Category: Economics & Investing

Video clip from Australia: Jim Rogers calls is straight on the MOAB, economic recovery, switching to tangible assets, and buying productive farmland. Rogers: “Yes, we are going to have another depression in the United States.” Thanks to FloridaGuy for this: Pontiac, Michigan may lay off all school teachers GG sent a link to an Ambrose Evans-Pritchard video interview on the rush into gold over “high degree of fear” regarding hyperinflation and economic collapse From R.S.R.: Statistician Says US Joblessness Near Depression Highs (19.1%) Items from The Economatrix: Gunmakers and Retailers Post Strong Sales Increases World Stock Markets Fell Again (Monday) …

Jim, While we prepare to break ground for this years garden I’m still preparing my financial stores long before my harvest comes in. There is still one question I can’t find an answer for that satisfies me. Are U.S. Savings Bonds safe? We have allot of EEs that can be cashed in but if they are safe as Bonds why not leave them. But if every thing is headed down the tubes how likely is the U.S. Government to default on this paper just like it would on another paper currency? Southern-Survivor in North Alabama JWR Replies: As I’ve written …

Bill N. sent this very observant piece: Gold, Spam, and Ruger vs the S&P 500.Bill notes “This is an interesting article, it even has a graph at the end comparing the S&P 500, gold, Hormel (makers of Spam), and Ruger Firearms for the last year.” Insurance giant AIG (now 80% US government owned, thanks to a $125 billion bailout with taxpayer funds) is not out of the woods yet. Asset values are continuing to decline, creating more credit default swap (CDS) derivatives counterparty risk. $300 billion in assets have already been affected. For some details, see this Wall Street Journal …

SurvivalBlog’s Editor at Large Michael Z. Williamson sent us a link to an interactive unemployment map. OBTW, speaking of Mike, I just heard that his recent sci-fi novel “Better to Beg Forgiveness…” is now out in paperback! (Be forewarned that this is not a children’s book!) D.S. flagged this from US News & World Reports: How to Handle Your Job and Finances If There’s a (Yikes!) Depression Signs of the times, courtesy of FloridaGuy: Stark, Ohio’s hottest job: Janitor – Over 700 applications for one slot. Holding a layoff-proof, low-paying civil servant job may become the source of envy, as …

Do you recall the warnings that I’ve made, starting in 2006, about derivatives counterparty risk? Well, CDS paper is just one aspect: Pressure to reveal major AIG counterparties grows.Stay tuned, as the economic depression unfolds, and we see hundreds of counterparties cease to exist. Who will get caught holding the bag? I spotted this linked at Drudge: 12 percent are behind on mortgage or in foreclosure. “A stunning 48 percent of the nation’s homeowners who have a subprime, adjustable-rate mortgage are behind on their payments or in foreclosure…” From reader Mike K.: We Are Facing an ‘Inflation Holocaust’: Jim Rogers. …

HPD flagged a sobering article from The Market Ticker: What’s Dead (Short Answer: All Of It) It is amazing seeing something like this coming from a relatively mainstream blogger like Karl Denninger: “Civil unrest will break out before the end of the year. The [active component] Military and [National] Guard will be called up to try to stop it. They won’t be able to. Big cities are at risk of becoming a free-fire death zone. If you live in one, figure out how you can get out and live somewhere else if you detect signs that yours is starting to …

We’ll start with some relatively good news: Oil producers running out of storage space: Glut caused by world slowdown leaves the world awash in crude. (A hat tip to Charley S.) Sean M. sent us a link to some charts sum up how bad things are getting, very succinctly: DD sent this: As markets slump, U.S. tries to halt cycle of fear. (They may say that we have “nothing to fear but fear itself”, but I don’t think it is irrational to fear tens of thousands of unemployed and hungry people that have been kicked out of their foreclosed houses. …

Vicki sent us a bit of video mirth to cheer us up, since there is more bad economic news to come: Taxpayers Clearinghouse Prize Patrol – Yes We Can! Thanks to OSOM for this: Marc Faber goes survivalist (as quoted in Bloomberg). “The best bet for investors may be to buy a farm and escape from the cities, as a prolonged recession could lead to war, as the Great Depression did.” From Bill in Ohio: The D-word: Will recession become something worse? From reader HPD: Bernanke Says U.S. May Need to Expand Bank Rescue. (Yea, the girth of the great …

Tony W. sent this: Even ‘Dr. Doom’ Is Scared: Economy Much Worse Than Roubini Predicted Bill from Ohio spotted this: 5000 Dow? 500 S&P? From Kevin A. come this sign of the times: Manhattan Apartment Buyers Abandoning Six-Figure Deposits Rather than Closing on Deals. Reader Kris N. mentioned in a recent e-mail: Over the last few weeks I have heard several politicians say that credit markets need to be opened up so Americans can start spending more to improve the economy. Is this not like Marie Antoinette proposing the solution to the peasant’s bread shortage is to have them switch …

JWR’s Introductory Comment: Gee, in light of all the following very bad economic news, can someone please send me something cheery to post? Perhaps some more articles about gun makers making record profits and building huge order backlogs? Frequent contributor HPD sent this: Brown told us not to question banks on risky practices, says City watchdog Reader “Bigbird” mentioned a piece in The Australian by Niall Ferguson with some biting criticism of Keynesian economics: The Great Repression CJB flagged this news story on the Chinese economy: China warns of unemployment risk GG sent us this one from Smart Money: Nothing …