I see a lot of negative comments on gold, but am sorely lacking any well documented arguments why our good old US$ is not at all being mishandled, depleted of its value, etc. and therefore to be distrusted.
Isn't this a typical sign of people hanging on to the unproven believe that nothing can destroy the US$ and thus that everything pointing the other way is nonsense ?
Personally I see little real evidence that all those trillions of dollars spend over now already a long period of time are resulting in our economy being or really getting back on its feet, but just some feeble jerks in that direction. Also no evidence whatsoever that the dollar is once more a valuable world currency. Abe following the US-example does not (yet?) has not shown more promising results, only an exchange that does not know which way to go and local Japanese bond investors loosing their shirts and income.
Despite all that has been said about the poor results of the EURO "austerity program" I see once more the EURO getting stronger against the US dollar (and 3rd countries more and more avoiding our currency). And before people start again about the disastrous situation in S-Europe and the ECB also printing Euros, consider that the S-Europe mess is the result of corruption and the printing the result of efforts to avoid half a continent finally gong under...! If N-Europe is not ding so well nowadays, it is largely due to their efforts in favor of the South. It would be a welcome change if our people started to stop looking at their navel and made an efforts to see the positive sides of efforts made abroad rather that showing them aside with a shrug. So, what is wrong with putting your house in order and avoiding disaster for our children by tightening the belt ?
GOLD is not called for nothing PM, Precious Metal. It is one of the very few things in our world that does not deteriorate in time and also not abundantly available. Therefore it is a Precious Metal. The author may buy and store store all the now available shares at NYSE, etc and in 500 years he will have nothing but dust. Not so with a PM.
That is a main reason it keeps a sure (even if variable) value.
3 Reasons Why Value Investors Should Beware [View article]
"First, the U.S. is the proverbial “nice house in a bad neighborhood.” The global economy isn’t growing at a fast clip, and the EU could dip back into recession."
May I put here a question mark ? According to the latest news in Spain the monthly non-employment rate has decreased for the 2nd consecutive time. As we all know it is one of the main EU economies and its further deterioration could substantially weaken the EZ). Therefor the "could dip" looks somewhat less likely. It seems to indicate that the EU "austerity" program might in the end not be such a bad thing and in the end put the EU back on the map. On the other hand, whilst the QE's have had some positive effects, the latter are very limited and looking to me as nowhere in relation to the huge debt we are amassing. So is the US really the proverbial nice house ? Isn't the author overlooking the negative effects of the impending interest rate increases ? If matters are getting out of control it remains to be seen if in the end the SP500 investors will not be the losers. Personally I am of the opinion that value investors may be better of in looking towards putting their money in something more tangible like housing, farming, etc.
1) Nations are formed by people. What I states in comment 191 was, quote " Basic problem is that, whilst in the States we have a melting pot and the idiosyncrasy of various European peoples have disappeared, over there they still exists." So, whilst we are talking the same language we draw a different conclusion. I maintain that Europe can only hope to reach a full unity if its peoples are prepared to sacrifice part of their idiosyncrasies, i.e. those that are hampering an integration. This has nothing to do with "dictator language", but is drawing a logic conclusion.
2) I don't remember having said that Europe has to become one country. I did use the term UNITY like the one in USA.
3) You negate any European hang to such a unity, claiming it exists only among some politicians. Well, that is not my impression. There is no doubt that at the moment it is weakening in favor of nationalistic trends. But isn't this normal when people are facing economic problems ? They are looking for scapegoats and, not wishing to accept any responsibility for possible past errors, the faults are always made outside their borders. This is normal human behavior and should not be confounded with the basic long term trends and desires. Since you live in Europe, why don't you ask around if people a) are of the opinion that the EU has decreased or increased the risks of war. b) and follow that up with the next question : if the EU should therefore be abandoned or maintained.
In my opinion you are mislead by the grumblings about the way Brussels act. And then comes the next question "Why are they dissatisfied?" And in my opinion for a good part the answer has to be found in the behavior of the national politicians, who have an ugly habit. Each time they have to take a decision which is rather unpopular they will say "Brussels imposes it", even if it has been approved by their own (party) representatives in the European Parliament.
4) Next point: the European technical rulings have to be unified. I assume you will agree that a federation is impossible to achieve without applying the same rulings. E.g. if an Italian producer wishes to sell his goods in Sweden, those goods have to comply with the Swedish regulation. From personal past experience I know how difficult it was to sell an item in Europe, because each country had its own set of rulings. One therefore had to produce x-types of the same product if one wished to cover x-European countries (or try to produce one that complied with all). The result was not only a very expensive production, but also made it virtually impossible for small producers to export. Are you really of the opinion that the unification of these matters has had a negative effect, be it on national (e.g. food) quality controls, exports, etc. or on e.g. welfare ?
5) Last point: The EU is not democratic. Yes, there is ample room for improvement, but your picture is far too gloomy. There is a freely elected European parliament. As far as I understand, the European commissioners are nominated by the domestic parliaments and have to be accepted (approved) by the elected European Parliament. Sure there are certainly dealings behind the scenes, but is it any different from what we have in the US ?
Hopefully with the above I have clarified some points. And if you wonder how come I am fairly well informed about European matters: Not only have a worked and sometimes even lived there, but also still have relatives in several European countries, amongst which a reporter which used to work for a number of leading European daily papers and who keeps me up to date.
Looking forward to the pleasure of reading you again, Regards.
These Alternatives seem to become quite popular and have the potential of making life difficult for Merkel's party (I don't think she herself will run a risk. Seems she is still much too popular for that). However as you undoubtedly know initial popularity is no guarantee for obtaining many seats. So: wait and see.
During my trips in Europe I have seldom seen people not blaming the Euro for inflation. The truth is of course that, like in the US, also the European countries have pumped too much money into the market. One just has to look at the increase in sovereign debts during the last 5-10 years in of many of them. And more money around = decrease of its value also called inflation. On the other hand nearly all Europeans I met admitted that a uniform currency has brought them prosperity and until now even the suffering Southern countries do whatever they can to remain in the EZ.
By the way, Pres.Hollande is really losing popularity even with the left, don't you think so too ? Rgds.
The Big 4 Economic Indicators: Nonfarm Employment [View article]
Good job, but matters would have been much clearer if the author would have applied an inflation correction. Also for the employment chart, some correlation with the total USA adult population development during the time span would have been welcome
Eric Sprott's Gold Analysis Deconstructed: What The Gold Bulls Still Don't Get [View article]
Whether gold is a currency or not looks to me as a fairly immaterial question. As everybody knows it has been used as a means of payment, like coins have been used to make jewels. And in case of distress everybody will be happy to accept it as a means of payment. Its value may fluctuate, like the value of specific currencies may fluctuate. What is materiel is the question how on the longer term their real values will develop, not their comparative value.
During the Weimar Republic the Mark lost within a very short time its value. Money was being printed ever more rapidly, but no solace was obtained. Somebody who at that time had gold was well off. Today the Fed is "printing" huge amounts of money . The result has not (yet) been the same as in Weimar. Why ? Well in the Weimar Republic the money was circulating and spent very fast, whereas in our country today we see comparatively little money seeps down to the men in the street and too little of the billions issued is circulating. The question which I would like to know (but only future will provide an answer) is what will happen if these amounts really reaches the masses and really starts circulating.
But there is another matter which hasn't been raised ofter enough: The demographic impact. I don't think many people will question the fact that in future interest rates will rise and consequently the debt burden will increase substantially. Simultaneously health care expenses will increase and the less tax payers will have to support the monetary needs of the government. And these extra burdens will fall upon the shoulders of our children.
If we look back to the development during the recent history we have generally and on a worldwide basis only seen increases in national debts and very seldom a decrease. Hoping or expecting that the extra expenses caused by the increase of interest rates on national debt will rapidly decrease (as well as an eventual debt repayment) once the economy picks-up is therefore a huge gamble.
Do we really wish to gamble and put into jeopardy that much the future of the next generations only because we wish at all costs to maintain a while longer our present living standard ?
This has been the real flaw in today's policy. Money is spend there where it does not start a real circulation, thus into productive consumers areas, construction, etc. It goes to non-productive services and to banks who refuse to stick out their necks by lending it out into the productive areas.
"Hedge funds are buying up residential properties hand over fist. Supply has been constrained for several years by housing starts below the rate of family formation. This is bullish for home prices and for growth in the demand for credit."
To have real growth means that money has to circulate. If the housing market would profit from individual private owners, it would mean a boost for a number of various industries (furniture, etc.). But speculative investment in this area hardly produces such an effect. Therefore its impact is limited until such times that the houses bought will be rented out or resold to private owners.
"So the Fed is buying up those Treasury securities to discourage savers from buying them." Isn't this the result of a low interest policy ( based on the assumption that this will encourage the industry and commerce to borrow and thereby re-establish growth ?) rather than a wish to discourage private investors to buy Treasury Securities ?
A lot of wrong statements and assumptions. To name but one, his starting point: " But many of the nations swept up in the eurozone crisis, such as Spain and France, had spending and tax revenues well aligned before it hit. I suggest Mr Backworth checks the various national debt data available to anyone who wishes to look at them . If spending and revenues were balanced there shouldn't have been any increases. Here are some official figures :
How Much Will Elderly Austerity Affect Consumer Spending And The Economy [View article]
In the UK the problem might be that the health care is run by the government.
Some pharmaceutical top people explained it to me why it should be run by mutual funds. As private enterprises the latter will aim for proper economics, whilst having to consider also a proper care level. If not, they will lose members, who will switch to another better and/or cheaper mutual care organization. No harm in the government subsidizing such organizations, but hands off from directly running the whole shop. This is the way (with slight differences) it has been set up in the Benelux countries and according to the same people it is in those countries where one receives the best medical care, also on a overall level. French medical care is also excellent, but far too expensive for the tax payers. Note: the pharmaceutical industry is better of with a state-run system. With competing mutual organizations their prices are more easily put under pressure.
A Very Bad Week For The Merchants Of Austerity [View article]
"Austerity should only be considered once the economy and unemployment is back to more normalized levels."
The massive QE injections have had no to an extremely limited success. Continuation of this folly does in no way guarantee success. And if it works and the economy would returned to "normal" levels and thus normal interest rates, the interest-on-sovereign debt will be such that not only the newly re-established so called normal economy will flounder, but also those tax payers having to cough up the enormous amounts will revolt. And those who have lived sensibly and put money aside will see their savings become worthless. All this in order to prevent having to tighten our belt somewhat today. We have lived far too long above a sustainable standard and continued to build up the total debt, profiting from the fact that the US$ has been the accepted international currency. Therefore our negative position partially financed by foreigners accepting our IOU's (T-bonds) as payment. And now with the bill being presented there are people claiming that our nation is not ill enough, we have to increase the doses of poison.
What it means can be seen today in Southern Europe. They spent too much with too little tax income. Todays heavy support programs are financed by the North and affecting the Northern economies, and still the South have problems to survive and many of their citizens are without work and suffer from poverty.
Seems that this example of what can happen to us if we continue to increase our debt level still does not faze those people who are afraid having to sacrifice some of their wealth. They ask for more dope and simultaneously for less tax. They don't seem to realize what is really going on in this world.
How Much Will Elderly Austerity Affect Consumer Spending And The Economy [View article]
Some further remarks: 1) I was referring to West-European healths care systems, since I am not familiar with the present Ex-East European ones. 2) I also wish to exclude the British one, which is way below par compared to the one in other West European nations.
How Much Will Elderly Austerity Affect Consumer Spending And The Economy [View article]
NEED MORE COFFEE,
Happily I am in a better position than you, but sympathize 100%. It is a bloody shame all these selfish people have one directional looks, i.c. towards their bill-fold and are totally blind and indifferent toward those who have made their present living standard possible. No further comments than the one I made lower on.
Gold: Time To Short [View article]
Isn't this a typical sign of people hanging on to the unproven believe that nothing can destroy the US$ and thus that everything pointing the other way is nonsense ?
Personally I see little real evidence that all those trillions of dollars spend over now already a long period of time are resulting in our economy being or really getting back on its feet, but just some feeble jerks in that direction. Also no evidence whatsoever that the dollar is once more a valuable world currency.
Abe following the US-example does not (yet?) has not shown more promising results, only an exchange that does not know which way to go and local Japanese bond investors loosing their shirts and income.
Despite all that has been said about the poor results of the EURO "austerity program" I see once more the EURO getting stronger against the US dollar (and 3rd countries more and more avoiding our currency).
And before people start again about the disastrous situation in S-Europe and the ECB also printing Euros, consider that the S-Europe mess is the result of corruption and the printing the result of efforts to avoid half a continent finally gong under...!
If N-Europe is not ding so well nowadays, it is largely due to their efforts in favor of the South.
It would be a welcome change if our people started to stop looking at their navel and made an efforts to see the positive sides of efforts made abroad rather that showing them aside with a shrug.
So, what is wrong with putting your house in order and avoiding disaster for our children by tightening the belt ?
Gold: Time To Short [View article]
GOLD is not called for nothing PM, Precious Metal. It is one of the very few things in our world that does not deteriorate in time and also not abundantly available. Therefore it is a Precious Metal.
The author may buy and store store all the now available shares at NYSE, etc and in 500 years he will have nothing but dust. Not so with a PM.
That is a main reason it keeps a sure (even if variable) value.
3 Reasons Why Value Investors Should Beware [View article]
May I put here a question mark ?
According to the latest news in Spain the monthly non-employment rate has decreased for the 2nd consecutive time. As we all know it is one of the main EU economies and its further deterioration could substantially weaken the EZ). Therefor the "could dip" looks somewhat less likely.
It seems to indicate that the EU "austerity" program might in the end not be such a bad thing and in the end put the EU back on the map.
On the other hand, whilst the QE's have had some positive effects, the latter are very limited and looking to me as nowhere in relation to the huge debt we are amassing. So is the US really the proverbial nice house ? Isn't the author overlooking the negative effects of the impending interest rate increases ?
If matters are getting out of control it remains to be seen if in the end the SP500 investors will not be the losers.
Personally I am of the opinion that value investors may be better of in looking towards putting their money in something more tangible like housing, farming, etc.
France, We Have A Problem [View article]
Here are my comments:
1) Nations are formed by people.
What I states in comment 191 was, quote
" Basic problem is that, whilst in the States we have a melting pot and the idiosyncrasy of various European peoples have disappeared, over there they still exists."
So, whilst we are talking the same language we draw a different conclusion. I maintain that Europe can only hope to reach a full unity if its peoples are prepared to sacrifice part of their idiosyncrasies, i.e. those that are hampering an integration.
This has nothing to do with "dictator language", but is drawing a logic conclusion.
2) I don't remember having said that Europe has to become one country. I did use the term UNITY like the one in USA.
3) You negate any European hang to such a unity, claiming it exists only among some politicians.
Well, that is not my impression. There is no doubt that at the moment it is weakening in favor of nationalistic trends. But isn't this normal when people are facing economic problems ? They are looking for scapegoats and, not wishing to accept any responsibility for possible past errors, the faults are always made outside their borders. This is normal human behavior and should not be confounded with the basic long term trends and desires.
Since you live in Europe, why don't you ask around if people
a) are of the opinion that the EU has decreased or increased the risks of war.
b) and follow that up with the next question : if the EU should therefore be abandoned or maintained.
In my opinion you are mislead by the grumblings about the way Brussels act.
And then comes the next question "Why are they dissatisfied?"
And in my opinion for a good part the answer has to be found in the behavior of the national politicians, who have an ugly habit.
Each time they have to take a decision which is rather unpopular they will say "Brussels imposes it", even if it has been approved by their own (party) representatives in the European Parliament.
4) Next point: the European technical rulings have to be unified.
I assume you will agree that a federation is impossible to achieve without applying the same rulings.
E.g. if an Italian producer wishes to sell his goods in Sweden, those goods have to comply with the Swedish regulation.
From personal past experience I know how difficult it was to sell an item in Europe, because each country had its own set of rulings. One therefore had to produce x-types of the same product if one wished to cover x-European countries (or try to produce one that complied with all). The result was not only a very expensive production, but also made it virtually impossible for small producers to export.
Are you really of the opinion that the unification of these matters has had a negative effect, be it on national (e.g. food) quality controls, exports, etc. or on e.g. welfare ?
5) Last point: The EU is not democratic.
Yes, there is ample room for improvement, but your picture is far too gloomy.
There is a freely elected European parliament. As far as I understand, the European commissioners are nominated by the domestic parliaments and have to be accepted (approved) by the elected European Parliament.
Sure there are certainly dealings behind the scenes, but is it any different from what we have in the US ?
Hopefully with the above I have clarified some points.
And if you wonder how come I am fairly well informed about European matters: Not only have a worked and sometimes even lived there, but also still have relatives in several European countries, amongst which a reporter which used to work for a number of leading European daily papers and who keeps me up to date.
Looking forward to the pleasure of reading you again,
Regards.
France, We Have A Problem [View article]
These Alternatives seem to become quite popular and have the potential of making life difficult for Merkel's party (I don't think she herself will run a risk. Seems she is still much too popular for that).
However as you undoubtedly know initial popularity is no guarantee for obtaining many seats. So: wait and see.
During my trips in Europe I have seldom seen people not blaming the Euro for inflation.
The truth is of course that, like in the US, also the European countries have pumped too much money into the market. One just has to look at the increase in sovereign debts during the last 5-10 years in of many of them. And more money around = decrease of its value also called inflation.
On the other hand nearly all Europeans I met admitted that a uniform currency has brought them prosperity and until now even the suffering Southern countries do whatever they can to remain in the EZ.
By the way, Pres.Hollande is really losing popularity even with the left, don't you think so too ?
Rgds.
The Big 4 Economic Indicators: Nonfarm Employment [View article]
Also for the employment chart, some correlation with the total USA adult population development during the time span would have been welcome
Eric Sprott's Gold Analysis Deconstructed: What The Gold Bulls Still Don't Get [View article]
Its value may fluctuate, like the value of specific currencies may fluctuate.
What is materiel is the question how on the longer term their real values will develop, not their comparative value.
During the Weimar Republic the Mark lost within a very short time its value. Money was being printed ever more rapidly, but no solace was obtained. Somebody who at that time had gold was well off.
Today the Fed is "printing" huge amounts of money . The result has not (yet) been the same as in Weimar.
Why ? Well in the Weimar Republic the money was circulating and spent very fast, whereas in our country today we see comparatively little money seeps down to the men in the street and too little of the billions issued is circulating.
The question which I would like to know (but only future will provide an answer) is what will happen if these amounts really reaches the masses and really starts circulating.
But there is another matter which hasn't been raised ofter enough: The demographic impact.
I don't think many people will question the fact that in future interest rates will rise and consequently the debt burden will increase substantially.
Simultaneously health care expenses will increase and the less tax payers will have to support the monetary needs of the government. And these extra burdens will fall upon the shoulders of our children.
If we look back to the development during the recent history we have generally and on a worldwide basis only seen increases in national debts and very seldom a decrease.
Hoping or expecting that the extra expenses caused by the increase of interest rates on national debt will rapidly decrease (as well as an eventual debt repayment) once the economy picks-up is therefore a huge gamble.
Do we really wish to gamble and put into jeopardy that much the future of the next generations only because we wish at all costs to maintain a while longer our present living standard ?
Because Debt Is Money [View article]
Because Debt Is Money [View article]
To have real growth means that money has to circulate.
If the housing market would profit from individual private owners, it would mean a boost for a number of various industries (furniture, etc.).
But speculative investment in this area hardly produces such an effect. Therefore its impact is limited until such times that the houses bought will be rented out or resold to private owners.
"So the Fed is buying up those Treasury securities to discourage savers from buying them."
Isn't this the result of a low interest policy ( based on the assumption that this will encourage the industry and commerce to borrow and thereby re-establish growth ?) rather than a wish to discourage private investors to buy Treasury Securities ?
Letta's Italy? [View article]
There Is No Debt Crisis In Europe [View article]
To name but one, his starting point:
" But many of the nations swept up in the eurozone crisis, such as Spain and France, had spending and tax revenues well aligned before it hit.
I suggest Mr Backworth checks the various national debt data available to anyone who wishes to look at them .
If spending and revenues were balanced there shouldn't have been any increases.
Here are some official figures :
France 2005 66% 2010 82% today 93%
Germany 68% 83% 85%
Spain 40% 68% 75%
Portugal 68% 93% 112%
Greece 100% 145% 187%
Italy 105% 120% 131%
Since this article starts on a wrong basis there is no need to read the rest of his story.
How Much Will Elderly Austerity Affect Consumer Spending And The Economy [View article]
Some pharmaceutical top people explained it to me why it should be run by mutual funds.
As private enterprises the latter will aim for proper economics, whilst having to consider also a proper care level. If not, they will lose members, who will switch to another better and/or cheaper mutual care organization.
No harm in the government subsidizing such organizations, but hands off from directly running the whole shop.
This is the way (with slight differences) it has been set up in the Benelux countries and according to the same people it is in those countries where one receives the best medical care, also on a overall level.
French medical care is also excellent, but far too expensive for the tax payers.
Note: the pharmaceutical industry is better of with a state-run system. With competing mutual organizations their prices are more easily put under pressure.
A Very Bad Week For The Merchants Of Austerity [View article]
The massive QE injections have had no to an extremely limited success. Continuation of this folly does in no way guarantee success.
And if it works and the economy would returned to "normal" levels and thus normal interest rates, the interest-on-sovereign debt will be such that not only the newly re-established so called normal economy will flounder, but also those tax payers having to cough up the enormous amounts will revolt. And those who have lived sensibly and put money aside will see their savings become worthless.
All this in order to prevent having to tighten our belt somewhat today.
We have lived far too long above a sustainable standard and continued to build up the total debt, profiting from the fact that the US$ has been the accepted international currency. Therefore our negative position partially financed by foreigners accepting our IOU's (T-bonds) as payment.
And now with the bill being presented there are people claiming that our nation is not ill enough, we have to increase the doses of poison.
What it means can be seen today in Southern Europe. They spent too much with too little tax income. Todays heavy support programs are financed by the North and affecting the Northern economies, and still the South have problems to survive and many of their citizens are without work and suffer from poverty.
Seems that this example of what can happen to us if we continue to increase our debt level still does not faze those people who are afraid having to sacrifice some of their wealth. They ask for more dope and simultaneously for less tax. They don't seem to realize what is really going on in this world.
How Much Will Elderly Austerity Affect Consumer Spending And The Economy [View article]
1) I was referring to West-European healths care systems, since I am not familiar with the present Ex-East European ones.
2) I also wish to exclude the British one, which is way below par compared to the one in other West European nations.
How Much Will Elderly Austerity Affect Consumer Spending And The Economy [View article]
Happily I am in a better position than you, but sympathize 100%.
It is a bloody shame all these selfish people have one directional looks, i.c. towards their bill-fold and are totally blind and indifferent toward those who have made their present living standard possible.
No further comments than the one I made lower on.