Author: Bill Bonner

GUALFIN, Argentina – Well, it’s ZIRP now. ZIRP forever. Viva ZIRP! Viva! Viva! As we suspected, Janet Yellen did not want to risk raising the federal funds rate. Bloomberg reports: Federal Reserve officials left interest rates unchanged, opting to delay an increase amid stubbornly low inflation, an uncertain outlook for global growth and recent financial-market turmoil.In holding their benchmark federal funds rate at zero to 0.25%, policy makers showed they are still not convinced inflation will move gradually back to their 2% target, despite continued gains in the labor market. Punish the Savers! The whole show is so preposterous that … Continue reading →

GUALFIN, Argentina – According to several headlines, the U.S. stock market rose yesterday “ahead of Fed.” The Dow was up 229 points – or 1.4% – for the session. And so, we return to poor Janet Yellen. Tomorrow, much of the world turns its lonely eyes to the Fed and its chieftain. The Fed has as much as promised to make the blind see and the lame walk. It claims that it – and it alone – is capable of improving the U.S. economy and, by extension, the world economy. People will earn more money. They will live better. And … Continue reading →

GUALFIN, Argentina – Poor Janet Yellen. Usually, we reserve our pity for the poor, the downtrodden, and the hopeless. But today, we spare a thought for the clueless… and feel Yellen’s pain. Markets are tense. Investors seem to be holding their breath. Everyone is waiting to see what the Fed will do. There must be hundreds of thousands – if not millions – of well-educated adults sitting on the edges of their seats… eager to hear what this rather ordinary functionary will say. No Return to Sanity Will Janet Yellen proudly put the Fed on the side of the angels, … Continue reading →

GUALFIN, Argentina – Stocks have been wiggly-waggling along for the last few days. Just like the tail on a happy dog. Investors don’t know what to do… And everyone is on the edge of his seat in anticipation of whether the Fed will raise interest rates at its policy meeting this week. This must be the most anticipated move by a central bank in all history. All Eyes on the Fed In a few days, Janet Yellen and her central banking cronies will decide whether to begin raising short-term interest rates. Supposedly, the six-year emergency is over. It’s time to … Continue reading →

GUALFIN, Argentina – September is here. As expected, market volatility is increasing. The Great Zombie War is intensifying. And investors are getting scared. Yesterday, the Dow lost 470 points – a nearly 3% drop. Bloomberg: U.S. stocks joined a worldwide selloff, after equities’ worst month in more than three years, amid continuing concerns that China’s slowdown will weigh on the global economy. ‘The problem is, as much as China is the catalyst for this, it’s also that we’re seeing weakness in fundamentals here,’ said Matt Maley, an equity strategist at Miller Tabak & Co LLC in New York. ‘A lot … Continue reading →

GUALFIN, Argentina – The Great Zombie War is proceeding as expected… Cannons to the left. Cannons to the right. And a fool on every corner. It will become more and more dangerous, we predict. Then in a fiery ball of hyperinflation and bombastic imbecility, it will all be over… If we’re lucky. Then we will return to sanity – older, wiser… and much poorer. Nuts to Lend at Zero But that won’t happen in a day. Or a week. Or even a year. Yesterday, the stock market bounce that began at the end of last week reversed course. The Dow … Continue reading →

BALTIMORE, Maryland – Is Donald Trump broke yet? We don’t know. But at the end of the first quarter, investors held about $24 trillion in stocks. Stock prices are down about 10% since then… leaving the rich $2.4 trillion less rich. Government bonds have generally gone up. Junk-grade corporate bonds have gone down. And real estate? It takes longer to react. Real estate is not “marked to market” immediately. Buyers and sellers discover prices slowly. Phony Wealth The “wealth” created in Stage III of the U.S. credit boom was largely phony. It came as the Fed dropped the price of … Continue reading →

BALTIMORE, Maryland – What did we tell you… The Janet Yellen Fed will not raise interest rates in any meaningful way anytime soon. Instead, she will announce new QE programs. Yesterday, red was showing up just about everywhere – U.S. stocks, European stocks, Asian stocks, emerging markets stocks, crude oil… But it could have been worse… U.S. stocks recovered some of their losses for the day, after the minutes of the most recent Fed meeting showed Yellen and team still won’t pull the trigger on a rate hike until certain unspecified conditions are met. According to the Fed, the conditions … Continue reading →

The curfew tolls the knell of parting day, The lowing herd wind slowly o’er the lea The ploughman homeward plods his weary way, And leaves the world to darkness and to me. Now fades the glimm’ring landscape on the sight, And all the air a solemn stillness holds, Save where the beetle wheels his droning flight, And drowsy tinklings lull the distant folds; Save that from yonder ivy-mantled tow’r The moping owl does to the moon complain Of such, as wand’ring near her secret bow’r, Molest her ancient solitary reign. – “Elegy in a Country Churchyard,” Thomas Gray . TIVOLI, … Continue reading →

PARIS – The Dow rose 75 points yesterday. The press reported “growing confidence.” Investors believe the cronies have things under control. In China, the government has had some success in arresting the plunging stock prices, thanks to a barrage of interventions. And Greece and its creditors have kicked the can down the road so many times most investors are losing interest. The Greatest Conflict of Our Time But the Great Zombie War goes on… Even Pope Francis has got involved… (More on that below.) It is the great conflict of our time. It will determine who runs the world economy … Continue reading →

LONDON – Want to know what happened yesterday? Read the newspapers! There are three big news stories today… No. 1: The Greeks are making a “last ditch” effort to get more money from their creditors. After countless delays, it looks as though the spark and the fuse will come together this weekend. Things could get hot. Your intrepid reporter loves a financial blow-up. So he’ll make his way to Athens tomorrow to see it for himself. No. 2: We’ll let the Financial Times tell it – “Rebound in China equities spurs rally in U.S. and across Europe.” The rally in the … Continue reading →

Over the weekend, the lines in Greece stretched along the street. Around the corner. Down the block. Lines to get cash. Lines to buy gas. Lines of people eager to get their hands on something of value. Food. Fuel. Cash. Pity the poor guy who was last in line… …the poor taxi driver, for example, standing behind 300 other people, trying to get 200 lousy euros out of an ATM. Like a tragic nightclub customer… among the last to smell the smoke. By the time he headed for the exit, it was clogged with desperate people, all struggling to get … Continue reading →

This is an “Amber Alert” day in the markets. “Greeks Line Up at Banks; ATMs Run Dry” was the headline over at the Drudge Report. Versions of it ran throughout the financial media. Greece is the canary in the coal mine for what could one day happen to your savings. You’ll recall our prediction: In a crisis, banks will move fast to block access to your money. First, they will limit withdrawals. Then they will either close their doors or run out of cash. Capital Controls Have Arrived… That’s what’s happening in Greece right now… The showdown going on there … Continue reading →

This may sound strange… But the catastrophic scenario Bill outlines below is potentially a much bigger threat than even the out-of-control national debt. Please remember this warning when you go to the ATM to get cash… and there is none. While we were thinking about what was really going on with today’s strange new money system, a startling thought occurred to us. Our financial system could take a surprising and catastrophic twist that almost nobody imagines, let alone anticipates. Do you remember when a lethal tsunami hit the beaches of Southeast Asia, killing thousands of people and causing billions of … Continue reading →

Our beef with our own generation is not that it failed, but that it succeeded too well. It took control of government and used it like an ape uses a rock – to crack open a nut. But we’ll come back to that in a minute… The Dow Takes a Dive First, the Dow dropped 190 points yesterday – or 1%. It is threatening to close below 18,000 for the first time in almost three weeks. We’ll wait to find out. Yesterday, a London-based magazine and a TV station interviewed us. Both asked if we were “pessimistic.” “Of course not,” … Continue reading →