U.S. Treasuries

The End of QE2

Today we say goodbye to QE2- a failed program that brought few desirable results. Unemployment is down marginally, but home prices double dipped and commodity prices surged, contributing to the inflation we see today. The dollar and bonds are down, which indicates that quantitative easing has adverse consequences for a country riddled with debt. Remember, there was a debt crisis in Europe led by Greece, so the dollar should have…

Home Prices Rise, But Is It Sustainable?

The Case-Shiller 20-city home price index showed a 0.7% gain for April, which is due in part to seasonality. Although the weaker markets such as Detroit and Las Vegas were down in April, the majority of markets in the 20-city index were up. There should be a bounce in home prices in the spring and summer months, perhaps followed by further declines in the fall. While we probably haven’t reached a…

Economic Slowdown Underway

More good news on the economic front as American consumer spending dropped to 20 month lows. I believe the bulls on the economy are officially extinct. Perhaps it is time to listen to the bears who have been right about the economy? What we face now is far more serious than a simple double dip recession. Think about it: if we run $1.6 trillion deficits in a “recovery”, how large will…

The Economic Non-Recovery

I have been very consistent in saying that the programs enacted by our government would not solve our economic ills. For awhile, there was actually a debate as to the efficacy of the government’s programs; now there is none. It is becoming increasingly difficult to find permabulls on the economy because quite frankly, most have gone into hiding. They know they were wrong. Where is the 6.8% unemployment rate we…

Will Higher Interest Rates Derail Gold?

Over the past couple of years, a lot of popular theories related to the demise of gold have been proven false. A popular theory in 2009 was that a “green shoots” economic recovery would cause gold prices to collapse. That was a good one. Then there was the popular “contrarian” argument that the real threat was deflation, and that gold would sell off as a result. That theory is now…