Forex Spread Betting – Gold Trading – Oil Trading
New Make Money Online Using A Simple Method.
Money, Adwords, Adsense Make Money Cash, Fast Money, Instant Money Affiliate HiJack Protection!
New Make Money Online Using A Simple Method.
Living On A Dime – Financial Independence Through Better Life Choices.
Publisher Of E-books About Paying Off Debt, Saving Money, Frugal Cooking And Homemaking.
Living On A Dime – Financial Independence Through Better Life Choices.
I know, alas, that there is nothing that can be done to prevent unimaginable suffering and the collapse of the economy, now that the Federal Reserve has created so much excess money and credit, and, to make matters infinitely worse, are still doing it, more than ever!
The exclamation point at the end of the sentence indicates that I still register surprise at the sheer stupidity and insanity of it all; the Federal Reserve has to create more money to be used to buy up the trillions and trillions and trillions of dollars in a for-the-rest-of-your-life tsunami of new federal government borrowing and spending.
Sharp Junior Mogambo Rangers (JMRs) noticed the use of the prosaic period as punctuation at the end of the last sentence, even though the content of said sentence is of such horrifying magnitude that it would seem to merit at least one exclamation point. But no!
So what gives? What am I up to? What am I trying to say with my choice of punctuation, as if it is was some kind of code, communicating some secret, probably nefarious and almost certainly stupid, plan?
The answer is simplicity itself; creating so much money is Bad, Bad News (BBN), and thus requires the use of an exclamation point, while the lowly period used at the end of the sentence was describing how the Federal Reserve is acting, as usual for the last few decades, like morons.
I cry aloud in what supposed to be a lonesome and heartbreakingly haunting Mogambo Plaintive Wail (MPW) at the situation, reminiscent of tortured souls falling into the fiery pit of eternal damnation, but I have too much of an “edge” of anger and outrage to be truly plaintive and thus truly pitifully, pitifully sorrowful.
For example, try saying, in a sorrowful, melancholy way, the sentence, “I despise and hate the neo-Keynesian econometric halfwit ‘economists’ in the Federal Reserve, and their lowlife lackeys infesting academia and the shallow media, who have destroyed us with their stupid economic theories that are just the same old worthless, totally debunked theories that have been tried thousands of times before, and utterly failing each time, except now they call it ‘stimulus spending’ and ‘replacing private spending with government spending’ instead of using terms like ‘increasing the circulating medium.’”
And speaking of “increasing the circulating medium,” I notice that the Treasury/Federal Reserve has issued, in the last year, another billion in actual cash (bringing the total of cash and coins to 9 billion!) which is, by its very nature, a billion increase in the money supply, which is Very, Very Important (VVI) to me because I am terrified, in a strange kind of psychotic-yet-charming way, of inflation in prices, and here it is! Inflation in prices is caused by an inflation in the money supply, which was inflated by the aforementioned billion in the last year! Yow!
I embarrassingly admit that in my rush to condemn Alan Greenspan and Ben Bernanke for their stupidity in doing this, and condemn the Congress for aiding and abetting them in this monstrous monetary madness, I had forgotten that there are intermediate steps between boom and bust.
This particular point was brought home to me by Bill Bonner here at The Daily Reckoning saying, “It’s been three years since this slump began. We’ve seen the biggest stimulus effort ever mounted; and the economy is well, not dead…but it’s beginning to smell funny.”
Hahaha! “Smell funny”! I thought it was not only profound, but a funny line, too! Unfortunately, the wife and kids immediately took it up and opined that perhaps the odor Mr. Bonner smelled was coming from me, and then the lively discussion moved to everyone trying to think of something that smelled as bad as my feet, or my breath, or my armpits, or my “big funky butt,” all vying for the top spot, and each with its champion.
However, there are many points to be made. The first point is not that We’re Freaking Doomed (WFD) by the insane excesses of the Federal Reserve and Congress (although we are), nor is the point even remotely connected with the finer points of personal hygiene or lack thereof, but that buying gold, silver and oil are the only things that are, by dint of the weight of 4,500 years of evidence proving this one point, going to save my big butt, funky or not.
There’s a lesson in there, and if you are half the Junior Mogambo Ranger (JMR) that I think you are, then you know just what that is: Whee! This investing stuff is easy!
The Mogambo Guru
for The Daily Reckoning
Punctuating the Severity of Excess Money Creation originally appeared in the Daily Reckoning. The Daily Reckoning, offers a uniquely refreshing, perspective on the global economy, investing, gold, stocks and today’s markets. Its been called “the most entertaining read of the day.”
From within the Fed in the days that the policy of quantitative easing became official, Philadelphia Federal Reserve Bank President Charles Plosser alerted us that “(recent economic statistics) prompted some commentators to suggest that the United States is facing a threat of sustained deflation, as we did in the Great Depression or as Japan faced for a decade.
“I do not believe this is a serious threat… (but) the Fed must credibly commit to preventing sustained deflation from becoming widely anticipated, just as it must prevent sustained inflation from becoming widely anticipated.”
All this is well and good. But between the lines one gets the feeling that Plosser and much of the Fed want to be inflation hawks and are maybe a little bit irritated that they have to stop and do something so radical as print money just like in the olden days of the Continental Congress, the French National Assembly, or the Weimar Reichsbank, as if the current circumstance had nothing to do with their having presided over a doubling of the broad money supply from trillion to trillion in the eight years ending in 2008.
Up until now Fed governors felt very effective, having seen strong income and employment growth, yet inflation was subdued. In the eight years through 2008, the CPI-U increased at an annual rate of just 2.9 percent, well below the 4.6 percent average of 1971-2007 or the 3.3 percent felt from 1913 to 2007.
But so much focus on the targeting of inflation has permitted robust credit expansion to stowaway on the economic ship, lifting total commercial bank credit ( trillion) to 77 percent of GDP from 45 percent of GDP in 2000, and seeing debt in aggregate rise to 360 percent of GDP, twice the level touched in 1929.
Regards,
Bill Baker,
for The Daily Reckoning
[Editor's note: This passage is reprinted from William W. Baker's book, Endless Money: The Moral Hazards of Socialism, with the permission of John Wiley & Sons, Inc (©2010). You can get your own copy of his book here.]
Radical Money Printing Just Like the Continental Congress originally appeared in the Daily Reckoning. The Daily Reckoning, offers a uniquely refreshing, perspective on the global economy, investing, gold, stocks and today’s markets. Its been called “the most entertaining read of the day.”
“It’s gold that puzzles the current Fed chief,” says a commentary piece by William Pesek today. It’s not just Bernanke either. Articles have been consistently cropping up since Bernanke’s statement of confusion about gold, like this one from the WSJ, written by authors who don’t seem to quite understand gold’s value outside of being an inflation hedge.
Here’s a perspective from Bloomberg:
“’I don’t fully understand movements in the gold price,’ Bernanke said on Capitol Hill last week. That shocks gold bulls like Johann Santer, managing director at Superfund Financial in Tokyo. And it may be awful news for the global economy that some investors are surer than ever that the gold rally is just getting started.
“It’s hard to decide what’s more frightening: that investors are losing confidence in paper money or that the shepherds of the world’s major currencies don’t get what’s going on. Gold’s climb of almost 30 percent in a year reflects fear, not just market concern over inflation or deflation risks. People have lost trust in the global financial system…
“…There are many reasons why gold is back in vogue, yet two in particular are worth considering. One is fear about “black swans,” unexpected events that have great impact. The second reflects how little gold many central banks in Asia and elsewhere hold on their balance sheets.”
Above, Pesek points out two reasons why gold makes sense to him as an investment outside of inflation. Although, of course, there are scads more reasons that can be detailed, depending on whom you ask. Strange, though, that Bernanke finds it worthwhile to publicly speculate against the increasing value of gold. It’ll be interesting to see what he says next if gold continues to rally higher.
You can read more of Pesek’s detailed criticism in his Bloomberg commentary on Gold’s surge puzzling Bernanke.
Best,
Rocky Vega,
The Daily Reckoning
“Shepherds” of Major Currencies Don’t Get Lost Confidence in Paper Money originally appeared in the Daily Reckoning. The Daily Reckoning, offers a uniquely refreshing, perspective on the global economy, investing, gold, stocks and today’s markets. Its been called “the most entertaining read of the day.”
Grandfather-economic-report.com is famous for presenting whole constellations, in graphic form, of horrors about the mess that fiat money and government, in the hands of incompetent do-gooders, has allowed.
He writes that, in 2009, people worked, “3 times longer per year to pay all taxes more than they pay for food, housing and clothing combined.” Yikes!
This is where I learned that the combined onslaught of government (from local corruption to Congressional corruption) consumes half of all income in the USA!
And this grasping, gobbling government colossus spends half of GDP, which to this day – to this day! – makes me have nightmares full of every post-apocalyptic horror movie I ever saw, pervasive darkness and gloom, dripping in despair and suffering, where government goons and killer robots relentlessly track down “undesirable” citizens, who, you gotta admit, are always the best looking men and the hottest hubba-hubba women of the whole bunch, which gives rise to the lesson that if you have to go down, these are the people to be with until then!
Of course, there are many lessons in these movies beyond this timeless philosophical gem, such as not trusting anybody because they are probably aliens from outer space or government killer goons. Or both.
Anyway, I thought I had made peace with myself about our system of governments consuming half of everything, but I entered a whole new land of fear and loathing (as Hunter Thompson might have termed it), when Grandfather goes on, “Increased government (at all levels) not only consumes national income by its spending, but their employees continually issue new regulations aimed at the reduced private sector, with the cost of compliance passed to the private sector as un-funded mandates to the tune of 15% of national income.”
By this time you are hardly paying attention, and are saying to yourself “Yeah, yeah, yeah. Tell me something new” in a kind of bored, I’ve-seen-it-all, “we’re screwed” ennui, but without yawning.
I was the same way! So, like you, I was not ready for him going on to say “Adding this 15% to the 49% spending ratio increases government’s control-share of the economy to 64%”, which bring our taxpayer’s share of income down to 36%.” Wow! The government consumes two-thirds of my income!
And so we learn that in 2009, people worked, “3 times longer per year to pay all taxes, more than they pay for food, housing and clothing combined” when, in reality, the taxpayer is left with much, much, much less than that paltry estimate of 36% of gross income, and everyone is getting lesser and lesser, too, since taxes are rising and there is talk of, and the certainty of, new taxes, while inflation (which has the same effect as a tax) is rising and rising, and destined to rise some more, and then more and more until the very life is being crushed out of you by inflation in prices, which will happen because inflation in prices is caused by inflation in the money supply, which is caused by the monstrous Federal Reserve creating the extra money, which it does so that the despicable federal government can borrow and spend the extra money, which drives up the proportion of the economy that the government consumes, making it all worse and worse in a big, ugly spiral, spinning around and around, spinning, spinning, spinning until you are so dizzy that you are think you are going to throw up, and then you realize that you are not puking your guts out because of vertigo, but because the government has destroyed the country!
Of course, there is much, much more at grandfather-economic-report.com, and there are graphs of gold and gold-related things, too, making you come away both dazed and scared out of your freaking mind, but with the idea floating around in your mind that “Hey! Maybe that Horse’s Butt Mogambo (HBM) was right about that buying gold thing that he was always yammering on about! And it looks like he may be right about silver and oil, too! How could such an idiot be right about anything, much less three things?”
How? The answer is that the Austrian school of economics – found free at Mises.org – makes it easy! So easy, in fact, that it makes you squirm in delight and exclaim, “Whee! This investing stuff is easy!”
The Mogambo Guru
for The Daily Reckoning
Guarding Your Money from Government Onslaughts originally appeared in the Daily Reckoning. The Daily Reckoning, offers a uniquely refreshing, perspective on the global economy, investing, gold, stocks and today’s markets. Its been called “the most entertaining read of the day.”