Executive Summary Last week I introduced the concept of currency debasement, or the loss of purchasing power of the dollar. I stated that this occurs largely due to inflation. This week, Part 2, addresses the chief pretexts for an increase in the money supply, specifically M2, and [...]

Executive Summary Debasement of the U.S. dollar refers to the loss of its purchasing power, which appears in two basic forms: loss of purchasing power due to inflation or depreciation in the currency relative to other currencies. Inflation, the rise in the prices of goods and services, [...]

Executive Summary The U.S. housing market experienced a surge in home prices during 2021, driven by low mortgage rates and Federal stimulus. However, the Federal Reserve’s rate hikes in 2022 slowed this growth, due to higher mortgage rates (second graph) and reduced affordability (third graph). Home prices [...]

Executive Summary Currently speculators continue pushing stock prices higher, justifying the move on technological advances. Similar times in history include the “New Era” of the 1920’s, the “New Economy” of the 1990’s and current AI advances. Economist John Hussman has a valuation methodology highly correlated with actual [...]

Executive Summary Prompted by the tragic Surfside condo collapse in Florida, new legislation—the Florida Condo Safety Act—now requires all condo associations with buildings three stories or higher to conduct a Structural Integrity Reserve Study (SIRS) and maintain dedicated reserve funds for structural repairs. Associations can no longer [...]

Executive Summary The Federal Reserve began cutting short-term interest rates again in September 2024 to address a weakening economy; however, the bond market remains skeptical about the effectiveness of these measures in controlling inflation. Despite several rate cuts and the introduction of Reserve Management Purchases (RMPs) – [...]

Executive Summary In this missive I will share how investors must feel confused when hearing contradictory information about the economy. The wealthy may feel the economy is strong as long as the stock market bubble is growing, but others may feel as they did in previous recessions. [...]

Executive Summary Japan’s Nikkei 225 stock index peaked in 1989 and took 34 years to recover after the dramatic decline (see first graph). In an unprecedented move to combat deflation and spur growth, the Bank of Japan pursued ultra-loose monetary policies – zero and negative interest rates, [...]

Executive Summary In 1935 Franklin D. Roosevelt signed the Social Security Act into law. One could claim full retirement benefits at age 65. At that time life expectancy for a 65-year-old was 12 more years. In 1945 there were 42 workers contributing for each person drawing benefits. [...]

Executive Summary The Fed is boxed in on how to deal with inflation, with the weakening jobs market combined with the possible inflationary impacts of tariffs, proposed stimulus, and lower interest rates. In the first graph below, one can see from 1967-1983 inflation came in three waves [...]