Tim McMahon

Work by editor and author, Tim McMahon, has been featured in Bloomberg, CBS News, Wall Street Journal, Christian Science Monitor, Forbes, Washington Post, Drudge Report, The Atlantic, Business Insider, American Thinker, Lew Rockwell, Huffington Post, Rolling Stone, Oakland Press, Free Republic, Education World, Realty Trac, Reason, Coin News, and Council for Economic Education.

M3 Components

Latest Recession Alarm

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There’s a new Recession Alarm! Money Supply Growth can have a significant influence on the state of the economy. When the FED is pumping, and the money supply is growing, Woo Hoo, it’s happy days, but when the flow dries up, the economy goes into a tailspin. As we have repeatedly implied, via the FED’s massive Quantitative Easing, the money supply has grown exponentially over the last decade.

But today, let’s look at the M3 money supply itself. The M3 money supply is a broad measure of money, including M2 plus much more. It is an indirectly derived measure of the supply of money which includes currency in circulation, checking and savings deposits, certificates of deposit, term deposits, call/term borrowings from ‘non-depository’ corporations by the banking system, and ‘Other’ deposits with the central bank.

Latest Recession Alarm Read More »

NYSE Composite Chart

Half-Way to the Stock Market’s Worst Case Scenario

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On the NYSE weekly chart. we can see that this year so far, the index has fallen from the peak at the long-term resistance line down to the mid-line (as we said it would). So as the headline suggests, we are now halfway to the worst-case scenario, i.e., all the way down to the long-term support line. Whether it gets that bad or not remains to be seen.

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NFTs Round trip to nowhere

Non-Fungible Tokens (NFTs): Another Financial “Fumble”

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Over the years, we’ve discussed various iterations of the “blockchain” and some of the possibilities it has for finance, industry, and even gaming. We looked at What are NFTs and Why are They Going Crazy?, How Blockchain’s Unique Innovations Can Prevent Money Remittance Scams, How Is Technology Affecting Global Trading Markets, and Metaverse vs. Multiverse- What are They? And Where are They Leading? Over at InflationData, we covered Cryptocurrencies and Inflation, and Can Crypto Solve Venezuela’s Hyperinflation Problem?, which we followed up with How has Venezuela’s Bitcoin experiment Fared? So we’ve looked at Crypto quite a bit. Today we are going to take another look at NFTs, which looked a lot like a crazy bubble right from the start.

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Student loans

Will Loan Forgiveness Raise College Costs?

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For years we’ve been tracking college costs and adjusting them for inflation. See Education and Tuition Inflation for more information. During that time, I’ve repeatedly said that one of the primary drivers of increased education costs was the ease of getting a loan. Unfortunately, the vast majority of college freshmen see a loan as “free money” and don’t seem to understand the difference between a “Loan” and a “Grant”. And apparently, this past week, many college loans effectively became grants.

Looking at it from a different perspective, we might wonder what lessons former college students will learn from this largess. Will they determine that debt is good? Or perhaps, they will surmise that no matter how stupid their decisions are, the government will always bail them out. Today’s article comes from the halls of Academia but doesn’t praise the government’s philanthropy as you might expect. ~Tim McMahon, editor

Biden’s College Loan Forgiveness Program Will Raise College Costs
When I interviewed for a teaching job at private college in Alabama more than twenty years ago, the recently elected governor had won partly on a platform in which the state would install a lottery system that would give students a $3,000 grant for college. As the provost and I discussed the prospects of this new program, he smiled and said, “We hope this lottery passes. Then we can raise tuition by $3,000.”

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US vs China

Is The U.S. A Powerful “Empire” In Decline?

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Recently I’ve been giving a lot of thought to the idea of global “empires”. Back in the 1970s one of my teachers discussed the parallels between the U.S. and the Roman empire and those parallels are even more striking today. A simple search on the term, “Parallels Between the U.S. and the Roman Empire” will generate pages and pages of results on this topic from such esteemed writers as Doug Casey, Seeking Alpha and even Salon.

In the U.S. we tend to bristle at the idea that we are an “empire” but a recent YouTube Video by Ray Dalio got me thinking about this subject once again. The characteristics of an “Empire” are fairly consistent and specific. Truth in History lists 36 characteristics of an empire. These include:

Being the “World’s Policeman”.
Meddling in the political affairs of foreign nations.
Original citizenry becomes rich, lazy, fat and demands “bread and circuses”.
Has an expanded immigration policy.
Accepts foreigners into its realm as unskilled laborers.
Ray Dalio’s video explains how the ascendency to Empire status occurs and he focuses on three recent “empires” including the Dutch, British, and the U.S. He calls this “the Big Cycle” and focuses primarily on the financial aspects of Empire.

Is The U.S. A Powerful “Empire” In Decline? Read More »

French AntiTerrorism Eagles

France’s War on Terror Uses Eagles to Catch Drones

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When you think of drones, you think of harmless toys or maybe Amazon package delivery systems. But with terrorism on the rise, terrorists might turn to drones to deliver a different kind of package.  And dealing with that threat might be difficult for law enforcement, after all, how do you shoot a drone out of the sky without injuring bystanders? Although no one was injured, at the time, the French began becoming concerned about drone attacks in early 2015, when drones flew over the presidential palace and a restricted military site.

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Inflation 1979-2022

Keynesians and Market Monetarists Didn’t See Inflation Coming

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The following article by Robert Murphy looks at the different views of inflation from the various economist’s camps. It also addresses the issue of why early Quantitative Easing (QE) didn’t produce the expected inflation. As I’ve said before the primary reason is that the deflationary forces of a contracting stock and housing market were great enough to counteract the massive money creation by QE. 

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