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stock market

Markets Are Waiting… Now Is the Time for Action

After an amazing two-year run in which stock markets gained 60% in value, the past three months have seen stocks take a long hiatus. With the Dow trading mostly in the 24-25,000 point range, markets are largely waiting to see what direction the economy will take. On the positive side, the Trump tax cuts have put billions of dollars into the pockets of both American consumers and American businesses. And with an official unemployment rate under 4%, the headline numbers [...]

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Egyptian Billionaire Puts Half His Net Worth Into Gold

Many investment advisers take a dim view of investing in gold. They’ll try to push their clients into stocks and bonds, CDs, and various other financial investments. If gold even gets a mention, it might get a recommendation to make up about 3-5% of an investor’s portfolio. Even billionaires like Warren Buffet denigrate the importance of gold, which is why hearing about the super-rich investing in gold always makes the news. Egyptian billionaire Naguib Sawiris made headlines earlier this month [...]

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warren buffett

Warren Buffett Is Completely Wrong on Gold

Every year the financial media await the Berkshire Hathaway annual shareholder meeting, relishing the opportunity to run interviews with Warren Buffett. Buffett didn’t disappoint this year, speaking freely about his thoughts on a number of issues. Among them was the idea of gold as an investment, which Buffett rejected. The media reported his statements on gold with not even a fraction of the fact-checking they engage in with President Trump’s statements. That’s inexcusable in this instance, because Buffett is [...]

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price of ground beef

The Subtle But Powerful Danger of Inflation

We haven’t heard its name bandied about much in recent years, but that doesn’t mean it isn’t still a major threat: inflation. As John Maynard Keynes once wrote: 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… Lenin was certainly right. There is no subtler, no surer means [...]

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gold coins

The Fed Doesn’t Understand Real Money

For over one hundred years, monetary policy in the United States has been the purview of the Federal Reserve System. Over that period, the dollar’s value has decreased by over 96% as the Fed has pursued loose monetary policy for decade after decade. Yet despite that abysmal performance, the policymakers at the Fed still consider themselves to be monetary experts. Perhaps that’s because the Fed has employed, provided scholarships to, or otherwise influenced at one time or another the majority [...]

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Congress Is Clueless on Financial and Banking Stability

A new legislative provision making its way through Congress highlights just how little most Congressmen know about financial and banking stability. The changes that Congress wants to make are being touted as beneficial to small banks, but they could end up making the banking system much less stable and lead to more bank failures in the future. While most people think of deposit insurance as a protective measure for depositors, it is actually more beneficial for banks. Since bank deposits [...]

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gold bars

Likelihood of Trade War Makes a Stronger Case for Gold

Stock markets took another beating last week as the trade war between the United States and China threatened to intensify. After President Trump slapped $50 billion worth of tariffs on China, China retaliated by placing the same amount of tariffs on imports from the US. Then President Trump decided to up the ante and floated the idea of a new $100 billion tariff plan. That’s the kind of escalation that many had feared might happen, only in the age [...]

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The Ticking Time Bomb of Higher Interest Rates

Most mainstream economic commentary focuses on large headline numbers like the level of the Dow Jones and S&P 500, on the number of jobs created, or on the unemployment rate. But far more important numbers are often ignored – interest rates. Very few people understand the concept of interest, or the importance of interest rates to the functioning of the economy. With the Federal Reserve having manipulated interest rates for so long, many people think of interest rates as something [...]

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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 [...]

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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 [...]

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