Investment/Trends

Defiling the Memory of President Eisenhower

"On a Tuesday night, 52 years ago. President Dwight D. Eisenhower appeared on TV sets across America. Three days later, he would leave the Oval Office to John F. Kennedy. It all happened very fast. No one was prepared for the grim prophecy Eisenhower would tell that night in his farewell address. In 1961, the words 'military-industrial complex' probably sounded nuts. But writing in 2013, I can say with confidence that an alert and knowledgeable citizenry is far more absurd. Back when Ike made his address, defense spending was about $350 billion in today’s dollars. Today, it’s over half a trillion dollars. What would Eisenhower say today? Probably, 'I told you so you, idiots!'" Continue reading →

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Worldwide loss of oil supply heightens Syria attack risk

"Libya's oil output has crashed to a near standstill over the past year as warlords and strikes paralyse the country, tightening the screws on global crude supply as the crisis in Syria comes to a head. There are still pockets of rising oil output, notably in the US where shale oil is rapidly reducing US dependence on energy imports. The geo-strategic effect of shale is double-edged for the US: it lowers the incentive for Washington to commit forces to the Middle East, but it also means the US is better able to handle the consequences of any oil spike. The biggest losers would be those emerging economies such as India and China that rely on fuel imports and operate inefficient industries." Continue reading →

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NSA’s Prism Could Cost Global IT Service Market $180 Billion

"James Staten, a Forrester analyst who follows IT services, argued in a blog post Wednesday that financial losses could prove substantially higher when other market segments are considered. In calculating his higher estimate, Mr. Staten said that in addition to the $35 billion estimated by the ITIF, vendors of hosting and outsourcing services – which offer many of the same services as cloud companies, but use different processes and revenue models — could suffer an additional $100 billion in lost business. Moreover, non-U.S. cloud service providers could lose $35 billion worth of business from international customers, as awareness grows of the surveillance activities of other governments." Continue reading →

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Total U.S. Public Debt Now Eclipses GDP

"We previously warned of what can transpire when desperate governments are no longer able to shoulder unbearable debts. As one can see in the chart above, total public debt in the United States recently crossed the proverbial Rubicon and now equals 104.95% of GDP. As if this weren't alarming enough, the Fed's official figures – which were used to create the chart above – do not include the nation's swelling, yet politically untouchable unfunded liabilities, namely Medicare and Social Security. When these figures are plugged in to the equation, the US's public debt level skyrockets to astronomical heights." Continue reading →

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“When Will They Learn?”

"In a conservative administration, a government will institute greater social controls. In the following liberal administration, the government will institute greater economic controls. And the police state will be increased under both administrations. The net effect is overall increased dominance by government. Under the two-party system, this dominance is not only tolerated by the populace, but encouraged. The day never comes when a people convince their government to 'lighten up.' Relief only comes when an overly-powerful governmental system collapses under its own weight." Continue reading →

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The Worst Law Most Americans Have Never Heard Of

"While there is still an opportunity for you to avoid getting boxed in by a desperate and out-of-control government, nobody knows exactly how much time is left. And once official capital controls are implemented (#3), your wealth is trapped and things tend to unravel pretty quickly. Developing your internationalization game plan does not mean you have to leave your home country. It is possible to achieve a certain level of international diversification without needing to leave your living room, for example, by opening a foreign bank or brokerage account remotely. The idea is to create your own personal insurance policy to immunize yourself from the common destructive measures of a desperate government." Continue reading →

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The Empire’s Next Effort to Extract Your Wealth

"Since before the tech bust, we’ve been suggesting that while Americans 'think' they’re getting richer… they’re actually heading in the other direction. They’re getting poorer. This proposition has been easier for folks to entertain since housing busted and the financial crisis reversed the “wealth effect” in 2008. With that in mind, let’s take a look at the logic of the American Empire and what you can expect in the year(s) ahead." Continue reading →

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Economic Darwinism and the Next Financial Crisis

"The boom times enabled animals called bankers grow to massive size. Nature selected those who were the fittest for that environment. When the environment changed, these animals were like dinosaurs staring at the glaciers. The interest rate policy of the Federal Reserve today is designed to keep those dinosaurs warm and well fed. The people who run our country were largely selected by Economic Darwinism from a pool of people who owe their success to cheap interest. It is no surprise that these people see cheap interest as the only solution to our economic woes. This policy is about rebuilding their past rather than improving your future." Continue reading →

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Fast-Food Strike Means Time to Buy Gold

"It’s clear from the stories I read that Burger Nation doesn’t realize the predicament it’s in, nor does it understand the law of unintended consequences. Push on a balloon in one spot, a bulge appears elsewhere … which is to say that the status quo with consumer prices today will not be the status quo tomorrow when wages are $15 an hour. Salaries will go up, but so too will consumer prices, and the spending power of $15 will feel exactly like the spending power of $7 to $10 – and workers will have essentially gone nowhere economically, though America could find herself hamstrung by a new financial crisis — runaway inflation." Continue reading →

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Do bitcoins belong in your retirement portfolio?

"For years, investment firms and professionals have advocated the need to include a small percentage of high risk and potentially high reward assets into your retirement portfolio. The thinking is that including a small percentage of your overall asset allocation (from 5% - 10%) into these assets can provide high potential returns with only a small impact on your portfolio if the risk becomes too great. Robert Powell wrote on this site recently of how defined benefit plan managers often go beyond stocks and bonds to achieve high returns by pursuing more 'nontraditional strategies'." Continue reading →

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