Everyone is very happy about the unemployment data. Groovygirl awaits the revision next year
The financial talking head today said that the “real stat” could be lower (at least he said it), but it doesn’t matter. Buy stocks and sell gold……is the mantra of the day. This could go on for a while.
Groovygirl is keeping an eye on that 30 year bond. It’s been flirting relentlessly with 4%. Many, many private and public loans (including commercial real estate) that need to be rolled over in the next 3 years are based on that number. Higher rates could turn a profitable investment into a bankrupt investment in one day. The Fed has spent the last 5 years and many billions keeping that rate down for the last roll-over from 2009-2012. That was only buying time, nothing else.
This rate moving higher will also effect the residential housing market.
If you are looking at a 10-year plan for an investment, real estate investment, or company assume this rate goes up. Make sure the forecasted profit will work (or not go negative) in an environment with an interest rate of 6, 8, or even 10%.
Here is Lew’s response to the US Dollar as a reserve currency. He says that the world counts on the US’s policy of the dollar for stability.
groovygirl is taking an online course out of Hong Kong that tells a very different story. Asia thinks that the US’s dollar policy helps the US domestic policy and not the world’s stability and they are aggressively thinking up something new and improved. It is always interesting to get away of the US propaganda blinders to see what other people think. Although, they also have their own agenda, but seem to be very aware of the short comings of the current system and hope to form something that doesn’t have those short comings….
Always understand the CONTEXT first, then the CONTENT. Know the point of view of the author, teacher, or politician, then you can better discern the truth, no matter what the info they put forth.
This new currency move will end the prosperity and positive debt expansion that the US has enjoyed since 1945, secured in 1971 but the disconnect of the dollar to gold, and continued to be secured by the protection of the petro-dollar trade through the Saudis and their financial influence in the oil region. It is now Asia’s turn in the cycle.
Click here for Martin Armstrong’s latest blog post entitled Debt and the DOW dated October 7, 2013. He has the latest ECM chart on the DOW as well.
Click here for Martin Armstrong’s latest blog post entitled How Empires, Nations, and City States Die-We Seem To Be Right on Schedule dated October 7, 2013.
Great interview with Jim Willie over at usawatchdog.com. It’s about 45 minutes. Click here.
Jim Willie suggests that the interest rate bond bubble has popped. And there is a major move behind the scenes to keep the NY Banks from imploding from these losses and moving into other markets.
Click here for Martin Armstrong’s latest blog post entitled Deja Vu- Austria All Over Again dated September 25, 2013.
Click here for latest free summary from LEAP 2020.
Their chart on muni-bonds is eye opening.
But it’s not only government bonds that are in freefall. Following Detroit’s bankruptcy, the Munibond market (US municipal bonds) is itself also extremely tense (7) as the following chart shows.
This is an alarming situation for many American cities which will inevitably lead to other significant bankruptcies in the coming months. In separating municipal and national debts, better numbers are shown certainly, but the risks are doubled.