May 14th, 2010 by Alex

May 13th, 2010 by Alex

Goldman Sachs had a perfect first quarter of proprietary trading (trading with their own bank created money for their own profit). That means that all 63 trading days in the U.S. markets in the first quarter were winners for Goldman. Needless to say, in a fair game, that is a nearly impossible feat. But Goldman wasn’t the only perfect trader in the first quarter, so was JP Morgan. And although not perfect, Morgan Stanley managed to make money 93% of the time. It all just goes to show that when you have the resources to determine the direction of a market, you can’t lose. It becomes just like a casino, it is rigged in favor of the house. So, that just goes to show that the idea that the market is some kind of oracle of the health and future of the economy is a delusion. All the markets is is a barometer of whether the big banks are mostly buying or selling on any given day. It is a joke.

And it isn’t only the markets that the big banks rig, it is also the government. Just look at the recent giant European Union bailout orchestrated by the European Central Bank and the Federal Reserve. The only things that bailouts like that do is reward bad government behavior by delaying the day or reckoning and they assure no loses for the banks who finance bad government behavior. It is all a sick symbiotic relationship between governments and banks that turns them both into monsters. Plus, all that funny bailout money (debt) and risk manipulation messes up the real economy.

But no one in the mainstream ever comes out and says what the real problem is with all this stuff. The problem is that MONEY IN THE MODERN WORLD IS LITERALLY NOTHING BUT DEBT! The world doesn’t need bailouts, it doesn’t even need investigations into Goldman, it needs real debt-free money.

April 24th, 2010 by Alex

A lot of people wish they had put all their money into the stock market in March of 2009, but if they were really the type of people with the guts to do that they would have already had all their money in the market well before the bottom.

The broad money supply (M3) is now not growing, but actually contracting. And M2 money supply is at least nearly contracting. That is not conducive to a growing economy. All it is conducive to is money floating around looking for a place to go. The only thing really growing is government and the government can’t grow without taking resources away from the private sector. And unless the private sector is prospering, there is nothing to fund the government except for borrowing and printing money. The problem with government printing money doesn’t really show up in full form unless that money is expanded by the banking system through increased demand to borrow and confidence to lend. Increased demand for borrowing and confidence to lend requires a positive economic outlook. So, from a money supply stand point, unless the economy really heats up and everyone becomes positive, I don’t see any really big inflation coming anytime soon due to money supply growth. I only see big inflation if people start bailing on the dollar.

In the near future, regardless of what the official numbers say, if the economy is weak it will be reflected in the economic health of states (since states don’t print their own money, except North Dakota). If states are in trouble, then the federal government will need to print money to bail them out. The imbalance between growth of government and lack of growth in the real economy is where the inflation danger rests. That is where we will see an inflationary depression scenario: rising prices without real economic growth and real wealth creation.

I don’t make short-term forecasts because I have no idea about things in the short-term. For instance, a rogue event like a big terrorist attack could mess up even the best forecast short-term. All I know is that long term, if you put your money in something like the Dow Jones Industrials for the next 40 years, you’ll average about 5% gain per year plus whatever dividends you get (probably no more than 3%). That might meet or beat the inflation rate, or it might not. And you might be down as much as 50% at some point between now and then if you start that strategy right now. Unless we learn how to manufacture gold in the next 40 years, I think gold is just as good as and probably better than most stocks. If we do learn to manufacture gold, then we’ll be well on our way to a post-economics world, so investing won’t matter much. Because the less scarcity there is, the less need for economic activity there is. In a world without scarcity there is no need for an economy. The basic formula of economics is: put as little as possible in to get as much as possible out. If economics is allowed to work to its conclusion, in the future, we’ll all live like royalty on a few minutes of work per day–especially if we start spending most of our time in evermore immersive virtual realities.

But anyway, for now, the bail out bubble rolls on, but I personally have no confidence in where it is rolling to.

April 24th, 2010 by Alex

The part of this clip I liked the best is were Ron Paul points out how people like Matthews are inconsistent in their support of liberties and social justice.

April 16th, 2010 by Alex

March 19th, 2010 by Alex

A six part series done with Drew Carey looking at free-market solutions for fixing the city of Cleveland.

March 17th, 2010 by Alex

The thing I found particularly interesting about this interview is that Ron Paul brings up the idea that the Federal Reserve may be lending foreigners money to buy treasuries, giving the dollar the illusion of support.