Category

U.S. Economy

Week in Review

What the Supreme Court Did for Healthcare Stocks

U.S. markets were relatively quiet last week with the Dow Jones Industrial Average dropping 0.4% to 17,946.68, the S&P 500 also slipping 0.4% to 2101.49 and the NASDAQ Composite shedding 0.7% to 5080.51.

The real action was in China, where the Shanghai Composite Index collapsed by 7.4% on Friday and neared a 20% drop which would constitute bear market territory. Chinese stocks saw their biggest two-week plunge since December 1996.

While the market Shanghai market is still up an extraordinary 70% since last November, China's central bank ran to the rescue Saturday morning by cutting its benchmark lending rate to a record low and lowering reserve requirements for some lenders.

Farmers may have to return to their fields if Chinese authorities aren't able to stop the obviously insane stock market bubble from bursting.

For us, Europe is the more dangerous place to be right now...

U.S. Economy

The Wealth Gap in America Has Reached Historic Levels

The wealth gap in the United States and other developed countries hasn't been this big since the 1980s, according to a new report from the Organization of Economic Cooperation and Development (OECD).

In the 1980s, the top 10% of earners in the developed world made seven times the income of the bottom 10%. But the wealth gap has expanded since. By 2013, the top 10% had 9.6 times the income of the bottom 10%. That was across 34 nations.

And the numbers in the U.S. are even worse…

U.S. economy

China Gold Reserves Threaten the U.S. Dollar

China gold reserves have been kept secret – but we know China is stockpiling faster than ever. And with enough of the yellow metal, China gold reserves could actually harm the U.S. dollar.

Watch the video to see how analysts know China is secretively stockpiling gold - and exactly why that poses a threat…

U.S. economy

Will the Petrodollar Collapse in 2015?

Will the U.S. petrodollar collapse in 2015? If the world’s largest energy exporter and the world’s largest energy importer have their way, it may.

Watch the video to see how two countries are working to take down the U.S. petrodollar…

U.S. economy

How U.S. Debt to China Threatens the Dollar

The U.S. owes foreign governments more money than it ever has – since 2001, the amount has increased six fold to $6.18 trillion.

And U.S. debt to China has been the biggest of all U.S. foreign debt, for seven years running.

This means nations like China hold the power to drastically affect the American economy...

U.S. Economy

The Stock Market Crash of 1929

Stock market crash history series #1: The Stock Market Crash of 1929 is without a doubt the most devastating in U.S. history, in terms of duration and extent.
On Black Tuesday, Oct. 29, 1929, the Dow dropped 12% (30 points) and 16 million stock shares exchanged hands – although for some, there were absolutely no buyers. When the dust settled, more than $30 billion (roughly $350 billion in today's dollars) in wealth had been obliterated. The Dow sank a total 48% from September to November 1929 and kicked off the 10-year-long Great Depression. It lost another 86% from April 1930 to July 1932 in the crash's aftermath.

Behind this crash was a phenomenon that may be more familiar than you'd like...

The Chinese and U.S. Economies Are Bubble-Thin

The Shanghai Composite Index soared by 8% last week to its highest level since 2008 and is up about 130% over the last year.

The Shenzhen Composite Index jumped by 12% last week and is up 166% over the same period and is now trading at 66x earnings according to Bloomberg, three times the level of the Shanghai Index.

How do you spell "bubble" in Chinese?

Full story here...

market rally

Stay Away from This Irrational Indulgence

When I see the market rally mindlessly – as it did on Friday, after the jobs report pushed the jobless rate down to 5.4%- I ask myself a set of questions like the following.

Do investors really think it's going to matter if the Fed raises interest rates by a quarter of a point in September instead of June? Do they really think it's normal that €3 trillion of European debt is yielding less than zero? The Swiss National Bank (Switzerland's Federal Reserve) owns $100 billion of stocks…Is that considered normal?

I can't be any more direct than this - sometimes the plane hits the ground before people have a chance to parachute to safety. Investors trying to ride this market to the bitter end are going to find the end is bitter, indeed...

Economy

Here's How Bad Job Layoffs in the U.S. Are Now

Job layoffs in the U.S. soared 68% in April. Low oil prices pressured companies across all sectors to trim headcount.

U.S.-based employers announced a whopping 61,582 job cuts last month. That was up from 36,594 in March. It was also 53% higher year over year, when the job cut tally was 40,298.

Check out this list of employers that are slashing scary high amounts of jobs from their payrolls...

U.S. economy

10 People to Blame for the 2008-2009 U.S. Stock Market Crash

The 2008-2009 U.S. stock market crash saw the Dow Jones Industrial Average plunge 54% in 17 months.

Housing prices fell 30% from their 2006 peak. The unemployment rate doubled from 5% (7 million Americans unemployed) pre-crisis in 2008, to 10% by the end of 2009 (15 million). And U.S. debt rose from 66% gross domestic product (GDP) to 103% from 2008 to 2012.

To blame was a systemic breakdown that encompassed Wall Street and Washington.

We like to call it the "Washington-Wall Street Corruption Corridor" - and these ten players had key roles...

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