Last Updated: Nov 18th, 2010 - 15:49:57 Newsletters : 2010 Newsletters : 24 September 2010 Thought for the Day Last fortnight I explained the effect of a diminishing money supply on the economy. Right on cue this week comes news that our GDP only rose 0.2% in the June quarter. This seems to have come as a great surprise to ordinary economists. It shouldn't have. A deflationary bust which is following a boom time is a result of the people in an economy trying to get back on an even keel. That is, to save more and pay off their debts - if they can. This is a good thing! Haven't the politicians been calling out for just this event. We must not let anyone scare the powers that be into impetuously printing a lot of money to compensate for that which has disappeared. It came from nothing (Japanese printing press perhaps?) and it is going back there. Printing more will only prolong the agony of the bust. The world situation is not unlike after the 1929 crash in America, as Henry Morgenthau, Secretary of the US Treasury said during the New Deal; May 1939: "We have tried spending money. We are spending more than we have ever spent before and it does not work. We have never made good on our promises. I say, after 8 years of the Administration, we have just as much unemployment as when we started... and an enormous debt to boot!" The Americans seem not to have learned a thing and are getting ready for printing upwards of another $2trillion. Can we hold our nerve? Sep 24, 2010, 13:55 Newsletters : 2010 Newsletters : 24 September 2010 Where Krugman Went Wrong How could a Nobel Prize winner in Economics be so wrong? We are about to see America follow his advice and continue to apply Keynesian economics. We will all learn some valuable lessons from this. Well, I hope we will! [ Visit Website ] Sep 22, 2010, 08:48 Newsletters : 2010 Newsletters : 24 September 2010 Does the US Economy Need Another Stimulus Package? After the recent big economic crash Paul Krugman admitted to The Economist that all he had learned about macro economics over the last 30 years was junk. Yet here he is proposing more of the same paper money solution as caused the problem in the first place. This is the sort of thinking which may be acceptable to American Bankers and Politicians but which will lead them into hyperinflation. So far we seem to be avoiding this disaster - but not by much. We will probably have a longish slowish deflationary reversion to a sustainable level. This would be the best approach. Printing money is the very worst of thing we can do. This article explains why. [ Visit Website ] Sep 21, 2010, 16:35 Newsletters : 2010 Newsletters : 24 September 2010 EDITORIAL: We Can't Afford This Government The Americans are between a rock and a hard place. They are running out of other peoples money so they are finding socialism under Obama rather difficult to pay for. They will soon begin printing even more trillions of dollars in an attempt to force life back into their moribund economy. The establishment is now starting to wake up and speak out. Things will get interesting now! Remember that the Americans own the world's reserve currency. As that decays it can only have a disastrous effect on all other countries - including New Zealand. [ Visit Website ] Sep 21, 2010, 12:45 Newsletters : 2010 Newsletters : 24 September 2010 Is the Tea Party a Modern-Day Renaissance? This essay brings an interesting new thought about our future: "And thus we venture out on a limb once more to present the idea that possibly, just possibly, a new Renaissance is upon us, a rediscovery and increased acceptance of free-market thinking, of limited government, judicial modesty – as a result of an increasingly forceful confrontation with the Money Power conspiracy that has haunted the West for the past 200-300 years." Could this possibly be happening? [ Visit Website ] Sep 21, 2010, 09:02 Newsletters : 2010 Newsletters : 24 September 2010 Gold: The Anti-Bubble An understanding of REAL Economics helps in understanding what is happening with gold these days. It is not a barbarous relic it is REAL Money, and when push comes to shove amongst countries everyone will recognise this fact. The Daily Bell has also recognised that the world's Central Banks have managed to get themselves synchronised for simultaneous disintegration. This is our biggest worry. [ Visit Website ] Sep 21, 2010, 08:51 Newsletters : 2010 Newsletters : 24 September 2010 Some in China Would Drop U.S. Holdings and Invest In Their Own Country This is the Century of China. The kids are feeling their oats. Sep 21, 2010, 08:38 Newsletters : 2010 Newsletters : 24 September 2010 Overdose - The Next Financial Crisis We have been watching the biggest financial crisis in the history of mankind unfold in America. This video sums it up nicely. What comes next? - Ah, that requires thinking! [ Visit Website ] Sep 19, 2010, 13:07 Newsletters : 2010 Newsletters : 24 September 2010 Why Government Is Necessary for Prosperity Have you ever wondered what it would be like without government? [ Visit Website ] Sep 18, 2010, 16:22 Newsletters : 2010 Newsletters : 24 September 2010 Atlas Just Shrugged Goldspan moves into the open! Sep 17, 2010, 11:31 Newsletters : 2010 Newsletters : 24 September 2010 Greenspan’s Warning on Gold And here is Greenspan's warning. [ Visit Website ] Sep 17, 2010, 10:43 Newsletters : 2010 Newsletters : 24 September 2010 The Backlash Begins Against The World Landgrab We are one of the world's most successful farming countries. We are still dependent on agricultural output for our standard of living - even though we have lived above our means for many years now. Farmers of the world are about to come into their own. This will be good for New Zealand - unless our government tries to control it and tax it out of existence. [ Visit Website ] Sep 15, 2010, 12:58 Newsletters : 2010 Newsletters : 24 September 2010 The Power of Freedom When I look at societies around the world over the last few centuries since economic wealth creation got started I see that the most free countries became the most wealthy. Is it as simple as that? [ Visit Website ] Sep 13, 2010, 19:19 Newsletters : 2010 Newsletters : 24 September 2010 Beware of Greeks Bearing Bonds So this is the moral hazard they talk about when we run a paper money system. I didn't realise that economics could be so fascinating. [ Visit Website ] Sep 13, 2010, 16:48 Newsletters : 2010 Newsletters : 24 September 2010 Quote for the Week The uniform, constant, and uninterrupted effort of every man to better his condition . . . is frequently powerful enough to maintain the natural progress of things toward improvement, in spite both of the extravagance of government, and of the greatest errors of administration. Adam Smith The Wealth of Nations Sep 12, 2010, 13:47