Here are the latest items and commentary on current economics news, market trends, stocks, investing opportunities, and the precious metals markets. We also cover hedges, derivatives, and obscura. And it bears mention that most of these items are from the “tangibles heavy” contrarian perspective of JWR. (SurvivalBlog’s Founder and Senior Editor.) Today’s focus is on Forever stamps sold by the U.S. Postal Service.
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Next, there is this from Nick Cunningham: Déjà Vu: Shale To Kill Oil Prices Once Again
Moving on to stocks, former OMB Director David Stockman issued a warning. He predicts a government shutdown, “The Mother Of All Debt Ceiling Crises”, and a stock market collapse. All of this was in an interview with Russia Today (RT): Horrendous Storm to Hit Stocks. He judges the Dow stocks as grossly over-priced, citing the current prevailing 25-1 price-to-earnings ratio. He says that given current economic conditions, a 16-1 ratio is more realistic. If that normalization occurs suddenly, it would mean a huge drop in the DJIA.
A cousin sent me this: Average Household Credit Card Debt in America: 2017 Statistics
Economy and Finance:
As reported by the leftist-statist biased Bloomberg news service: Some Trump Aides Want a New Leader at the Fed
Contrarian Inflation Hedging (Forever Stamps)
For a decade, the U.S. Postal Service has sold Forever stamps. Starting with the classic Liberty Bell design, most U.S. self-adhesive postage stamps no longer carry a denomination marking, and they have no expiry date. The “Forever” marking indicates that they represent one standard envelope’s First Class postage. (The Liberty Bell design has been retired, but they are still valid for use “Forever.”) I’ve been hedging into these stamps in a small way since their introduction in 2007. Back then, a single stamp was 41 cents and a 20-stamp booklet of Forever stamps cost $8.20. Now, with the inexorable march of inflation, a single stamp costs 49 cents and a booklet costs $9.80. So that is a decent hedge on inflation. And if consumer price inflation ever resumes with a vengeance, then these stamps will become a great hedge!
Also, I should mention that in celebration of the 10th Anniversary of the Liberty Bell Forever Stamp, I just did a test. I found that the adhesive on a 2007-vintage Forever stamp still works fine. There is only one major drawback to this hedge strategy: USPS regulations prohibit postal clerks from buying back or even trading stamps for different stamps, or for postal money orders. You must either use them or trade them to recoup your investment.
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Please send your economics and investing news tips to JWR. (Either via e-mail of via our Contact form.) These are often especially relevant, because they come from folks who particularly watch individual markets. And due to their diligence and focus, we benefit from fresh “on target” investing news. As a result, SurvivalBlog often “gets the scoop” on economic and investing news that is probably ignored (or reported late) by mainstream American news outlets. Thanks!