Archive - Oct 8, 2013 - Blog entry

China's predominant foreign policy has been cutting business deals, while the US policy has been one of military deployment followed by pressuring trade deals. Reception to the latter, not surprisingly, is increasingly being viewed as one-sided and not a win-win.

Pay no attention to that Keynesian moron behind the curtain!

Overview of Abenomics. 

Isn’t it wonderful how the US believes (whether that be the citizens or the politicians) that the state will never default on its debt repayments?

A year or two from now the insurance companies will be getting big increases. Whatever you think of Obamacare today, wait two years, you will come to hate it.

The appalling fiscal and monetary situation in the U.S. will lead to further dollar weakness in the coming  months. This weakness will be most manifest versus gold as other fiat currencies have their own risks. 

The euro system has many peculiarities as we have shown extensively on our blog. To a large extent the system can be analyzed as a “tragedy of the commons” problem. As is well known in economics, when a shared resource can be exploited in full by individuals with no exclusive property right, the resource will be overexploited.

The euro is a shared resource. Every national central bank can exploit it to the fullest while the cost will be shared by every member state.

The incentive in such a system is obviously rigged to its disfavor and it will eventually break down.