Fed Policy Is Bringing The Economy & Asset Prices Down

While Federal Reserve policy is succeeding in bringing down the economy and asset prices, it's not succeeding in bringing inflation back down to 2 percent. Long before that happens, both the economy and financial markets will get even weaker, causing the Federal Reserve to make another mistake by pivoting.

-- Peter D. Schiff, economist

Rules of Investing

Most successful investors, in fact, do nothing most of the time.

— Jim Rogers

The price of a commodity will never go to zero. When you invest in commodities futures, you are not buying a piece of paper that says you own an intangible of the company that can go bankrupt.

— Jim Rogers

One of the best rules anybody can learn about investing is to do nothing absolutely nothing unless there is something to do. 

— Jim Rogers

The Complexity of the World

Acknowledge the complexity of the world and resist the impression that you easily understand it. People are too quick to accept conventional wisdom. It's a basic fact of life that many things "everybody knows" turn out to be wrong.

The British Pound Is Crashing!

"The British pound just hit an all-time low against the U.S. Dollar, trading below 1.05 for the first time ever. It looks like the latest round of deficit-financed tax cuts will backfire, as a weak pound causes the cost of living to rise by more than the value of the tax cuts."

-- Peter Schiff, economist

Fighting Inflation With Tax Cuts

"The reason governments want to "fight" inflation with tax cuts and not spending cuts is that the former is popular with voters. But what voters don't understand is that only the latter will work. Tax cuts will actually make the inflation problem they're supposed to solve worse!"

-- Peter Schiff, economist

Silver Has Many Industrial Uses

Solar panels, many things use and need silver (more than gold). Gold is used in jewelry more than anything else. It does have industrial uses also but nothing like silver. I'm delighted to know that silver has industrial uses but that's not the main reason I own it.

Related trading instruments: iShares Silver Trust ETF (SLV)

Investing: Looking For Opportunities Outside Of Your Country

First of all, one should understand that there are many opportunities in many places in the world besides your own country. There always have been and there always will be. For instance, you know 50 years ago most people didn't know Japan had a stock market just on the verge of becoming one of the greatest success stories of the 20th century. So always be on the lookout for other markets, other opportunities.

Bear Markets End In Panic

"The last leg of a bull market always ends in hysteria. The last leg of a bear market always ends in panic."

-- Jim Rogers

Gold & Silver: The Way To Protect Yourself

I'm an old, old peasant ... I want to have some gold in the closet, I want to have some silver under the bed and I will buy more, just like all of us other old peasants, because we know that's the way to protect yourself.

Related trading instruments: iShares Silver Trust ETF (SLV), Market Vectors Gold Miners ETF (GDX)

German Stocks Are Feeling The Heat

"Good Morning from Germany, where real estate stocks are mirroring the doom and gloom in German housing market. Shares of industry leader Vonovia have almost halved in value this year, while TAG Immobilien has lost almost two thirds due to higher interest rates & falling property prices."

-- Holger Zschaepitz, Welt

Warren Buffett Turns 92 Today.

Warren Buffett turns 92 today.

One of lessons from early in his investing days:

"Buffett saved up $120 and bought his first stock at the age of 11. He bought Cities Service for $38.25 per share. It fell to $27, then rose to $40. He sold at a small profit. It later topped $200, teaching him an early lesson about patient investing."

-- story told by Jon Erlichman on twitter

“I regard Berkshire Hathaway, sort of like .. a painter regards a painting — the difference being that the canvas is unlimited. There’s no finish line at Berkshire.” -- Warren Buffett comparing investing and managing a business to art creation

Bitcoin: What Happens Next?

"There still seems to be a lot of buyers for Bitcoin below $20,000. But there are also a lot of sellers above $20,000. I think the market runs out of buyers before it runs out of sellers."

-- Peter Schiff recent commentary on Bitcoin's price action around 20,000 USD (August 28th)

Germany: Energy & Industrial Crisis

"Germany 1-year forward baseload electricity surges past €400 per MegaWatt/hour (MWh) for the first time ever. We are truly into crunching territory for the country's energy-intensive manufacturing industry. The current price is approximately 1,000% higher than the €41.1 per MegaWatt/hour (MWh) 2010-2020 average."

Javier Blas, Energy and commodities columnist at Bloomberg

Russia: I Haven’t Been Able To Get Out

"I did invest in Russia for all the reasons you mentioned (low debt, positive real interest rates) and more... I have not been able to get out (of my investments) because everything is essentially closed." 

- Jim Rogers, commenting on his Russian investments

Fighting Inflation Will Cause A Severe Recession

"While fighting inflation will cause a severe recession and high unemployment, those conditions alone won't reduce inflation. They'll actually make it worse. To reduce inflation we need positive real interest rates, very aggressive QT, and massive cuts in government spending."

-- Peter Schiff

The U.S. Economy Has Been In Recession All Year

"The U.S. economy has been in recession all year. With yesterday's rate hike, more layoffs, and inflation continuing to erode purchasing power, the recession will deepen in the third quarter (Q3). In fact, Q2 GDP will likely be revised even lower."

-- Peter Schiff, economist

We Have Very High Valuations And Staggering Debt

It’s been 13 years since we’ve had big problems and that’s the longest in American history. It’s already overdue on a historic basis and it’s very expensive. It always goes down a lot when it goes down. We have very high valuations and staggering debt.

Going Against Your Trading Plan

"After a string of losses, desperate traders will often go against their plan, just to get even. Bad strategy."

-- Yvan Byeajee, trading expert

How Strong Stocks Behave

"During the late stages of a bear market (when news is terrible and most are bearish) money starts to rotate, and even though many stocks continue to experience volatility and the indexes may even go lower, the leaders hold up relatively well and emerge undetected by the masses."

-- Mark Minervini, momentum stocks trader

Crude Oil: Price Is Now Below Invasion

"Crude Oil is now below the level it was at the day before Russia invaded Ukraine, down over 30% from its high in March. Markets are increasingly pricing in a global recession and a slowdown in demand (similar to what we saw in the back half of 2008)."

-- Charlie Bilello, Founder and CEO of Compound Capital Advisors

On The Verge Of A 2008-Style Financial Crisis?

"How is everyone so sure that we're not on the verge of a 2008 style financial crisis? Remember despite ample evidence, the experts didn't expect the 2008 financial crisis either. Plus, the economy is far more leveraged now than it was then, and there's a lot more debt to default."

-- Peter Schiff

European Inflation Is Squeezing Consumers

"While German CPI surprises to the downside, Spain's inflation unexpectedly surged to a record 10.2%. The surprise 10 percent reading for June dashes hopes that inflation in the Eurozone’s 4th-biggest economy had peaked and highlights how a squeeze on consumers is intensifying."

-- Holger Zschaepitz, Welt

America's Red Hot Economy Has Actually Been In A Recession All Year

The final read on Q1 GDP is now minus 1.6 percent. Since Q2 will likely be negative too, the Federal Reserve and President Biden will soon be forced to admit that America's red hot economy has actually been in a recession all year, which will only get far worse with high inflation and more interest rate hikes.

-- Peter Schiff

High Inflation vs. Financial Crisis

The Federal Reserve can either bring inflation down to 2 percent, cause a financial crisis, bank failures, stock, real estate and bond market crashes, the U.S. government to default on Treasury debt and slash Social Security benefits, while unemployment soars, or it can tolerate high inflation.

-- Peter Schiff

A Recession Is Inevitable

“If you’re still holding out hope that the Federal Reserve will be able to engineer a soft landing in the US economy, abandon it. A recession is inevitable within the next 12 to 18 months.”

-- Former New York Fed President Bill Dudley

Millions, Billions & Institutional Buyers

"I still find the difference between millions and billions to be rather mind-bending. One million seconds is approximately 11 days. One billion seconds is approximately 31.5 YEARS!"

-- Sahil Bloom

"Keep in mind that if the institutional investment community doesn't see what you see, your stock could sit dormant for an extended period of time. Why sit and wait when you can put your money elsewhere?"

-- Mark Minervini, momentum stocks trader

Bitcoin: Nothing drops in a straight line

"Don't get excited about Bitcoin being back above $20,000. 20,000 is the new 30,000. This is just another bull trap. Nothing drops in a straight line. In fact, this slow motion crash has been extremely orderly. No sign yet of any capitulation that typically forms a bear market bottom."

-- Peter Schiff

All This Debt Will Cause A Major Bear Market

 

Before this is over we're going to see the worst bear market in in my lifetime. In 2008 and 2009 we had a bad problem because of too much debt. Since then the debt everywhere even in China has skyrocketed! 

So the next bear market when it comes has to be the worst in my lifetime.

Bitcoin Will Not Be The New Monetary Standard

Jim Rogers on the possibility of a new monetary standard: 

"I don't see it being Bitcoin, it might be an electronic currency but it would be government currency. They're not going to give up their power, they're not going to give up their monopoly, because they never have." 

The End Of The US Dollar As A Reserve Currency

No currency ever lasted forever. If you go back and look at history we've had international currencies as the world's medium of exchange that have lasted 80, 100 or 150 years maximum. They've all changed over and over and over since the beginning of time.

The US Dollar has been on top for a while but now as I said we are the largest debtor nation in the history of the world and now we will not let the US Dollar stay neutral. Now, we're using it as a political or an instrument of war so that means nobody in his right mind  is going to want to use US Dollars (as an reserve currency).

Hot Commodities: An Amazon Review

"Highly readable and entertaining. It isn't necessarily going to benefit those who are already very knowledgeable about commodities, nor does this book tell you how to trade commodities. It isn't a practical guide but rather Jim suggests what you should look at when constructing your world view.
In Hot Commodities, Jim presents a strong case for why you should invest in commodities if you are going to invest at all. He doesn't recommend short-term punts or the use of leverage, he admits that if you are capable of trading then that's your prerogative. However, most people who wish to invest are just not suitable for leveraged trading. In fact he advocates simply buying a broad index of commodities rather than trying to pick the best. This corroborates with the findings of Bogle: index investing is best.

His arguments rely upon historical events and examples from his earlier days as analyst, he relates previous examples of the 70s and 80s to the situation we have now. While many people (politicians?) might have blamed speculators for high commodity prices in the 70s, Jim points out that speculation or market manipulation is hard to achieve over a sustained period of time. The cause of inflation, as Jim presents it, is due to something. One part of the high commodities' prices in the 70s was due to the natural cycle of commodities versus stocks (a theory that is fairly unique to Rogers), and the other part is due to the killing of the gold standard plus other monetary / fiscal policies. In the current climate Rogers believes we back in a commodity bull (upward trend) while stocks are bearish (lack of a strong upwards trend). This commodity bull cycle will likely come to an end in 10 - 20 years and then we'll likely be back to a bullish stock market. These long term trends are secular bull and bear markets, Rogers proposes the theory that stocks and commodities are bullish in the counter periods to each other.

Why is the author trustworthy? Anyone that regularly watches Jim on tv will know that he is consistent with his recommendations and analysis. He never claims to be right 100% of the time nor that investing is easy. Rogers comes across as honest and humble. Jim has never compromised his analysis because others dislike what he says. He presents the facts as he sees it and is unapologetic about it. Unlike other contemporary investors such as Soros, Roubini, Buffett whom seem far too willing to bend to the views of a particular government."

Hot Commodities, Amazon Review from Edward A. Thomson

How To Invest.

"After you act, you wait for it to play out. You don't go jumping in and out. If you buy something that you know is going to work, you wait, you wait, you wait. There will be panics, you'll be scared at times, but if you can just do nothing, you'll make money."

-- Jim Rogers

Ukraine - Russia War: This Should Never Have Happened.

Suppose Russia had an alliance with Mexico and they started stationing troops in Mexico and missiles and tanks what do you think we would do?

We'd say, "oh my gosh, it's so good let's drink vodka together!", no! They'd send an army down there and run them away just like they did in Cuba.  

This never should have happened. We should not have done what we did. The Russians should have somehow made it clear that this would be an act of war and the world should go on peace peacefully as peacefully as it can.

War Has Never Been Good For Anything.

War has never been good for anything. This whole thing starts because in 2014 the state department, our state department instigated a coup in Kiev and now we're paying the price for it.
 

We've been trying to move nato to Ukraine ever since. It's absolute madness, this no war should not be happening. None of this should be happening. We shouldn't have instigated the coup.