Is the economy on the mend or simply treading water? Are businesses hiring anew, or are they slashing jobs? Should investors lean toward buying or selling stocks? Will monetary inflation overshadow the looming specter of debt deflation?
The truth is, we are uncertain about these questions. Yet, we can share our thoughts on what we believe might be the answers. More crucial than our opinions, however, is the reality of the situation and the confusion it creates in reflecting upon markets and political economies.
“We have Monetary Anarchy running riot, where the bond between the real economy and the liquidity-driven markets is stretched beyond the realm of reason,” stated Bob Janjuah, head of tactical asset allocation at Nomura, earlier this week.
Indeed, things are spiraling out of control. A quick glance reveals that bubbles are inflating in nearly every sector. Stocks, oil, food, copper—you name it, all are on the rise. Just two days ago, we were faced with gas prices hitting $4.27 per gallon. Meanwhile, the actual economy seems hardly to be improving. Continue reading
Everything appears so methodical, arranged, and neat. Sixty seconds comprise a minute, 60 minutes form an hour, 24 hours make up a day, and one day equals a complete rotation of the Earth.
The moon orbits the earth roughly every 30 days—thus one month. The Earth orbits the sun once every 12 months—so one year.
So far, so good… right?
However, this orderly framework breaks down when trying to measure one complete orbit of the Earth around the sun in days; it actually takes 365 days plus an inconvenient 6 hours.
Nevertheless, we do not allow these pesky 6 hours to mar our perfection. As humans, we innovate and adapt the world to fit our needs. When the numbers don’t quite add up, we find ways to adjust them.
We set up off-balance accounts, formulate new theories, devise negative amortization loans, trade our freedom for the control of central bankers—and we even create leap years. Continue reading
Obama’s Budget is Every Investor’s Worst Nightmare
By Louis Basenese, Wall Street Daily
It matters little which political party you align with.
If you are a dividend investor—indeed, any type of investor—you should vehemently oppose President Obama’s proposed budget for 2013.
This isn’t a political stance; it’s a matter of investment strategy. Read on to discover why—and then make your voice heard!
Brace for Higher Taxes and Lower Yields!
Earlier this week, President Obama unveiled his budget proposal for the 2013 fiscal year, which includes nearly $2 trillion in new taxes and fees, with a clear focus on investors—especially dividend earners.
Specifically, the proposal seeks to raise the top tax rate on qualified dividends to 39.6 percent from the current 15 percent. When considering the surcharge from the healthcare reform package, this rate may reach as high as 43.4 percent.
Given these changes, the effects on after-tax yields will undoubtedly be profound. Continue reading
“…and the will of Zeus was moving toward its end.”
– Homer, The Iliad
Athens’ Decline
The burden of being at the pinnacle often weighs heavily on a civilization. Success can lead to overreach, making advancement unsustainable. Then, when least expected, something falters, and the unimaginable occurs: the collapse of wealth, military strength, and public dignity happens swiftly.
Consider Athens, for example; it lost its dominance over 2,400 years ago. By the time the Peloponnesian War commenced in 431 BC, Athens was the most formidable city-state in Greece. However, just 27 years later, the war left it in utter ruin.
The end of this war also marked the unfortunate conclusion of Greece’s golden age. Athens was never able to regain its former prosperity or status, and the collective psyche of its populace remained forever altered. Today, the people of Athens still carry a sense of grievance over their past.
Recently, for instance, protests erupted, resulting in buildings in central Athens being set ablaze. Continue reading
In conclusion, the complexities of our current economic landscape reveal profound challenges and uncertainties. While we navigate through these turbulent waters, it is imperative to remain vigilant and informed, recognizing the interconnectedness of markets, politics, and societal trends. As we forge ahead, understanding these dynamics will be key to making sound investments and decisions.
