Advises Treasury On Market

The U.S. government may ask investors to pay for the privilege and safety of holding short-term debt issued by its Treasury Department. In response to clamor from investors, the Treasury said on Wednesday it was looking closely at allowing negative-yield auctions. This would mean bidders who want the security of U.S. government debt in the face of global insecurity, might have to pay a premium for it. Doing so would allow the U.S. government to benefit from something that is already occurring on the secondary market, where investors have accepted negative yields in recent months to protect their cash from financial strains. Remarkably, Wall Street is asking to be able to pay a premium for U.S. debt even after the United States lost its prized AAA rating last year and as the government ...

(Reuters) - It has been raised nearly 80 times since 1960, often after political grandstanding by lawmakers on Capitol Hill. Despite rhetoric and partisan point-scoring, in the past both Republicans and Democrats have accepted they had no choice but to raise the cap on how much the government can borrow, and mustered the votes to do so. This time could be different. With Congress back this week from a spring recess, the battle resumes over whether to raise the United States' $14.3 trillion debt ceiling. Negotiations are expected to stretch into the summer, leaving markets jittery. With a fragile economic recovery, opposition from lawmakers backed by the conservative Tea Party movement to increased borrowing, and a hyper-partisan Washington heading into election season, some fear a ...

As we might have forecast, the government didn’t shut down. Gaddafi in Libya wants a ceasefire. And while another earthquake has hit northeast Japan, it doesn’t appear to have wrecked anything that wasn’t already destroyed. And yet, silver has pushed to another post-1980 high. At last check, it’s $41.27. Spot gold hit an intraday record in overnight trading at $1,476. Something more than the crisis du jour is driving these metals higher. In relative terms, “gold is cheaper today than it was in 1999, when it was $252,” offers Vancouver veteran Marc Faber, by way of helping us get a grip on things. “If gold were a bubble a lot of people would have gold,” he says. “The whole world would be trading gold 24 hours a day. But I don’t think it’s really a bubble.” Not when at a recent ...

Free Baron von NotHaus! Free our money! Poor Mr. NotHaus. He thought he was doing something good…something that needed to be done. His idea was to mint silver coins, which he called Liberty Dollars, or simply Liberties. These were real coins, with real value. In fact, their value has been going up. Silver has been the big star of the latest hard money drama; compared to gold – which has also gone up nicely – silver is at its highest level since 1984. And compared to itself, it is as high as it has been in 30 years. Silver has now gone mainstream. Even Jim Cramer advises listeners to buy the physical metal. They would be glad if they had. Almost nothing has outperformed it. Compare Mr. von NotHaus’s money to the money issued by the US Treasury Department. The Treasury’s dollars have no ...

Yesterday, against the better advice of Voltaire, your editor spent the afternoon tending another’s garden. The weeds had grown long on the lawn and the vines’ creeping tendrils spanned the entire stretch of the backyard wall. The yard, having been left to its natural state, was beginning to look like a jungle. We sweated against the sun, mate close at hand, the cool earth beneath our fingernails. Why all the effort? For one thing, we write for a living; it’s good to get one’s lily-white hands dirty from time to time. For another, the garden is out back of the house we are temporarily occupying here in Argentina’s capital. Our rental agreement is particularly favorable, so it behooves us to look after the place, to help out those who are taking care of us. Besides, we work (in the office ...

(Reuters) - Despite a sizable rally since the autumn, investors are still attaching a hefty risk premium to stocks. Bulls hope improving valuations will lead stocks higher next year, but some investors remain skeptical. The S&P 500's price-to-earnings ratio - a yardstick showing what investors are willing to pay for a dollar of S&P earnings - is about 13, based on 2011 earnings estimates, below the mean of 17 since 1988. But investors only expect that to rise to about 14 in 2011, implying a steady rather than a sharp move higher for stocks. Some analysts predict that risk aversion could stay elevated for several years as investors avoid paying big bucks for earnings. "I don't believe investors are going to pay up for earnings as the market is still trying to determine whether it's an ...

(Reuters) - The Federal Reserve launched a fresh effort to support a struggling U.S. economy on Wednesday, committing to buy $600 billion in government bonds despite concerns the program could do more harm than good. The decision takes the Fed into largely uncharted waters and is aimed at further lowering borrowing costs for consumers and businesses still suffering in the aftermath of the worst recession since the Great Depression. The U.S. central bank said it would buy about $75 billion in longer-term Treasury bonds per month through the end of June 2011 and could adjust purchases depending on the strength of the recovery. "The economy is slowly digging itself out of a deep hole," said Brian Bethune, economist at IHS Global Insight in Lexington, Massachusetts. "The Fed is making the ...