesuvius eruption, which leads us to scratch our heads of how in the world did we come to this point with rare earth supply fears?

9 Market Predictions for 2011

The bear market in bonds will be confirmed globally. While interest rates likely bottomed in 2010, a significant rise in rates during 2011 will confirm a bear market trend for smart money investors. This bear market will continue until the global currency market is restructured.

Forecast 2011: Better than Muddle Through

It is time once again to throw caution and wisdom to the wind and actually make my 11th annual forecast. I have to admit this is the most stressful letter I write each year. I do at least 5-10 times more research and thinking about this issue than any other. On a positive note, this may be one of the more optimistic forecast letters I have done in a long time. But there are some asterisks, as always.

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