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Tag Archives: Money Supply

No Inflation? Money Supply Continues to Grow at Record Rate

To hear Federal Reserve officials, politicians and mainstream financial media pundits tell it – there is no inflation. In fact, the consumer price index remains “stubbornly low” according to those who view rising prices as an economic good. But inflation defined correctly is rampant. In fact, it is at all-time record levels.Strictly speaking, inflation is an increasing money supply, and by that measure, it hs set records for five straight months.Last month, year-over-year growth in the...

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Peter Schiff: Getting the Definition of Inflation Right

What is inflation?When analysts, politicians and pundits talk about inflation, they usually mean rising consumer prices as measured by the consumer price index (CPI). Peter Schiff and Jim Rickards debated this on Kitko news. Rickards also used this definition, insisting there is no inflation right now. Peter said, “Of course there is. The Fed is inflating like crazy.”The ensuing debate led Peter to address the issue of inflation on his podcast. Peter called the modern mainstream definition...

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QE Infinity: Money Supply Grew at Record Rate in April

The money supply growth rate surged to an all-time high in April as the Federal Reserve created cash at an unprecedented rate through quantitative easing and other money-creating monetary policies.According to Ryan McMaken at the Mises Institute, the only time the Fed has come close to this level of money creation was in the 1970s – the era of stagflation. It was expected that money supply growth would surge in recent months. This usually happens in the wake of the early months of a...

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Peter Schiff: Everything Old Is New Again

Years ago, markets used to pay a lot of attention to the money supply and trade deficits. Now, these numbers barely get a passing mention. In his latest podcast, Peter Schiff said he thinks what is old will become new again and trade deficits and money printing will once again come front and center.The dollar has been trending weaker over the last few weeks and bond prices have been falling, with bond yields increasing accordingly. Peter said this reveals the problems that are building in...

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The Reasoning Behind Gold’s Breakout

Goldmoney Insights Gold’s dramatic move above $1400 has caught the investment establishment by surprise. Physical gold ETFs, as a proxy for direct portfolio investment, amount to only 0.05% of the estimated $250 trillion of global investment values. As well as being badly wrongfooted, investment managers have little understanding of the role of gold as money, believing it to have no role in the monetary system. They will have to undergo a rapid re-education. This article addresses their...

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Market Brief: Silver-Gold Ratio Widens, Disconnect Between Gold Price and Money Supply

Silver/Gold Ratio Continues to DivergeThe silver/gold ratio continues to diverge, favoring silver as relatively cheap compared to gold at the moment. This presents an attractive opportunity for silver. The white metal could benefit, along with gold, as a “safe haven” asset in a weakening economy with plenty of uncertainty surrounding the trade war and Brexit.The silver/gold ratio was over 89:1 on May 29. That means it takes 89 ounces of silver to buy 1 ounce of gold. The modern average...

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Monetary policy effectiveness: Regimes and instruments

The Mercatus Center has a new working paper by Hylton Hollander and Lars Christensen.  Here’s the abstract: The monetary authority’s choice of operating procedure has significant implications for the role of monetary aggregates and interest rate policy on the business cycle. Using a dynamic general equilibrium model, we show that the type of endogenous monetary regime, together with the interaction between money supply and demand, captures well the actual behavior of...

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The Great Reset, Report 8 July 2018

Before it collapsed, the city of Rome had a population greater than 1,000,000 people. That was an extraordinary accomplishment in the ancient world, made possible by many innovative technologies and the organization of the greatest civilization that the world had ever seen. Such an incredible urban population depended on capital accumulated over centuries. But the Roman Empire squandered this capital, until it was no longer sufficient to sustain the city (we are aware the story is more...

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Ben Bernanke and Company Pass “Chapter 9” with Flying Colors

A 1980s era cartoon featured a veterinary student named Doreen studying equine medicine in Chapter 9 of her textbook. On the left-hand side of the page was a list of horse ailments. They included things like a broken leg, infected eye, runny nose, and a fever to name just a few. On the right-hand side of the page, the treatment for each ailment was “Shoot.” The caption read, “Like most veterinarian students, Doreen breezed through Chapter 9.”Ben Bernanke, Milton Friedman and the Ivy...

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A Great Big Warning Sign

Jerome Powell came out pretty hawkish in his public debut yesterday. The new Federal Reserve chairman said he sees little risk of recession and reaffirmed plans to continue tightening the money supply through interest rate increases and quantitative tightening.My personal outlook for the economy has strengthened since December. I don’t see [the recession risks] as at all high at the moment.”But there are signals that Powell’s optimism is unwarranted and that the monetary blanket knitted...

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