Many economists inadvertently harm the reputation of their profession by promoting ideas that seem ludicrous, even to a child. It’s astonishing how frequently some economists demonstrate a lack of understanding.
Consider the cash for clunkers program. Everyone, save for the most misguided economists, recognizes that incentivizing people to discard perfectly functional vehicles is counterproductive. Yet, these economists celebrate the demand for new cars it supposedly generates and the boost to GDP.
If this approach truly led to prosperity, why not provide everyone with cash for a new car? Automakers would be thriving! Similarly, why not fund everyone in acquiring homes? Construction jobs would soar. This would seem flawless… if we were living in a make-believe world.
Another common misconception in contemporary economic thought is that wealth comes from borrowing and spending money, rather than saving and investing it. Simple logic disproves this notion, yet economists continue to embrace it. Continue reading
The stock market took a downturn yesterday. We won’t dwell on it extensively, but we can observe that change is palpable. You can see it, feel it, and even sense it in the air. However, being ready for what lies ahead – whether it brings profits or necessitates protection – is the true challenge. Here’s our analysis…
The value of the United States dollar has seen an uptick against other currencies recently. The dollar index – which measures the U.S. dollar’s performance relative to a collection of foreign currencies – hovered around 80 during the first half of the year but has soared since July.
Currently, the dollar index stands at approximately 86. This signifies a 7.5 percent increase in the dollar’s value in the foreign exchange market over the past three months. What implications does a stronger dollar carry?
There are both benefits and drawbacks to a stronger dollar, depending on one’s perspective. Generally, a more valuable dollar is advantageous for savers and consumers alike, as it usually translates to cheaper imported goods. Continue reading
The stock market experienced significant declines on Tuesday, with the DOW dropping 272 points. What does this mean? Is it a sign the market is finally beginning to retreat, something we’ve anticipated for a while? Or is it merely a temporary setback before reaching new heights?
By Wednesday, it seemed we had an answer. The DOW had surged back, gaining 274 points to recover all the previous day’s losses, plus an additional two points. This marked the best day of the year for the market, and Wall Street was filled with excitement.
Notably, gold stocks also climbed. Junior mining shares, as tracked by the Junior Gold Miners ETF (GDXJ), surged by 9.61 percent. Fixed income investors joined the rally, with yields on the 10-year treasury note plummeting to 2.32 percent, nearing their 52-week low of 2.30 percent.
So, what fueled this exuberance? Is the GDP on a rapid rise? Are we finally seeing wage increases? Is there a resolution to the conflict in Ukraine? Was a groundbreaking vaccine for Ebola discovered?
None of the above. The buying spree was spurred by what we term worshiping utterances. Continue reading
It was a delightful land, where dreams floated lazily before the drowsy eye;
A place of cheerful castles in the clouds, endlessly drifting around a summer sky.
CASTLE OF INDOLENCE
Apple Country
Oak Glen, California, lies just beyond the confines of Southern California’s concrete jungle. Here, the air is fresh and crisp at an elevation of a mile high, and the pace of life is slow and relaxed, rather than frantic and chaotic.
There are no traffic lights or fast-food restaurants marring the landscape. Billboards and power lines remain with the vast Euclidean boulevards in the valleys below.
In this serene environment, the architecture blends harmoniously with nature. A narrow, winding mountain road ascends, flanked by apple orchards that gently slope between the more imposing hills. Continue reading
