John Mauldin

  • Seasons of Gold

    Introduction Today we look at gold. I made my first dollar on gold stocks back in the mid-1980s when Doug Casey personally called me up and told me to by a particular stock. It was quite a home run and I have paid attention to what Doug says on gold stocks...
    Posted to John Mauldin's Outside the Box by John Mauldin on 04-10-2006
  • Preparing for a Credit Crisis

    The Consequences of Austerity
    Euro Break-Up – The Consequences
    Welcome to the Hotel California
    The Slow March to Recession in the US
    Preparing for a Credit Crisis
    What Can You Do About the Weather?
    Europe, Houston, New York, and South Africa

    ...
    Posted to Thoughts From The Frontline by John Mauldin on 09-10-2011
  • Dr. Frankenstein’s Europe

    "Had I right, for my own benefit, to inflict this curse upon everlasting generations? I had before been moved by the sophisms of the being I had created; I had been struck senseless by his fiendish threats; but now, for the first time, the wickedness of my promise burst upon me; I shuddered to think that future ages might curse me as their pest, whose selfishness had not hesitated to buy its own peace at the price, perhaps, of the existence of the whole human race."

    ...
    Posted to Thoughts From The Frontline by John Mauldin on 05-19-2012
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  • How Not to Run a Pension

    For all the focus on the unfunded liabilities of Social Security and Medicare, there is another unfunded crisis brewing, and this one is in your own back yard. It’s coming to you even if you live outside of the US; it just might take a little longer to get there. I wrote ten years ago that state and local pension funds might be underfunded by as much as $2 trillion. It turns out that I was being overly optimistic. New government research suggests that the figure might be as high as $3 trillion. But what if you take into account that retirees are living longer? An IMF study that we’ll look at in a few minutes does just that. And if we live a lot longer? Oh my. The problems are not universal – some cities and states will do fine, while others are already in deep kimchee – but it’s a big problem and getting worse.

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    Posted to Thoughts From The Frontline by John Mauldin on 02-14-2013
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  • O Deflation, Where is Thy Sting?

    The CPI was out this week, and it showed a continued drop in inflation. There were those who immediately pointed out that this vindicated the Fed's move to QE2. We have to get ahead of this deflation thing, don't we? Well, maybe, depending on how you measure inflation/deflation. This week we look deep into the BLS website on inflation to see just exactly what it is we are measuring, and then take a walk down Nostalgia Lane. But first we look at what I think we can call The Sputtering Economy, because that will tie into our inflation discussion.

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    Posted to Thoughts From The Frontline by John Mauldin on 11-19-2010
  • The Cure for High Prices

    In This Issue:

    The Cure for High Prices
    Let’s Rewind the Inflation Tape
    A Shocking Development
    Another Important European Election
    Home Again, a “Sports” Injury, and My Conference

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  • Any Bonds Today?

    By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method, they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls . . . become 'profiteers', who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished not less than the proletariat. As the inflation proceeds . . . all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless….

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    Posted to Thoughts From The Frontline by John Mauldin on 07-22-2013
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  • The Worst Ten-Letter Word

    This week we begin what will probably be a multi-week series on the subject of income inequality. Over the years, I’ve written many times about the lack of income growth for the middle class in the developed world. We have also looked at the growing spread between the top 1% or 5% or 10% and those further down the income scale. The widening spread is an undeniable fact. But what should be done about it? Do we take money from the more well-off, or do we increase opportunities for all? How do we increase opportunity without social expenditures for education and healthcare, and where will the money come from? What trade-offs do we get for the lost productivity and reduced savings that result from increased taxes? What institutional and policy barriers are there? These are all fundamentally important questions.

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    Posted to Thoughts From The Frontline by John Mauldin on 02-24-2014
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  • The Rise of A New Asset Class

    This week I am in Maine on vacation with my son, and next week is my daughter Tiffani's wedding, so for the next two weeks I am going to send an updated version of a speech I have been giving the past few months on what I think is the likely potential for the rise of a brand new asset class. It is too long to be sent as one letter, so we will start with the first part today and finish with the second part next week. This first part can be read as a standalone letter. I think we're at a watershed moment, what Peter Bernstein defines as an "epochal event," with the very order of the investment world changing as it did in 1929, in '50, in 1981, where a number of things came together - it wasn't just one thing but a number of events happening that conspired to change the nature of what worked in the investment world for the next period of time. It took most people a decade after 1981-2 to recognize that we were in a different period, because we make our future expectations out of past experience. It's very hard for us to recognize a watershed moment in the process. We're going to look back in five or ten years and go, "Wow, things changed." As we will see, it's going to be a change that's going to cost people in their portfolios and in their retirement habits....
  • Here Comes Tarp 3 and 4

    What does it mean for Citigroup to be at $3? As it turns out, it distorts the information we think we are getting from the Dow Jones Industrial Index. And more TARP money is surely in our future, and far more than anyone in authority is now suggesting. This week's letter will cover both topics and a little more. I think you will find it interesting. Before we get into the letter, just two quick housekeeping items. First, I spend most of my week researching and writing. Part of that process is the ability to call friends and esteemed colleagues to discuss our different points of view about the present markets and economy. I have offered, for the first time, exclusive access for my readers to listen in on those conversations. The first "Conversation" will be with Dr. Lacy Hunt and Ed Easterling next Tuesday, and we will have it ready for subscribers to my new service shortly thereafter. This new subscription service will allow you to listen in on Conversations with me and my friends about the most critical financial and economic topics of the day....
  • Trading With the Big Boys

    This week we are going to do something a little different. I am in Bermuda taking a little weekend R&R after a speech, as well as working on my book. There is not the time for the usual letter this week, but I have asked Barry Ritholtz to write about his new trading program, FusionIQ, for reasons I will talk about below. Warning: This e-letter is about a new trading platform that I think is interesting. While not trying to be promotional, it will offer you a product at the end. As I write below, there is reason to think about what tools other are using when you are trading against them; but for those of you who are looking for economic analysis, skip this and wait till next week, when I am back in the office. For the rest of us, let's jump right in....
  • The Velocity Of Money

    The late and great Milton Friedman told us that inflation is always and everywhere a monetary phenomenon. But there is an asterisk to his equation that we need to examine, namely, the velocity of money. Sometimes a fast-growing money supply is not as inflationary as you might think. Then we will take quick looks at why the banking sector is in for more and larger rounds of write-offs, as well as note that the housing industry is in a hole but is gamely digging itself deeper....
  • Who's Afraid of a Big, Bad Bailout?

    Flying last Tuesday, overnight from Cape Town in South Africa to London, I read in the Financial Times that Republican Congressman Joe Barton of Texas was quoted as saying (this is from memory so it is not exact) that he had difficulty in voting for a bailout plan when none of his constituents could understand the need to bail out Wall Street, didn't understand the problem, and were against spending $750 billion of taxpayer money to solve a crisis for a bunch of (rich) people who took a lot of risk and created the crisis. That is a sentiment that many of the Republican members of the House share. As it happens, I know Joe. My office is in his congressional district. I sat on the Executive Committee for the Texas Republican party representing much of the same district for eight years. This week, Thoughts from the Frontline will be an open letter to Joe, and through him to Congress telling him what the real financial problem is, how it affects his district and help explains to his constituents the nature of the problem, and why he has to hold his nose with one hand and vote for it with the other. I think this is as good a way to explain the crisis we are facing this weekend. This letter will print out a little longer because there are a lot of charts, but the word length is about the same. Let's jump right in....
  • The Financial Fire Trucks Are Gathering Again

    The economic news just continues to be bad. New unemployment claims were over 529,000 on a seasonally adjusted basis. The "real" number was 606,877 lost jobs. New home sales were off by another 5% and down 40% from a year ago, as builders slash inventories. The Chicago Purchasing Manager index came in at 33.8, the weakest number since the serious recession of 1982. The national number due next Monday will be just as ugly, as durable goods were down far more than expected, by a negative 6.2%. But it is Thanksgiving weekend, and not a time for gloom. In this week's letter I am going to talk about why we should be optimistic about the future. Things will turn around. I will also make a few comments about the latest stimulus package....
  • The Velocity Factor

    A severe global recession will lead to deflationary pressures. Falling demand will lead to lower inflation as companies cut prices to reduce excess inventory. Slack in labour markets from rising unemployment will control labor costs and wage growth. Further slack in commodity markets as prices fall will lead to sharply lower inflation. Thus inflation in advanced economies will fall towards the 1 per cent level that leads to concerns about deflation. Deflation is dangerous as it leads to a liquidity trap, a deflation trap and a debt deflation trap: nominal policy rates cannot fall below zero and thus monetary policy becomes ineffective. We are already in this liquidity trap since the Fed funds target rate is still 1 per cent but the effective one is close to zero as the Federal Reserve has flooded the financial system with liquidity; and by early 2009 the target Fed funds rate will formally hit 0 per cent. Also, in deflation the fall in prices means the real cost of capital is high - despite policy rates close to zero - leading to further falls in consumption and investment....
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