Why qe2 is bad

Read more posts on The Rayno Report ». For you. World globe An icon of the world globe, indicating different international options. Get the Insider App. Click here to learn more. A leading-edge research firm focused on digital transformation. In the last decade, cruising has grown immensely , with hundreds of ships regularly ferrying passengers to nearly every corner of the globe: from Miami to the Caribbean, around the Cape Peninsula, through the Panama Canal, up and down the Mediterranean Sea.

The ocean liner was a luxurious—and for some, less nerve-wracking—way to cross the Atlantic, and, at one time, was the only way to do so by sea. All listings featured in this story are independently selected by our editors.

However, when you book something through our retail links, we may earn an affiliate commission. This article has been updated with new information since its original publish date. You look at the ships nowadays, they're all sky rises on ship bases. The QE2 was sleek, she was slim.

She was made to cut through the ocean waves and she did it beautifully—fast and elegantly. Unfortunately, investors don't have the tools to play in this Wall Street version of "looking for a bigger fool to buy your overvalued assets" game.

As was the case with the dotcom bubble, in the giddy phase of bubble expansion ignorance is wonderful bliss and knowledge and adherence to the investment process are a curse—as disciplined investors will always sell too soon and will not partake in the bigger fool game. However, when the bubble bursts the money will flow to its rightful owners. The Fed doesn't want to you to be in cash, it wants you to reach for yield and speculate—but don't.

In the absence of good investment opportunities, the worst thing you can do is take advice from the Fed. Modern societies have fractional reserve banking systems where for every dollar deposited in the bank, roughly 95 cents are lent out.

This system functions fine as long as a bank's losses are manageable and depositors believe in the continuity of the banking system—in other words, they expect their deposits to be there tomorrow.

However, even in the absence of any losses, if the presumption of banking system continuity is broken and depositors fear for their funds and withdraw their money, then even the best, most conservatively run bank that has zero loan losses, will go bust. This is a run on the bank. Because of financial leverage, banking is one of the few industries where false perception may lead to reality.

The Federal Reserve System was established in , following the Bankers' Panic, a recession and collapse of several banks that led to runs on the country's banks.

Then all-powerful JP Morgan directed a coalition of banks that backed the banking system and stopped the nationwide run.

This planted the seeds for the creation of the Fed. The Fed's job was to be the lender of last resort, to avoid future bank runs. However, creating an institution that does its work only a few times a century was impractical, so the Fed was given additional responsibilities to regulate banks and to maintain stable price levels and full employment. In the midst of the financial crisis, to prevent the freezing up of the US financial system and possible bank runs, the Fed put in place QE1—it purchased over a trillion dollars of mortgage and agency debt.

The vessel has languished in Philadelphia since One of the few grand ocean liners we still have, the famed Queen Mary , was purchased by Long Beach, California, in the late s. Though launched in —a high-water mark in ocean liner travel—the ship's interiors date to the years after World War II. The preservation of the Queen Mary has not been optimal.

Much of the ship is now shabby or disfigured, and some of it has been reported to be in such disrepair as to be a danger to staff members. Frommer's has covered major scandals involving poor maintenance. This week, though, the issue reached a crisis point when the directors of the trust that controls the Queen Mary were arrested in Singapore for allegedly failing to disclose information to investors.

But there is some good news about at least one antique ocean liner: After many delays, the world-famous Queen Elizabeth 2 is officially back.