Notable Articles

16 Dec 2011, MF Global shows fractional reserve banking as a chain of lost ownership for someone else's benefit (106)
It is clearly time to become more aware of what you are involved with in the current banking system.

10 Dec 2011, Autopsy of the undead - Alan Grayson on the GAO report on the Federal Reserve (105)
It is remarkable how difficult it was to get this information, and how long it took to produce this report. What can you do about it? Alan Greenspan has explained that "The Federal Reserve is an independent agency. There is no other government agency that can overrule the actions that we take."

28 Sept 2011, Understanding What Happens Next - Chris Martenson (104)
In this article, Chris Martenson has summarized the current situation exceptionally well. The chart of debt growth since 1970 really says it all. This shows that we are now at a point where our unsustainable monetary system may have reached significant limits.

24 June 2011, The Unconstitutional U.S. Monetary System - Dr. Edwin Vieira, by David Galland (103)
Edwin Vieira, Jr., holds four degrees from Harvard: A.B. (Harvard College), A.M. and Ph.D. (Harvard Graduate School of Arts and Sciences), and J.D. (Harvard Law School). For more than thirty years, he has practiced law, with emphasis on constitutional issues.

22 June 2011, The EMU as a Self-Destroying System (102)
When property rights in money are poorly defined, negative external effects develop. The institutional setup of the euro, with its poorly defined property rights, has brought it close to collapse and can be called a tragedy of the commons.

21 Apr 2011, Fear the Boom, Not the Bust (101)
"The sooner the boom ends, the better. The boom destroys capital; the bust replenishes capital through savings. The economy needs savings, which are the foundation of production. The current fad, promoted by all central banks worldwide, is exactly the opposite. Central banks want everyone to believe that it is spending that drives the economy, not savings. This is called "Shop-Until-You-Drop Economics," and it is inherently flawed and unsustainable."

The Failure of Western Style Democracy (100)
Here is an interview with Hans-Hermann Hoppe the author of "DEMOCRACY, THE GOD THAT FAILED. The Economics and Politics of Monarchy, Democracy, and Natural Order."

The End of Sound Money and the Triumph of Crony Capitalism - David Stockman (99)
"In the immortal words of George W. Bush, our most economically befuddled President since FDR, "I've abandoned free market principles in order to save the free market system."
Based on the panicked advice of Paulson and Bernanke, of course, the president had the misapprehension that without a bailout "this sucker is going down." Yet 30 months after the fact, evidence that the American economy had been on the edge of a nuclear-style meltdown is nowhere to be found.
In fact, the only real difference with Iraq is that in the campaign against Saddam we found no weapons of mass destruction; by contrast, in the campaign to save the economy we actually used them — or at least their economic equivalent."

Why Economics Is Crucial for Ethics (98)
"It might be more accurate to say that ethicists ignore economics than that economists ignore ethics. To the extent that good economics shows what we can and cannot do with social policy, it is engaged with ethics. After all, if the point of saying we ought to do X is that we think it will achieve some set of morally desirable goals, then knowing whether or not doing X will actually achieve those goals is, or at least should be, a key part of moral inquiry."

Stay Out of the ROOM (97)
The key to successful retirement planning is understanding the Safe Withdrawal Rate, the percentage of assets that it is safe to withdraw on an annual basis for living expenses. This article provides an exceptionally good perspective on this crucial issue. The additional new key point this article makes is that realistic return assumptions and risk management are also key components. The ROOM stands for Running Out Of Money, and this is no joke if it happens when you are 85. Although the averages say this may be a low probability based on certain assumptions, always remember that for you in particular this is most likely an unacceptable outcome. In this case it makes sense to increase your probabilities above what these models suggest in any way you can.

Hazlitt and Keynes: Opposite Callings (96)
It is hard to form a truly valuable economic viewpoint unless you have studied the evolution of economic ideas, and understood the personal history of some the main contributors to economic thought. This outstanding article lays out the parallel lives of Keynes and Hazlitt, who lived through the same times, but whose characters were as different as their economic thinking.

Clarity on the Gold Standard and Fractional Reserve Banking (95)
In order to get to the root cause of our economic problems we have to understand the natural fraud that exists at the foundation of our money system. The truth is that fractional-reserve banking amounts to violating the nature of the law of property rights. This does not seem to be understood by even the chief economics commentator of the Financial Times.

The simple core economic flaw (94)
On June 13 and 24, 1844, Robert Peel pointed out in the House of Commons that in each one of the previous monetary crises "there was an increase in the issues of country bank paper" and that "currency without a basis … only creates fictitious value, and when the bubble bursts, it spreads ruin over the country and deranges all commercial transactions."

Why the IMF Meetings Failed and the coming Capital Controls - Michael Hudson (93)
On the deepest economic plane today’s global financial breakdown is part of the price to be paid for the Federal Reserve and U.S. Treasury refusing to accept a prime axiom of banking: Debts that cannot be paid, won’t be. They tried to “save” the banking system from debt write-downs in 2008 by keeping the debt overhead in place while re-inflating asset prices. In the face of the repayment burden shrinking the U.S. economy, the Fed’s idea of helping the banks “earn their way out of negative equity” is to provide opportunities for predatory finance, leading to a flood of financial speculation.

Larry Summers and the Subversion of Economics - Charles Ferguson (92)
Over the past 30 years, the economics profession—in economics departments, and in business, public policy, and law schools—has become so compromised by conflicts of interest that it now functions almost as a support group for financial services and other industries whose profits depend heavily on government policy. The route to the 2008 financial crisis, and the economic problems that still plague us, runs straight through the economics discipline. And it's due not just to ideology; it's also about straightforward, old-fashioned money.

Black Swans and Bank Leverage - Gary North (91)
"There is no solution to black swan events for as long as central bank protection is available to the largest banks, which are too big to fail"

Six Impossible Things - John Mauldin (90)
"Of course, the fixers have no idea what they are doing. All they have is a crackpot theory about the way an economy works. They stick with it despite the fact that it makes no sense in theory...and has never actually worked in practice. In the real world, Mr. Market always wins. He always wins because he IS the real world." - Bill Bonner

The Financial Crisis is Far From Over (89)
"The twin pillars of Keynesianism, official deficits and monetary inflation, are being tried on both sides of the pond but they are not working as they have in the past. Debt saturation has sapped the ability of either policy to work and, because of this lack of traction, you can be sure that additional financial crises lurk in the shadows ready to pounce. The odd part in this story to me are how few people, especially finance professionals that should know better, seem to really understand and accept the idea that the game has fundamentally changed." Chris Martenson once again explains what everyone should know but desperately wants to ignore.

14 Risks with Supposedly "Safest" Securities (88)
There is no prospectus for investors when they buy US Dollars, or Treasuries, but it is a legal requirement for any other security or investment. What would that prospectus say? What should every investor be fully aware of as an owner of US Dollars or Treasury. Are you fully aware of all these 14 points?

Sovereign Debt Defaults and You (87)
"The idea that our entire system of money and promises is bankrupt is at once both simple to prove and nearly impossible to internalize and accept. But there it sits, unmoving, and it is our job to come to grips with it as best we can." A very clear and simplifying article on this subject from Chris Martenson.

40 year trend in gold - By Dr. Steve Sjuggerud (86)
With the recent underperformance of gold this might be an ideal time to familiarize yourself with the 40 year trend in how gold performs in the long term.

Executive Summary - By Chris Martenson (85)
As is increasingly the case it is crucial to look deep into real data, and not accept conventional opinion. The current investment euphoria provides a crucial opportunity to reallocate you assets in a sustainable direction. The markets are never more dangerous than when consensus is at bullish extremes and investors are complacent about risks.
In this article, Chris Martenson does an outstanding job of setting out the immense risks underlying financial markets.

Zimbabwe: A Fresh Start - By Alf Field (84)
The history of Zimbabwe provides the latest episode of the tyranny and inevitable traumatic collapse of a fiat monetary system. Fortunately, Zimbabwe is now improving very quickly. Debt has been wiped out and there is no longer any control or currency manipulation within the country over the currency in use. Equality and confidence are returning at lightening speed, and well as peace and prosperity. We would all be well served to consider where other countries are in their own cycle, and learn the timeless lessons of the history of monetary systems unbacked by tangible assets. If this was widely understood, why would any intelligent majority ever choose a fiat monetary system?

Economics and Moral Courage - by Llewellyn H. Rockwell Jr. (83)
"To be an economist with integrity means having to say things that people don't want to hear and especially to say things that the regime does not want to hear. It takes more than technical knowledge to be a good economist. It takes moral courage, and that is in even shorter supply than economic logic." Lew Rockwell

Audit the Fed - by Thomas E. Woods, Jr. (82)
The superstitious reverence that Americans have been taught to have for the Federal Reserve is unworthy of the dignity of a free people. The Fed enjoys a government-granted monopoly on the creation of legal-tender money. It is not an unreasonable imposition for Americans to demand to know about the activities of such an institution. It is common sense.

Property Rights Take a Hit (81)
"... the fact that two of the highest-ranking government officials can conspire to violate both securities laws and private property rights is abhorrent to everything America supposedly stands for. If they get away with it, which I believe they will, the precedent and the message will be chilling." Peter Schiff

The End Game Draws Nigh – The Future Evolution of the Debt-to-GDP Ratio (80)
The debt-to-GDP Ratio is the ultimate determinator of the success or ruin of any nation. This article explains why an original Obama supporter has never been more concerned. This is perhaps the best economic analysis that I have read this year.

Can Congress Write Any Laws It Wants? - Andrew P. Napolitano (79)
"Some men think the Earth is round, others think it flat… But, if it is flat, will the King's command make it round? And if it is round, will the King’s command flatten it? … NO."

Europe On the Ropes - Niels C. Jensen (78)
This is an excellent article comprehensively setting out the scale, character and depth of the enormous financial issues facing Europe.

Paradox Squared - Paul Kasriel (77)
This explanation and chart entirely refute current government policy.

Obama's Opening Salvo - Peter Schiff (76)
"To restore prosperity, credit (derived from savings rather than a printing press) must flow to producers. Greater liquidity for business will lead to legitimate job creation, increased production, and rising living standards. By further encumbering the economy with burdensome regulation, and by transferring business decisions to vote-seeking politicians who will bail out the irresponsible, reward failure and punish success, the government will create a society destined for misery."

Rules for International Monetary Reform - Jesus Huerta de Soto (75)

Stimulating Our Way to Rock Bottom - Ron Paul (74)

3 Trillion Budget Deficit? (73)

Third Rock Illusions (72)

Increasing Instability - Steve Saville (71)

The Corrupt Origins of Central Banking in America - Thomas J. DiLorenzo (70)

Houdiniomics: The New Era of Government Magic - by Peter Krieg (69)
"How pale is the art of sorcerers, witches, and conjurors when compared with that of the government’s Treasury Department!" ~ Ludwig von Mises, The Theory of Money and Credit

What Hamilton Has Wrought - By Thomas J. DiLorenzo (68)

How AIG's Collapse Began a Global Run on the Banks - By Porter Stansberry (67)

Don't Buy the Fear - By Dr. Steve Sjuggerud (66)

Recapitalise the banking system - by George Soros (65)

The Creation of the Second Great Depression - by Ron Paul (64)

Who Holds the Old Maid? - by John Mauldin (63)

Dead Men Walking (62)

Is The US Banking System Safe? (61)
"Truth is in short supply today." Jim Quinn

Wall Street, Banks, and American Foreign Policy (60)
"The temptation for bankers in particular to wield the power of the State to their benefit is very great because it permits banks to inflate their asset base systematically."
"The disruptions which accompanied the business cycle were a major factor in the transformation of the dominant ideology in the U.S. from a general adherence to laissez-faire doctrines to an ideology of political capitalism which viewed the state as a necessary instrument for the rationalization and stabilization of an inherently unstable economic order."

The Ticking Credit Card Time Bomb, by Peter Schiff (59)
For those holding out hope that the American economy can miraculously avoid a long and deep recession consumer credit is often viewed as the wonder drug that can cure all manner of economic ills. As such, this week's report showing $15 billion growth in consumer credit was widely heralded as proof of America's economic strength and resilience. However, we are now suffering the after effects of too much debt, and our salvation cannot be found in more of the same.

Where is the Bottom in Housing? (58)
"Those who think we are close to a bottom in the housing bubble are engaged in wishful thinking. You read above what those who really do their homework are saying. If we had more space, I could give you even more statistics and forecasts from Gary Shilling, Greg Weldon, Dr. Nouriel Roubini and others who do their homework, rather than trying to see a trend in one month's statistics. Many of the home sales from February are foreclosures. Those are going to rise. The key pieces of data to look at will be the months of supply of homes for sale and foreclosures. Until the supply of homes gets back to 6 months, we will probably not have seen the bottom. Until we have worked through the millions of foreclosures that are in front of us, it is hard to think in terms of a bottom.
We are in a recession, and that means rising unemployment and falling consumer spending. It means tighter profit margins. Etc. It is going to take a long time for the economy to recover. Welcome to Muddle Through." - John Mauldin.


The Cultural and Spiritual Legacy of Fiat Inflation (57)
"All the perplexities, confusions and distresses in America arise not from defects in the constitution or confederation, not from want of honor or virtue, as from downright ignorance of the nature of coin, credit, and circulation." - President John Adams.
John Adams and so many of America's founding fathers, risked their lives for a set of passionately held beliefs and principles, that today seem to have been completely forgotten or regarded as outdated or irrelevant. The tragedy of today is that we have to relearn all over again what America's founding fathers already knew and tried to protect us from.
Central banking and fiat money are deeply corrosive to society, and the constitution attempted to make them illegal (see Article 50). The tentacles of our current financial system reach deeply and fundamentally into every aspect of our lives. This is one of the best articles I have read that explain why this is so destructive.


Central Banking and Addiction To An Illusion (56)
Our current government deals in illusion.
Individuals monitor their own level of debt. Most are careful not to let their debt load get beyond their ability to repay. They do not let themselves get into a position of having to default. They know that bankruptcy is a painful option. They know that creditors can repossess every mortgaged item they own. In contrast the United States government keeps rolling up debts year by year. It has on on-budget debt of almost $9 trillion, plus an off-budget debt in the range of $70 trillion.
There is no way that this can be paid off in money with today's purchasing power, unless political steps are taken today to stop the expansion of debt. But no such steps are ever taken. Politicians have no incentive to stop making promises. The unfunded liability keeps growing. When the debtor controls the currency nobody can foreclose on the debtor. Politicians have no incentive to create a schedule for repaying the government's debt. They would be thrown out of office if they suggested that the expansion of future obligations must cease until a means of repayment is set up.
While individuals have the incentive to be disciplined, governments generally tend to be financially undisciplined if they can get away with it.
Nevertheless, the illusion of repayment of government debt must be maintained. It will be maintained, nation by nation, all over the world. It will be maintained by the creation of more counterfeit money. The illusion of solvency of the government will be maintained by the insolvency of the currency. Meanwhile, for the system to continue, there must be widespread ongoing acceptance of this illusion.
Gary North writes a brilliant article highlighting our current illusory predicament.

Trade your way to Financial Freedom (55)
"Most investors believe there is some magic secret of the markets that will make them rich. Such a secret does exist. But the answer is where you would least expect it to be." Dr. Van Tharp

Federal Reserve Oversight Needed Now (54)
"How can a policy of steadily debasing our currency be defended morally, knowing what harm it causes to those who still believe in saving money and assuming responsibility for themselves in their retirement years? Is it any wonder we are a nation of debtors rather than savers? We need more transparency in how the Federal Reserve carries out monetary policy, and we need it soon." - Dr. Ron Paul is a member of Congress.

Are you ready for retirement? (53)
"Too many Americans don't save anything," I said, half-jokingly, "because they're spending money they don't have, on things they don't need, to impress people they don't like."

Dollars and Politics (52)
While other countries have to export in order to pay for their imports, the sovereign who emits a global currency is exempt from adhering to the most fundamental law of economic exchange. This sets domestic resources free for the expansion of the state, particularly military power. The more such an imperial power extends its military presence around the globe, the more its currency becomes a global currency, and thereby new expansionary steps can be financed. Expansion becomes a necessity. Over time, however, the divergence widens more and more between the weakening industrial base at home and the extended global role. With goods coming from abroad for which there is no immediate need to pay with sweat and effort, the domestic culture changes and power-hungry political elites emerge. In the private sector, the production of goods at home is substituted by fancy activities. This cycle has been the fate of all empires.

The Best Stock Tip I Ever Received (51)
When it comes to hot stock tips, it's either a bum insider tip (which could cost you a bundle) or it's a good insider tip... in which case you're then guilty of insider trading.

Money and the Constitution (50)
A close reading of the Constitution - the document whose purpose was to protect the American people from federal officials - leaves little room for doubt about the intentions of the Framers. As you read the following excerpts from the Constitution, ask yourself: Did the Framers intend for our country to have a monetary system based on gold and silver coins or on paper money?

Irreparable Cracks in the Financial System (49)
Sure, it would have been in the best interest of the island to have a strong currency, but it was certainly not in the best interest of the Smartos, who had devised their last grand plan: shift assets overseas and into precious metals, let the currency of the island collapse, and then repatriate the funds and buy up the remaining assets of the Bush tribe's middle and lower classes at bargain prices since they had never understood that their currency had collapsed against foreign currencies and against gold.

Alternative Medicine is Libertarian (48)
Do you own yourself? This is the first question you should ask yourself if you are going to improve your health.

America's Injustice system is criminal (47)
The US has 5% of the world's population and 25% of the world's prisoners. The American incarceration rate is seven times higher than that of European countries. Either America is the land of criminals, or something is seriously wrong with the criminal justice system in "the land of the free."

Imperialism, Inflation, and War (46)
Schumpeter's analysis explains the particularly strong propensity of democratic states to engage in imperialist war making and why the Age of Democracy has coincided with the Age of Imperialism.

A Century of War (45)
Look again at the real causes of war. Unless we understand our history better, how can we hope to create a more peaceful and creative world?

Precious Metals - Critical Diversifier (44)
Investors with a precious metals allocation improve their risk/return performance.

Supporting The Trade (43)
While most people yawn at any mention of the trade deficit, it is important to understand this truly remarkable mechanism that continues to support financial markets, but can not last for ever.

TD Ameritrade Investor perception study (pdf) (42)

TD Ameritrade Financial Advice difference explained (pdf) (41)

American democracy needs reform (40)
"In the last 50 years more than 95% of congressmen who stood for re-election won. Because incumbents tend to win they receive 5 times more in "donations" than challengers in the House, and nine times in the Senate. As average spending per candidate in the 2004 election was $1m for House seats and $7m for the Senate, re-election is heavily dependent on financing. How credible is it that congress is working for voters rather than donors? Aren't voters supposed to be sovereign if America truly believes in Democracy?"

How does a nation lose its soul? (39)
"What is morally wrong can never be advantageous, even when it enables you to make some gain that you believe to be to your advantage. The mere act of believing that some wrongful course of action constitutes an advantage is pernicious." - Cicero

Senators know best? (38)
Senators beat the market by an average of 12%, and they only have to file their financial holdings once a year.

The Principle of Sound Money (37)
"It is impossible to grasp the meaning of the idea of sound money if one does not realize that it was devised as an instrument for the protection of civil liberties against despotic inroads on the part of governments. Ideologically it belongs in the same class with political constitutions and bills of rights." - Ludwig von Mises.

Foreign policy and the dollar (36)
Congressman Ron Paul describes the evolution of the link between the US dollar and US foreign policy. The artificial demand for the US dollar as a reserve currecy, along with US military might, places the US in a unique position to "rule" the world without productive work or savings, and without limits on consumer spending or deficits. The problem is, it can't last.

The case for the Barbarous Relic (35)
All the perplexities, confusions and distresses in America arise not from defects in the constitution or confederation, not from want of honor or virtue, as from downright ignorance of the nature of coin, credit, and circulation." - President John Adams.

Executives and Stock Options (34)
Shareholders should really be asking whether executives should have stock options at all.

Hyperinflation or deflation? (33)
A great discussion about the choice we may one day have to face?

I,Greenspan (32)
The inner thoughts of Alan Greenspan have escaped well before publication of his memoirs.

50 Timeless rules of investing (31)
Great investment wisdom distilled into 51 timeless rules by Dr. Steve Sjuggerud.

How Government Debts grow (30)
How the growth of government debt has become relentless.

Richard Russell's investment wisdom (29)
Richard Russell's perspective on how to achieve long term investment success.

Sowing the Seeds of the next crisis (28)
The late 1990s boom was provoked by an overly expansionary monetary policy. Despite the following equity market bust, this same excessive monetary policy has been kept in place, sowing the seeds of the next crisis.

The End Of Dollar Hegemony (27)
Congressman Ron Paul describes the evolution of the link between the US dollar and US foreign policy. The artificial demand for the US dollar as a reserve currecy, along with US military might, places the US in a unique position to "rule" the world without productive work or savings, and without limits on consumer spending or deficits. The problem is, it can't last.

Budget Deficit Games (26)
There is the highly publisized "President's Budget" issued by the Office of Management and Budget, and the almost secret "Financial Report of the United States" issued by the Department of Treasury. The budget says the fiscal deficit for 2005 was $319bn, but the Financial Report claims it is $760bn.

Democracy versus Freedom (25)
The word "Democracy" does not appear in either the Declaration of Independence or the US Constitution. America's founders intended a limited constitutional republic, in which individual rights were strongly protected. They had rejected a pure democracy as an unsustainable political model.

Attention Deficit Democracy (24)
Strong opinion about the degraded state of American Democracy.

Addicted to war (23)
"House of War" author James Carroll says the Pentagon is out of control, and the Cold War was unnecessary, and much else besides. The history of the Pentagon from its beginning, right up to the current time.

What the price of gold is telling us (22)
The key message from the rising price of gold is discussed by Congressman Ron Paul.

The Progessive Era (21)
We are still living with the consequences of the "progressive era", which began in the 19th century. Ironically in the name of preserving competition and promoting the "public welfare", the Progressives ultimately created a system that stifled competition and created entrenched interest groups and the ubiquitous "revolving door" between regulated business and the agencies that regulate them.

Anatomy of the State (20)
What is the State? Is it us or something else? How does it work? Do we control it, or does it control us?

THE FATAL FLAW IN SOCIAL SECURITY AND MEDICARE (19)
As social security was designed during the 1930's depression, it's primary purpose was as a welfare scheme. Focusing too much on social security as a retirement scheme misses this basic point. Here is a common sense proposal that solves a great many of our financing problems, simply by returning social security to its roots.

Deflation and Depression (18)
There is a great deal of confusion about the linkage between deflation and depression. This article gives a very detailed analysis of what has actually occurred over hundreds of years in many different countries. Although most people have tended to link the two together because the US had both together in the 1930's, it turns out that there is very little linkage between deflation and depression.

Alan Greenspan recently said he simply did not understand why Japan had experienced persistent deflation in recent decades, but this has not stopped the Fed from pulling out all the stops to avoid deflation in the US. This suggests that fed policy has recently not only been confused but also inappropriate and so has increased the risks of instability in the economy in the medium term.

Greenspan's monumental liquidity trap (17)
The most alarming component of the labor statistics is that wages rose just 2.2% in the 12 months to the end of May. Inflation on the other hand rose 3.1%. So the American wage earner got poorer in the current "recovery". In every previous recovery wage earners got richer. The Greenspan boom is already on very fragile ground and this was before interest rates started rising. Dr. Kurt Richebacker writes in the attached note ("Greenspan's monumental liquidity trap") that "..by maintaining the consumer borrowing and spending binge in the face of plummeting income growth, the mortgage-refinancing bubble has been the U.S. economy's lifeline... What is unfolding there is not just gradual credit restraint. It is a most savage credit crunch with obvious, most dismal consequences for consumer spending and the economy."

Ignorance is bliss (16)
An article which takes its queue from Socrates who once said:
"True knowledge exists in knowing that you know nothing. And in knowing that you know nothing, that makes you the smartest of all."
The article describes well how it has come to be said that:
"Americans buy things they don't need, with money they don't have, from places they can't find on a map, to impress people they don't like."

House Prices - An Orderly Decline in Appreciation or a Crash Landing? (15)
MAKE IT STOP HURTING! by Gary North (14)
How to identify a bubble, by Kurt Richebacher (13)
Gold - the story of the 20th century (12)
5 Steps To Investing Better Than The Pros (11)
Too many treasure hunters, By Marc Faber (10)
US main beneficiary of China's fixed currency policy (9)
Paper Money and Tyranny (8)
Mutual Fund Expenses (7)
The Bankruptcy of America (6)
Reinventing Mutual Funds (5)
Moving the Goalposts (4)
Faith Versus History (3)
The Gold and Dollar Standards, Deficits and Inflation (2)
How pension fund losses boost earnings (1)