How exactly does one unwind a Ponzi Scheme? People like Bernie Madoff have done a fine job showing investors, and eventually the American public, how to build one up. Essentially, you use the contributions from incoming investors to pay “profitsâ€� out to departing investors. And you repeat this process for as long as the incoming checks are larger than the outgoing checks. When the inevitable tipping point finally arrives – and there isn’t enough new money to pay off all the old money – you skip the border and leave your clients waiting for their next share of the profits…and waiting…and waiting.
[Read more...]Social Security Turns 75… And Still Can’t Retire
August 17, 2010 by Leave a Comment
The insane have no idea that they are insane.
Pelosi presents a birthday cake to Social Security.
Seventy-five years ago, in the depths of a depression, with a stroke of a pen, President Roosevelt created programs that would morph into the biggest mandatory spending initiatives of the US federal government.
[Read more...]Bridging the Fiscal Gap of Unfunded Liabilities
August 12, 2010 by Leave a Comment
The stock market took a tumble yesterday. The Dow fell 265 points after investors had a chance to ruminate about the Fed’s latest action.
It wasn’t what the Fed did or said that discouraged investors. It was what it didn’t say and what it didn’t do. It didn’t say, for example, that it was going to “crank up the printing presses� and deliver trillions of new dollars to the economy.
[Read more...]The Futility of “Spending to Prosperity”
April 13, 2010 by Leave a Comment
“Like politicians?” asked our friend, Michael. We couldn’t help but laugh. “Yes,” we answered. “Just like politicians.”
Your editor occasionally spends his Saturday afternoon helping a Taiwanese friend with his English. Our friend manages a large retirement fund here and, as with many professionals in the developing world who interact frequently with western business people, Michael is tireless is his pursuit to improve his second language skills. Part of this past weekend’s lesson was devoted to explaining the word “parasite.” Michael, as you can see, is a fast learner.
[Read more...]
The Kabuki Theatre of Demopublicans, Part I
Doug Casey’s latest book, Totally Incorrect, gathers his iconoclastic views in a tidy package to stimulate and possibly dismay readers. In an interview with The Gold Report, Doug elaborates on some of his most radical ideas and offers his view of where the markets are likely to head in 2013.
[Read more...]Click for detailed story