Sunday, July 18, 2010

The Most Under-watched Financial Story of 2010

The Japanese Yen is the largest and most important currency in the world, after the Dollar and Euro, yet I hear almost no talk about the incredible appreciation. And what is even more astounding is that the BOJ has held rates at 0.1% and Japan has a massive national debt, yet they have so far unable to prevent this appreciation against the dollar. What this says about the world financial system I am not sophisticated enough to fully diagnose, but I wish it would get more press!

Tuesday, July 13, 2010

Silver of the Week 7/12/10

The Bahamas conch shell dollar is a simplistically beautiful coin that I very much admire. It captures the spirit of the Bahamas and coastal living without needing a complex allegory or an overly detailed scene. It is also interesting because sea shells were used as money in some aboriginal cultures, so it is somewhat analogous to how some coins depict wheat stalks, fish, or fur-trade animals (like the beaver or buffalo). The imagery, face value, and metal composition creates continuity between ancient barter, early money, silver money, and modern fiat.

It is .4666 ounces of silver. I am not sure what its purity is.

Quote of the Week - 7/12/10

The paper money system is an evil which punishes those who believe in it. Just like any other confidence game, what you need to do is to say in your own head, “One cannot get something for nothing,” and then you are free. Immediately you know what you have to do. You know exactly how the present system started. In 1933, the Democratic Party said, “We’re going to rob from the rich and give to you.” Rob they did. Take from the rich? Not a chance. Once you voted for rob, you became a victim. It is just like those people who play the state lottery. They lose and lose and lose, but their heads are full of big winnings around the corner.
Howard Katz, July 12 2010, The Chart Is True

Sunday, July 11, 2010

The Sunday Night Thing

Lately, over the last few months, I've noticed that gold and silver tend to go up on Sunday nights (Monday morning in Asia) and then get beaten down when the US markets take over at 10am EST. Now maybe this is just anecdotal, but it seems to confirm the idea that Asians are slowly accumulating gold and silver while the Western banks seek to suppress the metals in order to keep the paper ponzi going. Almost like clockwork, the best time of the week to buy metals is Monday afternoon or Tuesday morning. I will be watching the price action tonight and early Monday morning to see if I am right.

If the market progresses as it normally does, the gold price will rise a few dollars in Asia, then retreat through the day in the West, barring some major equities move.

Friday, July 9, 2010

Quote of the Week - 7/5/10

"A study of the markets show that the short term is hard to trade, and on this level most people lose. The path to success is to play the big moves. The big money is made in the big moves. The big moves are easy to trade. You get on board the trend. You do not try to catch the exact top or bottom. You just ride the trend and let it make money for you. Look at some of the big trends of our era: silver 1971-1980, up 38 times, gold 1970-1980, up 25 times, DJI 1982-2007, up 18 times, S&P 1982-2007, up 15½ times. In every one of these, as the trend was just beginning to lift off, the vast majority of people decided that the market was much too high and chickened out. I have mentioned the gold bug who, in 1972, with gold at $65/oz., gave up his hope that it would ever hit $70. There was Robert Prechter, who forecast DJI 3,600 in the early 1980s, gave up too soon and remained stubbornly bearish from 1987 to today. If you don’t need the psychological comfort of having others agree with you, then you have the mental toughness to make it as a speculator."
-Howard Katz, June 28th 2010, The Art of Speculation

Silver of the Week - 7/5/10

Driving the Persian hoard into the sea at Marathon:

My favorite silver of this week is a set of fractional bullion coins that hearken back to the most basic foundations of Western liberty, government, and mindset - the ancient Greeks and their citizen soldiers, the Hoplites. I wrote my senior thesis for my history degree on how Greek culture shaped their brand of warfare on the battlefield, so I could go on for quite a while, but I'll spare you and show the shiny stuff:

These 1/2 ounce, 1/4 ounce, and 1/10 ounce .999 silver fractionals are called "sovereign silver", which is appropriate on several levels. I actually don't know what company actually manufactures them, but they are available here:

(I have never done business with the website they are sold on, so I in no way recommend or endorse it - hopefully they are a good dealer because I think I need some!)

Friday, July 2, 2010

Video of the Week - 6/28/10

Only the Austrians Understand Interest Rates

Presented by Robert P. Murphy at "Austrian Economics and the Financial Markets," the Mises Circle in Manhattan on 22 May 2010 in New York, New York. Includes an introduction by Mises Institute president Douglas E. French.