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Economics and Investing:
John in Ohio forwarded this: At
G20, Kremlin to Pitch New Currency. JWR's Comment: Gee,
so they propose replacing numerous un-backed fiat currencies (with free-floating
values) with a single un-backed fiat currency of a "fixed" (constantly
inflating) value. Cui
bono? As I've written before: inflation is a hidden form of taxation.
How do I vote for a genuine specie-backed currency? Only with a trip to my
local
coin shop or arms bazaar. Vote with your wallet. For our own protection, get out of
paper
currencies
and
into
tangibles!
From The Appenzell Daily Bell: Banks
pop on talk of [FASB] accounting rule relief. (I've mentioned delays in
implementing the FASB 157 "Mark-to-market" rule, before.
Given the severity of the current financial crisis, we can expect to see convenient
delays and changes (convenient
to the
bankers,
that is),
for the foreseeable future.
Reader Brian F. sent this: Consumer
prices rise by largest amount in seven months. Rather than
typical inflation, this may be evidence of fixed overhead costs being distributed
into a dwindling sales base. To explain: In a retail operation, the building
lease or mortgage must still be paid, utilities must be paid, and sales
clerks
must
be paid, regardless of sales volume. When sales volume drops, it
is inevitable that some of the fixed costs must be passed along to customers.
This does
not bode well for traditional "bricks and mortar" retailers--especially
the large department stores. In the long run, low overhead home-based Internet
sellers may get a larger share of the market, as consumers search for bargain
prices and are willing to wait a few days to have items mailed or shipped.
G.G. found this one: Fed
to buy up to $300 Billion in long-term Treasury bonds, Fed will buy up to
$300 billion of long-term
government bonds; buy more mortgage
securities. Back in the Stone Age, when I studied economics in college they
called this monetization, and I distinctly recall my professor explaining
that this practice was peculiar to South American Banana Republics. ¿Se
habla Español, Señor Obama?
From reader HPD comes a link to some commentary by Mish Shedlock: Yet
Another Incompetent Treasury Appointment
