Thanks to my reading and teaching schedule, I’ve been unable to post much on current events the past couple of months. However, I simply must post a link to this interview with former White House budget director David Stockman.
Stockman paints a frightening picture of what is likely to be the endgame of the U.S. government’s “Ponzi economics” and “debt super-cycle.” When the yield curve (difference between short- and long-term interest rates) flattens out, something that appears to be beginning now thanks in part to the Fed’s “Operation Twist,” traders worldwide will begin to unwind their carry trades, and the credit markets will be in tremendous turmoil.
Stockman’s investment recommendation? Stay liquid and protect your capital at all costs. Yikes!