In the GOP presidential debates, when Ron Paul talks about economics he is a giant among pygmies. None challenge him. The best his opponents can come up with is to rail about the need to balance the budget. But, when he brings up the issue of the business cycle, the other candidates look like they want climb under the podium. Further, no moderator has ever sought to question his economic positions.
Ron Paul’s grasp of economics comes from fifty years of studying economics and reading the best books from the Austrian School of economic theory. He read Ludwig von Mises, Friedrich A. Hayek, Murray Rothbard, Henry Hazlitt and Hans Sennholz, to name only a few but the most high profile. Further, he has rubbed shoulders with and discussed economic theory with many these giants of the Austrian School. Although his formal education is in medicine, Ron Paul also is an economist.
(more…)
READ MORE
In 1954, Darrell Huff wrote his classic book How to Lie with Statistics, which covered many popular ways people use and abuse statistics to make them say anything they want. Well, it appears that our...
In 1954, Darrell Huff wrote his classic book How to Lie with Statistics, which covered many popular ways people use and abuse statistics to make them say anything they want. Well, it appears that our good friends at the Bureau of Labor Statistics (BLS) are no stranger to these techniques. Last Friday they released their new jobs number that said the employment rate had fallen to 8.3% on a net addition 243,000 new jobs.
While everyone in the mainstream media and the White House were busy celebrating the recovery of the American economy, Zerohedge dug into the numbers over the following days to reveal a much different picture of what was really happening.
The big problem they noticed was: how do you reconcile a reduction in the unemployment number with the fact that the labor force participation rate has been dropping for the last 12 years and is now at the lowest point in 30 years?
(more…)
READ MORE
Category: Economic Crisis, Interesting Issues
The issue of where a central bank stores its gold remains on the forefront.
The Dutch people want to know where the Dutch gold is stored. Venezuela called home some 160 tons that previously was held...
The issue of where a central bank stores its gold remains on the forefront.
The Dutch people want to know where the Dutch gold is stored. Venezuela called home some 160 tons that previously was held in the US, London and Canada. China has made it clear where its gold is to be with the export of gold prohibited and import licenses being liberalized. (more…)
READ MORE
Category: Gold, The Federal Reserve
Fractional reserve banking is one probably the least understood aspect of money; further misunderstood is how fractional reserve banking—when it is used to expand the money supply—impacts our economy...
Fractional reserve banking is one probably the least understood aspect of money; further misunderstood is how fractional reserve banking—when it is used to expand the money supply—impacts our economy and causes the business cycle, which, if it runs to extremes, results in recession at best, depression at worst.
People who want to protect savings and make smart investments need to gain at least a basic understanding of the relationship of fractional reserve banking and the Fed to the business cycle. (more…)
READ MORE
Category: Federal Finances, Money, The Federal Reserve
For years, silver bulls have lamented the metal’s failure to significantly outperform gold in this precious metals bull market. They look at the statistics: silver’s dwindling warehouse inventories,...
For years, silver bulls have lamented the metal’s failure to significantly outperform gold in this precious metals bull market. They look at the statistics: silver’s dwindling warehouse inventories, only a fraction of what they were a few decades ago; no huge government stockpiles of silver overhanging the market; stagnant production with increasing demand; announcements of new uses released almost daily; annual sales of the American Silver Eagle, which is only one silver investment vehicle available, now exceeding yearly U.S. domestic silver production; the US a net importer silver as domestic production meets only about one third of demand.
Why, silver bulls ask, has the price of silver not outstripped the price of gold? In past bull markets, most notably the 1973-1980 bull market, the price of silver shot up 25 times while the price of gold rose only seven to eight times. Significant in the 1970s precious metals bull market was the “Hunt Brothers” factor; this bull market does not have such a recognized development. Still, in other bull markets of shorter duration, silver significantly outperformed gold. So, why not now? (more…)
READ MORE
Category: Silver, The Metals Markets
Well, here’s an interesting tidbit from the Treasury Borrowing Advisory Committee (TBAC) compliments of Zerohedge. Their latest letter to Timothy Geithner contained the following paragraph:
“There...
Well, here’s an interesting tidbit from the Treasury Borrowing Advisory Committee (TBAC) compliments of Zerohedge. Their latest letter to Timothy Geithner contained the following paragraph:
“There was a lengthy discussion regarding the bid-to-cover ratios at recent Treasury bill auctions. It was broadly agreed that flooring interest rates at zero, or capping issuance proceeds at par, was prohibiting proper market function. The Committee unanimously recommended that the Treasury Department allow for negative yield auction results as soon as logistically practical.”
It’s probably the perfect summary of our insane monetary system in which common sense and everything else has been turned on its head. Here we have a group of Wall Street bankers “advising” the Secretary of the Treasury to implement a system for allowing negative interest rates as soon as possible. Yes, real life negative interest rates all in the name of allowing proper market function.
(more…)
READ MORE
Category: Economic Crisis, Federal Finances, Gold, The Metals Markets
