The culprit is inflation and blame it on too much money supply. Who increases the money supply?
And who prints the money? The Central Bank.
And who runs it?
(In the PHL the prescription by IMF was tight, very tight money supply and austerity. More taxes and less public spending.)
In Europe, it is tight money supply. That is why there are so many riots and protests. In the US, it more money - quantitative easing. Who is right?
What do you think?
---------- Forwarded message ----------
From:
Money and Markets <eletter@e.moneyandmarkets.com>
Date: Wed, Jan 9, 2013 at 2:54 AM
Subject: Treasuries wipe out an entire year of yield ... in one week!
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Tuesday, January 8, 2013
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| YOUR BEST SOURCE FOR THE UNBIASED MARKET COMMENTARY YOU WON'T GET FROM WALL STREET |
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Treasuries wipe out an entire year of yield ...
in ONE, SHORT WEEK ! |
| by Mike Larson |
Dear Subscriber,
Bonds are supposed to be the safest of safe investments. At least, according to many of the talking heads on Wall Street — but nothing could be further from the truth right now!
That's because long-term bonds have been driven to astronomically sky-high levels by the most reckless monetary policy in the history of the world ... which in turn has prompted the biggest influx of money into fixed income investments ever!
That pushes prices higher. And since yields move in the opposite direction of bond prices, they have collapsed to miniscule levels, dramatically raising the risk that months and months of income can be vaporized in the blink of an eye!
Just look at what happened
in the first week of 2013!
Long-term Treasuries lost roughly 3% of their value in only a few days. That was enough to wipe out an entire YEAR'S WORTH OF INTEREST, given the 3% yield on long-term bonds!
[Click chart for larger version]
Look, the world has been dog-piling like mad into bonds – Treasuries, mortgage bonds, junk bonds, emerging market bonds. We're talking about hundreds of billions of dollars in inflows, the biggest flood of money into bonds EVER.
As with just about every bubble over the past two decades, it's been prompted by reckless Federal Reserve policy. Just like the bubbles in dot-coms, housing, and other asset classes, it was always doomed to burst ...
And it's clear that we're seeing the classic signs that this bubble has already begun to burst right now!
This is critical: If an entire year's worth of interest can go up in smoke in just a few trading days, and if investors are exposed to that risk like never before, you can bet we're in for some seriously rocky times.
So be sure to watch these cyber-pages for more information on what you can do to protect yourself and even profit as this great bubble bursts in the days and weeks ahead!
Best wishes,
Mike Larson |
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