While the dollar may be the major beneficiary of Europe’s debt crisis for now, gold will remain the top safe haven in the long run, says Jerry Castellini, president of CastleArk Management.
That’s because loose fiscal and monetary policy will hurt both the dollar and the euro, he maintains.
“Over the next five to 10 years, the likelihood of currency debasement in the United States, Europe and other places is much higher than it has been at any time over the last 30 years,” he told CNBC. (more)
Saturday, June 5, 2010
The Root of the Housing Bubble Remains Unchanged
Banks and Wall Street profited immensely from millions of unqualified home buyers reaching out for the simulacrum of middle class "ownership." The fundamental root of the housing bubble--the collusion of the Central State and banks to extend home ownership to millions of citizens who did not qualify for that burden-- remains firmly in place.
The Federal government continues to pour tens of billions of dollars into this "home ownership should be for everyone" project via subsidies to Fannie Mae, Freddie Mac and FHA. Mortgage lenders have been delighted to write mortgages in our completely nationalized market in which the government backs literally 99% of all mortgages and the Federal Reserve bought $1.2 trillion in mortgages that no sane private investor would touch. (more)
Stock tumble as disappointing U.S. jobs data deepens pessimism about recovery
The Toronto stock market tumbled Friday as a fifth-straight month of job creation in Canada was trumped by a U.S. employment report that widely missed expectations and made it clear that the economic recovery isn't picking up the momentum that investors have been counting on.
The S&P/TSX composite index fell 242.27 points to 11,569.61, while the TSX Venture Exchange lost 18.25 points to 1,464.92.
Statistics Canada reported that 24,700 jobs were created in May. Economists had expected a modest increase of 15,000 after almost 109,000 jobs were created in April. (more)
Friday, June 4, 2010
How a Bursting Housing Bubble in China Could Slam the U.S.
China's housing crisis is much worse than the one in the U.S., according to a Chinese government minister, and given the scale of its pumped-up real estate bubble, suddenly deflating it could have global consequences.
"The housing market problem in China is actually much, much more fundamental, much bigger than the housing market problem in the U.S. and UK before your financial crisis," Li Daokui, a member of China's Central bank monetary policy committee, told the Financial Times.
The worst consequence of a burst housing bubble might be a huge spike in interest rates. But fear of an even bigger force -- Chinese citizens' anger at the high cost of real estate -- could tame China's efforts to constrain the housing market. (more)
"The housing market problem in China is actually much, much more fundamental, much bigger than the housing market problem in the U.S. and UK before your financial crisis," Li Daokui, a member of China's Central bank monetary policy committee, told the Financial Times.
The worst consequence of a burst housing bubble might be a huge spike in interest rates. But fear of an even bigger force -- Chinese citizens' anger at the high cost of real estate -- could tame China's efforts to constrain the housing market. (more)
10 Things You Need (But Don't Want) To Know About the BP Oil Spill
It's been 37 days since BP's offshore oil rig, Deepwater Horizon, exploded in the Gulf of Mexico. Since then, crude oil has been hemorrhaging into ocean waters and wreaking unknown havoc on our ecosystem -- unknown because there is no accurate estimate of how many barrels of oil are contaminating the Gulf.
Though BP officially admits to only a few thousand barrels spilled each day, expert estimates peg the damage at 60,000 barrels or over 2.5 million gallons daily. (Perhaps we'd know more if BP hadn't barred independent engineers from inspecting the breach.) Measures to quell the gusher have proved lackluster at best, and unlike the country's last big oil spill -- Exxon-Valdez in 1989 -- the oil is coming from the ground, not a tanker, so we have no idea how much more oil could continue to pollute the Gulf's waters. (more)
Though BP officially admits to only a few thousand barrels spilled each day, expert estimates peg the damage at 60,000 barrels or over 2.5 million gallons daily. (Perhaps we'd know more if BP hadn't barred independent engineers from inspecting the breach.) Measures to quell the gusher have proved lackluster at best, and unlike the country's last big oil spill -- Exxon-Valdez in 1989 -- the oil is coming from the ground, not a tanker, so we have no idea how much more oil could continue to pollute the Gulf's waters. (more)
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