"I go to many conferences every year. They usually ask the audience, even at resource conferences, how many have more than 5% of your portfolio in gold? I have been at a conference two days ago, among 500 people involved in real estate, not one had more than 5% of his assets in gold. I guess most of them did not have any gold at all, so if someone tells me it is a bubble, I can tell you in year 1999-2000, the whole world was gambling in NASDAQ stocks, in telecom stocks and the media companies everywhere in the world. Now most people that I know have actually sold their gold."

- Dr. Marc Faber (MAA) - from ET Now, June 24

A Failed Global Recovery

Stephen Roach (MAA) has written an essay for 'Project Syndicate'. He believes he sees the footprints of a failed recovery .. a post-crisis recovery is a very different animal - "As Carmen Reinhart and Kenneth Rogoff have shown in their book This Time is Different, over the long sweep of history, post-crisis recoveries in output and employment tend to be decidedly sub-par .. such weak recoveries, by definition, lack the cushion of V-shaped rebounds." [see the essay & also the video]

Click here to read & view

"U.S. Needs a Massive
Public Works Program"

Barton Biggs says the U.S. needs a massive public works program to get the economy going again .. paints a bleak outlook for the developed world with only huge government intervention likely to improve things .. "What the U.S. really needs is a massive infrastructure program; like the WPA in the 1930s."

Click here to link to the article

The End of Low Cost Chinese Goods?

Rising inflation, rising wages in Asia/China spell higher prices for Americans buying products made in China .. the effect of Americans & their politicians pressuring China to strengthen their currency may be beginning to bite. [We think the more the Yuan strengthens the more sorry most Americans will be to have wished for it] .. 4 minutes

Helicopter Money

Richard Duncan (MAA) emphasizes that Federal Reserve Chairman Ben Bernanke's money printing programs, unless combined with new policies to restructure the U.S. economy, will only worsen past mistakes & permanently undermine the U.S. economy [We love this guy].. "Given the scale of government intervention required to prevent complete economic collapse during the last three years, at this rate, a continuation of the 'money bubble-blowing' strategy will soon end in nothing less than total collectivization of society. The policy response to the New Depression has not cured the causes of the economic breakdown, it has merely nationalized the cost of attempting to perpetuate them .. QE 2 ends today [June 30]. Expect to hear a loud hissing sound as the global credit bubble begins to deflate. The next round of helicopter money is very likely to begin before the end of the year."

Click here to link to the article

"The European Union is 

rescuing German Banks"

Economist Joseph Stiglitz says the European Union is not rescuing Greece, but rather the German banks .. emphasizes the best solution for Greece would be the creation of a European solidarity fund - Germany could continue to expand, European banks conduct further investments in Greece & stimulate the economy, that would restore growth & reduce the deficit .. El Pais (Spain) article translated into English ..
Click here to link to the translated version

Financial Beer Goggles?

James Grant (MAA), publisher of Grant's Interest Rate Observer, talks about the impact of the Federal Reserve's policy of low interest rates & quantitative easing on the financial markets & economy .. says "We All Have on Financial Beer Goggles" .. 10 minutes

The 'Fed' is being Reckless? 

Peter Schiff (MAA) says Americans are losing their purchasing power as the Federal Reserve prints more money & the U.S.$ loses its value .. sees an orderly move away from the U.S.$ eventually becoming disorderly .. "I don’t know how reckless and irresponsible the Federal Reserve and Congress are ultimately going to be, but they could certainly be reckless enough to drive gold north of $10,000 .. Oil will probably be $300 a barrel. Everything is going to be getting more expensive, not just gold."

Click here to link to the interview

S&P 500 in Foreign Currencies

A Global Picture

Guru Focus calculates the returns over different time periods of the S&P 500 stocks in different foreign currencies - the picture is gloomy, especially for foreign investors .. 

Click here to link to the article

See below for the numbers:

S&P500 in World Currencies	Current Value	YTD Return (%)	12 Months Return (%)	3-Year Return (%)	5-Year Return (%)	10-Year Return (%)	Since Jan. 1, 2000
USA (US Dollar)	1278.36	1.6	14.4	-3	3.1	4.5	-13
Australia (AUD)	1205.24	-3	-6.2	-12.7	-28.3	-48.9	-46.2
Canada(CAD)	1251	-0.6	9.4	-6.7	-9.6	-33.2	-41
China (CNY)	8281.73	-0.2	8.6	-8.7	-16.5	-18.2	-31.9
Switzerland (CHF)	1079.19	-8.4	-13.1	-20.9	-29.8	-50.8	-53.9
EuroZone (EUR)	893.45	-5.8	-1.2	5.9	-9.5	-37.9	-38.8
Great Britain (GBP)	787.85	-3.6	4.3	17.9	16.8	-10.2	-13.4
Japan (JPY)	102556.43	-0.2	1.1	-27.6	-28.1	-32	-31.7

Today's Evidence of a Credit Bubble?

Dog Gets Student Loan!

(4 Years after getting a Mastercard) 

 see story

 

Courtesy of www.chartoftheday.com,

click to enlarge

S&P to deeply cut U.S. ratings 

if debt payment missed

Reuters exclusive article reports that the U.S. would immediately lose its top-notch credit rating if it misses a debt payment on August 4th, according to S&P's managing director ..
Click here to link to the article

Is Higher Inflation Inevitable?

Mises Institute article explores the question of whether inflation is inevitable or not; given massive injections of money into the financial system by governments worldwide  ..  "Escalating injections of money into the economies is not a promising policy in terms of restoring the economies back to health. Such injections would just lead to further debasement of the currency without solving the underlying root cause of the problem." .. quotes Austrian Economist Ludwig von Mises: "There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved." .. concludes the world will get inflation if governments try to print their way out, or will get deflation if governments decide not to print their way out .. 
Click here to link to the article

QE2 worked?

St. Louis Federal Reserve Bank President James Bullard says QE2 has worked by helping avoid a bout of mild deflation akin to Japan .. "QE2 has shown that the Fed can conduct an effective monetary stabilization policy even when policy rates are near zero .. The financial market effects of QE2 looked the same as if the FOMC had reduced the policy rate substantially .. In particular, real interest rates declined, inflation expectations rose, the dollar depreciated, and equity prices rose." ..

Click here to link to the article

Special - Greenspan One-on-One

It is amazing! Alan Greenspan, seems to have become a clear speaker with valuable insights after leaving the Federal Reserve. It is curious how the same person, when in power & with an agenda, can be such a dreadful adviser. Then, when 'outside', sees & speaks clearly.  Talks Greece, the end of QE2, Obama's plan .. On QE2: "It obviously had some effect on the exchange rate and the exchange rate was a critical issue in export expansion .. aside from that, I'm ill aware of anything that really worked .. Let me tell you why. Not only QE2 but QE1 has not been spent - a trillion and a half dollars, which is excess reserves, have to my estimation, not been spent ..  The way you can tell is that the money multiplier, a ratio of the expansion of credit in the commercial banks and the monetary base, which reflects the expansion of the federal reserve balance sheet - that has not changed at all." [remember when he spoke 'fedspeak'?] ..16 minutes

"In my whole life, I have known no wise people (over a broad subject matter area) who didn’t read all the time — none, zero."

- Charlie Munger [Note: Read more of Cliff Küle's Notes]

Caveat Venditor!

Caveat venditor is Latin for "let the seller beware"! .. This month's 'Markets At A Glance' from Eric Sprott provides fundamental numbers on the silver market that are very bullish, regardless of silver's character of short term volatility. [Our words: Something is askew in a market when more 'paper' (that represents silver) trades in one day, than supply of 'real' silver is produced in one year] .. In Sprott's words: "We look at the real silver market, and based on the supply and demand data coming from the real, physical markets for silver, the fundamentals are only getting stronger .. we pose the following question: Who is most at risk in the silver markets: the buyers of a scarce and real asset that serves a growing multitude of purposes, or the sellers, who are short a quantity of silver which may very well not even be obtainable at anywhere near current prices? Let the Seller Beware!" .. Click on "Caveat Venditor" to download the document (may need to provide email address) or click on 'View Fullscreen' below beside Scribd.
Caveat Venditor

China Heading for a Hard Landing?

Bloomberg special 3-part series by Gary Shilling .. Shilling points out how China is hoping to cool its economy without causing a recession, but faces challenges of inflation & huge problems with provincial government loans .. "By my reckoning, the Federal Reserve has tried 12 times in the post-World War II era to cool an overheating economy without precipitating a recession. It succeeded only once. Can the politically controlled Chinese central bank, and the government leaders who really call the shots, be more successful than the independent Fed? That seems unlikely. And the consequences, for China and the world economy, could be unfortunate."

Click here to link to the article
Read Part 1 and Part 2.

More are saying this

is permanent decline

courtesy of CBS News Poll

click to enlarge

More Impudence from Jim Rogers

Jim Rogers (MAA) talks about his investment strategy with Bloomberg .. discusses Europe’s sovereign debt crisis & Federal Reserve monetary policy .. 7 minutes

What's Happening to the U.S. Economy?

The U.S. Federal Reserve will maintain its policy of keeping the overnight interest rate near zero; but, given a fear of asset-price bubbles, it will not reverse its decision to end its policy of buying Treasury bonds – so-called 'quantitative easing' – at the end of June .. Moreover, fiscal policy will actually be contractionary in the months ahead. The fiscal-stimulus program enacted in 2009 is coming to an end, with stimulus spending declining from $400 billion in 2010 to only $137 billion this year .. The near-term outlook for the U.S. economy is weak at best. Fundamental policy changes will probably have to wait until after the presidential and congressional elections in November 2012."

- Martin Feldstein, Professor of Economics at Harvard University

1 In 3 Chance Of A "Perfect Storm"?

"There is a one in three chance a 'perfect storm' of fiscal woe in the United States, a slowdown in China, European debt restructuring, and stagnation in Japan will converge to stunt global economic growth beginning in 2013."

- Nouriel Roubini (MAA)

Speaking about Brazil's advantages: "We have our own oil, we've got natural resources - I believe we're living a cycle of growth like the U.S. lived in the 1960s."

- Eike Batista, Brazil's business baron
click here for reference

Jim Rogers: Bullish on Agriculture

Jim Rogers (MAA) says the global agriculture supply situation is worsening, a failure to boost food production fast enough to meet demand may lead to shortages ..  "We’ve got to do something or we’re going to have no food at any price at times in the next few years .. I still own agriculture .. buy it."

Click here to link to the article

Why the tapping of the 

strategic oil reserves?

Jeff Rubin questions why the U.S. & the International Energy Agency (IEA) are releasing 60 million barrels of oil next month from their strategic oil reserves .. the IEA cites the loss of 1.5 million barrels of Libyan production but that’s been going on since February .. points out if the reserves are tapped, they have to be restocked in the near future .. "When exactly does the IEA expect to take back into inventory to rebuild the 60 million barrels that they are now adding to the market? What’s going to change in the world demand-supply balance that will allow inventories be rebuilt without stoking the price pressures that tapping reserves are supposed to relieve. The only plausible time for restocking to happen is during the onset of another oil -induced global recession, which, of course, the IEA may think will occur sooner than most of us yet suspect."

Click here to link to the article

Blackrock: Equities Back in the Spotlight

BlackRock is now favoring equities .. a preview of the asset manager's quarterly allocation report, with Robert Doll, BlackRock chief equity strategist; Peter Fisher, BlackRock global head of fixed income .. Blackrock sees the Federal Reserve's monetary easing as ending, emphasizes now the process of returning monetary policy to "normal" conditions begins & will take a long time .. 8 minutes

Greece is Peanuts, 

U.S. is a Time Bomb?

Black Swan author Nassim Taleb: "There is a serious problem in the U.S. .. The U.S. deficit is around $1.5 trillion. It’s far more dangerous than Greece .. Investors and government officials around the world are unwise to focus so much on Greece when the real ‘elephant in the room’ is the U.S." ..

Click here to link to the article

Screaming Fundamentals 

For Owning Gold & Silver

Chris Martenson lays out an investment thesis for gold & silver .. thinks large gains remain, especially if monetary, fiscal, & fundamental supply-and-demand trends remain in play .. "Given the above fundamentals, I project that prices for the precious metals will be many multiples higher - in today's dollar terms - by the end of the decade."

Click here to link to the article

BlackRock's Larry Fink Wants 

to Be 100% in Stocks

Larry Fink, chief executive of the world's biggest investment co., would like to put all his money in equities at the moment. .. "I am not afraid of treasuries, but if my accountants would allow me, I would be 100 percent in equities. Equities are historically cheap, but people are still going out of equities .. Anything earning 3 percent or lower is the dumbest thing you can do."

Click here to link to the article

Three Reasons $100 Oil 

Is Here to Stay

Frank Holmes (MAA) firmly believes the days of $20, $30 or even $40 oil are gone, $100 oil is here to stay .. gives 3 factors why:

#1) Long-Term U.S. Dollar Weakness due to the fiscal Crisis in Washington:

#2) Emerging Market Demand Outpacing Developed Market Demand

#3) Reserves in Geopolitically Unstable Regions:

"I think that is really difficult for oil prices to fall unless there is a significant breakthrough in technology and in the use of energy [or] repositioning of energy."

"I do not see any major new sources of supply. We know that the known reserves of oil continue to decline worldwide. We know that there are huge shortages of agriculture developing. I don’t know if you knew this, but the average age of farmers in America is 58 years old. In 10 years, they’re going to be 68, if they’re still alive. Throughout the world, we have serious, maybe even catastrophic developments in agriculture, which is going to hurt us all over the next couple of decades. There will be setbacks and corrections along the way, but we have serious problems facing us in nearly all commodity areas."

- Jim Rogers (MAA)

Global Banking Is What's Really in Crisis

WSJ article makes the point that we are confronting more than a Greek crisis; an international banking crisis .. Like Lehman Brothers, Greece is not too big to fail - "It is too interconnected to fail, too interconnected to the international banking system, too interconnected to the political ambitions of those who have spent decades replacing the system of nation states with a united Europe .. What we are calling the Greek crisis is also a crisis of structural economic dysfunction. Illiquidity and insolvency are merely the symptoms of the deeper problem affecting a broad swathe of the euro-zone. Excessive debt is not the result of profligacy alone."

Click here to link to the article

"We’re past the recession – statistically. We are probably past the recovery. And we ought to be in the throes of a self-sustaining expansion. But it feels as if we’re in a dream and we’re trying to run, but our feet are stuck in the mud. In times past, the worst of recessions would snap back with a recovery but this particular recovery, or non-recovery, is remarkable for its lack of oomph. It speaks to the poverty of the policies that are being used to stimulate us out of our sorrows."

- James Grant (MAA)

click here for reference

New Jersey Borrowing 

a Sign of Coming Muni Crisis?

Meredith Whitney thinks New Jersey's move to take out a short-term $2.25 billion loan to pay its bills is symbolic of how difficult state & municipal financing will be in the year ahead .. Whitney, who has predicted a wave of municipal defaults this year worth upwards of $100 billion, says the move in the Garden State is not highly significant by itself .. "The pain of the states is upon us .. as the states are submitting final budgets, you'll see the real pain at the municipal level start happening July 1. That will intensify and that's where you'll see the fallout."

Click here to link to the article

“Huge Uncertainty” Over Greece?

The Economist economics editor sees passage of Greek austerity package .. "In Greece, nobody really knows. We're looking at a huge amount of uncertainty but I suspect .. it will squeak through .. I could imagine something like that happening — the markets go haywire and there's another Greek vote before the default needs to take place .. There's also possibility you have some kind of fudge; the Europeans have extraordinary capacity to fudge things."

IMF's Gauge on the Global Economy

Will U.S. growth continue on a slow path over the next decade? Insight with John Lipsky, International Monetary Fund acting managing director ..

U.S. - A Giant Insurance Company 

with Nukes?

Washington Post article emphasizes there is no good reason for negotiations on the budget & the debt ceiling to be deadlocked .. "It’s clear what needs to be done. President Obama and congressional leaders should agree on a series of firm deficit caps that would reduce the debt over time. This must be accompanied by a reasonable increase in the debt ceiling. Then we will spend years engaged in a difficult but necessary fight over what kind of government we want and how much we’re willing to pay for it. At present, we’re operating a heavily armed, heavily indebted health insurance company — a giant, profligate Aetna or Prudential, with nuclear weapons. That’s not going to win the 21st century."

Click here to link to the article

"With bankruptcies of governments becoming more and more likely, the reasons for owning gold and silver have become even more pronounced. Summer has only just started, but I still see this as a summer that will be like 1982, one for the history books."

- James Turk

click here for reference

Confidence Is More Important Than Gold?

Axel Merk writes on the importance of confidence .. quotes Chinese premier Wen Jiabao as recently saying "Confidence is the most important thing, more important than gold or currency" [note: we agree, the purpose of gold is to provide confidence, confidence that some human isn't in a position to foul things up] .. Axel Merk laments that government is throwing money at the problem, not bolstering confidence in the financial system - the current policies are better summed up as "We don’t know what we are doing, but we are doing a lot of it."

Click here to link to the article

$8 Trillion is Betting the Dollar Loses 
Its Global Reserve Status

CNBC reproduces a Financial Times of London article. A survey of central bank reserve managers that control over $8Trillion says the U.S.$ will lose its status as the global reserve currency .. more than 1/2 of the managers predict the $ will be replaced by a portfolio of currencies within the next 25 years .. "The results are the latest sign of dissatisfaction with the dollar as a reserve currency, amid concerns over the U.S. government’s inability to rein in spending and the Federal Reserve’s huge expansion of its balance sheet."

Click here to link to the article

China: Solution for European Debt?

Templeton Emerging Markets' Mark Mobius: "It's not unrealistic for China to backstop the European debt crisis; in fact it's very realistic, particularly at this time when China wants to diversify its foreign exchange .. the euro is an obvious candidate .. China wants to make money... and to establish goodwill with Europe .. they realize Europe is important .."

Austerity Alone Risks a Disaster?

Financial Times' Martin Wolf provides analysis on the recent report of the Bank for International Settlements (BIS), worries about its implications to the evolving global economic crisis .. thinks the BIS report understates the obstacles to across-the-board austerity .. the report argues for monetary & fiscal tightening across the globe, but Wolf questions if it is impossible "to eliminate structural fiscal deficits until either the private sector structural adjustment is complete or we see big shifts in the external balances .. The BIS boldly calls for simultaneous private and public deleveraging. But what are to be the offsets? That is the question. The BIS provides no convincing answer."

Click here to link to the article

U.S. Money Funds Risk Losses 

If Europe Becomes ‘Wildfire’

Bloomberg reports that U.S. money market funds risk losses if the European debt crisis spreads .. Vanguard Group fund manager: "It would take a very rapid decline and not just in the smaller European countries for the debt crisis to threaten U.S. money funds .. You’d probably have to see Spain and Italy get into difficult shape." ..
Click here to link to the article

click to enlarge - see article above about U.S. Money Market Funds exposure to Europe & be afraid. "U.S. money funds eligible to buy corporate debt had about $800 billion, or half their assets as of May 31, in securities issued by European banks, Fitch Ratings estimated. European lenders held more than $2 trillion at year-end in loans to Greece, Portugal, Ireland, Spain and Italy, the most indebted European countries, the Bank of International Settlements estimated."

 

 Is the U.S. looking 

at a Greek Tragedy?

Financial Sense's Jim Puplava welcomes Chris Martenson to analyze the debt crisis, why the U.S. may be looking at a Greek tragedy .. discusses implications for the U.S. ... sees a political failure in both countries to coping with skyrocketing debt .. the implications for the U.S. are dire if policies do not change soon regarding the explosion of debt at all levels in the U.S. .. 24 minutes
Click here to link to the interview

Gold Will Double In 5 Years?

Frank Holmes (MAA) thinks despite being off its recent highs, gold will continue in its bull trend .. sees gold as a seasonal investment .. thinks gold prices could double in 5 years - the supply of paper money is exploding, the supply of gold itself is growing modestly .. 

 

 What is the State of the Economy?

Interactive - click to enlarge,

courtesy of Russell Investments

The Wisdom of Sir John Templeton

"Bull markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria .. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell." .. here are some more:

- Invest for Maximum Total Real Return

- Invest – Don’t Trade or Speculate

- Remain Flexible and Open-Minded About Types of Investments

- Buy Low

- When Buying Stocks, Search for Bargains Among Quality Stocks

- Buy Value, Not Market Trends or the Economic Outlook

- Diversify. In Stocks and Bonds, as in Much Else, There Is Safety in Numbers

- Do Your Homework or Hire Wise Experts to Help You

- Aggressively Monitor Your Investments

- Don’t Panic

- Learn From Your Mistakes

- Begin with a Prayer

- Outperforming the Market is a Difficult Task

- An Investor Who Has All the Answers, Doesn’t Even Understand All the Questions

- There’s No Free Lunch

- Do Not Be Fearful or Negative Too Often

Click here for more on Sir John

The Fed Benefits from Global Fears

John Browne argues that the Federal Reserve will need to continue its money printing (QE - quantitative easing) whether the economy improves or not ..  if the economy improves, banks will lend more & the inflationary impacts of money printing will be increasingly felt, resulting in higher interest rates - this will prompt the Fed to launch more money printing to keep interest rates low .. "If the economy improves, inflation will flare and risk assets will become more attractive. This will reduce demand for Treasuries, and cause interest rates to rise, thereby impelling the Fed to launch more QE in a single handed effort to keep U.S. interest rates low. On the other hand, if the economy continues to deteriorate more, QE will be 'needed' to keep the current recession from becoming a depression. Either way,....."

Click here to link to the article

 

Decision Tree Debt Ceiling

click to enlarge,

courtesy of Societe Generale

The Gravity of Greece

Could the Greece debt crisis spill over onto U.S. shores? .. Discussing the implications of the austerity vote, with Martin Feldstein, Harvard University economics professor .. emphasizes it is just a question of time before Greece defaults .. 8 minutes

 

Courtesy of Dan Wasserman, The Boston Globe

click to enlarge (5*?)

Why It's Too Late for the Dollar

Exclusive interview by The Daily Bell with Dr. Marc Faber (MAA) .. Faber emphasizes he prefers gold over silver, has been positive on gold for the past decade, says he could make the case that gold today is cheaper than it was in 1999 when it was at $252 - cheaper relative to the increase in the credit markets in the world .. Faber would not be surprised if gold went down $200 here but still remains bullish in the long-term .. "I think we had the collapse of the financial system in 2008; the failed institutions and failed system were bailed out by government. Ultimately governments will fail. The U.S. and Europe will print money, and when everything fails, they'll go to war and then we have the complete collapse."

Click here to link to the article

3 Ways to Protect Your Investments

'Pragmatic Capitalism' presents 3 ways to protect yourself against worst-case outcomes in your investments, based on GMO James Montier's latest ..

1. Cash – This is perhaps the oldest, easiest, & most underrated source of risk protection. If one is worried about systemic events or drawdown risks, then what better way to help than keeping some dry powder in the form of cash – the most liquid of all assets.

2. Options/contingent claims – Occasionally, the market provides opportunities to protect against worst-case risk as a by-product of its manic phases.

3. Strategies that are negatively correlated with worst-case risk 

Click here to link to the article

China eyes Canada oil,

U.S.'s energy nest egg

The Associated Press reports on the massive reserves of oil in Canada & China is ready to spend the dollars for a big piece of it .. Eddie Goldenberg, chief of staff to former Prime Minister Jean Chretien, said in an interview that Canada should care less if some American officials are leery about Canada selling oil to China: "We're not the 51st state. It's not the business of the United States to decide where Canada sells its resources." .. article relates the challenges on pumping the oil ..

Click here to link to the article

Revolting PIIGS

Hedge fund manager Ben Davies provides insight into the European debt crisis, emphasizes how the global monetary system has mutated from the banking sector to the sovereign sector & back again, where private losses have been socialized by the public sector funded by the new issuance of vast amounts of sovereign debt .. Portugal, Italy, Ireland, Greece & Spain (PIIGS) countries borrowed from the northern European countries, creating the illusion of prosperity & growth - now they are revolting en masse .. "If we in the UK or the U.S. think we are different, one need think again. We have been just as irresponsible - all of us. The infected financial system is mutating everywhere, which is why you need to own a store of value outside the investment banking sphere. Lest we forget, gold has no liabilities."

Click here to link to the article

Who Says China's Inflation 

is Under Control (Hu?)

Hong Kong media quotes that China's Prime Minister Wen Jiabao says that China will find it hard to keep inflation below 4% in 2011 .. article by a strategic market intelligence firm focuses on the real inflation in China .. "If left unaddressed, China’s current dangerous inflation levels coupled with investors’ increasing interest in the China market can only lead to higher prices for the world market in the short and long term."

Click here to link to the article

Economic lessons from Sweden

Washington Post special article looks at how Sweden has become the rock star of countries recovering from the financial crisis .. Sweden is now growing rapidly, creating jobs & gaining a competitive edge .. The banks are lending, the housing market booming, the budget is balanced .. here are the lessons:

1. Keep your fiscal house in order when times are good, so you will have more room to maneuver when things are bad.

2. Fiscal stimulus can be more effective when it is automatic.

3. Use monetary policy aggressively

4. Keep the value of your currency flexible.

5. Bankers will always make blunders; just make sure they don’t doom the economy.

Click here to link to the article

Does Anyone See The Irony In Andrew Jackson's Image Being On The Form Of Money He Fought So Hard To Prevent?

Prosperity By Not Spending?

A short article in 'Seeking Alpha' takes the view that government stimulus spending is all for nothing .. "prosperity only comes from hard work & productive investments, not from money printing" .. Government .. lacks the profit motive, and politicians have the luxury of spending other peoples' money instead of their own .. Printing money doesn't create prosperity because it only fosters speculation and destroys confidence in the value of a currency." [Cliff Note: Has anyone noticed? The banks haven't been any more productive than government at extending credit/debt. The bank's role in money creation has been a disaster. Government has taken over the bank's debt disaster; which means the taxpayers get stuck with the bill. The partnership between the government & the banks has been as bad as Andrew Jackson & Thomas Jefferson said it would be. Those two, and other early patriotic Americans, warned us to keep the 'money creation power' away from politicians & bankers.]

Click here to link to the article

Why commodities will rebound

Financial Post special on how commodities will likely rebound due to shortages in everything from copper to palladium to corn - even if economic growth slows .. there are supply constraints on many commodities that could propel prices higher .. [Cliff Note: prices go up if supply falls faster than demand falls] .. and if economic growth continues, commodities prices will rise at a faster pace: "Commodity prices are going to continue to go higher. Worldwide, the economy continues to grow and monetary policy is going to stay relatively consistent with no changes." ..

Click here to link to the article