johngonole

• Stagflation and Peak Oil: How Related Are They? (Part II) [view article]

  User 987 - All the forms of energy you mentioned above still cost more than oil as I understand it. So first oil prices will go higher then they will become viable. Still oil is used in asphalt, platics, petro-chemicals, fertilizers, etc....
  
  Bottom line is that the entire industrial/agricultura... revolution has been built on oil. It will probably take another 100 years (short of some amazing free energy discovering of huge porportions) to simply make the transition. US Geothermal in the right areas could really be good kind of like hydroelectricity. I also like the idea of windmills as a supplement provided they can build them to last forever with very very little maintenance. Seems like a very good idea versus solar which you still have to replace every 20-25 years plus batteries. Oil shale may help with the transition. Oil/Coal/Nuclear are still the cheapest forms of energy and will likely remain so for a while. This country needs to become more energy independent. It will not only reduce the trade deficit but could actually get people back to producing real things in the country.
  Jul 28 02:38 AM

• 5 Key Quotes from Netflix on the Movie Distribution Business [view article]

  This segment like software and hardware will be very unpredictable. I think download streamed movies is going to be a lot like VHS versus Beta. The long term winners will only reveal themselves in time. First the competition will be stiff with many players involved. Your going to have the cable companies, apple, amazon, tivo, blockbuster, other media companies all try to get a share of this market. Second who knows when another disruptive technology might evolve. Satelite beams direct movies....who knows.
  
  One thing is that the deal with XBOX is smart. Microsoft has spent lots of money positioning themselves to be the future home entertainment company of America. They want computers with their software to control homes and access to the internet. You see this with the Xbox and Media versions of their operating systems. They will eventually turn the TV/computer/gamesystem... lighting controls/voice recognition into the same thing in the same box.
  
  So Netflix has chosen a good strong partner here. Likewise Microsoft needs a win soon and they must have found some good reasons to piggyback and use Netflix as part of their platform.
  
  Disclosure: I own shares of microsoft but not netflix. Netflix in my opinion is way over valued considering the uncertainties and the finite nature of their main business. Jul 28 01:49 AM

• Barron's Interview: Six Winners No Matter Where We Go From Here [view article]

  I purchase Wellpoint a few months ago. So far so good. I agree with the HMO's. Beaten down fairly stable cash flows. Margins may expand and contract a bit but at this price good bet long term. Only real risk is OBAMA man. Don't mess too much with healthcare Mr. Obama or it will get worse and go the way of transportation, NASA, FEMA, the post office (can service get any worse), etc... Jul 28 01:25 AM

• Historic Financial Collapse Underway? [view article]

  Taureimini
  
  Your thoughts are somewhat correct. But the US hasn't even plundered other nations through all of the conflicts we've been in. If the US were to actually plunder in conquest it would have plenty of money to do so for quite some time. See British Empire, Soviet Union, etc...
  
  US without plunder can't maintain a global militarism forever this is true. I don't think the American people believe in plunder so I expect the US to start letting the Europeans solve their own problems for a change. If the US builds out its energy infrastructure in all forms we could actual move back to a foreign policy the founders envisioned. At this point we'd be able to let the Europeans fight it out.
  
  China's control over the US is way overblown. They could force our government to balance its budget via the dumping. They could also spend the dollars they have and hence stimulate our economy perhaps even causing massive inflation but of the better kind. Anyway the real strategy they employ is to control us through debt and then wait wait wait till they can buy up everything on the cheap. Of course that is why I would advocate energy independence and a balance budget. If the US government would balance the budget who real cares what the market value of US treasury bonds becomes. Jul 25 03:06 AM

• Historic Financial Collapse Underway? [view article]

  Buillion man the homeless are only really seen in the great cities of liberalism where the homeless flock because of all the hand outs. Anyone who wants a job here can get one hence the massive immigration.
  
  My comments on the article is that his description of causes and outcomes are probably spot on. However I think it will be a very slow bleed downward as it has been. So I'm not sure the dollar as the world's currency researve will go away. Rather those who hold dollars will slowly buy up our largest corporations. So are things getting worse... yes. Will they get worse without the desribed free market solutions above Yes but I don't see an end of the world scenario.
  
  I was quite the skeptic of NewWorld order one world government but now it seems very plausible in the form of a one world fascist government. Large global corporation and other international banking conglomerates already control most of the political parties via funding and the political parties have written laws making in very hard for third and fourth parties to suceed. They have effectively created politcal duopolies that are funded by business that contribute to both sides to protect the order. In the US third parties can't even get their candidates into the public debates unless they poll something like 15% in the public polls. Who controls the polls? GE, DIS, and other media giants control the 15% and who gets to be heard. Its all fascism. Its never a failure of government or regulation but always a failure of markets. Markets simply reflect economic realities. Markets don't fail they simply describe the reality. When markets are artificially controlled you get resource misallocations and hence bad investments, shortages, surpluses, coruption, war, etc..
  
  Congress has an approval rating of like less than 15% and still no viable third party can be heard. I think I've described above why. So as creeping socialism/fascism increases so will poverty, unemployment (measured by real output...being paid to hold a shovel doesn't count), theft, wealth concentrations, etc.. Jul 25 02:56 AM

• How the U.S. Financial Crisis Resembles Japan’s 'Lost Decade' - And How to Play It, Part II [view article]

  I think his overall point is that we need to decouple from the dollar. Foreign investments, gold, etc will hedge us against a falling dollar. Also high monetary induce inflation can lead to stagflation or worse depression. Its like a standing wave. As time goes on the waves get larger and largers. We've been on the up wave as monetary supply increases but so have debts. As debts contract we will have deflation. His point is that the FED will try to avoid the impending massive quick deflation by inflating our currency further. This will continue to put pressure on commodity prices and will extend the amount of time it takes the country to move past this slow down. The new increase in monetary supply will most likely go into commodities or paying down debt...or banks recapitalizing. In the long run the monetary policies may work however the ups and downs are going to be more violent versus just letting the markets work because the FED can't control how the new dollars are spent or used. I'm not a pro when in comes to monetary policy but the whole thing stinks to high heaven if you ask me. We actually need a currency that super slowing gets more valuable. This will encourage good investment versus the investment environment we have today where everyone is taking on huge risky loans cause they know this is the way to play the system....bailouts, bankrupcy protection, etc...
  
  We'd be better off without the Federal Reserve or fractional reserve banking. What good is a currency who's value fluctuates the way ours does or is doing now. Speculation is all that it left. Too many investments depend on ever diluted currency.
  
  It seems to me that our monetary policy boils down to protecting the nation from deflation be ever increasing monetary debt. problem is interest must be paid on that debt. Most of the debt is increasing in the form of government. So we are socializing risk which results in more bad debts...and they cycle could go on till the taxpayers own nothing. Jul 19 03:47 AM

• Much to Like About the GSE Rescue [view article]

  These GSE's have essentially acted as another source of liquidity that the govt and federal reserve have used to prop up the economy and particularly the mortgage market. Increase home prices and homebuilding are what staved off the last recession remember. I'm pretty sure loose lending standards by these GSE's helped this. Its not a failure of free markets but of centralized planning. Bush/Clinton/Bush era are ultimately to blame as they all tried to promote economic growth through the expansion of debt. Debt expansion always promotes growth at first but then it taxes through interest. Jul 18 01:11 AM

• Fannie & Freddie: Affirmative Action for the Rich and Stupid [view article]

  Couple of houses near us sold very quickly once they were marked down to affordable prices. Prices went up so high and fast due to the perfect storm. Money from stock markets went into real estate. Interest rates were low. Credit qualifications were lowered. People began speculating on the premise that house prices never go down.
  
  Now all of the opposite is happening. The faster house prices come down the quicker our economy will turn around. The longer the government and the Fed try to extend this the more likely that everyone will lose confidence and a deflationary spiral could be the result. On the otherhand the vast majority of homeowners bought before 2003 so the housing market woudl quickly return to normal except for those who bought high. They would have to have take large losses when selling. Of course they'd be buying a cheaper house too. The only real losers will be those who bought second homes, and speculative rental real estate after 2003.
  
  I don't think its wise to risk the whole economic system (dollar dilutions, umemployment, etc...) trying to prop up the housing market or the prevent the tiniest of recessions. Lets get it over with. The recession could have come and gone by now if they'd just stop trying to manipulate the price of everything. Let price action do its job. Jul 13 04:27 AM

• 10 Signs of a Recession [view article]

  A-Lame-Dan - First I'm sure we all appreciate your participation in the changing of the word fundementalism into a bad word. Your like one of the pigs in the book animal farm. Please read it if you haven't already.
  
  Second most of the economic problems we face now and really ever since the great depression involve socialized or fascist industries. Freddiemac and Fannie are basically business in bed with government. Defense, Banking, energy, are highly regulated and affected by government policies. Lobbiest and big business interest controlling government is a direct result of the amount of money the government spends as a ratio to GDP. Blaming the free market for the failures of socialism and fascism is like blaming the rape victom for the rapers actions.
  
  What we need to do is create as much as possible a wall of seperation between business and government. Its not the free market that is causing any of these problems. Rather is it failure of regulated markets, socialism, and fascism. The mortgage industry got so bad because of Fed induced low interest rates in combination with the idea that the government is going to bail everyone out.
  
  Our country has one industry after another starting to become dominated by big businesses. Our government is the largest monopoly of all and it is created more monopolies and ogopolies through its policies.
  
  Wildhawk no offense but OBAMA has said less about his platform and his ideas than any politician I've ever listened to. He speaks in platitudes and veils is ideas (if he really has any) in messages of hope. He's like the Joel Osteen turned into a politician.
  
  
  
  
  
  Jul 10 01:19 AM

• Fannie and Freddie: Let’s Call the Whole Thing Off [view article]

  I agree with Tom Lindmark. Let the stockholders and bondholders suffer. The taxpayers should not have to pay for one more bad socialistic scheme turned into a fascist scheme. Once social security and medicare fail Rosy's failures will be complete.
  
  Its time to turn from the dark side and level the playing field and return to free markets. Its time to tear down these financial fascist constructs and set people free. Not only that.....I'm not sure I agree with this myself....but I also think it might be time to go back to real paper money backed by the governments assets such as gold, real estate, etc... We also need to real in fractional reserve banking. The idea that monetary policy can control the markets and prevent recessions is a bad idea because it depends on the expansion and contraction on the money supply which is the same thing as saying the expansion and contraction of debt. When they want to prevent recessions they encourage people and businesses to go into debt. It really doesn't make much sense. A little debt is OK but when the whole financial system is built upon it we will always run the risk of finanical collaspe. The dollar should respresent tradeable hard assets not debt promissory notes. Jul 10 12:31 AM

• The Deflation/Inflation/Stagnation Debate [view article]

  I have an idea that might actually work. We can stop the energy and food prices, other goods and services price increases by supporting the dollar. The Federal Government must balance the budget and the FED must go neutral and let the interest rate freely float. These actions will obviously have a deflationary effect. However there is one inflationary force that could balance this. As our goods get cheaper this country could once again become an exporter of goods. Ohio, Michigan, and Indiana could once again flourish. As our prices come down all those dollars that have been sitting over seas could come back into America as the chinese, middle east, and many others decide to actually spend those dollars they've earned on our goods.
  
  We just can't keep inflating our currancy and expect people to want our currency. Its time to get back to work. Let prices move freely. Short pain yes but prices will find a bottom. Unlike the great depression we have trillions of dollars waiting over seas to be spent into the economy. Jul 05 04:01 AM

• How the Fed's Decision Impacts You [view article]

  The bankers are thiefs pure and simple. Those of us who wish to keep the purchasing power and security we worked hard for are forced to speculate just to keep what is ours. There too wallstreet and the bankers profit from us.
  
  Bankers get a large cut of GDP simply for allowing us to trade. Our society has become slaves to the bankers in a very real sense.
  
  Jun 27 12:45 AM

• The Gold-Oil Ratio Approaches All-time Lows [view article]

  Engineer and Robert both have good points. The truth is that supply and demand fundementals for both of these commodities are different. What they have in common is that they can both be purchased in dollars. Gold having pretty much a limited supply trades mainly with currancy supply and demand. Oil will reflect both currancy inflation/deflation and traditional supply and demand forces.
  
  Engineer is correct that higher prices of gold will reflect the cost of energy it takes to produce it. If production costs go up than the supply of gold will flatline if the higher cost can't be passed on eventually. So gold is a store of energy to a certain point and its also a currancy. Oil is a currancy and a commodity. Oil is becoming more rare faster than gold so in these terms we should see the oil to gold ratio go down. Still most people who buy physical gold are looking for a currency hedge. Since oil is also traded in dollars gold will take into account all areas of inflation just not gold. So if gold is inflating at a higher rate than other assets gold will not keep up.
  
  Silver to oil would be a more interesting ratio since silver is also consumed. There even latex beds having silve laced fabrics added to them. More and more Nanotechnology will use silver in the future. Silver will react to both currency inflation and industrial supply and demand fundementals.
  
  If you haven't checked out silver consider purchasing some of it. Just a little Jun 24 09:49 PM

• IRS Ruling Benefits Real Estate Derivatives [view article]

  I must confess that I've never really understood derivatives. Never really studied them either. Most people don't need to hedge yet derivatives are huge. I also think its just another way of creating more paper money that will be traded. If they ever implode.....It reminds me exactly of a casino. Only without the mobsters that will make you pay up. More likely the banks will expect another bail out from us taxpayers. If taxpayers are going to back the banks perhaps all banks should be privatized......Run away run away. Jun 24 09:20 PM

• The Reverse Wealth Effect [view article]

  Eagle Chief - the low hanging fruit has been picked in many areas of the world. The north sea is declining. Russia is declining. Many countries that used to produce oil no longer can. Many believe the world has reached peal oil production and production will decline slowly at first and then drop exponentially. Of course prices will slow the decline of reserves.
  
  Icandoitdon - Agree speculation is way up. The printing of money forces people to speculate to preserve their purchasing power.
  
  I believe that we are seeing stagflation. The global economy is holding labor prices in check in terms of real income adjusted for inflation. Meanwhile the government and the federal reserve are printing money to force interest rates lower. This is causing the inflation in just about everything but housing which is pretty much tapped out. Too many houses. In sum I believe the politicians and the bankers abuse the monetary system and its power to line their pockets. Low interest rates are caused by the expansion of the money supply. The expansion of the money supply is essentially the same as saying the expansion of obligations or debt (since it is debt that backs our paper money). The politicians gain a smoother economy in the short term and money to fund their social spending schemes and ear marks. The bankers take their cut of an ever enlarging pie of debt making them rich. Think about it we as citizens give the banks our purchasing power. They lend it out like 30 time over all the while taking a cut of it in term of interest. Depositers in essence bear the risk and are compensated nothing. If we don't deposit the dollars are still wiped out by the expansion of the money supply and th ensuing inflation. Alternatively we can invest in stocks, bonds, etc... Again however the same bankers/finacial firms take their cut. They bear no risk because the government is ready to use the power of taxation to bail them out.
  
  This is ultimately the problem with Fascism and Socialism. Unfortunately the monetary policy failures continue to breed more and more people who are willing to entrust more power to the same persons holding them down.
  
  The grip of power that the government and the Federal Reserve have over the purchasing power of the people (as well as being a monopoly) is so vast and lock tight it is scary. Spend your money or we'll spend it for you. Then we'll tax your assets. We'll tax your income. Perhaps this is the price we pay for living in the type of society we have but clearly their were times when we didn't have all this regulation and things worked out pretty much the same or better. They have the power to bankrupt everyone at will. The only checks on this system are pitch forks and shot guns. This could very well happen if they drive our economic system into the ground. Our economic realities are less and less dependent on free market allocation of resources and more and more on how the government decides to allocate resources. The public needs to be more mindful of this and DEMAND and end to corruption, a balanced budget, and less tinkering with the economy.
  
  
  Jun 10 01:46 AM

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