Foundation for Economic Growth - Newsletter

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


Newsletters : 2010 Newsletters : 19 November 2010
Thought for the Day

Our aim is to help build a political system that gives the citizens of New Zealand the freedom to create wealth for themselves and their families, if that is what they choose to do.

During the last half-century we have seen the wealth and income of our citizens reduce relative to other countries. We have more and better material things as industry finds ways to produce goods better and cheaper, but it now takes two working adults to keep a family living comfortably in the suburbs where 50 years ago it only took the wages of the average working man to do the same thing. We have more cash but it buys much less than it did 50 years ago.

In the 1950s my father was earning an average wage of around $1000 (500 pounds) and he built a new house in an average suburb for $3000 - three times the average wage. Now the average wage is $50,000 and the average house is about $350,000 - seven times the average wage. And the modern house is not built of heart Rimu - and a lot of them leak!

So we earn 50 times as many money units but can buy only half as much in terms of REAL Assets.

Printing more paper money each year and calling it GDP growth is a mirage. What is going on? All will be revealed - eventually!


Nov 18, 2010, 16:29

Newsletters : 2010 Newsletters : 19 November 2010
How to Make the Dollar Sound Again

The New York Times has a thinking journalist. A very rare breed indeed.

Not only that but he writes so well that he puts my drab scribbling completely in the shade.

What he says is so completely sensible that it has no chance of being adopted until the paper money men have tried everything else and reduced the world's financial system to a smoking ruin.

Perhaps it is time for New Zealand to take a lead?

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Nov 17, 2010, 11:13

Newsletters : 2010 Newsletters : 19 November 2010
Contagion Hits Portugal as Ireland Dithers on Rescue

Europe still has its debt problems. Could they be worse than America's?

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Nov 17, 2010, 10:50

Newsletters : 2010 Newsletters : 19 November 2010
How to Bully a Country into Bankruptcy

A look at Britain and France from a Romanian perspective.

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Nov 16, 2010, 11:59

Newsletters : 2010 Newsletters : 19 November 2010
Ireland's Young Flee Abroad as Economic Meltdown Looms

From boom to bust. Yes, Mum, it really happens.

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Nov 15, 2010, 13:56

Newsletters : 2010 Newsletters : 19 November 2010
World Chaos – Global Success Story?

You may not remember when "the sun never set on the British Empire". You can probably see that we are living in the age of the American Empire. You will also see that the world comprises a bunch ~200 nation states in various stages of development and decay.

There is talk of the demise of America and the Rise of the Chinese in the twenty first century. Is there any plan behind all of this or is it just a continual process of natural advance and decline?

It is a bit hard to tell for sure but it makes for an interesting discussion. Do we want a New World Order with a world money system of unified IMF paper? Would it actually work? Or should we go back to a gold standard? Would having a gold standard lead to a safer and friendlier world? Fewer wars because of the difficulty of paying for them?

Would a One World Government led by the socialists in the United Nations really provide us with a better way of living our lives? How many petty regulations could they dream up to control our actions? Would we actually obey them all? Who wants to pay world wide taxes?

Quote: "You can either be complicit in your own enslavement or you can lead a life that has some kind of integrity and meaning.

Chris Hedges: Pulitzer Prize-winning journalist and author."

Like I say - plenty to discuss here!

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Nov 15, 2010, 12:42

Newsletters : 2010 Newsletters : 19 November 2010
Hypocritical U.S. is Tops at Currency Manipulation

Someone else refers to the REAL Economy:

"Going back to the gold standard "would be painful" and even lead to a depression in the near term, Pento concedes. But "all the imbalances would be reconciled and we can start over again with a real economy.""


Nov 15, 2010, 12:04

Newsletters : 2010 Newsletters : 19 November 2010
Idiots Guide to Public Sector That Produces no Wealth

Business is the Golden Goose and entrepreneurs are the creators of Golden Geese.

Governments steal the eggs and choke the geese with red tape.

This information somehow hasn't yet seemed to have filtered through the blocked minds of union leaders. Never mind Helen, don't cry, if you didn't manage to kill off the Hobbits there will be more opportunities later.

The Brits are getting an explanation, at last, with a touch of humour!

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Nov 15, 2010, 09:21

Newsletters : 2010 Newsletters : 19 November 2010
Quantitative Easing Explained

This will make you think! Who will the proles blame for their newly arriving poverty? Trouble is stirring.

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Nov 14, 2010, 10:54

Newsletters : 2010 Newsletters : 19 November 2010
Rumours of Irish Bailout Sweep Through Financial Markets

The bad news for Ireland continues. New Zealand still OK. Relax and enjoy the summer!

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Nov 12, 2010, 19:10

Newsletters : 2010 Newsletters : 19 November 2010
Gold: The Market's Global Currency

Concern about the World's fiat currency system is reaching the daily newspapers as more and more people begin to wonder if the present system can keep working.

The fact is that it cannot go on forever. We cannot know when it will stop, but the question we can discuss sensibly is, "What will take its place?"

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Nov 12, 2010, 16:04

Newsletters : 2010 Newsletters : 19 November 2010
The Coming Gold Standard

Has the Financial Times launched a new discussion on a gold standard for the world?

Surely not.

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Nov 11, 2010, 17:47

Newsletters : 2010 Newsletters : 19 November 2010
Die Was Cast Before Elections

First a quote from the Master Economist, Ludwig von Mises:

“The boom produces impoverishment. But still more disastrous are its moral ravages. It makes people despondent and dispirited. The more optimistic they were under the illusory prosperity of the boom, the greater is their despair and their feeling of frustration. The individual is always ready to ascribe his good luck to his own efficiency and to take it as a well-deserved reward for his talent, application, and probity. But reverses of fortune he always charges to other people, and most of all to the absurdity of social and political institutions. He does not blame the authorities for having fostered the boom. He reviles them for the inevitable collapse. In the opinion of the public, more inflation and more credit expansion are the only remedy against the evils which inflation and credit expansion have brought about.”

-From Human Action, 1949

And so the tendency for politicians and bankers to give in to the will of the people and prefer hyperinflation (because it is "way in the future"), to the hard work of reconstructing society on a realistic deflated base.

REAL Investors know this as John Embry illustrates in this recent interview. Happy reading and may all your investments be REAL.

And as Ludwig von Mises also observed:

"There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner...as the result of a voluntary abandonment of further credit expansion; or later...as a final and total catastrophe of the currency system involved."

That catastrophe is hyperinflation and America is opting for that option.

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Nov 11, 2010, 14:24

Newsletters : 2010 Newsletters : 19 November 2010
A Return to the Gold Standard?

As fiat currencies approach their crisis point people are starting to look for better ways of doing things. When one understands the basic elements of economics and realises that money is used as a store of earned wealth, and therefore must have a value in and of itself, the answer becomes obvious; go back to the use of gold as money as our ancestors have done for untold generations.

This is the only way to restrict governments and their Central Bankers from artificially increasing the money supply, which causes the inflationary conditions under which we have suffered these past 100 years. Boom bust is a terrible way to run the world - especially when a natural uncontrolled market economy using gold and silver as money would find and maintain its own level of operation all by itself.

Our understanding is limited on this point because we have all only experienced economies where governments interfere more or less in their day to day running. We accept this as normal but it is not.

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Nov 10, 2010, 15:26

Newsletters : 2010 Newsletters : 19 November 2010
Quote for the Week

When a government is dependent upon bankers for money, they and not the leaders of the government control the situation, since the hand that gives is above the hand that takes. Money has no motherland; financiers are without patriotism and without decency; their sole object is gain.

Napoleon Bonaparte


Nov 9, 2010, 13:53

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