Perspectives

TSP & Vanguard Smart Investor Posts

Doug Noland: Crazy Extremis

… was the Great Depression chiefly the consequence of post-crash policy mistakes, as conventional thinking has come to profess? Or did the previous “Roaring Twenties” Bubble sow the seeds of a major down-cycle and collapse?

Doug Noland: Music to the Market

From a conventional “financial stability” standpoint, this Credit cycle may appear virtually pristine. Yet Credit Bubbles survive only with unrelenting debt growth. Today’s mirage of “financial stability” depends on ongoing massive federal deficits coupled with aggressive monetary stimulus.

TSP Investing: Where there’s smoke…

A financial smoke detector went off in the last month (I’m sure your financial adviser told you about it, right). The financial media provided many excuses like “who knew corporations would have to pay taxes like they do every year at this time surprising the bankers” (never mind they have the lowest tax rates ever).

Doug Noland: What the Heck is Happening in the Cayman Islands?

It was no coincidence that U.S. “repo” market tumult followed on the heels of an abrupt reversal in global bond yields. I appreciate how the enormous global buildup in leveraged speculation works miraculously so long as bond yields are declining (bond prices rising). If only bond yields could fall forever – even as debt and deficits expand uncontrollably. It’s not clear to me how the global system doesn’t turn increasingly unstable, which I believe explains why the ECB and now the Fed have resorted again to QE.