Financial Bubbles | timiacono.com - Part 3

Faber: “A Bubble In Everything, Everywhere”

Marc Faber, the purveyor of the Gloom, Boom, and Doom report, talks about the current course of asset prices and how things might end badly someday as the Federal Reserve contemplates raising interest rates and the U.S. dollar continues to strengthen.

As detailed in Dr. Marc Faber’s three bold predictions for 2014, his crystal ball gazing early in the year doesn’t look particularly prescient at the moment:

1. The market will continue to decline from its November high of 1,813
2. Best shorts for 2014: Facebook, Tesla, Twitter, Netflix, and Veeva Systems
3. Best longs for 2014: Gold, gold shares, and Vietnamese stocks

It is, however, worth pointing out that 2014 is a long way from being over.

Misunderstanding the Fed

Here’s an entertaining clip of Bill Fleckenstein on CNBC in which Futures Now host Jackie DeAngelis begins by pointing out that the continuing market rise is evidence bearish investors simply don’t understand Federal Reserve policy.

Fleckenstein notes, “If you want to pursue idiots like the Fed doing crazy policies, and if you think you can get out in time, go for it. I don’t want to try to do that … When markets decline, how fast will it be taken away from you?” after which there is an awkward silence.

Seniors and Student Loans

The data in this new General Accounting Office report(.pdf) on seniors and student loans is both fascinating and disturbing, especially when viewed in relationship to the burgeoning for-profit college system (as detailed nicely by John Oliver the other day) and the dim prospects for anyone without a college degree in today’s U.S. economy.

There’s more in this WSJ story that details how a rapidly growing number of senior citizens are having their social security/disability checks garnished as a result.

About the only good news here is that at least college kids are getting better grades, as evidenced by the graphic below from this item at the Economist.

In the words of Walter White during another highly entertaining (and greatly appreciated) repeat of the Breaking Bad Binge on AMC, “So, there’s that”.

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After watching this segment on John Oliver’s Last Week Tonight, student loans are sounding more and more like 2005-era mortgage lending and we all know how that ended.

I started watching Last Week Tonight early on and didn’t know quite what to think of it at first, sometime not watching it for days later (it’s somewhat timely), but I’m quickly warming up to it and now get to it much sooner in the week.

Some have called it, basically, a Daily Show/Colbert Report that’s done only once a week, but as discussed by Oliver during a recent round of interviews, they always take on one topic that, on the surface, doesn’t sound like it’s going to be very funny and make it so, the above clip being a good example.

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