A few articles and blog posts you may have missed this week that are worth your time:
“We Are At The End Of A Failed Forty Year Experiment” – an interview with Kevin Massengill with observations on the current economy, why the accepted practices of the last forty years are close to an end, and where opportunity and risk may be found.
“Central Banks – Tiptoeing Toward the Exit” by Pater Tenebrarum on the “Frisky Fed Hike-o-Matic.” Acting-Man was requested to “comment on the efforts by the Fed and the ECB to exit unconventional monetary policy and whether they could do so without triggering upheaval in the markets and the economy, so we are taking this opportunity to do just that.” Worth your time.
James Kunstler brings his own unique wit and sarcasm to “Rain Dance”, writing about the new senate health bill. A taste – “Think of the ObamaCare reform debate now playing in the US Senate as the final gurglings of polity that knows it is whirling around the drain. They’re pretending to attempt to fix a racket that comprises eight percent of the American economy. Yikes! How did that happen? At the beginning of the 20th century it was one-quarter of one percent (.25 percent) of the economy.”
David Stockman penned “Just Stop It!” – “In short, reported GAAP earnings—–the honest kind companies report to the SEC on penalty of jail—— are now down 18% from their recent bubble cycle peak. But since the S&P 500 has remained within 3% of its May 2015 all-time high (2130), it means that the PE ratio has been rapidly inflating right into the teeth of falling profits and a rapidly cooling domestic and global economy. In fact, the market closed today at 23.9X, which is a truly ludicrous valuation level. We are in the waning days of the third bubble cycle of the 21st century, yet the casino is pricing current earnings as if recessions have been outlawed and that the long-term growth trend of earnings is in double digits.”
Our friend Joshua Sharf contributed to The Hill with “An opportunity for lawmakers to fix Colorado’s broken public pension system” – Joshua outlines the lack of vision and bold solutions – “While PERA tries flicking switches and turning knobs to buy time, some states with similar problems have been taking bolder action to solve them. Pennsylvania recently passed sweeping state pension reform.”
International-economy.com provided a symposium of views in regard to the future of a world in which debt is approaching 300% of GDP – “Has The World Been Fitted With A Debt Straitjacket?”