Bernanke’s Monetary Philosophy, Explained

Posted on May 21, 2013 by MN Gordon

The days continue to get longer.  The nights continue to get shorter.  This tells us a unique opportunity is in front of us…

It’s time to make hay while the sun still shines.

As for the stock market, the sun has never shined brighter.  Day after day, golden rays of light cascade down upon Wall Street.  Day after day stock prices hit new record highs.

The relentless run up is breathtaking and fantastical.  DOW 16,000…there’s nothing stopping it.  Not even the IRS.

Year to date the Dow’s up over 17 percent.  Many people have come up with many reasons why stocks will continue to rise.  One popular reason, as described by Jeff Reeves at MarketWatch, is that “rates remain low, fostering investment and spending.” Continue reading →

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To The Class of 2013

Posted on May 17, 2013 by MN Gordon

Today we depart from our usual cogitations to offer some remarks to the Class of 2013.  Though no trade school or remedial academy invited us to deliver this year’s commencement address, we won’t let that get in the way.  What follows, free of charge, are several observations, opinions, and anecdotes, we’ve prepared for this year’s graduating class…

Overqualified and Unprepared

Those who can, do; those who can’t, teach…or so goes the saying.  Unfortunately, this is a bunch of ill placed flattery.  For if your college experience was anything like ours then you know university professors can’t teach either.  So if you learned anything these past four years it was, by necessity, how to learn on your own.

You’ll soon find out this is a pretty darn valuable skill to have.  Too bad it took four years, countless beer parties, and beaucoup dollars to master.  But if you were, in fact, able to master it then you’ll be able to achieve just about anything…if you’ve got the requisite guts and determination. Continue reading →

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Reaching for Yield

Posted on May 14, 2013 by MN Gordon

Reaching for Yield
By Dennis Miller, Editor, Money Forever

With the Fed buying $85 billion in government debt every month, effectively holding interest rates far below the rate of inflation, many seniors are struggling to make ends meet.  It is no wonder the Dow has hit an all-time high.  But for the stock market, where else can we expect to find any return?

The Fed can go on all it wants about how business is turning around.  I’m not buying it one bit.  Bring back the 6 percent CDs of yesteryear, and we will see just how much money seniors and baby boomers pull out of the market to reduce their risk.  Frankly, I don’t know one person in my real life who is euphoric about the market.  The only enthusiasm I see or read comes from the television or the Internet.

Staying proactive amid the media hoopla is always a challenge.  But it’s a necessity for investors who actually want to profit.  Every time a member of the Federal Reserve speaks, it’s a clue waiting to be revealed. Continue reading →

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Coming Uncorked

Posted on May 10, 2013 by MN Gordon

On Tuesday something incredible happened.  The Dow closed above 15,000 for the first time ever.  What a joy to be alive and bear witness to the great miracle of our time.

Whereas just 100 years ago the new marvels were flying machines and bucolic indoor plumbing…these days we have iPads and Dow 15,000.  Without question, iPads are quite marvelous.  Without question, Dow 15,000 is quite grotesque.

Without question, extreme government price fixing of money has blurred the line between real economic growth and the illusion of economic growth.  Often times it’s difficult to tell the difference.  Yet sometimes the difference becomes crystal clear as misallocations of capital reach extremes…

Consider the dot com bubble of the late 1990s.  Or the housing bubble of the mid-2000s.  These first appeared to be reflections of real economic growth.  Later it became crystal clear they were illusions of economic growth…destructive miracles of monetary policy.

For several years, it has been fairly obvious, if not crystal clear, there’s a Treasury bond bubble.  No one quite knows just when it will blow. Continue reading →

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