Category: Economics & Investing

Economics and Investing:

Commentary from Barry Eichengreen in the Wall Street Journal: Why the Dollar’s Reign is Near an End. (Thanks to Jeff E. for the link.) Also from Jeff: Muni Default Estimate: $100 Billion. A site that maps gasoline prices, by county, has been mentioned here before: Gas Buddy. So much for the “recovery”: February planned layoffs highest in 11 months: Challenger Items from The Economatrix: Can you feel the artificial stimulus trickling down? US Auto Sales Jump 20% In February. (Perhaps people are out shopping for more fuel-efficient cars.) Oil Prices Jump On Middle East, Bernanke Comments   Manufacturing Growing at …


Two Letters Re: Nickels as an Inflation Hedge

Jim, Just another data point for you about Nickels, from North Carolina.  My bank continues to order boxes [of $100 face value in nickel rolls] for me, but they were told by their supplier that 20 boxes was the new limit per week (I had asked for 55 boxes).  The funny thing is the manager said they would simply order me 20 boxes/week until I had what I wanted! They also noted a strong uptick (from essentially none) in customer requesting nickels for the same reason I am getting them – base metal value.  Though none more than a couple …


Economics and Investing:

At last report, Spot Silver was at $34.65 per Troy Ounce. I told you so… Ben S. mentioned: Is the U.S. dollar still a safe haven?   Ben notes: “One opinion in this article is that the dollar is overvalued by 8%.  If this is true, wouldn’t the US Dollar Index also be overvalued by the same, thus resulting in an index of approximately 71?”  Peter Schiff: “We’re in the Early Stages of a Depression” Items from The Economatrix: History Tells Us That A Surge In Fuel Costs Makes A US Recession Likely  Silver Squeeze to Continue   The Silver …


Letter Re: Silver Coins with a Very Low Likelihood of Fakery

Hi James, I’ve been suspicious about the possibility of silver coins being faked ever since reading your links about tungsten “gold” and think I’ve come up with an answer.  As long as you’re not looking for collectibles, just buy second-quality silver coins – modern ones like Liberty one-ounce silver rounds, not numismatics.  You know, the coins that are scratched, dented, and discolored.  They clean up just fine with a little Wright’s silver polish.  Who the heck is going to counterfeit dents, scratches, worn spots and discoloration?  Also, they’re [relatively] inexpensive.  These are the “junk silver” version of (.999) silver coins …


Letter Re: A Bank Run Reality Check

Mr. Rawles, After reading the letters about banking reality, I would like to add what I have learned from working at a reputable bank in the Midwest.  The bank never has enough cash on hand to supply all their “demand “ or checking accounts, no matter what their legal fine print says.    The amount of cash is mandated by the Federal Reserve for the banks in their region.  Each week the Fed tells the branch how much cash they can order, how much excess cash must be sent back to them, and how much cash they will need to …


Economics and Investing:

What are We Getting for an Extra $1 Trillion in Federal Spending? Wind Power Generates Renewed Interest as Oil Worries Grow   Prospective Homebuyers: Time Is on Your Side  Items from The Economatrix: Oil Drops, But Gasoline Prices Keep Rising   Easing Oil Prices, Deal News Send Stocks Higher   China’s Holding of US Debt Jumps 30%   Celente:  “When the Money Stops Flowing Down to the Man in the Street, the Blood Starts Flowing in the Streets”   


Economics and Investing:

Fake Silver Coins/Bars/Ingots ARE on the market in U.S.! This includes some useful videos with tests for fakes. (Thanks to Nic for the link.) Reader “Firecracker” notes: Paul Krugman (Nobel prize-winning Princeton economist) recently spoke to students at The University of Oklahoma.  The local paper had a very short article about his speech. The last line in the article sums it up pretty well: “We’re eating our seed corn,” he said. “We are very far from being over the financial crisis.” Items from The Economatrix: Royal Canadian Mint Now Saying It’s Difficult Securing Silver   War, Martial Law, And The …


Inflation Watch:

Middle East Mirrors Great Inflation Revolutions Since 1200 A.D. (Thanks to Mark G. for the link.) Bobbi, South Dakota notes: “Six weeks ago, I could buy canned Progresso brand soup (ready to eat) for $1 per can. Yesterday it was $2.29. Gasoline (10% ethanol) was $3.06 four days ago. It is now $3.36. The “Cheap” white bread was regularly on sale for $.79 for a 24 ounce loaf. Now it is $.99 (as a “Hot Buy”) for a 16 ounce loaf. Navel oranges are still $.78/lb, but those in the latest batch are very small and even slightly green. Cucumbers …


Two Letters Re: A Bank Run Reality Check

Dear Mr. Rawles, While the quantity of FRN currency and coins on hand at a bank branch certainly makes or breaks one’s ability to withdraw one’s funds in a “run” situation, the overriding factor of which most depositors are completely unaware is that only checking accounts are “demand” accounts, meaning that you have a legal and immediate right to all of your money when you demand it. If you read the account disclosure fine print for your certificate of deposit (CD) or savings account, you will find that the bank is under no obligation to return your money when you …


Economics and Investing:

A new age of uncertainty: Why Arab turmoil could mean an orgy of bloodletting and rocketing oil prices rather than a Utopian world order. (A hat tip to J.B.G. for the link.) K.A.F.send us a story about “voting with their feet”: Irish Remedy for Hard Times: Leaving U.S. crop boom not enough to rebuild thin supplies. (Thanks to Nick F. for the link.) Natural Gas: A Cure for America’s Crazy Oil Addiction Items from The Economatrix: Regulators Close Small Illinois Bank; Makes 23 in 2011   State and Local Budget Cuts are Slowing US Economy   Oil Prices Spike to …


Economics and Investing:

Reader F.G. sent the link to this entertaining video clip: Investing Ferraris Versus Gold. FDIC: 884 ‘Problem’ Banks Remain Even as Profits Grow. (Thanks to G.G. for the link.) Reader Michael P. sent this from David Chapman: The End of the US Dollar? Analysis: Oil prices could be game-changer for world economy Paul Farrell: Market Crash 2011: It will hit by Christmas. (Thanks to Pat S. for the link.) Items from The Economatrix: If all else fails, bribe them: Saudi ruler offers $36 billion to stave off uprising amid warning oil price could double Why I’m Buying Silver at $30 …


Letter Re: A Bank Run Reality Check

James Wesley, I have been trying to take the blinders off my wife’s family.  While they are not ready to don tin foil hats with me yet, they definitely don’t think I am quite as eccentric as I was before.  A failing economy can do that for people.  I did have an interesting conversation with my Sister-in-Law though concerning banking.  She is a branch manager of a bank;  a very large banking institution.  I don’t want to say the name, but as of 20 minutes ago, they have over 24,000 branches and ATM locations around the world.  I asked her …


Economics and Investing:

Jim Willie: QE2: The Road to a Gold Standard North African Turmoil Could Rocket Crude to $220 John R. recommended this article: Middle East Chaos: What To Learn And What To Expect Items from The Economatrix: Crude breaches $119 in frantic trading Market Jitters As Oil Price Heads For The Sky   UK:  Petrol to Hit £6.50 a Gallon; Mideast Crisis Cuts Supplies   (That is $10.52 USD, folks!) US House Prices Plumb New Depths   Video of Eric Sprott Speech: The Government Lied…There is No More Silver!


Inflation Watch:

Trapped: The Fed Has Painted Itself Into a Corner Charles Kadlec reports at Forbes: Higher Inflation Is On The Way. Wegman’s freezes prices on 40 products. (JWR Asks: How long can that last?) Cost of…everything…about to go up Inflation-hit India gains new price measure tool


Forever Preps – Preparations You Can Buy Once, and Have Forever, by Andrew D.

As a self-confessed budgeting fanatic, I’ve constrained my prepping budget on a monthly basis where I spend in one month what I made the previous month.  For example, I spend money in February that I earned in January, and so on.  Given the uncertain times, I never want to be “on the hook” with paying for things with “future money”.  So confession out of the way, sometimes it’s hard to know where to start with your preparations.  I know all about the rule of 3, etc., but when it comes down to it, there really are a lot of choices.  …