money

Currency Controls in Cyprus Increase Worry About Euro System

"On a visit to Athens this year, Marios Loucaides, a Cypriot businessman, saw an apartment he liked in the heart of the Greek capital and decided to buy it. However, Mr. Loucaides discovered that the euros he had on deposit here in Nicosia, the capital, could not be moved to Greece, even though the two countries share the same currency and, in theory at least, the same free movement of capital.The apartment deal collapsed. And so, too, did Mr. Loucaides’s belief that Europe has a common currency. Tangled in restrictions imposed in March as part of a bailout for the country’s ailing banks, a euro in Cyprus is no longer the same as one in France, Germany or Greece." Continue reading →

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300 Year Old Russian Watch Factory Raketa Accepts Bitcoins

"Just this week, Russia’s historical watch factory Raketa, began accepting Bitcoins. Raketa was founded in 1721 by Peter the Great and is the oldest factory in Russia. For almost 300 years, Raketa, formerly known as Petrodvorets Watch Factory, has produced and sold wristwatches to individuals in Russian and those around the world. Petrodvorets Watch Factory was renamed Raketa in 1961 to honor the World’s first cosmonaut Yuri Gagarin. Yuri was the first human to travel to outer space." Continue reading →

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Portrait of a Bitcoin miner: How one man made $192K in virtual currency

"Eric has been mining Bitcoins since 2010, and at one point quit a high-paying job as a software engineer to devote all of his time to, figuratively speaking, extract gold from silicon. His move was bold and risky, but yielded an awesome reward: To date, Eric has accumulated 2500 bitcoins, which is worth a cool $191,900 as of this writing. (At Bitcoin’s highest exchange rate, that amount was $665,000.) He doesn't trade them and has no immediate plans to cash out. Instead, he's hanging on to them, and waiting to see how their value changes." Continue reading →

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Failed Banking System Prompts Iraqis to Hoard Gold

"There is an old Arabic saying that 'gold is both for decoration and storing.' Currently, Iraqis, particularly residents of the Kurdistan Region of Iraq, are taking these words to heart. In the absence of a trustworthy banking system, they are converting their money into gold and stashing it in their homes. The Department of Standards and Quality Control for Gold and Minerals in the Kurdistan Region acknowledges that, indeed, large quantities of gold are being imported and distributed. The entry of such massive amounts of gold into the country is offset by the exit of large amounts of foreign currency, in particular US dollars, in which gold traders often deal." Continue reading →

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Bill Bonner: Can the Fed’s “Credit Cure” Really Work?

"The US economy reached a turning point in the 1980s. Natural, healthy, sustainable growth gave way to credit-boosted phony growth. The 'growth' of the last 30 years was not like the growth of the 30 years before it. It was not based on rising productivity, increased wages and real capital formation. Wages stagnated. The only way people could increase their standards of living was by spending money they didn't have. That's where the credit came in, made possible by America's post-1971 flexible paper money system. Spending money you don't have is one of those things that economist Herb Stein had in mind when he said, 'When something can't go on forever, it will stop.'" Continue reading →

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Bitcoins Soar In Value In Argentina Due To Capital Control Laws

"With the Peso undergoing yet another period of severe inflation at a rate of 20%, and now President Kirchner’s attempt to lure citizens back into the banking system over which they have absolutely no trust, by attempting to repatriate the US dollars held overseas or in hidden accounts by citizens in exchange for the domestic Cedin, the demand for Bitcoins has rocketed. Compared to Argentina’s much more freedom-orientated neighbor Uruguay, values of Bitcoins in Buenos Aires are between 30% and 40% higher than just 75 kilometers away in Colonia del Sacramento, Uruguay according to Argentinian Bitcoin expert Mauro Betschart." Continue reading →

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Dollars Vanish as Tourists Grab Argentine Bondholder Cash

"Argentina’s supply of dollars it needs to pay bondholders is dwindling at the fastest pace since the depths of the nation’s economic crisis 11 years ago. Since Fernandez banned buying dollars for everything but travel since July, the nation has posted a deficit from tourism revenue of $223 million this year through April, a 10-fold increase from a year ago, as more Argentines went abroad to buy dollars at a cheaper exchange rateand the nation attracted fewer visitors. On the black market, a dollar costs 8.05 pesos compared with the so-called 'tourist dollar,' which is the official rate plus a 20 percent tax on credit cards, or about 6.44 per dollar." Continue reading →

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About That Supposed Correlation of the U.S. Dollar and Gold….

"One of the most widely accepted truisms in what passes for our financial media is that the dollar and gold are correlated: when the dollar weakens, gold rises, and when gold rises, the dollar declines. Nice, except this vaunted correlation isn't remotely visible in the charts. Conclusion: there is no correlation between gold and the U.S. dollar index. Not even close.The two move independently; any apparent correlation is semi-random signal noise. They are not on a simplistic see-saw." Continue reading →

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Book Review: Damn Right! Biography of Charlie Munger

"There are huge advantages for an individual to get into a position where you make a few great investments and just sit back and wait: You’re paying less to brokers. You’re listening to less nonsense. And if it works, the governmental tax system gives you an extra 1, 2 or 3 percentage points per annum compounded. And you think that most of you are going to get that much advantage by hiring investment counselors and paying them 1% to run around, incurring a lot of taxes on your behalf? Lots of luck." Continue reading →

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