Sublime

Do we think the Fed will abandon its responsibility to control inflation and resort to total monetization of U.S. debt? No. But in the attempt to get mild inflation, it is possible the controlled fire they hope to kindle could get out of control, forcing them to act to take back the excess reserves and bring about a recession, as did Volcker. Let’s

Por outro lado, não parece ser boa ideia usá-los para fins oficiais, por deixarem de lado parte do “verdadeiro” custo de vida, bem como pelos riscos de interferência do governo, seja para mascarar a inflação, seja para, de alguma forma, reduzir o valor de suas dívidas.

Such large-scale debt buildups pose risks because they make an economy vulnerable to crises of confidence, particularly when debt is short term and needs to be constantly refinanced. Debt-fueled booms all too often provide false affirmation of a government’s policies, a financial institution’s ability to make outsized profits, or a country’s standa

The title for the chapter on Japan is “A Bug in Search of a Windshield.” While the currency of the Land of the Rising Sun is very strong as we write, there are real structural reasons, as well as political ones, that lead us to predict that the yen will begin to weaken. At first, it will be gradual. But without real reform in government expenditure

Imposing negative interest rates is strip-mining the capital stock.

Straus found academic papers arguing that global central banks have a distaste for abrupt currency moves, which can disrupt economies, so they step in to slow sharp moves in either direction, thereby extending those trends over longer periods of time.

Let us give you one scenario that worries us. Congress shows no discipline and lets the budget run through a few more trillion in the next two years. The Fed has been successful in reflating the economy after it has embarked on even more aggressive quantitative easing. The bond markets get very nervous, and longer-term rates start to rise. What lit

there is a well-known pattern in government behavior called financial oppression: There exists an alternative to outright default. “Financial oppression” (imposing on creditors real rates of return that are either negative or artificially low) has been used repeatedly in history in similar circumstances. Investors should be prepared to face financi