Bernanke says there’s not enough gold (which is money) to satisfy a growing economy. Therefore, a gold standard can restrain economic growth because of the tight rein it imposes on the money supply. Most people instinctively agree with this. But when you think about, you’ll realise such an interpretation is one-dimensional.
March 23rd, 2012 | Greg Canavan | 3 comments | ContinuedArchive for Greg Canavan
Greg Canavan is the editor of Sound Money, Sound Investments, a financial report devoted to unearthing great value investments amid today's "money illusion" of fiat currency. For a free trial of Greg's service, go to Sound Money, Sound Investments.
Bernanke’s Take on the Gold Standard and the Conceit of Central Bankers
Ben Bernanke recently gave the first of four lectures to the poor kids of George Washington University, giving his version of how the Fed came into existence and what the Fed’s purpose is. He also gave his version about the gold standard. Is it a truthful recollection of events?
March 22nd, 2012 | Greg Canavan | 4 comments | Continued
Why Greece Ain’t Alright
So Greece apparently avoids another default – no wait, a disorderly default…a plain old default is okay. The market is already placing bets on the next one.
March 9th, 2012 | Greg Canavan | 0 comments | Continued
The Link Between China and Australian Property Prices
If Chinese growth falls to just 7 per cent it would result in a 10 per cent fall in Australian house prices. So what’s the link between China and Australian property?
March 9th, 2012 | Greg Canavan | 7 comments | Continued
Underestimating the Black Swans and Fat Tails of the Chinese Economy
The doubt has to remain over China’s economy. And as we’ve pointed out many times before, it is our view that Australia’s historic terms of trade boom was a direct result of China’s historic credit boom.
March 8th, 2012 | Greg Canavan | 0 comments | Continued
Apple’s Share Price – Check This Out For A Sell Signal
Apple’s share price has gone from around $360 in late November to nearly $550 now. That’s a gain of more than 50 per cent in about three months. How much of this is due to the latest liquidity gush from the ECB, as well as the promise of low interest rates ’til 2014 from Ben Bernanke? We would think a lot.
March 2nd, 2012 | Greg Canavan | 0 comments | Continued
Why the ECB and the Fed Have China Laughing
While the ECB pumped over €500 billion into the system overnight, the Federal Reserve was trying to downplay the prospects of another round of QE.
March 1st, 2012 | Greg Canavan | 9 comments | Continued
An Ice Age For Australian House Prices
Well that’s all right then. The head of the Reserve Bank’s financial stability department, Luci Ellis, reckons Australia will avoid a US-style house price meltdown.
February 24th, 2012 | Greg Canavan | 6 comments | Continued
How Political Incompetence Provides a Deflating Experience For All of Us
Australia’s political incompetence has been quietly bubbling away for months. Fortunately, Europe’s world-class, AAA-rated, gold medal political incompetence has masked the shortcomings of our own power mongers and their schoolyard antics.
February 23rd, 2012 | Greg Canavan | 5 comments | Continued
Why is Australia So Expensive?
We caught up with an old friend from the United States last night. He was last in Australia in 2001. He couldn’t believe how expensive things in Australia had become. Even taking the massive swing in exchange rates into account, on a one-for-one basis the price difference is huge.
February 10th, 2012 | Greg Canavan | 14 comments | Continued
Health, Wealth and Stealth Inflation in the Great Food Swindle
Today’s Daily Reckoning will deal with health and wealth – in equal measure (with a dose of inflation thrown in). Having good health, especially as you get older, is a form of enrichment so there’s symmetry between it and your wealth. And if you’ve been to a doctor / specialist / hospital recently, you’ll know maintaining your health is not cheap.
February 3rd, 2012 | Greg Canavan | 3 comments | Continued
Why the Latest Global Manufacturing Data Is Not Good, Just Less Worse
Global markets finished up strongly overnight on the release of ‘strong’ global manufacturing data. Why do we think this is a bear market rally? We’ll get to that in a moment. First, let’s take a quick look at the bear’s recent work.
February 2nd, 2012 | Greg Canavan | 2 comments | Continued
Currency Wars
The currency wars are heating up. On Wednesday, Federal Reserve boss Ben Bernanke promised speculators he would keep interest rates low until 2014.
January 27th, 2012 | Greg Canavan | 1 comment | Continued
Sit Tight With The Bull Market: An Investing Lesson From The Great Bear of Wall Street
The book, Reminiscences of a Stock Operator by Edwin Lefèvre immortalised Jesse Livermore’s exploits. I have never read it so I can’t be sure the following quote is even from that book. But wherever it comes from, it might be the most wise advice you’ll ever read about how to handle a bull market.
January 26th, 2012 | Greg Canavan | 3 comments | Continued
Why Low Interest Rates are Bad for the Economy
A year ago, the RBA and the horde of market economists who hang on its every word expected interest rates to be higher by now. Even as late as September 2011 the RBA was sitting on its hands, unsure which way to move.
January 20th, 2012 | Greg Canavan | 4 comments | Continued
