Last Updated: Oct 22nd, 2010 - 15:35:08 Newsletters : 2008 Newsletters : 14 November 2008 Thought for the Day Barrick Obama won in America and John Key won in New Zealand. Our congratulations to them. The Pohutakawas are starting to bloom and we should look forward to a nice long hot summer. The economies of the world lurch along and Prime Minister Brown proposes a world wide bureaucracy to administer monetary and financial regulations to us all. That should be fun. Nothing can be so bad, but a politician somewhere will make everything worse, by proposing to fix it. Meanwhile I shall enjoy the sunshine. Nov 14, 2008, 11:15 Newsletters : 2008 Newsletters : 14 November 2008 Abandon All Hope Once You Enter Deflation If you have debt then inflation is your friend. Buy up houses with 100% mortgages and run tax losses and eventually the government will inflate the currency so that your house prices become double the mortgage. Ie the 100% mortgage magically transforms itself into the 50% mortgage. This is money for old rope, as they say, and is great for borrowers. On the other hand deflation is great for those earnest people who eschew debt and have large savings in cash and fixed interest earning safe investments like government bonds. Their cash can buy more and more as each year passes. So relative to others they become well off. If Shakespeare said, "Neither a borrower nor a lender be . . .", and he was a very wise man, why do our leaders promote inflation and decry deflation? The answer is contained within the last 100 newsletters. Some of you may know already! Nov 13, 2008, 13:18 Newsletters : 2008 Newsletters : 14 November 2008 Who is Obama? If you want to know how Obama got to be President - watch this. [ Visit Website ] Nov 13, 2008, 10:00 Newsletters : 2008 Newsletters : 14 November 2008 Consumers Don't Cause Recessions "In his discussion of the "paradox of thrift," Paul Krugman proves that he is not an economist — or at least, not a very good one." So says Robert Murphy, and I believe him! Yet Paul Krugman has just won a Nobel Prize in economics. No wonder politicians are confused! [ Visit Website ] Nov 12, 2008, 12:20 Newsletters : 2008 Newsletters : 14 November 2008 Obama's Golden Opportunity Some senior members of the establishment are beginning to see the advantages of having a gold standard. No regulation or regulator is able to ensure that people do not take advantage of the possibilities inherent in paper money. The only thing that will keep money as "good as gold", is gold itself. Bankers cannot conjure up gold from nowhere. This fact alone is what makes a gold standard essential for a stable world of commerce. Besides, with gold money, it is much more difficult for nations to declare war and attack others because they cannot inflate their way out of the debt incurred from war. A gold standard would just about stop war completely. This might stop new empires forming to fill in the vacuum of America's impending financial demise. Nov 12, 2008, 11:06 Newsletters : 2008 Newsletters : 14 November 2008 Wounded Wolves On The Financial Prarie The Daily Reckoning Presents: With interest rates approaching zero and the unemployment rate the highest it's been in 14 years, the Mogambo again takes to the pulpit, trying to make sense of all this madness. But with so few people to listen, the angriest guy in economics is sadly, yet again, left howling at the moon. Nov 12, 2008, 10:38 Newsletters : 2008 Newsletters : 14 November 2008 The Real Story Silver market analyst Ted Butler has obtained a letter from the U.S. Commodity Futures Trading Commission to U.S. Rep. Gary G. Miller, Republican of California, that virtually confirms Butler's speculation in September that the smashing of the silver price this year involved JPMorganChase's takeover of Bear Stearns in March. Butler writes: "Bear Stearns held the largest concentrated short position in COMEX silver (and gold) futures at the time of its forced merger with JP Morgan in March. That position was not discovered until the publishing of the August Bank Participation Report followed by the October 8 letter from the CFTC to Congressman Miller. Furthermore, Bear Stearns had no legitimate backing to the short silver position, either in actual metal or cash. Otherwise it could have been delivered against or bought back, just as would have happened were it a long position. "The price of silver at the time of Bear Stearns implosion was $20 to $21 an ounce. A free-market covering of a concentrated short position of this size would have driven silver prices to the $50 or $100 level and would have exposed the long-term manipulation. Rather than let the free market deal with the required short covering of such an uneconomic and unbacked short position, government authorities arranged to have the short position transferred to JP Morgan. This was undertaken by the U.S. Treasury Department, along with taxpayer guarantees against loss to Morgan worth billions of dollars. This was done, no doubt, to save the financial system from imploding. This was also patently illegal, as it aided and abetted the silver manipulation." That is, it is now virtually certain that the big silver short (and the big gold short) is the U.S. government's New York bank, JPMorganChase. Butler's new commentary is headlined "The Real Story" and you can find it at GoldSeek's companion site, SilverSeek, here: [ Visit Website ] Nov 11, 2008, 11:07 Newsletters : 2008 Newsletters : 14 November 2008 China OKs Domestic Spending Boost; Europe Plans More Rate Cuts In terms of the boom/bust cycle the world is getting into sync! All of the G20 countries are now working to pump money into their economies to stop the impending recession. This will slow down the process of cleaning out the bad investment decisions and prolong the downturn. All this new money will eventually start up the new boom and we will be away on the next round of good times. Will the next boom be bigger than the last? What about the following bust? Getting all the major countries synchronised in this boom/bust cycle should be fun! Nov 10, 2008, 11:05 Newsletters : 2008 Newsletters : 14 November 2008 Quote for the Week And now that the Labour-led government has bequeathed us a few years of deficit: "Christmas is a time when kids tell Santa what they want and adults pay for it. Deficits are when adults tell the government what they want and their kids pay for it." -- Richard Lamm [Richard Douglas "Dick" Lamm] (1935- ) American politician, lawyer, governor of Colorado (D) (1975-1987), 1996 US presidential candidate for the Reform Party Aug 13, 2008, 10:56