Category Archives: Money

Crossing Borders with Gold and Silver Coins, by Doug Casey

There are some very good reasons to own gold and silver coins. From Doug Casey at internationalman.com:

It’s well-known that you have to make a declaration if you physically transport $10,000 or more in cash or monetary instruments in or out of the US, or almost any other country; governments collude on these things, often informally.

Gold has always been in something of a twilight zone in that regard. It’s no longer officially considered money. So it’s usually regarded as just a commodity, like copper, lead, or zinc, for these purposes. The one-ounce Canadian Maple Leaf and US Eagle both say they’re worth $50 of currency.

But I’ve had some disturbing experiences over the past couple of years crossing borders with coins. Of course, crossing any national border is potentially disturbing at any time. You might find yourself interrogated, strip searched, or detained for any reason or no reason. But I suspect what happened to me crossing a few borders in recent times could be a straw in the wind.

I’ve gradually accumulated about a dozen one-ounce silver rounds in my briefcase, some souvenirs issued by mining companies, plus others from Canada, Australia, China, and the US. But when I left Chile not long ago, the person monitoring the X-ray machine stopped me and insisted I take them out and show them to her. This had never happened before, but I wrote it off to chance. Then, when I was leaving Argentina a few weeks later, the same thing happened. What was really unusual was that the inspector looked at them, took them back to his supervisor, and then asked if I had any gold coins. I didn’t, he smiled, and I went on.

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The Unprofitably Incompetent, by Robert Gore

Those who can’t do, demand.

Profit propels civilization. When a producer can make an item or provide a service at a cost lower than a customer values that item or service, and the customer has the means and the freedom to buy, the difference between what’s paid over cost is profit. That profit is the producer’s incentive to produce, and in turn funds the producer’s consumption, savings, and investment, which creates other producers’ profits. Profit is the necessary prerequisite for consumption, savings, investment, and consequently, progress.

Many of us profit every day. We offer services and provide goods, supporting ourselves at a cost that is lower than what we’re paid. We’re profitably competent, engaging in honest production and peaceful, voluntary exchange. The only alternatives to profitable competence are living off of someone else’s profitable competency via inheritance or charity, or criminality—theft via fraud or violence.

Criminals cloak their thefts in all sorts of justifications, some of which, like socialism, become full-blown political doctrines. Ironically, a larcenous litany of demands and rationalizations are efflorescing at a time when whatever is left of the overall profit pool has been drained. It has been mortgaged multiple times, just as hordes of the unprofitably incompetent, who had no hand in producing it, clamor for their “fair share.” They’ll insist the profitably competent figure out how to pay for it, but the fair share of nothing is nothing, political promises to the contrary notwithstanding.

“Your means, my ends; I wish, you fulfill,” is the foundational fantasy of modern governance. The favored groups shelter in their safe spaces—government and its rackets, crony corporations, academia, the media, and Hollywood—living on the delusion that there will always be someone who will produce, without question or protest, for their benefit. Upon that foundation they’ve constructed a phantasmagorical edifice of illusory constructs and passages to nowhere.

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The Yellow Vests Get it Right, by Robert Gore

Financial nuclear warheads.

The mainstream media has degenerated irreparably. Here’s a reliable rule of thumb: if it’s important it’s not covered; if it’s covered it’s not important. Stories in the American mainstream press about Yellow Vest protests have been few. One aspect of the protests, transcendently important, has received scant coverage.

The Yellow Vest protestors have called for a coordinated run on French banks. Whether they realize it or not, they’re playing with nuclear warheads that could annihilate not just the French, but Europe’s and the entire world’s financial system. Because inextricably linked to the ends of contemporary governments―how much they can screw up the lives of those who must live under them—is the question of means―how do they fund their misrule? The short answer is taxes and debt.

Since 1971, when President Nixon 
“temporarily” suspended international convertibility of dollars for gold (it’s never been reinstated), the monetary basis of the global economy has been fiat debt. Neither government or central bank debt nor currencies are tethered to any real constraint, like precious metals (see “Real Money,” SLL). Thus, politicians and monetary officials can create as much debt as they want: debt by fiat.

Government and central bank debt is at the apex of the global debt pyramid. The next tier is commercial banks that have accounts at central banks. Those accounts are bank assets and central bank liabilities, or debts. Central banks expand their fiat liabilities to banks in exchange for banks’ fiat government debt, an exchange called debt monetization, which is a bit of a misnomer since no “Real Money” is involved. The “monetization” is the central bank’s fiat expansion of banks’ accounts with the central bank in exchange for fiat government debt, which expands banks’ assets available for loans to governments, businesses, and individuals.

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The Tragedy Of The Euro, by Alasdair Macleod

The euro’s failure at inception wasn’t a certainty, but now it is. From Alasdair Macleod at goldmoney.com:

After two decades, the euro’s minders look set to drive the Eurozone into deep trouble. December was the last month of the ECB’s monthly purchases of government debt. A softening global economy will increase government deficits unexpectedly. The consequence will be a new cycle of sharply rising bond yields for the weakest Eurozone members, and systemically destabilising losses in the bond portfolios owned by Eurozone banks

The blame-game

It’s the twentieth anniversary of the euro’s existence, and far from being celebrated it is being blamed for many, if not all of the Eurozone’s ills.

However, the euro cannot be blamed for the monetary and policy failures of the ECB, national central banks and politicians. It is just a fiat currency, like all the others, only with a different provenance. All fiat currencies owe their function as a medium of exchange from the faith its users have in it. But unlike other currencies in their respective jurisdictions, the euro has become a talisman for monetary and economic failures in the European Union.

Recognise that, and we have a chance of understanding why the Eurozone has its troubles and why there are mounting risks of a new Eurozone systemic crisis. These troubles will not be resolved by replacing the euro with one of its founding components, or, indeed, a whole new fiat-money construct. It is here to stay, because it is not in the users’ interest to ditch it.

As is so often the case, the motivation for blaming the euro for some or all the Eurozone’s troubles is to shift responsibility from the real culprits, which are the institutions that created and manage it. This article briefly summarises the key points in the history of the euro project and notes how the mistakes of the past are being repeated without the safety-net of the ECB’s asset purchases.

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Let’s do follow the climate money! by Paul Driessen

Global warming “believers” carp about trivial amounts of money that the few who either question or challenge their hypothesis receive from corporate donors, but don’t want to talk about the gobs of money they get from governments, corporations, and foundations. From Paul Driessen at fact.org:

The climate crisis industry incessantly claims that fossil fuel emissions are causing unprecedented temperature, climate and weather changes that pose existential threats to human civilization and our planet. The only solution, Climate Crisis, Inc. insists, is to eliminate the oil, coal and natural gas that provide 80% of the energy that makes US and global economies, health and living standards possible.

Failing that, CCI demands steadily increasing taxes on carbon-based fuels and carbon dioxide emissions.

However, as France’s Yellow Vest protests and the latest climate confab in Poland demonstrated, the world is not prepared to go down that dark path. Countries worldwide are expanding their reliable fossil fuel use, and families do not want to reduce their living standards or their aspirations for better lives.

Moreover, climate computer model forecasts are completely out of touch with real-world observations. There is no evidence to support claims that the slight temperature, climate and weather changes we’ve experienced are dangerous, unprecedented or caused by humans, instead of by the powerful solar, oceanic and other natural forces that have driven similar or far more serious changes throughout history.

More importantly, the CCI “solutions” would cause unprecedented disruption of modern industrialized societies; permanent poverty and disease in poor countries; and serious ecological damage worldwide.

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Soros ‘person of the year’ indeed: In 2018 globalists pushed peoples’ patience to the edge, by Robert Bridge

Soros may be the snake or the arachnid of the year, or globalist would-be dictator of the year, but person of the year he is not, except in the flatulent fantasies of the Financial Times. From Robert Bridge at rt.com:

It is no secret that neoliberalism relentlessly pursues a globalized, borderless world where labor, products, and services obey the hidden hand of the free market. What is less often mentioned, however, is that this system is far more concerned with promoting the well-being of corporations and cowboy capitalists than assisting the average person on the street. Indeed, many of the world’s most powerful companies today have mutated into “stateless superpowers,” while consumers are forced to endure crippling austerity measures amid plummeting standards of living. The year 2018 could be seen as the tipping point when the grass-roots movement against these dire conditions took off.

Since 2015, when German Chancellor Angela Merkel allowed hundreds of thousands of undocumented migrants into Germany and the EU, a groundswell of animosity has been steadily building against the European Union, perhaps best exemplified by the Brexit movement. Quite simply, many people are growing weary of the globalist argumentthat Europe needs migrants and austerity measures to keep the wheels of the economy spinning. At the very least, luring migrants with cash incentives to move to Germany and elsewhere in the EU appears incredibly shortsighted.

Indeed, if the globalist George Soros wants to lend his Midas touch to ameliorating the migrant’s plight, why does he think that relocating them to European countries is the solution? As is becoming increasingly apparent in places like Sweden and France, efforts to assimilate people from vastly different cultures, religions and backgrounds is an extremely tricky venture, the success of which is far from guaranteed.

One worrying consequence of Europe’s season of open borders has been the rise of far-right political movements. In fact, some of the harshest criticism of the ‘Merkel plan’ originated in Hungary, where its gutsy president, Viktor Orban, hopes to build “an old-school Christian democracy, rooted in European traditions.” Orban is simply responding to the democratic will of his people, who are fiercely conservative, yet the EU parliament voted to punish him regardless. The move shows that Brussels, aside from being adverse to democratic principles, has very few tools for addressing the rise of far-right sentiment that its own misguided policies created.

Here it is necessary to mention once again that bugbear of the political right, Mr. Soros, who has received no political mandate from European voters, yet who campaigns relentlessly on behalf of globalist initiatives through his Open Society Foundations (OSF) (That campaign just got some serious clout after Soros injected $18bn dollars of his own money into OSF, making it one of the most influential NGOs in the world).

With no small amount of impudence, Soros has condemned EU countries – namely his native Hungary – for attempting to protect their territories by constructing border barriers and fences, which he believes violate the human rights of migrants (rarely if ever does the philanthropist speak about the “human rights” of the native population). In the words of the maestro of mayhem himself: “Beggar-thy-neighbor migration policies, such as building border fences, will not only further fragment the union; they also seriously damage European economies and subvert global human rights standards.

Through a leaked network of compromised EU parliamentarians who do his bidding, Soros says the EU should spend $30 billion euros ($33bln) to accommodate “at least 300,000 refugees each year.” How will the EU pay for the resettling of migrants from the Middle East? Soros has an answer for that as well. He calls it “surge funding,” which entails “raising a substantial amount of debt backed by the EU’s relatively small budget.

ny guesses who will be forced to pay down the debt on this high-risk venture? If you guessed George Soros, guess again. The already heavily taxed people of Europe will be forced to shoulder that heavy burden. “To finance it, new European taxes will have to be levied sooner or later,” Soros admits. That comment is very interesting in light of the recent French protests, which were triggered by Emmanuel Macron’s plan to impose a new fuel tax. Was the French leader, a former investment banker, attempting to get back some of the funds being used to support the influx of new arrivals into his country? The question seems like a valid one, and goes far at explaining the ongoing unrest.

At this point, it is worth remembering what triggered the exodus of migrants into Europe in the first place. A large part of the answer comes down to unlawful NATO operations on the ground of sovereign states. Since 2003, the 29-member military bloc, under the direct command of Washington, has conducted illicit military operations in various places around the globe, including in Iraq, Libya and Syria. These actions, which could be best described as globalism on steroids, have opened a Pandora’s Box of global scourges, including famine, terrorism and grinding poverty. Is this what the Western states mean by ‘humanitarian activism’? If the major EU countries really want to flout their humanitarian credentials, they could have started by demanding the cessation of regime-change operations throughout the Middle East and North Africa, which created such inhumane conditions for millions of innocent people.

This failure on the part of Western capitals to speak out against belligerent US foreign policy helps to explain why a number of other European governments are experiencing major shakeups. Sebastian Kurz, 32, won over the hearts of Austrian voters by promising to tackle unchecked immigration. In super-tolerant Sweden, which has acceptedmore migrants per capita than any other EU state, the anti-immigrant Sweden Democrats party garnered 17.6 percent of the vote in September elections – up from 12.9 percent in the previous election. And even Angela Merkel, who is seen by many people as the de facto leader of the European Union, is watching her political star crash and burn mostly due to her bungling of the migrant crisis. In October, after her Christian Democratic Union (CDU) suffered a stinging setback in Bavaria elections, which saw CDU voters abandon ship for the anti-immigrant AfD and the Greens, Merkel announced she would resign in 2021 after her current term expires.

Meanwhile, back in the US, the government of President Donald Trump has been shut down as the Democrats refuse to grant the American leader the funds to build a wall on the Mexican border – despite the fact that he essentially made it to the White House on precisely that promise. Personally, I find it very hard to believe that any political party that does not support a strong and viable border can continue to be taken seriously at the polls for very long. Yet that is the very strategy that the Democrats have chosen. But I digress.

The lesson that Western governments should have learned over the last year from these developments is that there exists a definite red line that the globalists cross at risk not only to the social order, but to their own political fortunes. Eventually the people will demand solutions to their problems – many of which were caused by reckless neoliberal programs and austerity measures. This collective sense of desperation may open the door to any number of right-wing politicians only too happy to meet the demand.

Better to provide fair working conditions for the people while maintaining strong borders than have to face the wrath of the street or some political charlatan later. Whether or not Western leaders will change their neoliberal ways as a populist storm front approaches remains to be seen, but I for one am not betting on it.

 

Apple Lost $11 Billion Buying Back Its Own Stock In 2018, by Tyler Durden

At least Apple used its own money to speculate on its stock. A lot of companies borrow money to buy their own stock. Like Apple, many of them have bought stock are prices far higher than current prices. From Tyler Durden at zerohedge.com:

There’s a funny thing about buybacks: when stocks are rising (and are therefore more expensive), companies have zero doubts  about repurchasing their own stock, especially if said purchase is funded with cheap debt. Of course, by repurchasing their stock, the price goes even higher making management’s equity-linked comp more valuable, which explains why management teams usually have no misgivings about allocating capital to this most simplistic of corporate uses of funds. However, when stocks fall, companies tend to clam down on buybacks due to fears that the drop may continue, forcing the CFO or Treasurer to explain his actions to the CEO or the board, and why they risked losses on capital (as well as getting a pink slip) instead of investing in “safer” corporate strategies like M&A, R&D or capex.

The irony, of course, is that companies should not be buying back stocks when the stock is rising (as that’s when it is more expensive), and accelerate repurchases when it is dumping. And yet, that virtually never happens in reality as management teams, like most investors and algos, tend to chase momentum and direction. Meanwhile, confused by underlying pricing mechanics, management – which is singlehandedly responsible for the levitation in the stock price with its buybacks – then watches its stock price tumble even more one stock repurchases are halted.

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