Marc Faber is a market analyst and publisher of the “Gloom, Boom and Doom Report” newsletter. As you may have gathered from that title, he’s rather pessimistic about the economy. (He’s also been very accurate concerning economic trends over his career.) But he really dropped jaws this morning when he made the following statement on CNBC:
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“I am a great optimist in life; otherwise I would commit suicide in view of the kind of governments we have nowadays.”
Hyperbolic suicide comments aside, it brings up an interesting irony that I have been noticing for a while. That is, most (if not all) of the most bearish economic forecasters describe themselves as optimists in their day to day lives. I consider myself extremely optimistic, but my views on the economy are dire at best. The fact that we optimists are so pessimistic about the economy should cause you to take notice and ask if maybe there is something to all this gloom and doom after all. Continue reading →
[The Liberty Insight Newswire is an aggregation of what we consider to be important financial and political news and commentary from across the web.]
There is so much going on in global finance and politics these days it’s impossible to keep track of it all. From the hourly rumor mill on the European Greek bailout, to OWS, to manipulations and rules changes in the gold and silver markets, to fraud and insolvency at the banks and big news at the Ron Paul campaign that doesn’t make the news. Below are a few articles of particular interest. If you still crave more, Goldsilver.com has been doing a great job keeping up with things on their industry news feed. Continue reading →
[The Liberty Insight Newswire is an aggregation of what we consider to be important financial and political news and commentary from across the web.]
This week’s newswire examines the Occupy Wall Street movement. What the heck is it? Do they even know? The movement without a goal or even a direction started with one central theme- express displeasure with the current system where the average person gets screwed while the top 1% get bailed out.
The OWS movement is a mixed bag, ranging from socialist progressives to hardcore libertarians. Initially treated as a joke by the mainstream media and portrayed as a bunch of unemployed, uninformed Commie hippies sitting around playing drums and finger painting, the movement has spread to multiple cities and has grown in numbers and diversity (and cameo appearances).
While I don’t agree with all of the protestors occupying Wall Street I can certainly empathize with their plight. After all, the common man has gotten screwed. The bankers screwed up royally, got bailed out by the government with the people’s money, and then paid themselves huge bonuses.
What these people are actually protesting, whether they know it or not, is not Capitalism or even corporations themselves, but “Corporatism” a.k.a. “Crony-Capitalism” a.k.a “Soft-Facism”. They’re protesting a system where big corporations give $millions to politicians in exchange for $billions in bailouts and special favors. A system that protects the big, politically connected corporations from competition, through regulations written by those very corporations. Where the Federal reserve prints new money to finance big banks and government contractors, while the average worker only gets stagnant wages and rising prices.
Unfortunately, so far, most of the anger has been misplaced; mistakenly directed at the “greedy” corporations and especially the big banks. Don’t get me wrong, I have no love for the banks and agree that many of the bankers are a bunch of greedy, deranged money whores. The banks were complicit in the housing bust and the destruction of our economy. But… should we blame the banks for asking for a bailout or the politicians who gave it to them? Of course the corporations are going to take a bailout if they can get it; just as the socialist contingent at OWS would take free education (paid by others) if they could get it. It is the responsibility of the politicians to say “No!”
None of this would be an issue if the government simply followed the Constitution. Hopefully, this is a lesson those at OWS will learn while they’re camped out on Wall Street with Captain Midnight (see video below). Continue reading →
Don’t you love clearance sales? You had your eye on that adorable handbag (or European carry-all) and just as you are ready to buy it, the store announces it is dropping prices by 30% to make room for new inventory. Score! But act fast, because prices this low won’t last.
To the delight of silver and gold investors (not traders) world markets are offering huge markdowns on beautiful Silver Eagles and Gold Krugerrands. Gold has dropped to $1600/oz from its high of $1900/oz; a 15% discount. Silver fell to $26/oz and is settling in around $30/oz, down 30% from its recent trading range high of about $42/oz. (Silver is down 40% from its record high of $50, but it only spiked up there for a nanosecond so I don’t consider that a meaningful number.)
But like any good sale, these cheap prices aren’t likely to last for long. If you’ve been thinking about buying some precious metals but were hesitant because they were trading at all time highs, now’s your chance to jump in. That’s not to say the prices can’t drop even further. But, if they do, precious metals investors will rejoice and thank their lucky stars that they can buy more at even cheaper prices. Continue reading →
On Tuesday, Peter Schiff testified before a Congressional committee about ways to increase job creation in the economy. His message, while not popular with many politicians, was loud and clear; Get the government out of the way. True to form, Peter explains the true root of the problem in terms so clear and simple, that even a Congressman could understand them.
One thing I found interesting is that in the five person panel that testified, only Peter was actually a businessman who has to hire people in the real world. The other four people were academics who base their opinions on charts, studies, and economic theory.
In his testimony, Peter explains how government stimulus, such as President Obama’s new “jobs bill” or President Bush’s tax rebate stimulus package, simply diverts capital from one segment of the economy to another while running up the debt and adding a layer of bureaucracy. He explains the motivations behind an employer’s decision to hire an employee and how the government has made hiring someone “one of the riskiest things you could do in America.” He explains how artificially low interest rates are hindering capital formation necessary to increase production. But enough of my blabbering; watch it straight from Mr. Schiff below.
If you only have a few minutes, definitely watch his opening five minute statement and the last two minutes of part 2.
The example of Henry Ford cited in the last few minutes of the video sums up the situation perfectly. In 1914, Henry Ford was able to pay his factory workers $5 a day or the equivalent of $125,000 a year today; and that was with zero income taxes or payroll taxes. He paid the highest wages in the world and sold his cars for the lowest price. But how is that possible? It was possible because the government was tiny, regulations were minimal, taxes on business were low, savings and capital was available to increase productivity, and employers didn’t fear getting sued at every turn.
The most liberal guest on the panel, Dr. Boushey, unwittingly proved Peter’s point about the worker/employee relationship; namely, that in a free market without regulations and unions, employers will pay fair wages and aim to please their workers, or face losing them to the competition. As Dr. Boushey points out, Henry Ford paid those high wages “to reduce turnover and keep highly skilled workers,” not because of union demands. Continue reading →
On Thursday, President Obama unveiled his latest $450 Billion stimulus program to create jobs. Incidentally, he never used the word “stimulus” in his speech, presumably since his last $800B round of stimulus did nothing to budge unemployment. Instead, he called the plan a “jobs bill”, as if a change in semantics will improve the outcome. His Keynesian plan has been debunked in enough articles that I won’t rehash all the criticisms here. Just suffice it to say, the plan amounts to borrowing more money now to spend it on some temporary stimulus to the economy. While Mr. Obama promises that this $450B will not add to the national debt, he has yet to reveal where the money will come from to pay for it. Anyone want to wager that his plan won’t be financed with non-binding budget projection cuts five to ten years in the future?
Presidential candidate Ron Paul has proposed an economic stimulus plan of his own. It may seem antithetical to see the words Ron Paul and “stimulus plan” in the same sentence. After all, this is the man who has railed against government borrowing and spending in Congress for over thirty years. The man who has spent a lifetime preaching that the government’s role in the economy is to set simple rules, protect sound money, and enforce contracts and property rights; not to dole out money and favors while picking winners and losers with taxpayer money. But in this case, the word “stimulus” is a semantic distinction to show how Ron Paul’s policies would generate an immediate boost to the economy and jobs. Continue reading →
[The Liberty Insight Newswire is an aggregation of what we consider to be important financial and political news and commentary from across the web.]
This week’s newswire examines the European Union rapidly unravelling, the end of the Swissie safe haven, and a look back at the shining star of Obama’s last jobs program in the wake of President Obama’s new jobs program proposal. Continue reading →
[The Liberty Insight Newswire is an aggregation of what we consider to be important financial and political news and commentary from across the web.]
This week’s newswire features a history lesson on the Constitution, a behind the scenes look at the mindset of the Federal Reserve board, European bailout fatigue, and a gentle reminder that our soldiers are still mired in a no-purpose war in Afghanistan. Continue reading →
There’s an old expression in the gambling world: If you can’t spot the sucker at the table… it’s probably you.
The great American financial casino used to be an inviting place, with options for all kinds of people.
Investors with a fairly long time horizon and an appetite for risk, could sit down at the blackjack tables (i.e. the stock market) and let it ride. Sure, the dealer (brokerage firms) took a cut, but the deck was stacked in the player’s favor and the rules of the game were favorable. The players knew that if they could withstand some hot and cold streaks, over time they could expect to win about 10% a year on their investment. Of, course, if you did win money, the government would take a cut of your gains through taxes, but that’s hardly a concern when you’re making reliable profits just by playing your cards right.
People who wanted to play it safer in the great casino could play the slots (i.e. bond market) which produced a more steady and predictable stream of income. These were some friendly slot machines that posted their payouts on top of the machine. Signs like 8% or 4% informed investors of the yearly percentage gains from each machine.
Those who didn’t want to take part in the gambling activities could relax at the pool, enjoy the shows, and pay a reasonable price for dinner at the buffet. They could simply save their money in an interest bearing account that grew faster than inflation, and steadily build up enough money to buy a house, pay for their children’s education and set something aside for retirement. While they didn’t win money, they benefitted from the booming casino as the facilities got nicer, the shows got better, and the atmosphere became more exciting.
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Today, the great American casino is a different place. A place where the stakes are higher, the odds are worse, and the house and the well-connected always win. The big flashing neon sign on the door now reads, “Suckers Welcome! Come on in!” Continue reading →
Marc Faber is a market analyst and publisher of the “Gloom, Boom and Doom Report” newsletter. As you may have gathered from that title, he’s rather pessimistic about the economy. (He’s also been very accurate concerning economic trends over his career.) But he really dropped jaws this morning when he made the following statement on CNBC:
![[Most Recent Quotes from www.kitco.com]](https://i0.wp.com/www.kitconet.com/charts/metals/gold/t24_au_xx_usoz_4.gif)
![[Most Recent Quotes from www.kitco.com]](https://i0.wp.com/www.kitconet.com/charts/metals/silver/t24_ag_xx_usoz_4.gif)
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