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low interest rates keep companies that should fail afloat:
https://www.cnn.com/2019/03/31/inves...ebt/index.html
several economic indicators are flat or declining
Why Dinner's About to Start Eating More of Your Wallet
A confluence of events including strange weather from El Nino, activity on the solar surface and the effects of a U.S. drought years ago are reducing agricultural output,
there does appear to be a high correlation between spot count and global temperatures, with fewer spots being associated with cooler weather.
"Lower-than-average yields are associated with low sunspot activity,"
"The bottom line is that the great U.S. crop production miracle of the last two years will not repeat in 2016,"
http://www.dailyfinance.com/2015/11/02/food-inflation-dinner-more-expensive/
Usually the cost off the farm is a small %age of retail cost, eg, marketing, logistics, BigFinance speculators all take their share.
And 10Ms of employed people are on public assistance, and many who aren't are still living paycheck to paycheck.
low interest rates keep companies that should fail afloat:
https://www.cnn.com/2019/03/31/inves...ebt/index.html
Trash has ordered the Fed to lower interest rates (hoping he can run on non-cratered economy)
"Reversal rates" acknowledged in Fed report: savers get plugged, good money chases mispriced risk.
https://wolfstreet.com/2019/11/20/fe...-says-the-fed/When interest rates come down, these people have less money to spend, and they cut their spending. This includes the many retirees in the US. And it reduces demand. This has been happening in Japan for over 20 years. It’s happening in Europe. And it’s happening in the US.
When central banks, in this environment of already lacking demand, cut interest rates further, they will make the demand problem worse. In other words, these “distributive effects” no longer benefit the overall economy, but hurt it.
This is the point where “reversal rates” set in.
In addition, low interest rates do something else that damages the overall economy: they distort the pricing of risk. Risk is priced via the cost of capital. Normally, investors demand a larger return to compensate them for a higher risk.
But if central banks push interest rates too low, this essential function doesn’t function anymore. While investors and banks are taking more and more risk to make a little return, unprofitable projects get funded cheaply, thus encouraging unprofitable projects, malinvestment, misallocation of capital, and ultimately zombie projects with big losses. It means overproduction and overcapacity. It means asset bubbles that infuse the entire financial system with huge risks.
All of these factors are bad over the longer term for the real economy.
Honey for the Bears: Freight Volumes Negative YoY for 11th Straight Month
https://moneymaven.io/mishtalk/econo...E6t7RTXcErjWA/[COLOR=rgba(0, 0, 0, 0.87)]Donald Broughton, founder of Broughton Capital and author the [/COLOR]Cass Freight Index[COLOR=rgba(0, 0, 0, 0.87)]says the index signals contraction, possibly by the end of the year.[/COLOR]
yeah, I hate zirp and low interest rates. i ing hate that I can't get better than 1.31% on the money market/CDs when just over a year ago it was 3%.
Financial repression was, and is, a choice.
The arbitrage only benefits the finance sector and those rich enough to get richer off its products. It's canonical redistribution to the wealthiest.
When the system breaks again because of the inherent fragility it caused, expect more of the same.
Fiscal austerity for me and thee, gold-plated socialism for TBTF financial ins utions.
At this point I'm hoping for a Recession in 2020. I'm sitting on a lot of cash and want the housing market to tank so I can buy a bunch of cheap gutted distressed properties, fix em up and get rich. Also buy a house for myself in the process and fix that up.
It's been a seller's market for unrealistically far too long.
Personal loans are ‘growing like a weed,’ a potential warning sign for the U.S. economy
More than 20 million Americans have taken out these loans, and the average balance is over $16,000
Americans are hungry for personal loans that they can use as quick cash to pay for anything from vacations to credit card debt, a potential red flag for the economy.
Personal loans are up more than 10 percent from a year ago,
a rapid pace of growth that has not been seen on a sustained basis since shortly before the Great Recession.
double-digit growth in this market in recent months.
https://www.washingtonpost.com/busin...gn-us-economy/
In the last couple of weeks, I've noticed the various loan shark knee-capping operators have put up signs with the new text
"No Interest Loans"
These borrowers are the same suckers who poll as "confident in the strong economy"
BigFinance enslaving, aka ANTI-freedom, Americans by renting them money at high interest rates
HOUSEHOLD DEBT AND CREDIT REPORT
https://www.newyorkfed.org/microeconomics/hhdc.html
House flippers have been raiding public records for lists of homeowners who are behind on their property taxes.
And of course billionaire Ditzy Devos in contempt of FEDERAL court, but not fined nor jailed, for punishing students with loans signed to attend bankrupt for-profit "colleges" eg, Don The Con Trash "University"(no diplomas, no professors, no post-grad education to qualify as "university")
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