By Jeff Clark, BIG GOLD Have you considered what will happen to your portfolio and all the other areas of your life if the dollar fails? The ramifications will be widespread, painful, and inescapable if you’re not properly diversified. Last month, I attended the Global Currency Expo sponsored by EverBank®. The overarching theme, as you might expect, was that diversification out of one's home currency is paramount. While there were plenty of traders on hand, it was the big-picture talks that had the most pressing messages. I came away feeling that I needed to reexamine my exposure to the dollar. Have you considered what will happen to your portfolio?and all the other areas of your … [Read more...]
Sheltering Cash From Inflation
When Inflation heats up it can ravage your cash holdings and so of course that is why a portion of your portfolio needs to be in inflation hedges. But a side effect of inflationary forces is the added volatility it adds to markets. Navigating this added volatility involves having flexibility in your portfolio and flexibility comes from cash or cash equivalents. Unfortunately, cash equivalents are big losers during periods of high inflation. So what do you do? Fortunately, there is a solution that will provide liquidity and prevent the major part of the purchasing power erosion due to inflation. Plus provide good returns in the mean time. In today's report the author of "Keep What You … [Read more...]
April Inflation Up in OECD Countries
OECD annual inflation continues rising to 2.9% in April 2011 The Organisation for Economic Co-operation and Development (OECD) released the April inflation numbers for its member countries today. Although we have known the U.S. inflation numbers for a couple of weeks now it is interesting to see how they compare to other developed countries around the world. Some of the biggest gainers were the United Kingdom (to 4.5% in April, up from 4.0% in March) and the United States (to 3.2%, up from 2.7%). Inflation also accelerated in Germany (to 2.4% up from 2.1%), Italy (to 2.6%, up from 2.5%), France (to 2.1%, up from 2.0%) and Japan (to 0.3%, after four consecutive months at 0.0%). Average … [Read more...]
Raw Materials Price Inflation Skyrockets– Manufacturing Collapses
According to the May report of the Richmond FED-- the index of manufacturing activity fell 16 points from a positive level of 10 in April to a declining (negative level) of -6 in May thus indicating that manufacturing actually contracted during the time period. During this same time the cost of raw goods required to manufacture goods increased dramatically. Inflation was the monthly equivalent of an average annual rate of 6.12% in May the highest monthly reading since December 1993 up 27% from April's equivalent of 4.81%. As I've said many times 5% annual inflation will stifle the economy 6% is pretty devastating. Manufacturing activity in negative territory is a sign of a recession … [Read more...]
Soros Sells Gold- No Longer Fears Deflation???
When I think of using gold for asset protection I think of it for protection against inflation. But obviously, according to the WSJ, I am all wrong (or maybe not). According to a Wall Street Journal article, billionaire George Soros sold his $800 million stake in precious metals in the first quarter of 2011 saying that he "no longer fears deflation". What? With inflation climbing, I can see why he no longer fears deflation... but why would he buy gold to hedge against deflation, in the first place? … [Read more...]
Where is the Global Economy Headed?
Roy Furr, Contributing Author To be forewarned is to be forearmed. I'm writing today after spending the last three days in Boca Raton, Florida, attending The Next Few Years: A Casey Research Summit. If you're not already familiar, the purpose of this summit was to bring together many of the world's top economic and investing minds to share with us where they believe we're headed in the months and years ahead. The cast of speakers was impressive, to say the least. They brought a variety of view points, an almost overwhelming amount of data and analysis, and a perspective on what the current world means for investors that would be hard to build on. Yet, with all this variety of … [Read more...]
Hyperinflation and Double-Dip Recession Ahead
An interview with Karen Roche of The Gold Report Economic recovery? What economic recovery? Contrary to popular media reports, government economic reporting specialist and ShadowStats Editor John Williams reads between the government-economic-data lines. "The U.S. is really in the worst condition of any major economy or country in the world," he says. In this exclusive interview with The Gold Report, John concludes the nation is in the midst of a multiple-dip recession and headed for hyperinflation. The Gold Report: Standard & Poor's (S&P) has given a warning to the U.S. government that it may downgrade its rating by 2013 if nothing is done to address the debt and deficit. … [Read more...]
Does the Consumer Price Index (CPI) Include Taxes?
Question: I have heard over the years that the CPI does not include taxes as one of its components. In other words, an increase or decrease in a tax rate is not considered a change in consumer prices/costs. Is this true? If so, how is this omission justified? Thank you, James Schmidt … [Read more...]
Does Deflation Remain a Threat?
From physics we learn that every action has an equal and opposite reaction. From nature we see the pendulum swing to its farthest extreme and then return an equal distance in the opposite direction. Even children know the saying , "what goes up, must come down". But those laws of nature don't apply to debt and credit inflation do they? Can debt creation can go on forever? In this article the editors of Elliottwave International look at the largest credit inflation in history and where it is going now. Will it eventually result in a massive deflation? ~ Tim McMahon, editor A 90-Page "Deflation Survival Guide" Gives the Answer By Elliott Wave International "Every excess causes a … [Read more...]
Does The “FED” Really Just Print Money?
Printing Money, Quantitative Easing, Money Supply and Currency in Circulation--- how do they relate? Today we are looking at an excellent explanation on the FED's money printing process by James Hamilton, economist of the University of California, San Diego. Did the Federal Reserve really print a Trillion dollars in their Quantitative Easing program? Did that increase the money supply by a Trillion dollars? He presents some interesting charts on currency in circulation versus currency reserves. Tim McMahon, editor … [Read more...]
