 Nothing Makes Sense Anymore
Richard Daughty
...the angriest guy in economics
The Mogambo
Guru
Archives
May 25, 2005
- I am officially back on the "scared and paranoid"
side of life, and while it is not "good to be home,"
it is, at least familiar, and there is a certain comfort in that,
as at least I know where all the pistols and cookies are stashed
around here. But then again, my homecoming is only because I
was temporarily in a distant, disturbed place, where even shadows
spook me out, and where my nights were spent entirely without
sleep, night after night, because my brain no longer waited for
me to fall asleep before I started having nightmares about the
economy, and I am here to tell you that that is unnerving, to
say the least.
My problem seems to be that
nothing makes any sense anymore. A story in The Post says essentially
the same thing when the author notes "In the past few weeks,
the world's financial markets have acted in a confused, counter-intuitive,
bipolar fashion." Doug Noland entitled his Credit Bubble
Bulletin this week "Conundrums."
Mike Hoy writes
"I have never seen as many red flags being raised at one
time as what I see right now." It's everywhere!
I mean, inflation is up, but
bond yields are down, which is the exact opposite of what you
would expect. In fact, the yield on the 10-year T-note is barely
over 4%! Foreign demand for US debt is down, yet prices for debt
go up, the exact opposite of what you would expect. Inflation
is up, yet gold is down, again the exact opposite
of what you would expect. Demand for oil is up, yet prices are
coming down, the exact opposite of what you would expect. The
economy is slowing, yet stocks are soaring, the exact opposite
of what you would expect. It just goes on, day after day, item
after item, which explains why I am cowering in the hall closet,
gobbling tranquilizers and whimpering "It doesn't make sense!
It doesn't make sense!"
Perhaps Bill Bonner sums it
up best for me when he says, "And then we stand back and
wonder: what kind of monster is this? It has such a strange,
Frankensteinian look to it. The world's richest, most powerful
country depends on the savings of the world's poorest. The world's
most dynamic, flexible economy offers its money at negative real
interest rates...and is afraid to 'normalize' them for fear the
whole thing will collapse. Americans buy what they cannot really
afford...and the Chinese build factories to produce what their
principal customers don't have the money to buy. And the whole
world economy advances - apparently - only so long as house prices
in America continue to rise at three to five times nominal inflation
and an infinite multiple of household income, which went backwards
in 2004."
But what has made some sense
of it all is that Total Fed Credit, which has not been showing
its usual parabolic rise here of late, has started back upward,
and expanded by $4.3 billion last week. So at least we know where
the money is still coming from.
And speaking of the Federal
Reserve, it looks like they are shifting into high gear on buying
debt outright, as they are almost consistently buying, outright,
over a billion dollars a week. A billion! A week! This is the
ultimate fraud; the government creates bonds to get money, and
the Fed creates some money to literally buy the bonds! Government
debt is now creating money directly, and people wonder why I
am so weird all the time! I was weird before all this happened,
but I am much worse now.
Jeffrey Simon of The Market
Nugget notes that everything seems to be about interest rates.
"Aside from the above, it is, and remains, all about INTEREST
RATES! The Federal Reserve is raising short rates and talking
up long rates; if they are not successful in talking up the long
end then an inverted yield curve is almost certain. As Greenspan
himself has previously noted, an inverted yield curve is the
most accurate indicator of an impending recession is the
market already pricing in future interest rate reductions in
anticipation of this occurrence? The current picture does not
look good with the spread between 6 month and 10 year interest
rates having narrowed to barely over 1%."
Foreign holdings of American
debt held at the Fed expanded back to its former glory, too,
and it went up by $4.7 billion last week. And not to be outdone,
the Treasury admitted to plunging us another $13 billion in debt,
and the banks admitted to buying $13 billion in Treasury debt.
What a coincidence, eh?
- The Leading Economic Indicator
fell. This is the indicator of future production. So, with a
fall of 0.05%, the future seems bleak. The Coincident Indicator,
is, as the name implies, is an indicator of current business
activity, and it is up from 119.5 to 119.6, which is slightly
up. This goes along with the report that the "Fed Bank of
Philadelphia's general economic index for May fell to 7.3 from
25.3."
But my wife sees me hiding
in the closet behind the vacuum cleaner, and wants to know what
is wrong. I tell her that it was the Lagging Indicator that made
the hair stand up on the back of my neck, and I should be out
stacking sandbags around the old Mogambo Bunker, as the Lagging
Indicator is the indicator of inflation, and that is why The
Mogambo pays particular attention to it. And I'll bet that you
already guessed something was amiss with the Lagging Indicator,
and you would be right. It was up from 99.4 to 99.7, which was
not much, I'll admit, even though I am loath to admit to anything,
especially about where I was last Tuesday about 8 p.m. But it
is not the nominal size of the increase in the Lagging Indicator
that is important. It becomes important only when measured against
the Leading Indicator (which actually fell) and against the Coincident
Indicator, which rose barely a third as much.
This goes right along with
the new official rate of inflation, which is 3.5%, up from 3.1%
last month, and up from 2.3% this time last year. And yet the
dollar rose! Weird!
Even Peter
Schiff of Euro Pacific Capital is pretty amazed all of this.
He writes, "The reality is that year-over-year consumer
prices are up 3.5%. Thus far, during 2005, CPI is rising at an
annualized rate of 4.8%, its fastest pace since 1990." Now,
Mr. Schiff and I are pretty upset at this, and stunned that nobody
else is. And how bad is this? He writes that it is "0.3%
higher then the 4.4% rise in 1971, the year in which inflation
was so bad that Richard Nixon imposed wage and price controls
to contain it." Inflation has always, always, always been
considered very bad news, up until the current crop of idiots
got out of whatever asylum they escaped from and bizarrely achieved
prominence. And poor old Nixon was just responding with the appropriate
degree of alarm and desperation. But nowadays? Nothing! The Mogambo
cries alone.
But Nixon has been singled
out as the perennial bad guy, an infamy that is not, maybe, altogether
deserved. Mr. Schiff notes, "Perhaps had President Nixon
been a little more 'tricky', he might have come up with the concept
of 'core CPI' himself, rather than resorting to such draconian
and misguided measures." But Mr. Nixon is famous for having
said "I am not a crook." I notice that politicians
don't say that anymore, and for a very good reason, too!
So what is inflation? Doug
Wakefield, president of Best Minds, says that Webster's Dictionary
defines it as "An increase in the volume of money or credit
relative to available goods resulting in a substantial and continuing
rise in the general price level." Beyond the sheer academics
of that, Mr. Schiff goes on to say "The Federal Reserve
has recently pursued the most inflationary monetary policy in
its 89-year history. Initially, inflation resulted in the stock
market bubble. However, as stock prices are not components of
the CPI, no one cared. Next, inflation made its way into rising
real estate prices. Again, no one cares. More recently, inflation
is causing commodity prices to rise. The CRB is up 22 percent
this year, and is now within 1 percent of a 4 year high."
And STILL nobody cares! But let me try mowing the damned lawn
in an old ratty pair of underwear, and suddenly EVERYBODY cares
about everything, as I gather from hearing them yelling "He's
doing it again!"
But we were talking about money
and inflation, and to show you how MUCH nobody cares about that,
take a look at the bond market. Bonds are going up in price!
People are actually locking in their money for long period of
time, measured in years and years, to get a yield that is, after
taxes, less than inflation! They are going up in price because
morons are scrambling to buy them, bidding against each other
to buy them, actually tripping over each other in their haste
to sink more money into the bond market! At the risk of repeating
myself, they are thus driving the yields down to almost the rate
of inflation, and, after accounting for taxes that will be due
on the taxable interest, they will receive less than the freaking
rate of inflation! Less than inflation! They are actually, purposely,
losing buying power the longer they continue doing this silly
stuff!
- The amazing run-up in stock
prices, I submit because that is the kind of suspicious and paranoid
loser that I am, is that it was to bail out some hedge funds,
which operate on the principle of massive leverage, and which
have sustained such losses that the chumps (the banks) who loaned
out so damn much money to these guys were on the phone to Greenspan
and then on to the Plunge Protection Team, screaming "Save
us from ourselves! Save us! We acted like greedy little jerks,
and now we are whining!"
Jon D. Markman of TheStreet.com
is no stranger to hedge funds, and writes "Now enter the
hedge funds seeking to provide dependable returns to pension
managers. A new breed of math geniuses entered the scene not
too long ago with financial models that they believe help them
understand when certain tranches are undervalued relative to
other tranches. The big idea is that if you can figure out which
ones are overpriced and likely to lose value, and which ones
are underpriced and likely to gain in value, you can short one
and buy the other and make a few bucks as their prices converge."
Okay, but this kind of crap
is a zero-sum game. If they make money, then someone has to lose
money. The other side is; somebody has to take the other side
of those trades, and they will LOSE the money that these guys
make. The big question, of course, is "Who is so stupid
as to take the other side of those trades?"
Mr. Markman suggests some likely
suspects. "One of the big trades that hedge fund managers
working on behalf of your pension put on in recent years has
been to buy the 'mezzanine,' or medium-risk bond tranche of CDOs,
and short the equivalent amount of money in the equity tranche
or equity of the company. The amount of money involved in these
trades is quite enormous; because the trading environment was
so tame up until quite recently, the equity tranches were leveraged
by as much as 17 to 1." So the idiots who are buying debt
at these absurd prices is you and your pension fund! Hahaha!
So what happens when these
geniuses fall on their faces? "At times like this, the Federal
Reserve and other central banks have learned to flood the system
with money to avoid big disruptions. If we see big up days in
the market followed by big down days, you can be sure that funds
are using every uptick to unload inventory to meet their obligation
and avoid bankruptcy."
- Justice Litle, writing on
the Daily Reckoning site, has a new essay entitled "Financial
Madness." He writes "As of year-end 2004,
China had more than $600 billion in U.S. dollar reserves. That
is a sum that could effectively tear the financial plumbing system
apart, if it were unceremoniously dumped on the markets with
such massive pressure in a compressed period of time the pipes
would surely burst. Of course, this would be fiscal suicide for
the dumpers as well, which is precisely why such a move is not
feared. China's own economy would be sucked into the vortex too,
so why would the Chinese put a gun to their own heads?"
And there is more at stake
here than money. With that kind of leverage over the U.S., there
are extortions everywhere, as each of our creditors wants something
in return for playing Mister Nice Guy. And what they want is
stuff like guns, bombs, planes, supercomputers, allies against
their enemies, and maybe a nice pizza with everything.
And they may be getting them.
In the San Francisco Chronicle we read that "The Department
of Defense, already infamous for spending $640 for a toilet seat,
once again finds itself under intense scrutiny, only this time
because it couldn't account for more than a trillion dollars
in financial transactions, not to mention dozens of tanks, missiles
and planes. Defense, which recently failed its seventh audit
in as many years."
Donald Rumsfeld, the American
Secretary of Defense, has said "The financial reporting
systems of the Pentagon are in disarray . . . they're not capable
of providing the kinds of financial management information that
any large organization would have." To which I say, "Why
not?"
A trillion dollar's worth of
stuff, including whole airplanes, has disappeared? And I am supposed
to believe that it has simply been misplaced? Hahahaha! They
are incompetent to merely keep track of their own toys, and yet
they have the brains to wage something as complicated as global
war against everybody? Hahahaha!
- Eric Fry has noticed something
in the numbers that is very interesting, too, and if you are
thinking about buying a house, then perhaps it will give you
the appropriate pause. He writes, "Now, for the first time
ever, lending to purchase real estate comprises more than half
of all lending in the U.S." Half of all lending is going
into buying overpriced houses?
And where are these people
getting the money to make the payments until they can unload
these houses? Well, about 70% of all new real estate loans are
now interest-only, and about half of them are adjustable rate!
Hahaha! What a nation of gamblers! No wonder poker is so popular
these days!
- A lot of people are speculating
as to who will be the next chairman of the Federal Reserve when
Greenspan retires next January. The leading candidates are supposed
to include Fed Governor Ben "Birdbrain" Bernanke, who
has written papers that actually prove he is incompetent to be
a central banker or have anything to do with economics whatsoever,
as he stridently WANTS inflation, and lots of it, as a potential
remedy for stocks "deflating" from these stupidly-high
levels. Bush, astonishingly, has nominated this dimwitted twit
to head the White House Council of Economic Advisers, which ought
to tell you all you need to know about the Bush administration.
Of course, this is the perfect opportunity to bring up a quote
by everybody's favorite curmudgeon, H.L. Mencken, as highlighted on 321gold.com, who seems almost prescient when he
said "As democracy is perfected, the office of President
represents, more and more closely, the inner soul of the people.
On some great and glorious day the plain folks of the land will
reach their heart's desire at last, and the White House will
be adorned by a downright moron." Ergo, it was almost pre-ordained
that Bernanke would be picked as chief of the White House Council
of Economic Advisers.
Also in the running to replace
Greenspan are Harvard economist Martin Feldstein and former Bush
adviser Glenn Hubbard. Notice that The Mogambo is not on that
list, and there are two very good reasons for that. One, they
are all out to get me, and two, that I would not take the job,
as it is, as the Brando-ism goes, "A one-way ticket to Palookaville."
- The TIC (Treasury International
Capital system) report came out, and there is something seriously
amiss, as numbers on the report mysteriously change from one
month to the next. Caroline Baum of Bloomberg, while not actually
explaining how this happened, is nonetheless hip to what it means.
"Whatever the outcome portrayed by the TIC data, it was
always negative. There was no upside to this report, not to mention
the multiple problems with interpretations."
Rob Kirby of FinancialSense.com
is even less charitable. "Economic history has apparently
been rewritten, folks. The inconsistencies and conflicting data
being fed to us by officialdom are brazenly astonishing."
But this is just another example
of the frauds and corruptions that are now so endemic that I
can quote RCMP Chief Superintendent Peter German, who told the
banking, trade and commerce committee "I don't think anyone
will deny the fact that white-collar crime is a growth industry."
- "Quoted
Pearls on Energy" is an essay by Jim Willie CB, editor
of the Hat Trick Letter. He writes on the 321energy.com site,
"Contract prices for crude oil have risen for the 'out'
years, the distant future months. A tectonic shift has occurred
since last autumn 2004. Those who mistakenly (very shallow analysis)
point to the recent pricing of crude oil above $45 per barrel
as a temporary aberration, might want to check the forward pricing
of crude oil futures contracts. A $10-12 rise across the distant
year spectrum versus last Oct2004 is evident in futures contracts.
This should be interpreted as 'crude market recognizes post-peak
supply declines' integrated into pricing structures. Couple the
reality of finite limited oil supply with steady relentless demand
increases, especially in emerging markets. Supply will struggle
to meet 84 to 86 million barrels per day demand. Population growth
and economic growth foster demand, a reflection of reality."
He also quotes T. Boone Pickens,
who has been around oil for a long, long time, as saying "The
oil price is going up. We are heading to $60. This is the weakest
season of the year, when inventories are built up. From the second
quarter and third quarter, we will be coming into demand. The
current oil price is legitimately based upon supply & demand.
In the short term there is plenty of oil around right now. We
will make it to $60 by the third quarter for sure. The typical
backwardization [in futures contracts] has changed dramatically."
- A letter from a Norwegian
reader to Bill Bonner of DR and his newsletter "The problem
is that the politicians here, just as in the U.S., don't have
a clue. They are spending the oil and gas revenues on better
schools, better homes for seniors, more expensive roads, higher
minimum wages, etc. and all of this is driving up prices.
Now we are facing a rate (tax) hike, I'd guess."
Well, if not now, then soon
enough, as the continued expansion of a socialist state always
involves everything getting more and more expensive, bigger and
bigger, and the money to pay for all of that has to come from
somewhere. And when you couple that with how everyone is trying
to live at the expense of everyone else, you get a system that
will continually get more and more weird and expensive.
But there is no stopping the
socialist state. Walter Williams writes, "How many times
have we heard advertisements from law firms that specialize in
elder law urging, 'If you anticipate that you may have to enter
a nursing home down the road, an elder care attorney may be able
to help you create a plan that will both protect much of your
assets and make you eligible for government benefits'? Boiled
down to basics, the lawyers are suggesting that they can arrange
for you to live off others should you ever require long-term
care instead of having to spend the assets you've accumulated
during your lifetime."
As another example, now that
the Leftist morons in Congress have passed so many laws mandating
that hospitals provide first-class service to anyone who shows
up, you can see why people are not paying their health insurance
premiums; they are going to get all the health care they need
whether or not they can pay. Which means that somebody ELSE has
to pay, and that is, apparently, me, as my health insurance carrier
just informed me that my premiums are going up another 15% as
of June because, as I quote from their letter, "Pharmaceuticals,
hospital and physician expenses are simply out of our control
and continue to rise." Health insurance is now my biggest
monthly cost.
And the socialist state is
not something that is just some hypothetical construct. James
Cook of Investment Rarities writes, "Our state legislature
here in Minnesota has given us a look into the future. Liberals
introduced a proposal to increase the state tax to 11% on incomes
over $166,000.That would be the highest state income tax in the
country."
But you can be sure that he
is correct in his assessment of the future, as the layers and
layers of government, city, state and federal, are now so large
that they ARE the economy, and whole giant swaths of the population
depend on the government. And there are more and more of them
every freaking day who want to get on that gravy train. Ergo,
for the economy to grow, the government must grow.
The point is that for an economy
to grow, the government must grow, and that takes money. Lots
of money. More money than the human mind can comprehend.
And even then, after getting
more money, we will still be in the original paradigm; for the
economy to grow, the government must grow, and that takes money.
MUCH more money than the human mind can comprehend.
And even then, after getting
more money, we will still be in the original paradigm; for the
economy to grow, the government must grow, and that takes money.
Much, MUCH more money than the human mind can comprehend.
And even then, after getting
more money, we will still be in the original paradigm; for the
economy to grow some more, the government must grow some more,
and that takes money. Much, much, MUCH more money, a whole LOT
more much more money, more and more money until the words have
lost all meaning, and then it is just money money lot lot money
lot money money, all the time more money, more and more and more
money than the human mind can comprehend, until I breathless
talking about it and scared out of my mind thinking about it.
The Mogambo looks up from his
reverie, and the grasshoppers stir themselves at the sight. Raising
himself up on one elbow and spilling a can of beer off his lap,
The Mogambo speaks, and the assembled crowd marveled at his words.
And they were thus: "And you ought to be thankful that you
can't comprehend that much money, because if you DO comprehend
it, then your brain would explode. Your consciousness would be
blown to atoms because you have came face to face with (pause
for dramatic effect) Infinity. And as you would gaze upon the
face of Infinity, it would look like The Mogambo, only with nicer
clothes and a snazzy new car. Yea, verily I say unto you to heed
the words of the earthly Mogambo, he who was always screaming
about this kind of Big Government crap, and how a fiat currency
and a fractional banking system will always kill you and your
stupid economy freaking dead."
With that, The Mogambo sank
back into his chair, exhausted by the effort. And then the room
suddenly went dark. Onto the wall was flashed a chart of how
exponential growth gets bigger and bigger and bigger. It starts
of innocently enough, gently rising. Then it starts getting steeper.
And then steeper. You glance up at the title of the graph. It
reads "Exponential Growth." You realize that this is
characteristic of damn near everything in America. Debt is growing
faster and faster, and so the curve gets steeper and steeper.
Your heart is beating faster. Off to the right, the curve gets
steeper and steeper and steeper, and then, suddenly, the line
starts going almost straight up! You are sweating like a pig
and your heart is pounding pounding pounding from the panic!
On the graph, the amount of debt DOES go straight up and completely
off the page, always growing faster and faster and faster, and
then a short time after that it starts approaching infinity!
You scream in fear! And then you remember that nobody was screaming
in the movie "2001: A Space Odyssey," and so you feel
like a big crybaby, and then you remember that ARE a big crybaby
anyway, but you don't care who knows it anymore, and so you keep
screaming your head off until your throat is sore and bloody
from screaming because you are facing the ultimate horror.
Of course, things cannot grow
to infinity, and things will fall apart eventually. And, if George
Ure and his web bot program is correct, it will be very, very
soon indeed.
- Carl Swenlin, in the "Did
you notice?" column of the Daily Reckoning, gives us a little
technical insight into money flows and prices, and a little solace
for those of us who have bought gold
and silver and watched in dumbfounded horror
and amazement as they went down. He writes "While cash flow
normally runs parallel to price, divergences can often appear
ahead of price reversals. Rising prices and negative cash flow
will usually result in a price correction. Now we have a situation
where cash flow into the Precious Metals Fund has been flat and
now positive, while prices have been falling like a rock. This
indicates that bulls are trying to hold their ground and that
accumulation of precious metals shares has been taking place.
The end result will probably be a rally in precious metals shares."
Speaking of gold,
Bud Conrad of Macroanalysis notes that "the US government
claims to have about 261M oz of gold,
which is worth about $110B at today's market prices. Our annual
trade deficit is running about $660B per year. Using gold to pay off this trade imbalance, the entire
stash would be gone in 2 months. And that assumes the gold on our books is really there and that accounting
is accurate -- there has been no audit in decades."
He goes on to say "As
a relative size comparison note, the Federal Reserve has issued
$755B of paper money called Federal Reserve notes. If this currency
were backed by gold at 100%, the gold
price would be $2,892."
- Castrese Tipaldi is a guy
whose ego is so strong that he doesn't even care that people
know that he reads the Mogambo Guru newsletter, and has titled
his latest essay "An
Answer for the Mogambo," which is in reference to my
question along the lines of "If bread rises 1000% in price,
but your stock holdings have collapsed by 90%, do you have inflation
or deflation?" He writes "Twenty-four centuries ago,
Aristotle understood that very well already: 'A paper money would
not be a bad idea, on condition that you have a God ruling the
printer'." So what does this mean? He writes "My educated
guess is that in time gold will
always appreciate against every fiat-currency."
- John
Mauldin, who is one of those guys who has a lot of smarts,
doesn't think that there is a lot of room left for big gains
in anything, which is probably a wild exaggeration of what he
really thinks, although I once tried to snag half of a bagel
from his plate when he was not looking, and I can tell you that
I DO know what he thinks about THAT. He says "There seemed
be a general consensus that we are in a low return environment
for both equities and bonds in the near-to-midterm future. While
there might not have been agreement as to what the words 'low
return' mean, I think it was understood that the 8% annualized
returns implicit in many pension fund and retirement plan projections
are unlikely to be achieved."
"A flat (or very low)
equity return environment over the next 7-10 years would mean
that public pension plans would be underfunded by somewhere close
to $1 trillion. If you go to the S&P web site, you find the
P/E ratio for core earnings for the S&P 500, which is a good
proxy for corporate America, is still a quite high 21. That easily
puts it in the top 20% of all the years for the past 100 years.
And as I have often noted, when P/E ratios are in their top 20%
range, the return for the next 10 years averages approximately
0. The shortfall would have to be made up by taxpayers."
- Doug Noland quotes Helen
Yuan and Xiao Yu of Bloomberg, who report, "China's imports
of steel products rose to a one-year high in April, indicating
efforts by the government to cool economic expansion isn't dampening
demand from makers of home appliances and cargo containers."
This proves that the Chinese are just like everyone else, and
that the lure of a new washing machine and dryer combo is one
of those things that people will stretch to have, and the machinations
of a government are not much of an impediment.
Mr. Noland also refers to an
article by David Turner in the Financial Times, who reports that
"Japanese wholesale prices showed their biggest monthly
rise in six years in April, raising hopes of another blow to
the deflation that has bedeviled the country for many years."
A blow to deflation? Bedeviled? It makes you wonder how in the
hell the Japanese got a reputation as hot shots in the first
place, as the curse of inflation is certainly not something that
one would want. In fact, the history of intelligent people is
that they actively try to AVOID inflation, and they sure as hell
don't go around celebrating it as some kind of savior!
- Ron Paul, probably the only
Congressman that is not an idiot, has written another informative
essay that has a title ("Congress
and the Federal Reserve Erode Your Dollars") that really
hits the nail on the head. Beyond that, he hits us where we live
when he concludes that the effort to get the Chinese to un-peg
their money from the US dollar is absurd. "If anything,
the US government should be embarrassed that another nation has
depressed its currency by tying it to the US dollar. An economically
sound nation would take pride in its currency, one that maintains
a stable value and provides incentive for savers. Yet here we
are, mad at China for our own sin of flooding the world with
cheap dollars."
Ugh.
***The Mogambo Sez: Keep buying gold
and silver and oil, as these obvious manipulations
to keep the price down cannot last, or even produce positive
lasting results, and these current low prices are a gift from
a despicable, lying and corrupt government to you. Beyond that,
prices have to rise, according to Jim Jubak, whose column, Jubak's
Journal, is published on of MoneyCentral.msn.com. He writes
about the secular history of inflation. "If the history
of prices is an accurate guide, we're now about 100 years into
a wave that hasn't yet peaked." And I will amend that to
say that the history of prices is a VERY accurate guide, and
that is why I know that inflation, the rip-roaring kind that
makes you throw your wallet at the checkout clerk at the supermarket
and scream "Here! Take it all, you thieving bastards!"
is coming. Whether or not precious metals will prosper, I don't
know. They always have. So I figure that they will this time,
too, for the upty-umph jillionth time in a row in the history
of corrupt governments, fiat money and economic death by inflation.
Richard Daughty
email: RichardSmithGroup@verizon.net
 Daughty
Archives
Provided as a courtesy of Agora Publishing and The
Daily Reckoning
Richard Daughty
is general partner and C.O.O. for Smith Consultant Group, serving
the financial and medical communities, and the writer/publisher
of the Mogambo Guru economic newsletter, an avocational exercise
the better to heap disrespect on those who desperately deserve
it. The Mogambo Guru is quoted frequently in Barron's, The
Daily Reckoning
and other fine publications.
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