Inflation

Understanding Unintended Consequences

As you get older and start thinking more, you realize there are more layers to even seemingly straightforward problems. When you are young, solutions are simple: If drugs are bad, we should make them illegal and put people in jail for using them. Or if we need to raise revenue, we should raise taxes on everyone, especially the rich. Perhaps this is the logic behind the saying, “If you are young…

The End of QE2

Today we say goodbye to QE2- a failed program that brought few desirable results. Unemployment is down marginally, but home prices double dipped and commodity prices surged, contributing to the inflation we see today. The dollar and bonds are down, which indicates that quantitative easing has adverse consequences for a country riddled with debt. Remember, there was a debt crisis in Europe led by Greece, so the dollar should have…

The Economic Non-Recovery

I have been very consistent in saying that the programs enacted by our government would not solve our economic ills. For awhile, there was actually a debate as to the efficacy of the government’s programs; now there is none. It is becoming increasingly difficult to find permabulls on the economy because quite frankly, most have gone into hiding. They know they were wrong. Where is the 6.8% unemployment rate we…

The Declining Confidence of Americans

I account for the real possibility of civil unrest when I make investment decisions. Civil unrest is one of those things that will have an inordinate effect on the gold price. If gold has come this far from good old government mismanagement alone, imagine how high it can go if Americans protest. It has been quite some time since protests due to a weak economy were even a remote possibility….

Record Job Cuts in States

In further evidence that our economy is in the process of slowing, states are projected to make record job cuts in the 3rd quarter. As I’ve said before, states in the U.S. are indistinguishable from Greece. The arguments that the U.S. won’t suffer a huge crisis since we own the reserve currency and can print our way out of this just do not apply to the states. States need to balance…