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Categories: Economics

Has The Fed Already Lost?

Chris Martenson - 7 hours 43 min ago

Increasingly we live in a world of Now. Instantaneous access to digital real time data and news has simply become a given in our lives of the moment.

You may be surprised to know that the Federal Reserve has taken notice.

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Categories: Economics

The Future Of Interest Rates

Chris Martenson - 7 hours 44 min ago
Executive Summary
  • Why the Fed may no be able to raise rates from here
  • Will the Fed go to negative interest rates instead?
  • Why the next recession will limit the Fed's options greatly
  • Why it may well be too late for the Fed at this point to act

If you have not yet read Part 1: Has The Fed Already Lost? available free to all readers, please click here to read it first.

What If The Fed Isn't Actually Able To Raise Rates From Here?

Let’s start with a look at the history of the Federal Funds rate (the shortest maturity interest rate the Fed directly controls).  Alongside the historical rhythm of the Funds rate are official US recession periods in the shaded blue bars.   

Chart Source:  St. Louis Federal Reserve

Of course there is one striking and completely consistent historical commonality in the behavior of the Funds rate over time.  The Fed has lowered the Federal Funds rate in every recession since 1954 at least.  There are no exceptions.  You can see the punchline coming, can’t you?  Just how does one lower interest rates from zero to stimulate a potential slowdown in the economy?

Of course in the banking system...

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Categories: Economics

Daily Digest 4/17 - Canadian Oil And Gas Firms 'Bleeding Money,' What's Really Driving Gold

Chris Martenson - 12 hours 38 min ago
  • You Can't Have a Functioning Democracy Without High Quality Infrastructure
  • The Clintonian Theory of Foreign Money
  • Conspiracy Theorists, Bloggers Compared To ISIS During Congressional Hearing
  • World Bank projects leave trail of misery around the globe
  • What Is Really Driving Gold
  • Gold, Silver, Yen & S&P Correlation
  • Feds change no-fly procedures to evade judicial review
  • Canadian oil and gas firms 'bleeding money' amidst darkest outlook in a decade
  • Oil Market Too Murky To Call, Says IEA

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Categories: Economics

Off the Cuff: Hot Money, Cold Econony

Chris Martenson - April 16, 2015 - 11:28

In this week's Off the Cuff podcast, Chris and Brain Pretti discuss:

  • Global Capital Flows
    • The hot money is fleeing Asia and inflating Western assets
  • What Recovery?
    • GDP growth appears to be returning to 0%
  • What Will Happen When The Fed Raises Rates
    • Or better put: can it raise rates without destroying the economy?
  • Lack Of Competent Leaders
    • Those making the big decisions are not the ones we want making them

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Categories: Economics

Daily Digest 4/16 - The Rise Of The Paper Machines, Hydrogen Fuel Cells Return

Chris Martenson - April 16, 2015 - 07:24
  • Detroit, Stockton bankruptcies may flag wider problems -Fed's Dudley
  • The Common Painkiller That Also Kills Pleasure
  • What You Need to Know About Trade Agreements and Fast Track
  • Central bankers gather privately in Washington this Friday to discuss gold
  • The Rise Of The Paper Machines
  • Tony Abbott says iron ore price collapse blew $30-billion black hole in federal budget
  • Has The U.S. Reached “Peak Oil” At Current Price Levels?
  • Saudi Arabia’s Plan to Extend the Age of Oil
  • Fighting Homelessness, One Smartphone at a Time
  • Hydrogen Fuel Cell Cars Return for Another Run

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Categories: Economics

A Trade Rule that Makes It Illegal to Favor Local Business? Newest Leak Shows TPP Would Do That And More

The leaked text is full of dense legal jargon. But a close reading makes its corporate agenda crystal clear.
Categories: Economics

Daily Digest 4/15 - House Takes Step to Patch Pension Fund Hole, Banks May Pay Borrowers In Europe

Chris Martenson - April 15, 2015 - 08:07
  • Higher water rates on tap as utilities cover losses from drought
  • An unexpected after-death side effect of Obamacare
  • Retirees who didn’t work for the police or fire departments can now expect to see a 4.5 percent pension cut and the elimination of annual cost-of-living payments
  • Report: S. Korea could be headed for Japan-style long-term economic downturn
  • House Takes Step to Patch Pension Fund Hole
  • Christie Urges Benefit Cuts as New Jersey Retiree Rush Strains Pension
  • Treasury Officials Increase Efforts With Finances of Puerto Rico
  • Detroit, Stockton bankruptcies may flag wider problems: Fed's Dudley
  • Prescription drug spending jumps 13% to record $374 billion in 2014
  • IMF Calls On Bank of Japan To Crank Up Stimulus Steps
  • China Junk Bonds Pose Most Risk Since ’04 on Credit-Quality Dips
  • Dutch five-year DSLs sell at negative yields for first time
  • Negative rates in Europe: banks may pay borrowers
  • IMF says slowing emerging-market growth is sapping global economy
  • IMF cuts its U.S. growth estimate for 2015 by a half point

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Categories: Economics

How to Free the Soil by Depaving

Shareable Magazine - April 15, 2015 - 07:07

How much thought do you give to pavement? Our cities are covered with it, but it’s not exactly a hot topic of conversation—though it should be. Pavement causes all sorts of problems including the fact that water can’t soak through it and instead runs across it, collecting pollutants and biological contaminants that make their way into waterways, plants, animals, and ourselves.

Categories: Economics

Daily Digest 4/14 - CA Cycles Of Drought, Low Wages Cost Taxpayers Billions

Chris Martenson - April 14, 2015 - 07:39
  • Poverty-level wages cost U.S. taxpayers $153 billion every year
  • Groupthink is killing the economy: We need a Copernican revolution in economics: Prof. Steve Keen
  • Big Companies Pay Later, Squeezing Their Suppliers
  • The Ultimate Middle East Dilemma: Time For Us To Stop Intervening?
  • Doug Casey: ‘We’re in for a world of trouble’
  • Out of the ashes
  • The Real History Of Fracking
  • In California, a Wet Era May Be Ending

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Categories: Economics

How I Learned to Ask For Handouts (No Matter How Weird It Feels)

Farming and writing don't bring home the bacon—why I'm no longer ashamed to ask my community to help.
Categories: Economics

Ocean Acidification: An Ecological Nightmare

Chris Martenson - April 13, 2015 - 18:10

The oceans are facing numerous difficulties including pollution (especially from farm run off), over-fishing, and dragnet methods that ruin innumerable other things besides the targeted catch -- but all of that pales in comparison to the problem of ocean acidification.

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Categories: Economics

Science of Sharing Exhibit Explores Cooperation, Collaboration

Shareable Magazine - April 13, 2015 - 15:48

On Pier 15 in San Francisco, inside the famed participatory museum the Exploratorium, a large flat screen displays two bright circles—one red, and one blue. Inside each circle are rapidly increasing numbers; at the bottom of the screen is a timer, counting down. In front of the screen, at four podiums, total strangers frantically press either a blue or a red button, attempting, it seems, to up the count of that color. What are they doing?

A placard between the podiums explains:

Categories: Economics

New Zealand Family Shares a Tiny-Home Castle on Wheels

Shareable Magazine - April 13, 2015 - 14:45

The truck unfolds into a spacious three-level home. (Daily Megabyte)

They say a person's home is his castle. But what about their truck? New Zealanders Jola and Justin have done the seemingly impossible, building a road-ready house truck that transforms into a high-ceilinged abode with full kitchen, roof deck, and—yes—a pair of turrets.

Categories: Economics

Alternative Fishing Methods

Chris Martenson - April 13, 2015 - 14:03

When you are in a survival situation, knowing how to fish can get you a great source of high-energy protein quickly and easily. But let’s say you are in a survival situation and don’t have any fishing gear such as tackle, line, or hooks. What then?

Knowing a few basic techniques for catching fish without gear can be the difference between going hungry and staying alive.

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Categories: Economics

Gardening in a Drought

Chris Martenson - April 13, 2015 - 12:57

An interesting gardening technique for drought prone areas from people who deal with extended droughts and dry conditions.

http://thesurvivalmom.com/gardening-in-a-drought/

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Categories: Economics

How to Host a Seed Swap

Shareable Magazine - April 13, 2015 - 07:56

Seed swaps are great ways to learn about local seeds, build community around seed sharing, and show support for the Save Seed Sharing movement. Designed for gardening newbies and master gardeners alike, they provide people an opportunity to get seeds from other local growers and share seeds from their own harvest.

Categories: Economics

Daily Digest 4/13 - Corruption ‘Isn’t Just the Cost of Doing Business’, More Oil Moves By Rail

Chris Martenson - April 13, 2015 - 06:35
  • Corruption ‘Isn’t Just the Cost of Doing Business’
  • Working, but Needing Public Assistance Anyway
  • Common mistakes while bugging out
  • Nutritional Science Isn’t Very Scientific
  • Investing in You: Group urges student loan 'debt strike'
  • Bank Deposits No Longer Guaranteed By Austrian Government
  • More oil moves by rail, and it moves here
  • Six Vintage Pictures of Farmers Planting

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Categories: Economics

John Michael Greer: The God Of Technological Progress May Well Be Dead

Chris Martenson - April 12, 2015 - 11:49

As we often state here at Peak Prosperity, the narratives we hold are immensely important. The stories running our heads influence everything from our beliefs to our values to our actions.

Which is why it's so dangerous when a society clings onto a narrative that is no longer serving it well, a narrative divorced from reality.

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Categories: Economics