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Quartz The Underappreciated Economic Lynchpin
In Spruce Pine, North Carolina, one small area supplies the world with high-purity quartz. Spruce Pine Quartz ranks among the world’s most important economic minerals. The following description is courtesy of a Wired article entitled- The Ultra pure, super-secret sand that makes your phone possible. “Spruce Pine, it turns out, is the source of the […]
Mar 19, 2024
CRE Loans Threaten Regional Banks
The following commentary is from The National Bureau of Economic Research (NBER). The NBER claims that “about 44% of office loans appear to have negative equity.” “Furthermore: A 10% (20%) default rate on CRE loans – a range close to what one saw in the Great Recession on the lower end — would result in […]
Mar 18, 2024
MicroStrategy Investors Are Buying Bitcoin At A Massive Premium
Microstrategy (MSTR) provides its customers with business intelligence, mobile software, and cloud-based services. Despite losing money and zero growth in revenues over the last ten years, investors can’t seem to buy enough of MicroStrategy. The rationale is not based on prospects for their core technology businesses but on their massive accumulation of Bitcoin since 2020. […]
Mar 15, 2024
Sticky Inflation And Fed Policy In Context
Over the last few months, the downward inflation trend has slowed appreciably. Such leads some to conclude that inflation is sticky and likely to stay around current levels instead of returning to the Fed’s 2% target. As we have noted on numerous occasions, we think inflation will continue to decline over time. The pandemic-related damage […]
Mar 14, 2024
Blackrock Works For Blackrock Not You
Wall Street banks, brokers, and asset managers put out market research, which can be of great value. While valuable, we read their research with skepticism and question its authenticity. Firms like Blackrock, Goldman Sachs, and others have a glaring bias. The industry makes billions in annual profits by selling stocks and bonds to investors. Consequently, […]
Mar 13, 2024
Miners Fail To Keep Up With Gold And Bitcoin Rally
Gold and Bitcoin have been among some of the best-performing assets recently, yet despite their outperformance, the companies that mine for gold and bitcoin lag well behind their respective products. The lower two graphs show the price ratio of gold versus gold miners and bitcoin versus bitcoin miners. Over the last two years, gold has […]
Mar 12, 2024
Household Versus Headline- Which Employment Report Is Right?
Friday’s employment data from the BLS was a mixed bag. The closely followed nonfarm payrolls number grew by 275k jobs, decently above expectations of +190k. Despite the seemingly strong number, the unemployment rate rose by 0.2% to 3.9%. Last month’s scorching gain of 353k jobs was revised lower to 229k. You may wonder why the […]
Mar 11, 2024
Why Are Financial Conditions Easing?
The Fed is doing QT and keeping interest rates at 15+ year highs. Mortgage rates are 7%, credit cards are around 20%, and auto loans are between 7% and 10%. As the graph below on the right shows, consumer loan growth, excluding the pandemic, has fallen to levels last seen over ten years ago. Loan […]
Mar 8, 2024
Bitcoin Declined 13% Intraday Again
From Monday’s close to its low point on Tuesday, Bitcoin declined by over 13%. While a 13% decline in one day may seem enormous for almost any asset class, it’s not that out of the ordinary for Bitcoin traders and investors. As we graph below, Bitcoin has fallen by 13% or more intraday 59 times […]
Mar 7, 2024
Paul Volcker Warns The Fed
Paul Volcker, Fed Chairman from 1979 to 1987, passed away in 2019. However, poignant words from his book Keeping At It, The Quest for Sound Money and Good Government may haunt the Fed today. In his book published in 2018, Paul Volcker offers the following advice. The real danger comes from encouraging or inadvertently tolerating […]
Mar 6, 2024
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