A Self Directed Investment In Your 401K or IRA, Just Like Gold

Bitcoin and Brexit

On June 24, 2016, immediately after the final Brexit vote was publicized, the pound sterling plunged to its lowest level since 1985; conversely, the US dollar and the Japanese yen rose to new levels.

It’s telling, though, that the price of bitcoin actually rose 6.5% in the 24 hours after the results of the Brexit referendum became publicized. Bitcoin had already been up 25% prior to the vote for reasons not directly related to Brexit.

Clearly, those who jumped in to bitcoin to drive up the price were looking for an alternative to conventional currency during a time of political unrest. It makes sense that companies are now offering the ability to purchase bitcoin with your 401K and IRA funds.

In that role, bitcoin performs much like gold – an uncorrelated asset to which traders flock during times of geopolitical uncertainty. According to Coinbase data, the Brexit movement had a positive impact on bitcoin prices even before the referendum. In the week just before the vote, Coinbase, which offers a well-known bitcoin wallet and a bitcoin exchange, encountered a 55% increase in new account applications and a 350% increase in bitcoin purchases from the UK.

On the day of the referendum, the anticipation of Brexit affected bitcoin purchases before the actual vote, and Coinbase saw an 86% increase in UK signups. One Coinbase official observed a similar reaction with bitcoin when it served as an effective safe haven against the debt morass in Greece, and the capital regulations in China.

Founded in 2012, Coinbase now has 4 million users and operates in 32 countries. It launched in the UK only a year ago, and is making it possible for Brits to buy bitcoin in pounds, euros, or dollars.

Bitcoin and China

China is attempting to outdo the West in bitcoin activity by making large investments in server farms and carrying on immense speculative trading on Chinese bitcoin exchanges. In fact, Chinese exchanges account for 42% of all bitcoin transactions in 2016, according to a Chainalysis report commissioned by The New York Times.

Just last week, the giant Chinese internet company, Baidu, along with three Chinese banks invested in the popular American Bitcoin company Circle.

Again, we would like to emphasize the effectiveness of a combined bitcoin/gold investment. Gold, of course, is a traditional risk-off safe haven for investors and traders looking to protect their wealth against the uncertainty of paper assets. Bitcoin, on the other hand, presents an excellent speculative opportunity for an investor looking for aggressive upside return. The combined bitcoin/gold strategy can be especially effective since the digital currency and the yellow metal are both non-correlated assets. They can also be held in your self directed IRA or 401K.

The current market cap of all bitcoins is now $10.7 billion.

Discover how bitcoin can diversify your portfolio by contacting a Bitcoin IRA specialist.


US Mint Ends Silver Eagle Allocation

The Silver Eagle coin shortage is officially over. 

Click Here For Official US Mint Announcement and Full Coverage:


We’ve Entered an Era of Rising Instability and Uncertainty

That we have entered an era of rising instability and uncertainty is self-evident.There will always be areas of instability in any era, but instability and uncertainty are now the norm globally.

There is a template for global instability, one that has been repeated throughout history. Historian David Hackett Fischer described the dynamics that generate periods of rising instability in his book The Great Wave: Price Revolutions and the Rhythm of History (sent to me a number of years ago by correspondent Cheryl A.)

In Fischer’s well-documented view, there is a grand cycle of prices and wages which turn on the simple but profound law of supply and demand; all else is detail.

As a people prosper and multiply, the demand for goods like food and energy outstrips supply, causing eras of rising prices. Long periods of stable prices (supply increases along with demand) beget rising wages and widespread prosperity. Once population and financial demand outstrip supply of food and energy–a situation often triggered by a series of catastrophically poor harvests–then the stability decays into instability as shortages develop and prices spike.

These junctures of great poverty, insecurity and unrest set the stage for wars, revolutions and pandemics.

It is remarkable that the very conditions so troubling us now were also present in the price rises of the 13th, 16th and 18th centuries. Unfortunately, those cycles did not have Disney endings: the turmoil of the 13th century brought war and a series of plagues which killed 40% of Europe’s population; the 16th century’s era of rising prices tilled fertile ground for war, and the 18th century’s violent revolutions and resultant wars can be traced directly to the unrest caused by spiking prices.

(The very day that prices for bread reached their peak in Paris, an angry mob tore down the Bastille prison, launching the French Revolution.)

After a gloriously long run of stable prices in the 19th century–prices were essentially unchanged in Britain between 1820 and 1900–The 20th century was one of steadily increasing prices. Fischer takes great pains to demolish the ideologically appealing notion that all inflation is monetary; the supply of money (gold and silver) rose spectacularly in the 19th century but prices barely budged. In a similar fashion, eras of rising prices have seen stable money supplies.

Monetary inflation can lead to hyper-inflation, of course, but there are always mitigating factors in those circumstances. The long wave is not one of hyper-inflation but of supply and demand imbalances undoing the social order.

Americans are inherently suspicious of anything which seems to threaten constraint of the American Dream; thus it is not surprising that cycles of history are largely unknown in the U.S. As Fischer explains:

This collective amnesia is partly the consequence of an attitude widely shared among decision-makers in America, that history is more or less irrelevant to the urgent problems before them.

Fischer notes that he describes not cycles but waves, which are more variable and less predictable. (Surfers know to count waves, as they tend to arrive in sets.)

In response to this great rise in prices of essentials, both commoners and governments debased the currency. In their day, this meant shaving the edges of coins, or debasing new coins with non-precious metals. The debasement was an attempt to increase money to counteract the rise in prices, but it failed (of course). Every few decades, a new undebased coinage was released, and then the cycle of debasement began anew.

Just as insidiously, wages fell:

But as inflation continued in the mid-13th century, money wages began to lag behind. By the late 13th and early 14th centuries real wages were dropping at a rapid rate.

This growing gap between returns to labor and capital was typical of price-revolutions in modern history. So also was its social result: a rapid growth of inequality that appeared in the late stages of every long inflation.

And what happened to government expenditures? It’s deja vu all over again–deficits:

Yet another set of cultural responses to inflation created disparities of a different kind: fiscal imbalances between public income and expenditures. Governments fell deep into debt during the middle and later years of the 13th century.

Oh, and crime and illegitimacy also rose. Fischer summarizes the end-game of the price-rise wave thusly:

In the late 13th century, the medieval price-revolution entered another stage, marked by growing instability. Prices rose and fell in wild swings of increasing amplitude. Inequality increased at a rapid rate. Public deficits surged ever higher. The economy of Western Europe became dangerously vulnerable to stresses it might have managed more easily in other eras.

And there you have our future, visible in the 13th, 16th and 18th century price-revolution waves which preceded ours. It is hubris in the extreme to think we have somehow morphed into some new kind of humanity far different from those people who tore down the Bastille in a great frustrated rage at prices for energy and bread they could no longer afford.

It is foolish to blame “speculators” for the rise in food and energy, when the human population has doubled in 40 years and the consumption of energy and food has exploded as a result.

So where does this leave us? Based on the history so painstakingly assembled by Fischer, we can anticipate:

 

  • Ever higher prices for what I call the FEW Essentials: food, energy and water.
  • Ever larger government deficits which end in bankruptcy/repudiation of debts/new issue of currency.
  • Rising property/violent crime and illegitimacy.
  • Rising interest rates (currently considered “impossible”).
  • Rising income inequality in favor of capital over labor.
  • Continued debasement of the currency.
  • Rising volatility of prices.
  • Rising political unrest and turmoil (see “Revolution”).

 

With this in hand, we can practically write the headlines for 2017-2025 in advance.

 Why Our Status Quo Failed and Is Beyond Reform ($3.95 Kindle ebook, $8.95 print edition) For more, please visit the book’s website.

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More War-War by Sketchaganda

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Gold, Trump and Rates: Bank That Foresaw Rally Flags $1,500

Financial Market Strategists are advising their clients to “buy gold on dips”.

“Gold has seen four major bull markets since 1970: this is another one,” Benjamin Wong, foreign exchange strategist at the Singapore-based bank’s Chief Investment Office, said in an e-mail. “The market has yet to deal with the political uncertainty going into the Nov. 8 presidential election.”

Fears surrounding Brexit saw gold rally to the recent highs of $1,375. However, as the uncertainty created in the wake of the “Leave” vote wanes, global equity markets have rallied, helped in no small part by surprisingly strong employment numbers from the U.S.

However, some feel that the gold market retracement is only temporary and that,“the market has yet to deal with the political uncertainty going into the Nov. 8 presidential election.”

Wong is advising clients that any dips to $1,296 to $1,300 would be opportunities to accumulate. The next rebound may top resistance at about $1,380 and move prices toward $1,437 to $1,455, he believes. “Longer term, if the full force of the inverse head-and-shoulders pattern is applied, there remains scope for $1,525.”

You can read the full article here 


[KR941] Keiser Report: Preventing Debt Parasites

We talk to Dr. Michael Hudson about a solution to prevent the debt parasites from sucking the life force from the productive economy. We highlight the fact that the most productive period in US economic history was during the 1950s and 1960s, when household debt levels barely registered, and yet incomes and wealth were booming. Finally, we talk about how “creditor colonialism” damages the global economy and discuss what can be done about it.


Truth About Markets – 16 July 2016

We talk about #TurkeyCoup, #28pages and #Brexit

Click on image to listen to show

truth-markets-time

For more download & listening options, visit Archive dot org


Western Democracies in a Pickle?

Well Well! Doesn’t this leave western ‘democracies’ in a PICKLE?

pickle
They have to support the democratic leader of Turkey who is eroding planks of democracy like press freedom, jailing university professors, as well as sacking police members and judges involved in investigating a corruption scandal that allegedly included Erdogan’s son.

‘Erdogan denounced the investigation as a foreign plot to bring down his government. He ordered the sacking of hundreds of police officials across the country, including the police chief in Istanbul.’

Erdogan is well known for his tendencies towards strongly joining Church and State which many in the military object to. This beacon of democracy has question marks around his support of militant Islam who are gleefully taking responsibility for various horror attacks across Europe and the world.

Meanwhile NATO, via the U.S. Air Force, stores 90 nuclear bombs at the Incirlik Air Base in southern Turkey.

Now Mr. E has has removed 2,745 judges from duty in the wake of the failed military coup.
The attempted coup leaves the US scrabbling for some pantomime villian to blame. This time in the form of Fethullah Gulen.  EU chiefs Donald Tusk and Jean-Claude Juncker have backed Turkish President whom they have paid in the order of 3BN Euro to keep Middle Eastern refugees fr0m European shores.

‘US Secretary of State John Kerry said Saturday that the United States will assist Turkey in the investigation of a failed coup and invited Ankara to share any evidence it has against a US-based opposition figure Fethullah Gulen.’
Famously Mr. Erdogan said ‘that women and men are not equal’ echoing statements made by Iranian Supreme Leader Ayatollah Khamenei when he said that gender equality was “one of the biggest mistakes of Western thought.”

Who knows what the motivations of the military are in this latest coup,  but given Erdogan’s consistent erosion of democratic values and human rights where does that leave the EU and indeed the UN Human rights Charters?

Below are some of the stories that have informed my opinions. Read more ›


“Helicopter Money” Won’t Fix What’s Broken

The mere mention of helicopter money has intoxicated global stock markets, which have soared on the rumor of Japanese helicopter money. But as I explained in Why Helicopter Money Won’t Push Stocks Higher, central banks funding fiscal spending (i.e. helicopter money) will only have a weak and entirely indirect effect on profits or stock market valuations.

The problem with helicopter money is that it cannot fix what’s broken in the economy–and even worse, it perpetuates every inefficient, corrupt, bloated and unsustainable system in the status quo. As I explain in my book Why Our Status Quo Failed and Is Beyond Reform, the problem isn’t lack of fiscal spending or stimulus; the problem is the primary systems of the status quo have failed and cannot be fixed with central bank easy money.

In effect, helicopter money feeds the perverse incentives that have crippled our economy and society. Rather than be forced to choose priorities and rid centralized systems of wasteful corruption, bloat and graft that siphon off wealth and destroy productivity, helicopter money enables the continuation of all the inefficient, corrupt, bloated and unsustainable systems that make up the status quo.

No sacrifices are required by helicopter money: unlimited sums of freshly created money will be used to fund the same broken systems that have generated extremes of debt and wealth/income inequality.

The list of what won’t be fixed by helicopter money is long:

– The demographic time-bomb in pension plans, Medicare etc.: not fixed, just papered over.

– The higher education cartel’s out-of-control spending spree: not fixed, just papered over.

– The healthcare/sickcare cartel’s out-of-control spending spree: not fixed, just papered over.

– America’s declining health and runaway epidemics of “legal” drug addiction and metabolic syndrome diseases (diabesity): ignored, untouched.

– — The defense-industry cartel’s out-of-control spending spree: not fixed, just papered over.

I could go on and on, but you get the picture: funding broken, bloated, failed systems only perpetuates the rot at the heart of the nation’s economy, society and culture.

Funding Medicare’s immense fraud, needless tests, etc. won’t fix what’s broken.

Funding the failed F-35 fighter aircraft program won’t make the F-35 a better plane or a better deal for taxpayers. It’s still a gargantuan failure, regardless of how much “free money” central banks create to fund existing bloat/waste/fraud.

The entire status quo desperately needs a re-set, but helicopter money insures there’s no pressure for a re-set. Whatever the lobbyists, grifters, political favorites, quasi-monopolies, bureaucratic fiefdoms and cartels want, they’ll get, courtesy of central bank-created helicopter money.

What helicopter money does is destroy the discipline imposed by living within our means, and it obfuscates the crushing opportunity costs of maintaining a failed status quo that benefits the few at the expense of the many.

What proponents of helicopter money cannot evade is the S-curve: simply creating more money and “fiscal stimulus” without generating the higher productivity that creates more wealth is the equivalent of overdosing on crack cocaine and actually believing you have god-like powers to evade consequences.

Creating “free money” to support bloated bureaucracies and corrupt cartels only makes the underlying problems worse. We can’t solve problems with “free money;” solving problems requires realistic assessments, lifting the burden of dead weight imposed on a stagnating economy by bureaucratic bloat, institutionalized fraud, profiteering quasi-monopolies, etc., and actually fixing what’s broken.

I am in favor of real solutions, which is why I wrote A Radically Beneficial World.

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Gold Ends Lower After Central Bank’s Surprise Move

The  gold price continued to fall overnight after the Bank of England, contrary to expectations, kept interest rates unchanged at yesterday’s meeting.

The market had earlier priced in an over 80 percent chance of a 25-basis point cut in the July meeting, though some had reckoned that the BoE may prefer to wait till August when more data will be available to assess the impact from the Brexit decision.

Gold prices have rallied more than 25% since the beginning of 2016, but is the rally now over, or would it be foolish not to buy gold?

Brexit isn't the only market upset to affect the gold price, with interest rates and currency changes impacting demand

To help answer that question let’s take a look at what has driven the gold price higher in 2016.

One of the key drivers continues to be interest rates.

Demand for gold typically climbs when interest rates are low. Although gold has no yield, it tends to offer investors a better place to park their money when returns from bonds and cash savings are poor – as they are when rates are low.

At the end of last year, it seemed the tide was turning, with the US Federal Reserve increasing rates for the first time in seven years. But the Fed folded on a rate rise in June and expectations for further hikes this year have receded.

Meanwhile, the Bank of England this week dashed expectations that it would slash rates below 0.5pc over fears Brexit could plunge the economy into recession.

An article in The Telegraph looks at this and the 4 other key forces driving the rally in gold.

You can read the full article here 


Legendary Gold Trader Jim Sinclair Issues “The Most Important Article You Will Ever Read”

The urgent communication released today from the legendary Jim Sinclair is not an easy read,
But it is the MOST IMPORTANT Read of Your Lifetime…

Click Here For Jim Sinclair’s “Most Important Article You Will EVER Read”:


[KR940] Keiser Report: Gold & World’s Debt Problems

We talk to Jim Rickards, author of The New Case for Gold, about gold as a solution to the world’s debt problems. We also discuss the solution that the leading global powers will present: rolling up the world’s bad debt into the Special Drawing Rights (SDR), which is why China has been buying SDRs on the market.