Archive for the ‘Currencies’ Category

When the Dollar Collapses, Where Will You Put Your Money?

When the Dollar Collapses, Where Will You Put Your Money?Over the last several years, I have written a multitude of articles about my conviction that the global economy is destined to collapse on a scale humanity has never experienced before. But contrary to some insinuations, my primary objective with these articles is not to create fear and panic. My goal has always been to disseminate these theories to an audience capable of returning debate and criticism. If I am correct, I would hope to prepare at least some small contingency of readers; as a species, I am convinced human beings must find a new way of doing things — because the consequences of the old ways are descending upon us like a maelstrom. So I ask: when the dollar collapses, where will you put your money? Read On…

Bitcoin Adoption and Name-Brand Recognition

Bitcoin Adoption and Name-brand RecognitionSince the advent of Bitcoin in 2009 — and the subsequent rise of thousands of ancillary imitators using the same algorithm — there hasn’t been much interest in the technology from big corporations around the globe. This isn’t surprising; the instruments are new, risky, and their collective goal is to decentralize and reduce the costs of global capital transfers. This presents huge potential threats to existing payment systems, and it stands to reason that any firm with a considerable market capitalization might want to take a wait-and-see approach.

For companies with sufficient capital and patience, however, there are opportunities developing that have gone unnoticed so far. The cryptocurrency market is maturing quickly. I believe the entire world is about to seriously consider the implications and potential of Bitcoin adoption and name-brand recognition. Read On…

Cynics Are Missing the Bitcoin Boat

Cynics Are Missing the Bitcoin BoatThe first Bitcoin crash happened in 2011. In this dramatic, optimistic surge, the cryptocurrency quickly rose to about $28 — and just as quickly fell to about $3. The gloomy naysayers, defeatists, and misanthropes came out of the woodwork — boldly asserting that cryptocurrencies were finished. And yet, through it all, Bitcoin has been remarkably resilient; for every “collapse,” it has rebounded vigorously — making new highs. Likewise, with each new surge, the pessimists have become ever more angry and critical. This despondent, dogmatic hatred is disappointing, because in reality, the cynics are missing the Bitcoin boat. Read On…

The U.S. and Europe Now Have an Opportunity to Dominate Bitcoin

The U.S. and Europe Now Have an Opportunity to Dominate BitcoinAnyone from the west who believes the world’s financial center of power isn’t rapidly moving to Asia is either excessively prideful, excessively stupid, or both. China’s exploding middle class, strong manufacturing base, unstoppable work-ethic, and relatively low debt make it the perfect breeding ground for economic domination. Add Japan, Taiwan, Singapore, and South Korea into the mix, and it’s not hard to see that financial power has been shifting slowly for decades. However, the U.S. and Europe Now Have an Opportunity to Dominate Bitcoin. Read On…

Bitcoin Price Growth Makes Sense: It Is a Safe Haven

Bitcoin Price Growth Makes Sense: It Is a Safe HavenHistorically, in every inflationary context, when a national currency becomes unstable, the people depending on that money look for alternatives. From Germany, to Zimbabwe, to Argentina, when hyperinflation appeared, people found it necessary to immediately convert from the given broken currency to something more stable. And that’s why I say Bitcoin price growth makes sense: it is a safe haven. Read On…

Bitcoin Is More Than a Currency

Bitcoin Is More Than a CurrencyIs Bitcoin money?

The arguments from both sides of the aisle are passionate and vociferous. But as I trudge through the morass of opinions, I can’t help but notice people are missing some crucial details about private cryptocurrencies — and how they are changing our world. One thing seems certain, however: Bitcoin is more than a currency. Read On…

Bitcoin vs Gold

bitcoin vs goldSince its inception in 2009, Bitcoin’s controversy has raged. Its libertarian proponents see the digital currency as the killer of central banks everywhere. Its detractors have labeled it a binary bubble — calling it the most elaborate Ponzi scheme of all time. Most often, the latter arguments center on the misplaced belief that anything of value must be “backed” by something else – whether a stream of earnings, a commodity (like gold or oil), or the full faith and credit of a government.

Regardless of which camp you subscribe to, if you are reading this article, you too are undoubtedly curious about this question: what does make a digital currency (or anything else, for that matter) valuable? And how does the “bitcoin vs. gold” analysis stack up? Read On…

The Keynesian Solvency Standoff

The Keynesian Solvency Standoff“Markets can remain irrational longer than you can remain solvent.”

— John Maynard Keynes

What, exactly, constitutes “solvency?” I am no fan of Keynes, but why should I be? He even loathed himself by the time he stood before his maker. His theories are preposterous, and he knew it! And with every day that passes, we get ever closer to the inevitable collapse of the American empire, caused by decades of reckless abuse of the financial system by the federal government — all justified by Keynesian theory. The evidence abounds: Read On…

Japan, the U.S., and Quantitative Easing

Japan, The U.S., and Quantitative Easing“When future historians look back on our way of curing inflation, they’ll probably compare it to bloodletting in the Middle Ages.” – Lee Iacocca

Japan, the U.S., and Quantiative Easing…

For those of you who aren’t familiar with quantitative easing: it is the important-sounding way central banks manage the economy through monetary policy. The most common way is by manipulating the rate at which they loan to other banks; when the economy is running too hot, the central bank will raise the rate at which it loans money — thereby discouraging borrowing and capital investment. Likewise, if the economy is in the tank a central bank can lower the rate at which it lends to other banks, thereby encouraging borrowing and capital investment in the economy. Read On…

The Death of the Dollar

The Death of the Dollar“We have experienced asset bubbles, and we now have an economy that is more highly leveraged than it ever has been in the post-World-War II period. Greenspan has been instrumental in bringing about this high leverage.” – Paul Kasriel

“A dollar saved is a quarter earned.” – John Ciardi

I have been an analyst, a portfolio manager, and a financial writer for more than 18 years, and until early last year my focus was almost exclusively on individual stocks and value investing. In my book Discipline, however — which I completed in 2001 and published in 2007 – I took a more macro stance, predicting an economic collapse resulting in the death of the dollar and a Soviet-style break up of the country. Read On…

An Artificial Economy

An Artificial Economy“Instead of furthering the inevitable liquidation of the maladjustments brought about by the boom during the last three years, all conceivable means have been used to prevent that readjustment from taking place; and one of these means, which has been repeatedly tried though without success, from the earliest to the most recent stages of depression, has been this deliberate policy of credit expansion. . . . To combat the depression by a forced credit expansion is to attempt to cure the evil by the very means which brought it about; because we are suffering from a misdirection of production, we want to create further misdirection — a procedure that can only lead to a much more severe crisis as soon as the credit expansion comes to an end. . . . It is probably to this experiment, together with the attempts to prevent liquidation once the crisis had come, that we owe the exceptional severity and duration of the depression. We must not forget that, for the last six or eight years, monetary policy all over the world has followed the advice of the stabilizers. It is high time that their influence, which has already done harm enough, should be overthrown.” –Friedrich August von Hayek (1932)

Your government is creating bubbles all around you, in an artificial economy.  Read On…

The Intrinsic Value of Nothing, Part Two

Intrinsic Value of Nothing“There is no such thing as prices outside the market. Prices cannot be constructed synthetically, as it were…

It is ultimately always the subjective value judgments of individuals that determine the formation of prices…”

— Ludwig von Mises, Human Action

“During thousands of years, in all parts of the inhabited earth, innumerable sacrifices have been made to the chimera of just and reasonable prices.” – Ludwig von Mises, The Theory of Money and Credit

In my previous article (Part One of this two-part series), I discussed the fallacy of intrinsic value – especially as it relates to the U.S. dollar, and the shell game the federal government has been playing for the last hundred years or so. In the tornado of debate, castigation, and general mayhem that ensued, some good points emerged – not the least significant of which was the observation that there is a difference between exchange value and use (or utilitarian) value. Read On…

The Intrinsic Value of Nothing, Part One

Intrinsic Value of Nothing“Action is purposive conduct. It is not simply behavior, but behavior begot by judgments of value, aiming at a definite end and guided by ideas concerning the suitability or unsuitability of definite means. . . . It is conscious behavior. It is choosing. It is volition; it is a display of the will.” – Ludwig von Mises

Reach in your wallet, and pull out a dollar bill. Look at it for a moment. Now ask yourself, what is this worth? Next, consider the intrinsic value of nothing — because the idea that anything has “intrinsic value” is a fallacy. Read On…