Yield v Reason


QUESTION: I see all of these people calling for a major crash of 50%+. With interest rates so low and the dividends on the Dow twice that of interest rates, does anyone look at yield anymore?

PH

ANSWER: I fully agree. The yield on the Dow Jones is 5.34%, which is about double the 10-year rate. Back in 1983, I presented these two charts that show the earnings and book value of the Dow Jones Industrials. The majority were calling for a crash and our computer warned of a Phase Transition and a 600% rise in the Dow. I was blamed for creating the takeover boom, but it was clear that the earnings were at least 5% and the stocks were trading out of a major historical low on price v book value. So earnings do come into the mix

Capital Controls v Protectionism


QUESTION: Marty; You mentioned at the cocktail party in Rome, which was spectacular BTW, that your concern would be capital controls emerging when the euro starts to break hard. Do you have a time frame for that?

WJ

ANSWER: Yes, the view from the cocktail party was spectacular. A bit cold; we could have used that global warming.

We saw Turkey move to entertain that which set off the contagion in emerging markets overnight. While the history books tend to put the blame for the Great Depression at the feet of corporation, as did Galbraith, they never mention the Sovereign Defaults of 1931 or the fact that there were capital controls imposed.

The flight of capital to the dollar was met by imposing capital controls. These capital controls may have solved the flight of capital immediately, but at the cost of a complete collapse in confidence in Europe as a whole. The lesson from 1931 was not that of PROTECTIONISM, which killed trade, but it was the imposition of capital controls that brought international trade to a halt. If capital could not be exported, then commerce could not buy any goods. This was far more drastic than protectionism with tariffs. There just seems to be very questionable analysis applied which was either by true idiots, or more likely, the analysis deliberately hid the actions of government to justify the takeover by Marxist Socialism.

The time frame where we may see governments resort to capital controls may arrive in 2021-2022. We MUST be realistic that capital controls are far worse that trade disputes.

Capt. America Throwback: New U.S. Army Uniform Recalls World War II


Published on May 10, 2019

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The new U.S. Army uniform is a near replica of the World War II version. Can the Army meet its recruitment quotas of teen millennials with a throwback image from the Greatest Generation? Bill Whittle thinks the it’s brilliant. There’s a place you can go to think, and unburden your mind, and share the fellowship of liberty-lovers like you. It’s a place of reasoned thought, civil discourse, and great humor. There you find like-minded folks who put their commitment where their convictions live. If you enjoy this video, you’re going to love being part of the team that produces it at https://BillWhittle.com

Victor Davis Hanson Questions Obama’s Political Past


Published on Oct 31, 2008

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Complete video at: http://fora.tv/2008/10/20/Victor_Davi… Conservative columnist and Hoover Institution Senior Fellow Victor Davis Hanson discusses several accusations regarding Barack Obama’s political career. —– Victor Davis Hanson discusses Obama, Palin, and the Culture Wars. This event was part of the Hoover Institution’s Fall Retreat 2008. Victor Davis Hanson is a Senior Fellow at the Hoover Institution, Stanford University, a professor emeritus at California University, Fresno, and a nationally syndicated columnist for Tribune Media Services. He is also the Wayne & Marcia Buske Distinguished Fellow in History, Hillsdale College, where he teaches each fall courses in military history and classical culture. He was a full-time farmer before joining CSU Fresno, in 1984 to initiate a classics program. In 1991, he was awarded an American Philological Association Excellence in Teaching Award, which is given yearly to the country’s top undergraduate teachers of Greek and Latin. Hanson has written for the New York Times, Wall Street Journal, Los Angeles Times, International Herald Tribune, New York Post, National Review, Washington Times, Commentary, The New Republic, Claremont Review of Books, American Heritage, Policy Review, Wilson Quarterly, Weekly Standard, Daily Telegraph, and has been interviewed often on National Public Radio, PBS Newshour, the Hugh Hewitt Show, and C-Span’s BookTV. He serves on the editorial board of Arion, the Military History Quarterly, and City Journal. Since 2001, has written a weekly column for National Review Online, and in 2004, began his syndicated column for Tribune Media Services. In 2006, he began writing a blog for Pajamas Media, Works and Days.

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QE & Its Failure


QUESTION: Dear Martin,
During WEC in Rome I came to understand that the issue with QE is that it did not create any inflation in the USA. On the other hand, as you mentioned the inflation is being calculated in a different way that it used to be in the future. How come then the US does not just change the way of calculating the inflation in a way which would show it’s there? Wouldn’t that be an easier way than to do more QEs?
Thank you,

MK

ANSWER: The primary reason QE fails is because the economy is global. Central banks can no longer manage the economy, for the money does not remain in isolation. Additionally, as I pointed out in Rome, they may have negative interest rates, but that does not pass through. You cannot borrow money from a bank at negative rates.