Foundation for Economic Growth - Newsletter

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Last Updated: Jul 3rd, 2017 - 15:54:31


Newsletters : 2010 Newsletters : 10 September 2010
Thought for the Day

In March 1988 the Reserve Bank started keeping account of the total amount of money in the system and called it M3. At that time it was $43,101 million. Since then M3 increased to a peak of $216,399 million in February 2009. Month after month with very few small exceptions M3 increased by annual percentages ranging up to 20%+.

So for 21 years M3 expanded at the compound rate of almost exactly 8% per annum.

Then it faltered and in November 2009 M3 began contracting by annual rates of up to 5% (as measured each month).

From its peak of $216,399, M3 fell to $206,072 as of July 2010. That is a decrease of 4.8% over 18 months or 3.2% on an annual basis.

So after expanding by 8% since records began our money supply M3 has begun deflating at 3% per annum over the last year and a half.

Yet this has never been mentioned in any news media as far as I can tell. It would be very interesting to know what our economists think of this phenomenon. It would also be interesting if they think this tells us anything about the future of our economy.

If you have been following our discovery of REAL Economics then you will be very worried by this happening.


Sep 3, 2010, 11:19

Newsletters : 2010 Newsletters : 10 September 2010
Treasury Bills: The New Opium

An interesting piece of history and theory about the future.

Visit Website ]
Sep 9, 2010, 16:37

Newsletters : 2010 Newsletters : 10 September 2010
Quake could be good for economy

Glory be! How can these two economists make such statements. Have they never heard of Bastiat's Broken Window fallacy? How did they ever pass Econ101? Did they really make this statement?

Destruction of wealth is destruction of wealth. Less wealth more poverty. Would these idiots like to see more earthquakes so their precious GDP number would look better?

All that work expended in restoring the status quo after the earthquake could have been used in building up more wealth producing enterprises. (If the entrepreneurs had any money left!)

See for yourself:

Visit Website ]
Sep 7, 2010, 14:10

Newsletters : 2010 Newsletters : 10 September 2010
How the Stock Market and Economy Really Work

Kel Kelly has spent over 13 years as a Wall Street trader, a corporate finance analyst, and a research director for a Fortune 500 management consulting firm. Results of his financial analyses have been presented on CNBC Europe, and the online editions of CNN, Forbes, BusinessWeek, and the Wall Street Journal. Kel holds a degree in economics from the University of Tennessee, an MBA from the University of Hartford, and an MS in economics from Florida State University. He lives in Atlanta.

This guy should know a thing or two!

Visit Website ]
Sep 6, 2010, 11:42

Newsletters : 2010 Newsletters : 10 September 2010
The Bankrupt Finnish Welfare State

We have learned a lot by observing other countries who all seem to be doing the wrong thing and getting themselves deeper and deeper into debt.

It will be interesting to see how Finland copes over the next year or two. Newsweek recently proclaimed that Finland was the best country of the world in which to live. As we might observe of these mainstream magazines this is often the kiss of death.

Visit Website ]
Sep 6, 2010, 10:48

Newsletters : 2010 Newsletters : 10 September 2010
IMF Eliminates Borrowing Cap On Rescue Facility In Anticipation Of Europe Crisis 2.0; US Prepares To Print Fresh Trillions In "Rescue" Linen

If you have understood the situation so far this will make your hair stand on end. Now the IMF is borrowing, making, printing creating $1 Trillion to lend to countries in trouble. And they are then intending to double up the borrowings to ensure safety for economies.

The Ponzi scheme has now escalated to the Grand Unified Global Money Lending Fund - all backed by someone's debt.

I wonder whose?

Visit Website ]
Sep 2, 2010, 16:24

Newsletters : 2010 Newsletters : 10 September 2010
Islamic Gold Dinar Gains Ground in Malaysia: Official

This is how the middle class can protect their wealth. It will be interesting to see how this push from the people progresses.

Visit Website ]
Sep 1, 2010, 11:53

Newsletters : 2010 Newsletters : 10 September 2010
AAA Ratings: A Grim Fairy Tale

The Chinese have come out with a REAL(?) Ratings methodology.

New Zealand rates seventh on the list - ahead of America.

Visit Website ]
Aug 31, 2010, 14:09

Newsletters : 2010 Newsletters : 10 September 2010
The True Value of Gold

It is always gratifying to see the mainstream press catching up with the state of play in the REAL World.

Visit Website ]
Aug 30, 2010, 13:14

Newsletters : 2010 Newsletters : 10 September 2010
Gold Demand to Surge in Vietnam as Dong, Stocks Slump

When I read this article I thought, "I bet that they are inflating their money supply." When countries print more paper money the prices of everything go up - especially REAL Assets like REAL Estate and REAL Money.

So I Googled Vietnam money supply:

http://uk.reuters.com/article/idUKHAN37919520100212

And sure enough Reuters is reporting that Vietnam is increasing its money supply by 28%.

The way that the Vietnamese protect their wealth is to keep their savings in gold and not in paper!

Visit Website ]
Aug 30, 2010, 09:48

Newsletters : 2010 Newsletters : 10 September 2010
It Pays to Riot in Europe

The distortions of our paper money system are worsening.

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Aug 29, 2010, 11:22

Newsletters : 2010 Newsletters : 10 September 2010
Fresh Flight to Swiss Franc as Europe's Bond Strains Return

As we approach the end point things move faster and faster.

It is interesting to note Ambrose' last point. At some stage the newly created poor will revolt! The next article has a picture showing the increasing percentage of poor people. An historical point of view would be valuable.

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Aug 29, 2010, 11:14

Newsletters : 2010 Newsletters : 10 September 2010
'Atlas Shrugged': From Fiction to Fact in 52 Years

In January 2009 the Wall Street Journal wrote this article. At least someone from the "main-steam press" recognizes what is happening.

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Aug 28, 2010, 16:40

Newsletters : 2010 Newsletters : 10 September 2010
Quote for the Week

(Perhaps GDP is not really a measure of REAL Growth! Ed.)

*** *** ***

What is up, and up dramatically, since the recession began 33 months ago are government transfers to households (in the form of unemployment benefits, food stamps, welfare, social security) they have ballooned 31% since the end of 2007. A record 30 cents of every dollar in personal income is now derived from some form of government support now tell me that is not a depression-era statistic. The modern day soup line is a cheque in the mail. Maybe now we can get a better appreciation of why it is that the NBER has yet to sound the all-clear siren that the recession actually ever officially ended despite four quarters of positive GDP growth perhaps not only because this may have merely been an unsustainable policy-induced spasm, but also because, in per capita terms, real final sales continued to contract through this alleged statistical recovery.

David Rosenberg, Chief Economist & Strategist, Gluskin Sheff & Associates [Toronto]


Aug 26, 2010, 16:47

Creating Wealth and Keeping it

The New book by Phil Scott, President of the Foundation for Economic Growth.

"This book is good, damn good and no statistics!" Lindsay Gordon, MA, MSC, PHD.

Every serious economics student should have a copy and read this ground-breaking foundation of clear economic thinking. Real Economics explains how human actions shape our world and why so much seems to be going wrong for Western economies. This book will bring enlightenment for the general reader who will see why a few very wealthy are becoming exceedingly rich and the middle classes are on the road to serfdom.

See more: www.realeconomics.co.nz