Monthly Archives - March 2018

stock market rise

Continued Stock Market Upheaval Makes the Case for Gold

The horrendous stock market performance last week has hopefully put to rest any notions that the Dow Jones will continue pushing upward to set new highs. A market that is reliant on easy money and investor euphoria for its continued growth is a market that is destined to crash, and to crash hard. The economy is under attack on three different fronts, making it more and more likely that 2018 will be a rough year for stock markets. The Growing [...]

insurance deposit

Deposit Insurance Leads to Moral Hazard

The fractional reserve banking system is a system that is doomed to fail, it’s just a matter of when, not if. Governments throughout history have taken steps to prop up that system, but in the long run nothing has ever worked. You just can’t loan out deposits while telling depositors they can retrieve their money at any time without eventually running into problems. The introduction of deposit insurance has helped to prevent bank runs that periodically plagued the banking [...]

tariff tax

More Tariffs Means the Economy Is in for a Rough Spell

With his recent decision to place tariffs on imported steel and aluminum, President Trump could cause some serious disruption to the economy. In an attempt to rectify what he sees as an uneven trade deficit, he could harm American industries and consumers. But with so much discussion of the trade deficit, it is surprising that no one seems to understand why the trade deficit is as large as it is. And as long as the trade deficit’s underlying cause [...]


New Fed Chief Doesn’t Inspire Confidence

Last week saw the first Congressional testimony of new Federal Reserve Chairman Jerome “Jay” Powell. Anyone who expected anything groundbreaking from his testimony was, of course, disappointed. But Powell’s appearance did show signs of his thinking and of what we might expect from the Fed going forward. For investors, both Powell’s testimony and his answers to questions didn’t inspire confidence that the Fed will get its act together anytime soon. For one thing, Powell seemed to downplay indications that inflation [...]