Why Cash Is King

In investing, the hardest thing to do is nothing. There is always the hot new stock or sector that demands our attention. In investing as in life, the hardest thing to do is usually the right thing. Significant trends, where the big money is made, always appear to be moving in slow motion. This is what we’re seeing in the U.S. dollar. The fundamentals were in place long ago for the…

What Happened to Silver?

It seems like ages ago that silver was the talk of the town. As silver spiked towards $50, the expectation was for the outright collapse of our entire monetary system. That didn’t occur as planned; as usual, before a bull market make its biggest move, the believers need to disappear. That’s the process occurring as we speak. If an asset is trading within it’s normal range, it is generally not interesting…

Let the Capitulation in Gold Begin?

Since my last post, gold has dropped over $60 in a matter of weeks. This is not good, especially because the “mandatory” dollar rally appears to have arrived. To review, the dollar became the carry trade currency of choice due to artificially low interest rates. This creates a situation where the slightest uptick in the dollar forced investors to buy back dollars to unwind their trade. This, of course, leads to…

U.S. Stocks: The Only Game in Town

There is widespread disbelief of this rally in U.S. equities, which is exposing myths about stocks. One such myth is that equities are tied strictly to economic growth. This intuitively makes sense, but the market does not care what we think should be true. Remember, equities rallied over 300% from 1932-1937 in the midst of the Great Depression. Warren Buffett understands this phenomenon, which is apparent from his Op-Ed in the New…

Gold: It Is Not Time

I was at a used bookstore  the other day perusing the business and investing section when I saw a couple of books about the next Great Depression of America. Of course I had to take a look. The arguments in these books were pretty sound, and I nodded my head often…. that is, until I realized these books were from 20 and 30 years ago! These authors (still doom and gloomers today)…

The U.S. Government Bond Bubble

What follows will read like an indictment on our entire economic system. But underlying my (relatively mild) harangue is an observation that people are ignoring the most obvious bubble out there; that is, the bubble in U.S. government bonds. The following is my attempt to figure out why. Efficient Market Theory Let’s face it, markets are inefficient. The efficient market theory, manufactured from the ivory towers of academia, poses perhaps the greatest threat to the…

The Cost of Being a U.S. Citizen

I’ve written before about the record number of people choosing to renounce their citizenship. Well the cost of  renouncing your citizenship just went up over 400%. This isn’t a coincidence- the government knows about the crisis that’s coming. They are on a crazed hunt for revenue that is going to prevent a quick recovery. We are on the path to a drawn-out Japanese-style lost decade at best. For now most people have no clue what’s going on; these…

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Why Being a Full-Time Bear is Hazardous

As I scour the internet, I sense misplaced bearish sentiment and a growing chorus of people expecting a stock market crash. I don’t think a crash is likely, which puts me in an uncomfortable position. Most of my peers in the “government debt is out of control, gold is going to rally, prepare now or forever hold your peace” crowd are bearish on everything. I just don’t agree, and I haven’t agreed in years. The sad thing…

Gold and Precious Metals

What Happened to Silver?

It seems like ages ago that silver was the talk of the town. As silver spiked towards $50, the expectation was for the outright collapse of our entire monetary system. That didn’t occur as planned; as usual, before a bull market make its biggest move, the believers need to disappear. That’s the process occurring as we speak. If an asset is trading within it’s normal range, it is generally not interesting…

Let the Capitulation in Gold Begin?

Since my last post, gold has dropped over $60 in a matter of weeks. This is not good, especially because the “mandatory” dollar rally appears to have arrived. To review, the dollar became the carry trade currency of choice due to artificially low interest rates. This creates a situation where the slightest uptick in the dollar forced investors to buy back dollars to unwind their trade. This, of course, leads to…

Gold: It Is Not Time

I was at a used bookstore  the other day perusing the business and investing section when I saw a couple of books about the next Great Depression of America. Of course I had to take a look. The arguments in these books were pretty sound, and I nodded my head often…. that is, until I realized these books were from 20 and 30 years ago! These authors (still doom and gloomers today)…

Where’s the Economic Collapse?

Those who have been expecting an economic collapse are no doubt wondering why the markets are not reacting to clear bearish news: a) the renewed engagement in Iraq, b) the Ukranian/ Russian crisis, and c) riots on the streets in St. Louis. Let’s also not forget the cell phone “kill switch” that is about to be passed in California under the veil of catching criminals who steal phones. The truth, though, is that…