Gold as money presentationMarch 19, 2010 On Wednesday I presented to a large group of financial planners at the Van Eyk annual conference in Sydney. Full credit must go to Mark Thomas and his team at Van Eyk for allowing gold to headline alongside the chief economist from Goldman Sachs. It may have taken 10 years of 17% compounding growth and out performance of every other asset class on the planet but maybe gold is finally getting the mainstream recognition it deserves. The A.S.S principle: It's All Speculators StupidMarch 09, 2010 Greek Prime Minister Papandreou delivered an important speech today in the US flanked by Hillary Clinton. To paraphrase the 20-page speech: it is still just the speculators' fault, who are now "threatening not only Greece, but the entire global economy". Hmmm. Lets call it the A.S.S. principle. It's All Speculators Stupid! Hyperinflation parallels: Weimar Germany vs US/UKFebruary 28, 2010 SocGen's Dylan Grice provides a gripping account of Germany's hyperinflationary episode, in which he charts the extended parallels between not just the precursor economy that lead to a 16,579,999% inflation in 1923 Weimar Germany, and modern day developed (and highly leveraged) countries, but between Germany's then central banker Rudolf von Havenstein, and the Greenspan-Bernanke duo. And while we know how "der Geld Marschall's" Weimar experiment ended, the future before the U.S., as a result of the Maestro's (both Senior and Junior) almost identical policy response is still open-ended. As the future of America is now exclusively in the hands of insidious economists, the following insight from Grice into the utility of economic models and decision-making should be sufficient to dash the hopes of any optimist for a favorable outcome. End the monetary experiment, retun to the gold standardFebruary 23, 2010 The absurdity of using the US dollar as the worlds reserve currency should not underestimated. The removal of gold in favour of the US dollar in 1971 as the check and balance of the worlds financial system has enabled the US (and the world) to create money out of thin air for nearly 40 years. The consequences were clear. As long as currencies remain relative to one another all governments were empowered to spend with reckless abandon, without need for old fashioned ideas such as raising taxes or balancing budgets. Developing nations loved this cycle because the increased deficit spending and access to consumer credit created demand for their export products. Developed nations liked it because they avoided the nasty boom bust cycles had access to cheap imported goods. Consumers loved it because stock prices moved higher and the humble home became a money tree with an ATM attached. Of course the US benefited most. For the selfless act of becoming the worlds monetary system anchor the US was able to build the greatest empire in history. With access to money without limit the US has funded global military activities and created dominant multinational corporations in food, health, banking, energy and all across the industrial complex. American consumers have also greatly benefited by achieving standards of living well beyond what would have ever been possible pre 1971. Bigger houses, more cars, better holidays, larger stock portfolios and of course bigger wastelines. A Greek crisis is coming to AmericaFebruary 13, 2010 It began in Athens. It is spreading to Lisbon and Madrid. But it would be a grave mistake to assume that the sovereign debt crisis that is unfolding will remain confined to the weaker eurozone economies. For this is more than just a Mediterranean problem with a farmyard acronym. It is a fiscal crisis of the western world. Its ramifications are far more profound than most investors currently appreciate. Gold is better value today at $1100 than it was at $300January 07, 2010 Global investing guru Marc Faber believes that gold is less expensive today at $1100 per ounce than it was below $300 in 2001 due to an explosion of foreign exchange reserves in the world, zero interest rates, the huge debt overhang, and the expectation of further money printing If only paper was as good as goldDecember 27, 2009 This article by Peter Schiff provides a nice overview of how we arrived at todays experimental backed by thin air monetary system. It also provides some insight into the likely consequences of close to 100 years of disasterous monetary policy. Consider not how high gold might go, instead think how low can paper money go. What Peter Schiff has written here is critically important to understanding wealth preservation in a new decade. Also Australian investors should not assume this is an American problem. Since 1971 all paper currencies are essentially derivatives of the US dollar. Despite being the 3rd largest gold producer in the world, Australia owns virtually no gold. In our wisdom we sold it all at the market bottom in 1999 and replaced it with those wonderful interest bearing US dollars which have subsequently lost more than 60% of their purchasing versus gold in just 10 years. Why China encourages its citizens to buy gold and silverDecember 05, 2009 The Chinese are well aware that the foreign currencies with which their exports are paid, are only fiat money payments and that the Reserves to which they give rise are nothing more than shaky investments whose value is at risk – 60 to 70% of China’s Reserves are dollars which are being savagely debased and the euro is not in much better condition. Gold is pale becuase it has so many thieves plotting against itOctober 01, 2009 Antal E. Fekete Professor of Money and Banking San Francisco School of Economics discusses how Keynesian and Friedmanite politicians and economists have never allowed a free discussion on the gold standard. The role of gold in your investment portfolioAugust 27, 2009 While some investors view precious metals as a short-term cyclical speculation, there are actually three important reasons for including precious metals in every investment portfolio. These are: strategic asset allocation, hedging and tactical asset allocation. Inflation and the French revolutionMarch 03, 2009 As in so much else, the French revolutionary regime (1789-94) was the precursor of the centralized, totalitarian, managerial, pseudo-democratic despotisms that now reign over the West. It is also reminder that mass democracy and inflation go together, as surely as thunder and lightning. Let us revisit the Revolution, from a free-market, hard-money perspective. The ravages of inflationFebruary 03, 2009 Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. 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, beyond their deserts and even beyond their expectations or desires, become ‘profiteers,’ who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery. What does a trillion dollars look like?November 14, 2008 What does $1 trillion dollars look like? Check out this visual representation you will be blown away. Think about the $13 trillion given to bail out the banking system? |
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