Archive for October, 2012

  • The argument I have offered you is totally different. It says that we have NOT, will not, CANNOT and SHOULD NOT fix the present financial system back to its former state.
For the simple reason that the present catastrophic situation we find ourselves in, was not due to a break down in the system, but is an inevitable consequence of how that system works in the first place.

    The Undead Heart – Part 3

    The argument I have offered you is totally different. It says that we have NOT, will not, CANNOT and SHOULD NOT fix the present financial system back to its former state. For the simple reason that the present catastrophic situation we find ourselves in, was not due to a break down in the system, but is an inevitable consequence of how that system works in the first place.

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  • Whenever someone buys a security they do so because they want the promised return on their money. What they don’t want is the Risk that goes with it. Risk and return are the light and shade of finance. You can’t get one without the other. But the promise that you somehow can, is what the Shadow banking system is all about. They dazzle you with fantastic returns and promise that somehow the risk has stayed in the shadows.

    The Undead Heart – Part 2

    Whenever someone buys a security they do so because they want the promised return on their money. What they don’t want is the Risk that goes with it. Risk and return are the light and shade of finance. You can’t get one without the other. But the promise that you somehow can, is what the Shadow banking system is all about. They dazzle you with fantastic returns and promise that somehow the risk has stayed in the shadows.

    Continue Reading...

  •  Nations still printed and controlled their currency. But securitization gave banks the ability to print their own currency. And this new securitized currency, based on debt, was theirs to print, control, spend, and ultimately to debase. In short, it gave banks a power to rival nations. It is worth, therefore, understanding its outlines at least. Please don’t panic. Like most financial stuff its not nearly as difficult as the priesthood would have you believe.

    Securitization – the Undead heart of the Shadow banking machine – Part 1

    Nations still printed and controlled their currency. But securitization gave banks the ability to print their own currency. And this new securitized currency, based on debt, was theirs to print, control, spend, and ultimately to debase. In short, it gave banks a power to rival nations. It is worth, therefore, understanding its outlines at least. Please don’t panic. Like most financial stuff its not nearly as difficult as the priesthood would have you believe.

    Continue Reading...

  • Some say that the gold price rises and falls, but they are grabbing the wrong end of the stick. It is the purchasing power of national currencies that rise and fall. Here is an analogy to make this point clear. When standing in a boat and looking at the shore, it is the boat (currencies) – and not the land (gold) – that is bobbing up and down.

    Determining the value of gold

    Some say that the gold price rises and falls, but they are grabbing the wrong end of the stick. It is the purchasing power of national currencies that rise and fall. Here is an analogy to make this point clear. When standing in a boat and looking at the shore, it is the boat (currencies) – and not the land (gold) – that is bobbing up and down.

    Continue Reading...

  • Gold should be thought of as a currency, one which pays no interest. Dollars, euro, yen and other currencies can be deposited to receive interest, and this rate of interest is meant to compensate for the decline in the value of paper currencies via inflation. Gold, in contrast, maintains its real value over time so no interest is necessary.

    PIMCO On Gold – The Simple Facts

    Gold should be thought of as a currency, one which pays no interest. Dollars, euro, yen and other currencies can be deposited to receive interest, and this rate of interest is meant to compensate for the decline in the value of paper currencies via inflation. Gold, in contrast, maintains its real value over time so no interest is necessary.

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  • "Bernanke is so bad that we should wish to return to the age of Marriner Eccles in 1935 - a fiscal Keynesian who believed that money-printing would fuel speculation and inflation; if the government were going to rob the people, it should do it the honest way - through taxes"

    How Crony Capitalism Corrupts the Free Market | David Stockman

    "Bernanke is so bad that we should wish to return to the age of Marriner Eccles in 1935 - a fiscal Keynesian who believed that money-printing would fuel speculation and inflation; if the government were going to rob the people, it should do it the honest way - through taxes"

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  • This is nothing new; throughout history whenever people have struggled to put food on the table for their families, social unrest has been a common consequence. The French Revolution is a classic example; after decades of unsustainable fiscal and monetary practices that wrecked the French economy, the harvest season and subsequent winter of 1788 were particularly harsh. People went hungry, and it ultimately started the revolution.

    Two no-brainer ways to play rising food prices

    This is nothing new; throughout history whenever people have struggled to put food on the table for their families, social unrest has been a common consequence. The French Revolution is a classic example; after decades of unsustainable fiscal and monetary practices that wrecked the French economy, the harvest season and subsequent winter of 1788 were particularly harsh. People went hungry, and it ultimately started the revolution.

    Continue Reading...

  • Of all the mystics, only the Chartist pretends a rational basis for his gobbledygook. The Chartist further elevates his status by including himself in a larger, even more virulent group that label themselves as "market-technicians." Surely, one would think that the devastating losses suffered recently in the equity markets would have exposed these charlatans and their false religion. But, no, their followers are like zombies. Never questioning, and in constant search for that blip on the chart that pierces the shrouded future.

    Beware the Chartist: He Brings You False Science

    Of all the mystics, only the Chartist pretends a rational basis for his gobbledygook. The Chartist further elevates his status by including himself in a larger, even more virulent group that label themselves as "market-technicians." Surely, one would think that the devastating losses suffered recently in the equity markets would have exposed these charlatans and their false religion. But, no, their followers are like zombies. Never questioning, and in constant search for that blip on the chart that pierces the shrouded future.

    Continue Reading...

  • I have dealt with gold investors for over forty years. Their checks are always good; they honor every commitment, stay informed on current issues, and have a profound understanding of history. They provide for their families, and they don't go broke. I can assure you that many, many of them have done very well with their gold investments.

    Gold and the New Yorker Magazine

    I have dealt with gold investors for over forty years. Their checks are always good; they honor every commitment, stay informed on current issues, and have a profound understanding of history. They provide for their families, and they don't go broke. I can assure you that many, many of them have done very well with their gold investments.

    Continue Reading...

  • If they think that government will ever be neutral towards the gold market, they are fools. It is equivalent to thinking the US government — or any government for that matter — would relinquish their ability to collect taxes. To protect the corrupt stranglehold they impose on the economy, the insiders will violate every commandment. Intervening in the gold market is just a minor chore.

    The King Doesn’t Like Gold, Never Has, Never Will — Unlike Mr. Chang

    If they think that government will ever be neutral towards the gold market, they are fools. It is equivalent to thinking the US government — or any government for that matter — would relinquish their ability to collect taxes. To protect the corrupt stranglehold they impose on the economy, the insiders will violate every commandment. Intervening in the gold market is just a minor chore.

    Continue Reading...