Special Update: A couple of Charts for “Coast” Listeners

On the air tonight with George Noory www.coasttocoastam.com who is doing an economic round table tonight with Gerald Celente and Catherine Austin Fitts (and me).  three charts from the Minneapolis Federal Research Bank’s economic data dispenser service are critical to your economic thinking.

First is the long term view of the 10-year bond.

This shows the bonds peaked in about 1982 and this really is a very good snapshot of the economic long wave.

The great period to buy real estate was just after the low was in the bond market.  How would you have done if you’d bought real estate in 1968, or so?

And, if you’d sold your home in 2005 into the frothy housing market and rolled that into the bond market, how would you have done?

Here’s the Civilian Labor Participation rate chart and a couple of notes:

This chart shows out of the “workforce” number, reported by the labor department, what number are”participating” (working).  37,2% of America’s workforce is not working for a variety of reasons.

Second point of the chart is that “participation” is (percentage-wise) back at the 1978 levels.  And the third point is you can see how a LOT change in the 60’s and 70’s.  It was in this period that we went through the big press to get women into the workforce, the convertibility of paper money into silver was abandoned, and Nixon closed the gold window, breaking the link between the dollar’s value and gold.

The second chart shows the Velocity of Money at M2.

What this means is that money is “seizing up.” 

Think of money as being able to do work…and how much work gets done is related to how fast the water is moving.  If the money is not “moving” (e.g. its velocity slows).  So you can print money all day and all night and it won’t turn into inflation – yet!

The point where we see the Velocity (or turnover) of money increase is when we will see the return of serious inflation.