Economy Blog

2011-12-18T19:37:00.000-08:00

Jim Rogers on GBTV talking about US economy, US history of economics, world economy etc.
It's about 30 min in 3 parts.
Jim Rogers on GBTV

2011-12-18T19:32:00.000-08:00

Jim Rogers in Salzburg on Sep 22.
The video includes questions from the audience, including myself.
It's about 50 min in 4 parts.
Jim Rogers in Salzburg on Sep 22 (in 4 parts)

2011-09-11T23:26:00.000-07:00

Quote:

The last time the SNB carried out a similar measure, in October 1978 when a floor for the now-defunct deutschmark against the franc was introduced, inflation soared, peaking at over 7 percent in 1981. The Swiss abandoned the policy in 1982.

Source: 'Aggressive' Swiss National Bank Move Shakes Up Markets

2011-09-07T14:30:00.001-07:00

Jim Rogers: Swiss Central Bank Move 'Huge Mistake'

2011-08-09T06:27:00.001-07:00

Jim Rogers on S&P's downgrade of the US
Jim Rogers: Investors Were Aware of Downgrade Risk

2011-07-25T13:44:00.000-07:00

This video is a bit long (26 min), but it's a very interesting debate:
CrossTalk ft. Jim Rogers: Euro Jitters

2011-06-23T09:22:00.000-07:00

Jim Rogers talks about the world economy and the commodity markets on BBC HARDtalk (in 2 parts):
BBC HARDtalk - Jim Rogers - 17/5/2011 (Part 1/2)
BBC HARDtalk - Jim Rogers - 17/5/2011 (Part 2/2)

2011-05-04T21:36:00.001-07:00

A U.S. court sentenced Bernard von NotHaus, private producer of the Liberty Dollar, to 15 years in prison and a fine of 250.000 $. Furthermore the company’s stock of gold valued at 7 million $ was confiscated.
The Freedom to strike Gold

2011-04-20T04:13:00.000-07:00

"The bailout is what is on everyone's mind. And you know that the anger must be palpable if it fired up the usually sleepy world of Finnish politics."
The EU Crackup by Lew Rockwell

2011-03-25T04:14:00.000-07:00

Top 5 hyperinflations - a slide show with many interesting details (read the text next to the pictures, on the right):
The Worst Hyperinflation Situations of All Time

2011-02-18T08:11:00.000-08:00

A quite detailed analysis about the drawbacks of representative democracy:
How To Win an Election

2011-01-06T03:09:00.001-08:00

Clarke and Dawe: Lending merry-go-round

2010-12-31T08:26:00.000-08:00

History Of Central Banks In The United States

2010-12-30T09:23:00.000-08:00

Marc Faber: U.S. Bonds Worthless

2010-12-29T06:29:00.000-08:00

Govt Has Kill Switch To Shut Down Internet

2010-12-26T03:57:00.000-08:00

The Riverside Conversations (TRC): a series of smart conversations for television hosted by Jim Rogers and featuring Marc Faber. Each of the three episodes is 50 minutes long and concentrates, in depth, on an issue of global economic importance.

Click here for more details and to watch the videos online.

2010-12-20T05:22:00.000-08:00

A Sushi Model of Capital Consumption

2010-11-22T06:03:00.000-08:00

Economic Recessions, Banking Reform, and the Future of Capitalism by Jesus Huerta de Soto

2010-11-05T14:21:00.000-07:00

Bernanke was wrong

2010-10-24T19:38:00.000-07:00

QE2 and the Alleged Deflation Threat

2010-10-21T12:12:00.000-07:00

Jim Rogers at the Ludwig von Mises Institute:
How I See the World Today | Jim Rogers
How I See the World Today: Question and Answer Period | Jim Rogers

2010-10-12T16:52:00.000-07:00

What's wrong with US economic policy and what should be done? Here's the answer:
Are the Austrians Too Harsh?

2010-10-04T04:40:00.000-07:00

A bit of fun:
How the markets really work

2010-09-29T08:59:00.000-07:00

An article about the problems with free healthcare:
Time as a Price

2010-08-16T09:45:00.000-07:00

The Fed as Giant Counterfeiter

2010-07-27T07:46:00.000-07:00

A very clear and succinct explanation of why we are headed towards (hyper)inflation:
The Unlimited Power of Suppressing the Interest Rate

2010-06-17T11:14:00.001-07:00

There is a pretty detailed review of the commodity market by Jim Rogers in the "Economic Crisis Summit" webinar. I strongly recommend the part that contains the Jim Rogers interview (between 10:30 and 18:00), but not the other parts. Here is the video:
Economic Crisis Summit webinar

2010-06-05T05:30:00.000-07:00

Interview With Jim Rogers: The CPI Is A Lie And Inflation Is Going To Increase

Speculators

2010-05-11T03:13:00.000-07:00

Below are three articles about speculators and the hypocrisies of politicians. Here is a quote from one of the articles:

European politicians are also in denial about the role of markets, at least in public. Leaders such as Nicolas Sarkozy of France endlessly declare that the financial markets are acting as “speculators”: ie, not as rational or legitimate actors. In late January the Spanish and Greek prime ministers murmured darkly that sinister political and financial interests were picking on Greece to try to destroy the euro.

Yet when euro-area governments agreed to lend money to Greece at a hefty premium over the benchmark rate paid by Germany, they were implicitly conceding both that markets had a legitimate point (ie, that not all governments are equally creditworthy) and that market forces can be useful (higher borrowing costs are a vital tool to discipline Greece). Some speculators have certainly aimed at Greece. The Belgian finance minister, Didier Reynders, boasted that his country would “turn a profit” on the billion euros it is due to lend Greece by borrowing the cash at rates below those Greece would have to pay. Perhaps speculation is not wicked when governments indulge in it.

Those wicked speculators again
You say speculator, I say investor
Sticks and bail-outs

2010-05-10T10:29:00.000-07:00

There's nothing new under the sun. Reducing the intrinsic value of coins was already tried by the Romans:
Will Nickel-Free Nickels Make a Dime's Worth of Difference?

2010-05-10T06:17:00.000-07:00

The EU also started printing money heavily:
Markets Welcome E.U. Rescue Package
The €750 Billion Package That Will Not Rescue The Single Currency

2010-05-07T06:25:00.000-07:00

Jim Rogers on Bloomberg:
5/6/10 Jim Rogers on Bloomberg: Stock Market Plunge is "Normal Correction"
3/8/10 Jim Rogers on Bloomberg: Greece Bankruptcy Would Be Good for Euro!
5/3/10 Jim Rogers on Mining Stock Talk
June 2009: Jim Rogers: They're Printing So Much Money That Stocks Will Go To 30,000

2010-05-03T08:27:00.001-07:00

The Fed's modus operandi: Panic

2010-03-25T16:02:00.000-07:00

They think this will save them from inflation:
Bracing For Position Limit Talk in Metals

2010-03-25T15:57:00.000-07:00

Gordon Brown was finally told to explain why he sold Britain's gold

2010-03-18T04:40:00.000-07:00

An eye-opening article about why free competition is good in the insurance business:
Why Not Universal Car Insurance?

2010-03-05T02:14:00.000-08:00

Why free competition is better - this time applied to ISPs:
Opening the Internet — with an Axe

2010-03-02T10:32:00.000-08:00

Why government stimulus was not and is not necessary:
Does "Depression Economics" Change the Rules?

2010-01-27T08:24:00.001-08:00

Roubini Says Spain `Bigger Problem' for EU Than Greece

2010-01-25T23:39:00.001-08:00

A bit of history:
The Panic of 1819
Illusions of the Age of Keynes

2010-01-21T12:36:00.000-08:00

Where most of the developped economies are heading:
Hyperinflation, Money Demand, and the Crack-up Boom

2010-01-17T18:54:00.001-08:00

Why is it a bad idea to "stimulate" the economy by printing money?
The answer is here:
Of Time and Marshmallows

2010-01-05T07:29:00.001-08:00

The reason why it is a bad idea to invest in futures-based ETFs:
UNG vs. USO: A Tale Of Two Commodities

For more technical details, see:
What’s Wrong With UNG?

2009-12-29T13:12:00.000-08:00

George Orwell turns in his grave:
Supreme Court Guts Due Process Protection
Dred Scott Redux: Obama and the Supremes Stand Up for Slavery
US: Guantanamo Prisoners Not ‘Persons’

Britain is not much better:
British Government: We Want Access to Your Every Phone Call, Email and Web Search

Peak-oil confirmed!

2009-12-17T09:43:00.000-08:00

Finally! The International Energy Agency finally recognized that there will be a peak-oil (a maximum of daily production volumes). They think it will be in 2020. I think they are still being optimistic, but compared to the complete denial that they were communicating until now, 2020 should be a pretty alarming date.

Here is the article from The Economist:
The peak-oil debate: 2020 vision

2009-12-14T09:57:00.000-08:00

The crisis in a nutshell:
China alarmed by US money printing

2009-12-13T19:02:00.000-08:00

I watched a movie called "The Money Masters" on youtube. Very-very interesting. It is 3 hours long, but it is very eye-opening. You can look at it in 22 pieces, here:

The Money Masters

2009-12-11T10:16:00.000-08:00

Barack Obama Ensures a Long Depression

2009-12-11T10:08:00.001-08:00

The Myth that Laissez Faire Is Responsible for Our Present Crisis

2009-12-11T10:06:00.001-08:00

The “GDP Fraud”

2009-12-11T09:09:00.000-08:00

Why the freedom of trade is so important:

Ticket Scalpers Are Hidden Heroes

2009-11-27T09:19:00.001-08:00

Is $6,300 fair value for gold?

2009-11-24T19:29:00.001-08:00

When is a speculator not a speculator?

2009-11-07T08:42:00.000-08:00

Jim Rogers says this is not a bubble, this is a good year:

Jim Rogers says Nouriel Roubini is wrong on gold bubble

Watch the video here

2009-10-18T13:55:00.001-07:00

A story about the emergence of money (also part of Economy 101):

The Economic Organisation of a P.O.W. Camp by R. A. Radford, Economica, vol. 12, 1945

Unfamiliar Expressions Used in the article:

Radford uses British expressions that were in common use after World War II. Some of these are still in use in Britain. Others are not. Bully is canned beef. Treacle is molasses. Oflags, short for
Offizierslagers, are POW camps for officers. The BRCS is the British Red Cross Society. Money is
clipped when metal is trimmed from the edges of coins. It is sweated when heat is applied to remove the metal. Points are electrical contacts.

2009-10-18T13:52:00.000-07:00

A very interesting article by Sebastien Bastiat, written more than 150 years ago (in 1850). It should be part of every Economy 101 course:

That Which is Seen, and That Which is Not Seen

Unrepentant bears: The end is nigh (again)

2009-10-08T05:30:00.000-07:00

Pessimistic commentators remain anything but convinced by the stockmarket rally

Read the full story here.

The search for America's worst investor

2009-10-08T05:21:00.000-07:00

"Hedgeable.com, an investment start-up that has come up with a neat gimmick to draw attention to its launch: a nationwide contest to find the three investors whose portfolios lost the most value between October 2007, when stockmarkets began to tumble, and March 2009, when they hit bottom.

The consolation will be a holiday in Rome, “the last great empire to collapse under a mountain of debt, a devalued currency and out-of-control spending”. The prizes for second and third place are trips to Iceland, scene of a more recent collapse, and Las Vegas, America’s foreclosure capital."

Read the full story here.

Buttonwood: Chucking the buck

2009-10-08T05:11:00.000-07:00

"It is hard to think of a parallel in history. A country heavily in debt to foreigners, with a government deficit it is making little attempt to control, is creating vast amounts of additional currency. Yet it is allowed to get away with very low interest rates. Eventually such an arrangement must surely break down and a new currency system will come into being, just as Bretton Woods emerged in the 1940s."

Read full story here.

2009-10-05T09:47:00.000-07:00

Finally they start to realize that it's not always good to have "positive thinking":

Report on Wall Street banks' bailouts says US Treasury misled public

2009-09-18T05:14:00.000-07:00

Follow the money

2009-09-09T07:22:00.000-07:00

Amazon vs. Orwell:

2009-09-07T07:38:00.000-07:00

Obituary to Fannie and Freddie:

http://news.bbc.co.uk/1/hi/business/8239033.stm

About the painting:

American Gothic

2009-09-07T02:08:00.001-07:00

Morbid:

'Life settlements' bonds could be Wall Street's next big act

2009-08-27T09:32:00.000-07:00

FDIC:

The U.S. added 111 lenders to its list of “problem banks”
The U.S. has taken over 81 banks this year
A total of 416 banks with combined assets of $299.8 billion failed the FDIC’s grading system for asset quality, liquidity and earnings in the second quarter
FDIC-insured banks reported a net loss of $3.7 billion in the second quarter

Full story here:
FDIC List of Problem Banks Surges, Putting Reserve Fund at Risk

2009-08-12T10:57:00.000-07:00

Peter Schiff Was Right 2006 - 2007 (2nd Edition)

2009-08-12T08:33:00.000-07:00

Are we in 1984?

A request to snoop on public every 60 secs

Councils, police and other public bodies are seeking access to people’s private telephone and email records almost 1,400 times a day, new figures have disclosed.

2009-08-12T07:07:00.001-07:00

One hand washes the other:

How close are Goldman Sachs's connections with the US treasury?

2009-08-07T10:34:00.000-07:00

It is easy to reduce losses by redefining what are considered losses...

The Fannie Mae sinkhole

2009-08-07T10:30:00.000-07:00

Buffet:

Buffett’s Betrayal

Billionaire Buffett benefits from bailout he promoted

2009-08-06T12:21:00.000-07:00

Government and big business: one big happy family!

COMPLIANCE WATCH: SEC Settlement Tactic Raises Questions

2009-08-06T12:00:00.000-07:00

It is becoming more and more clear that the government, by helping the big banks, was (and still is, see previous posts) throwing good money after bad:

Is the End Near for BofA CEO Ken Lewis?

2009-07-31T11:18:00.001-07:00

As I said it on numerous occasions: the government takes money from one of his pockets and puts it in another one. In the meantime banks get rich by taking money from the taxpayers. Now in Europe also.

Europe borrows from Peter to lend to Peter

2009-07-23T06:34:00.000-07:00

There are banks that know what to do in a crisis instead of asking for more and more money from the state:

Credit Suisse Confirms Winner Status

Porsche vs. VW

2009-07-23T06:31:00.000-07:00

Porsche tried to buy VW over the last few years. They took a lot of credit (10 billion EUR) to buy VW shares. They could buy quite a lot, almost half. But then came the crisis, Porsche sales in the US plumetted and they could not renew their credits anymore (banks started being afraid of giving them credit). So after a lot of back-and-forth, trying to get an investment from Quatar to keep being independent etc, the result is: Porsche's CEO was fired and VW will buy Porsche!!! The tables are turned.

What is funny, is that Ferdinand Porsche founded Porsche and designed the original VW Beetle. Today the boss of VW (and soon Porsche) is his grandson, Ferdinand Piech.

2009-07-02T11:22:00.001-07:00

Dumbest Moments in Business 2009...midyear edition

2009-07-02T11:02:00.000-07:00

Yesterday I read that Wal-Mart supports the idea of mandatory health insurance paid by big employers for their employees. I thought to myself: "Yeah, right!". Today I found an article about the possible motivations:

Wal-Mart and Health Insurance: The Theories of the Case

2009-06-01T13:32:00.000-07:00

Here is an eye-opening white paper:

The Shameful Truth about the CPI

2009-05-28T11:00:00.000-07:00

New nails in the dollar's coffin:

Geithner to Urge Chinese Leaders to Rely Less on Exports

If the Chinese economy can rely on internal consumption, they will not need to export in exchange for worthless US Treasuries.

What's driving the great bond freak out

I think people who think there will be a recovery, move from Treasuries to stocks, while people who don't believe in a recovery, move from Treasuries to commodities. Either way, Treasury prices decrease (yields increase).

2009-05-20T16:37:00.000-07:00

A September 26, 2008 Wall Street Journal opinion written by John Paulson suggested an alternative to the Treasury Secretary's plan for stabilizing the markets:

The Public Deserves a Better Deal

2009-05-07T13:37:00.001-07:00

Why I Fired My Broker

I agree: the best thing to do is to invest in commodities and learn to farm.

2009-05-07T13:37:00.000-07:00

Why I Fired My Broker

2009-05-06T08:40:00.000-07:00

There is a nice market overview on Reuters. A small excerpt:

Chrysler's dive into bankruptcy protection means the U.S. taxpayer won't be seeing the $7 billion in bailout money provided to the automaker ever again.

Nice...

Read the whole article here.

2009-04-14T13:19:00.000-07:00

Taxing Grandma to Subsidize Goldman Sachs

The circle is now closed: banks get cheap loans from the Fed and they use it to pay back the TARP funds. So they take money from one pocket of the government and they put it in the other, freeing themselves of federal restrictions on compensation. Brilliant!

2009-03-26T10:32:00.000-07:00

Another nail in the dollar's coffin:

Will the US dollar remain king?

2009-03-09T17:26:00.000-07:00

Watch what the masters are saying:

Jim Rogers on Feb 13, 2009

Jim Rogers in Dec 2008

Ron Paul on Jan 21, 2009

Joseph Stiglitz in Feb 2009

Peter Schiff

Marc Faber on Feb 18, 2009

2009-03-09T16:50:00.001-07:00

Here is an excerpt from Oil hits 2-month high as traders eye OPEC meeting:

Separately, the head of China's energy bureau said in an editorial published Monday that China should use part of its nearly $2 trillion in foreign-exchange reserves to buy more gold, oil, uranium and other strategic commodities. The comments by Zhang Guobao, head of the National Energy Administration, appeared in China Reform Daily, a newspaper run by the government's National Development and Reform Commission.

I think it's pretty clear what this would do to the price of those commodities. Since most of China's reserves are in US Treasuries, so first they would would have to sell them, it should also be clear what this increased supply would do to the price of Treasury notes and ultimately the US dollar.

2009-03-09T14:26:00.000-07:00

A friend of mine sent me a link to an interesting article:

Top 10 headlines that could signal a market bottom

Here are my comments:

A significant (more than 10%) one- or two-day drop in the market. Since this is technical analysis, I would only trust it on the very short term.
Timothy Geithner is replaced with Paul Volcker. I don't think it will happen. If it does, I agree, that would be a clear sign.
The 100th day of a bankruptcy by General Motors Corp. I would not bet on GM ever coming back to life.
Gold at $2,000 an ounce. I expect it significantly higher than $2,000. And I expect it to cross the level where the Dow Jones Industrial index will be.
The Dow Jones Industrial Average changes more than two names at the same time, and/or adds names to increase the overall number of stocks in the index. I agree. Unfortunately indexes (and mutual funds) have something called "positive bias": only those shares are accounted for, where the company is still alive. If a company goes bankrupt, its shares will not be taken into account in the index (or even if they will be, they are weighed by the share price, which is very low), therefore the index shows a higher value than where it really should be.
New York Stock Exchange daily volume drops to 1 billion shares for 30 sessions in a row. I agree that it has to decrease significantly, but I don't know the exact volume.
One million jobs lost in a month. I don't think this is very significant.
The market starts to rally on bad news. I'm not convinced that this shows anything. If it goes on for a significant time, then yes, but first we have to wait for a significant time to see it.
Stock market favorites see 15% to 20% declines. Who is to say which companies are the favorites? And why 20%, why not 40%?
CNBC goes off the air. If they do go off the air, that would be a clear sign. But I'm afraid they will survive and it is hard to measure how many people are watching it.

2009-02-12T16:30:00.001-08:00

Some are more "AAA" than others:
U.S. and UK ratings "being tested" by crisis

However, I think the most important remark is about the fact that the US will not default.

2009-02-12T16:28:00.000-08:00

They finally realized:
Official: Economic Strife Poses Security Threat to U.S.

2009-01-09T12:47:00.000-08:00

Should we laugh or should we cry?

Newstopia explains the Reserve Bank

2008-12-14T19:40:00.001-08:00

The king is naked after all.

Madoff and the Global Economy

2008-11-24T09:16:00.000-08:00

An article about an alternative to capitalism:

Beyond Capitalism: Leland Stanford’s Forgotten Vision

2008-11-21T09:32:00.001-08:00

The latest in Ron Paul vs. Ben Bernanke:

11/18 Fiat Dollar Reserve System Dead New World reserve currency

2008-11-18T10:17:00.001-08:00

An interesting summary of the pros and cons of bailing out the auto industry:

Detroit bailout: 7 key questions

2008-11-17T12:39:00.000-08:00

I agree 100%:

Bail Out Capitalism, Not The Big Three

2008-11-14T14:05:00.000-08:00

A good summary of how did we get here:

How Bretton Woods reshaped the world

2008-11-13T09:53:00.000-08:00

There are many smart Hungarians - just not in Hungary:

The Crisis & What to Do About It

2008-11-12T08:34:00.000-08:00

The International Energy Agency (IEA) gives a different reason for oil supply crunch, but the result is the same:

Energy agency warns of supply crunch

2008-11-11T07:23:00.000-08:00

The government has the nerve to say that this is good for taxpayers.

AIG Bailout 2.0