Cynics and the Big Fat Greek Default

Posted on May 26, 2015 by MN Gordon

Cynics and the Big Fat Greek Default“Crito, we owe a rooster to Asclepius.  Please don’t forget to pay the debt,” were the final words of Socrates.  He uttered them shortly after downing poison hemlock in 399 BC, in fulfillment of his death sentence for corrupting the youth.

Asclepius was the Greek god for curing illness.  One interpretation of Socrates’ last words is that death is the cure – or freedom – of the soul from the body.  Another is that Socrates viewed his death as a cure for Athens’ ailments…including its decline from the height of hegemony and defeat by Sparta in the Peloponnesian War.

By all accounts, Socrates’ followers were left searching for direction following the death of this profound gadfly.  Plato, for example, went on to explore, broaden, and clarify Socrates ideas, making them lasting contributions to the world.  However, many of Socrates’ other followers dissolved into various factions, and became nothing more than historical footnotes.

The Cynics, for instance, took Socrates’ teachings of the virtues of a simple life and extended them into loony land.  Before long Diogenes of Sinope was begging for a living and stumbling around the marketplace with a lamp in full daylight, claiming to be looking for an honest man. Continue reading →

Posted in Government Debt, MN Gordon | Tagged , , , , , , | Leave a comment

Monkey Economics

Posted on May 22, 2015 by MN Gordon

Despite the advent of the tablet phone and microwave kettle corn, there are still rudimentary evolutionary responses hardwired into the core of the human psyche.  During moments of failing they take over and suppress clear thinking.  How else can one explain modern man’s continued imbecilities?

Perhaps at another time and another place this animal instinct served a valuable purpose.  The luxury of thoughtful contemplation wasn’t always an option.  When backed into a corner just a moment of hesitation could mean the difference between life and death.

These days this archaic trait can become a great liability when put to the test.  For instance, rather than slamming on the brakes to prevent a bus from driving off the cliff, a driver will often do the opposite…they’ll accelerate.

Several months ago the European Central Bank (ECB) initiated a new mass money debasement scheme.  It involved buying €60 billion ($66 billion) a month of European government bonds.  Somehow this was supposed to improve the economy. Continue reading →

Posted in Inflation, MN Gordon | Tagged , , , , | Leave a comment

Get Paid by Politicians

Posted on May 19, 2015 by MN Gordon

Get Paid by Politicians“I’m out here studying what appears to be an epidemic of arrested development in the American Dream,” wrote Hunter S. Thompson from San Francisco to a New York Editor in the mid-1960s.

Fifty years later the effects of this epidemic have spread their ails across the entire American landscape.  You can hardly peer about without evidence of the rampant degeneration – be it lack of manners or people too large for their sweat pants – lacerating your eyeballs.

There’s not much you can do to stop it.  But you don’t have to be part of it.  What’s more, there are ways you can make the best of it.

Today’s insights are for the patient and shrewd individual.  If you are one among these few and far between fellows you’ll delight – and prosper – from what follows.  And even if you can’t hold on to a buck, for fear it’ll burn your fingers, you may somehow find it within yourself to exploit this clever and elegant opportunity.

You only live once.  Why not dare to do something that’s both fun and profitable…and a little subversive? Continue reading →

Posted in MN Gordon, Politics | Tagged , , , , | Leave a comment

Pinching the Losers in Congress

Posted on May 15, 2015 by MN Gordon

Pinching the Losers in CongressFinancial markets are remarkably confounding.  If you’ve ever speculated on stock price movements, you know what we mean.  Predicting where the market will go is hard enough.  But knowing exactly when…that’s nearly impossible.

Looking back, assigning causation, and projecting forward, doesn’t do the trick.  Neither does charting out wave patterns and drawing trend lines.  For eventually trend lines are broken.  Then what?

The point is, stocks go up and then they go down.  So, too, they go down and then they go up.  But sometimes times they go down and then they go down some more.  For what’s absolutely the right time to buy at one time is spectacularly wrong at another.  And what’s spectacularly the wrong time to buy at one time is absolutely right at another.

Take Southwest Airlines, for instance.  It was last year’s top performing S&P 500 stock…returning 124.63 percent.  This year, however, as of May 14, it was down 0.47 percent.

Make of it what you will.  But, by shrewd acumen alone, we don’t think there were many who purchased Southwest Airlines on January 1 and sold on December 31, 2014.  That would involve good luck, in addition to great guesswork. Continue reading →

Posted in MN Gordon, Politics | Tagged , , , , , | Leave a comment