It may seem a little suspect to use the words ‘another’ and ‘rare’ together as has been done in the title. After all, if one is using the adjective ‘another’, shouldn’t one be questioning the supposed rarity of the object to which it refers? Well, there is a point to this; so if the immediate trends in the Fed’s balance sheet continue, we will probably have to stop using such phrases. The reason why it’s ok for now is because there have only been four weeks in 2011 (including this one) in which the Fed’s balance sheet contracted. Here, I present several charts relating to the Fed’s balance sheet and consider the investment implications of the recent stagnation in the total balance sheet size. continue reading »

Marc Faber was interviewed on Bloomberg TV yesterday (19/8/11). He spoke about US treasury bonds, gold, equities & currencies. See below for the video and summary.

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Right on schedule, the US Treasury received around $11 billion from the proceeds of Mortgage-backed Securities sales last Thursday. Moreover, the US Treasury released an update on the MBS portfolio wind down titled; ‘Taxpayers Recoveries Reach 70 Percent Milestone‘. The title left us thinking; hmmm… sort of… Here, I highlight the hidden confiscation involved with this particular piece of trickery and present the usual daily treasury statement charts.

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As our regular readers may know, we’ve been taking note of the economic unravelling of the Russian Federation over recent weeks and months. Our main contention has been that the prevailing monetary conditions have been creating profound economic and financial stress. Here, I present two further pieces of the puzzle.

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Monday was the 40th anniversary of the irredeemable fiat dollar. Unlike the preceding 39 anniversaries, this one was actually noticed! Here, I present several charts that show the changes to the Fed’s balance sheet since 1971. I conclude that the current gold price may be as ‘cheap’ as it was in 1971!

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If we had to choose to indulge in just one form of pseudo financial mysticism, we would undoubtedly go for the view that financial assets tend to move in generational cycles.  In short, we believe that nothing is more conducive to action than good old muscle memory. Here, I explain why the recent crash in the array of ‘risk assets’ is corroborating our hunch about the generational nature of trends in financial assets. Moreover, I consider one way in which widespread apathy towards speculation may come to pass.

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Apologies for missing last week’s update and for the delay in publishing new content on the main page (we’ve been busy with our monthly newsletter). Here, I present an update of the weekly inflation vs deflation google insights chart for 15/8/11. It looks like we’re at the beginning of a spike in deflation fears (relative to inflation worries).

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