Business

Authored by Steve Keen, originally posted at Forbes.com,

The great tragedy of the global economic malaise is that it is caused by a shortage of something that is essentially costless to produce: money.

Both banks and governments can produce money at physically trivial costs. Banks create money by creating a loan, and the establishment costs of a loan are miniscule compared to the value of the money created by it—of the order of $3 for every $100 created.

Last Thursday when we recounted the story of how Venezuela is now literally flying in paper money (using three dozen cargo Boeing 747s), we wrote that "Venezuela's hyperinflation, already tentatively estimated at 720%, will likely add on a few (hundred) zeroes by this time next year. It is also quite likely that Venezuela the country, as we know it now, will no longer exist because once any nation is swept up in hyperinflationary rapids two things occur like clockwork: social uprisings and political coups.

Despite a collapse in yields and implicit plunge in the odds of a rate-hike anytime soon, asset-gathering, commission-taking talking-heads continue to spew unrealities about the economy and where it goes next as excuse after excuse (low oil is good, services trump manufacturing etc) are discarded. What is worse is that none other than The Fed's "owners" - the primary dealers - refuse to play along with The Fed's transitory narrative as their Treasury Bond position is the longest since 2013.

Excerpted from Doug Noland's Credit Bubble Bulletin,

On the first day of this month, Google.. er, Alphabet.. turned in an impressive quarter.

Revenues soared 18% Y/Y while Q4 earnings were $8.67/share, well above the $8.08 the Street was looking for and a whopping $2 more than Q4 2014. Paid clicks rose by more than a third while FCF rose to $4.3 for the period. In short, just about everything looked great with the possible exception of CPC, which dropped 13%.