How to Invest in a Declining Economy

Posted on July 10, 2012 by MN Gordon

Despite enormous monetary and fiscal stimulus efforts, the world economy continues to trudge along like a weary pack mule.  Most European countries are in recession, the United States is growing at just 1.9 percent, and, from what we gather, China’s epic twenty-year boom is stalling out.  Where are things headed next?

Today we’ll check in with Dr. Copper for a trustworthy answer…

Dr. Copper – the metal with a PhD in economics – is always the first to know which way the economy will go.  Copper’s broad use in industry and many different sectors of the economy, ranging from infrastructure to housing and consumer electronics, makes it a good early indicator of economic activity.

When copper prices rise, economic activity soon often increases.  When copper prices fall the economy often then stagnates.  Over the last year, copper prices have fallen 20 percent.

Obviously, the price of copper is in a downtrend…and it appears the world economy is following… Continue reading →

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Rigging the Price of Money on a Grand Scale

Posted on July 6, 2012 by MN Gordon

Some people earn their money by honest means.  Others do so at the expense of one another.  If you borrowed money from a bank between 2005 and 2009 to buy a house or car, to pay for school, or if you happened to use a credit card during that time, you’ve likely been duped by a collaborative price rigging scheme courtesy of the big banks.

No doubt, this is quite a revelation.  In short, what it means is that nearly everyone – including businesses and investors – who used credit between 2005 and 2009 was swindled.  What’s more, they were swindled in a major way.

“This dwarfs by orders of magnitude any financial scams in the history of markets,” said Andrew Lo, a professor of finance at the Massachusetts Institute of Technology.

Charles Ponzi, Bernie Madoff, Kenneth Lay, Bernie Ebbers, Dennis Kozlowski, can’t hold a candle to the price fixing scheme the big banks orchestrated.  What Ponzi and the like did were small potatoes by comparison…they just scammed their clients and customers.  The big banks, on the other hand, scammed everyone.

Obviously, we wish we were making this up…but, alas, we are not.  What follows is a brief review of this insulting racket… Continue reading →

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Celebrating Independence Day with Gratitude

Posted on July 3, 2012 by MN Gordon

Uncompromising independence and limitless personal freedom were once essential to the American character.  According to popular American folklore, they still are.  We have some reservations.

No doubt, America was at one time the land of the free.  Of course, that was long before 46.4 million citizens began using Electronic Benefit Transfer (EBT) cards to purchase their daily bread.  Similarly, that was back when you could milk your cow and sell the milk to thirsty buyers without being visited at 5 a.m. by U.S. marshals.

These days the ideas that roused America’s War of Independence are, alas, just ideas.  Limited government and individual liberty were long ago squandered for big government and collectivism.  Gone are the days when you could earn a living without the IRS making a federal case out of it.  So, too, gone are the days when your kids could sell a glass of lemonade to your neighbors without some city busybody shutting them down for not having an approved permit. Continue reading →

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Violating the Promptings of the Economy

Posted on June 29, 2012 by MN Gordon

I left my heart in San Francisco
High on a hill it calls to me
To be where little cable cars climb halfway to the stars
The morning fog may chill the air, I don’t care

My love waits there in San Francisco
Above the blue and windy sea
When I come home to you, San Francisco
Your golden sun will shine for me

— Frank Sinatra

—

Today we’re in San Francisco working, observing, writing and taking pause with our wife and son to ride cable cars up and down Powell Street, traverse through the city’s varying districts – like Chinatown, North Beach, SoMa and Fisherman’s Warf – and eat fresh crab and pasta.  What follows are some ruminations on the City’s beginnings, gold, Jack London, and much, much, more…

The First Day of the California Gold Rush

On January 24, 1848, James W. Marshall stepped out from Sutter’s Mill and peered down the American River, in Coloma, California.  In the distance he saw a glimmer along the river bank twinkling back at him.  What could it be? Continue reading →

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