Consumers aren’t the only ones defaulting on their debts: Corporate bond defaults were up massively in 2023, especially for high-risk junk debt, and the trend is continuing this year at a pace not seen since the 2008 global financial crisis. Unsurprisingly, companies selling low-rated junk debt are being hit the worst.
The Federal Reserve is often viewed as a neutral guardian of the economy, tasked with safeguarding employment and ensuring stable prices. However, the Fed is run by individuals who, like anyone else, are swayed by certain motivations. Do the people behind the Fed truly have the incentive to remain impartial? Our guest commentator demystifies the notion of ‘Fed neutrality,’ revealing the intersections of politics and policy within its operations.
JD and Joel discuss hotter-than-expected inflation data, Peter’s recent podcast, TikTok, Twitter, and gold and silver price action.
In this episode, Peter reacts to a hotter-than-expected CPI report, big trades in Bitcoin, and the federal bill that would ban the popular social media app TikTok. He also notes silver’s historically low price, which is nearly 50% of its 2011 high.
At the end of 2022, investors all around the world who had bet big on cryptocurrency and had their cryptocurrency stored by the crypto exchange, FTX, received bad news. Sam Bankman-Fried and other leaders of the exchange had been using cryptocurrency that was supposedly stored by the exchange to make bets on financial markets. And the FTX leadership was bad at trading and racked up huge losses. FTX declared bankruptcy and many of FTX leaders were convicted of financial crimes. For the investors of FTX, it was a painful experience that came from betting on cryptocurrency and the viability of crypto institutions that managed such assets. Expected losses were claimed to be in the billions.
This analysis takes the BLS inflation data and recalculates the percentage changes at the category level to get unrounded numbers. The total number ties to the BLS, but it gives more detail at the granular level.
On Sunday, Peter recapped a stellar week for gold. He also provided an analysis of President Biden’s State of the Union Address and criticized Fed Chair Jerome Powell’s perspective on the economy.
With President Biden’s Saving on a Valuable Education (SAVE) plan set to extend more student loan relief to borrowers this summer, the federal government is pretending it can wave a magic wand to make debts disappear. But the truth of student debt “relief” is that they’re simply shifting the burden to everyone else, robbing Peter to pay Paul and funneling more steam into an inflation pressure cooker that’s already set to burst.
This weekend, Todd Sachs interviewed Peter on the state of the economy. They discuss the parallels between now and the 2007-2008 housing crisis, the role of economic sentiment in voters’ opinions, and why foreign central banks are losing faith in the dollar.
Rampant government spending continues to mask fundamental weaknesses in the US economy. Recently, national debt grew much faster than the economy for the third quarter in a row, just one of many warning signs concerning legendary investors. Our guest commentator explains just how much the government is spending to make the economy seem strong, even as the US remains in the midst of a “private sector recession.