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IceCap Asset Management: Tug Of War
From Keith Decker - IceCap Asset Management
February 2012 – Tug of War
In Berlin June 1922, Alia Schmidt paid 3 German Marks for a really nice loaf of bread. A very quick six months later, the same loaf of bread cost her 700 German Marks. The German decision to print money caused inflation to skyrocket. No one was happy and Mrs. Schmidt had to stop eating bread.
In Tokyo 1994, Makishi Satou paid a whopping 217 Japanese Yen for a delicious McDonalds hamburger. A very long 18 years later, Mr. Satou is still enjoying hamburgers, yet he is only paying 216 Japanese Yen for this very same delicacy.
The Japanese decision to print money resulted in zero inflation. Yet, despite a full belly, Mr. Satou and others are not at all happy with their money printing experience and the subsequent -77% decline in their stock market and the -90% fall in their property market.
Today, future economic historians are lucky enough to both see and experience what will happen as Europe (lead by Germany), Japan, Great Britain and the United States fully engage in the biggest, coordinated, money printing experiment in the history of the Universe. In its simplest form, only three scenarios are possible:
1) Money printing has absolutely no impact on prices rising or falling
2) Money printing results in a return to the 1922 German experience
3) Money printing results in a return to the modern day Japan experience
No worries though - the very competent hands of today’s central bankers, on the surface at least, appear quite confident that their money printing games will successfully engineer a very serene road to prosperity. The mere mention of the probability of scenarios 2 or 3 occurring are casually dismissed as easily as an offering of a third espresso.
However, what should make you a little concerned is that central bankers in both 1922 Germany and 1990 Japan came to the very same conclusion before they commenced their devastating money printing strategies.
...
Tug of War – Inflation vs. Deflation
The 1922 German hyperinflation experience was undoubtedly propelled by printing massive amounts of money. Yet, the Japanese money printing experience has had no impact whatsoever on inflation.
Here we are in 2012, and the World’s four main central banks (USA, Britain, Europe and Japan) continue to print gobs of money. Will the outcome be 1922 Germany or 1990 Japan?
An important point to understand is whether the printed money actually flows through to the economy. In the 1922 German case – yes, it definitely did. The printed money circulated in the economy causing the German Mark to plummet against other currencies which resulted in extreme inflation.
Today, trillions of Dollars, Yen, Euros and Pounds are being printed – yet this new money is certainly not being distributed into the economy. Instead, big banks everywhere are hoarding the newly minted cash for a rainy day. In economic parlance, this is referred to as a “liquidity trap” meaning there is plenty of cash available, however the cash remains trapped and is not being used. This makes today’s situation, perilously closer to the Japanese experience.
Chart 1 ... shows the amount of money not being distributed into the economy by the very big American banks. Once this money is eventually released (via loans) into the economy, the cost of things could rise very quickly – similar to 1922 Germany.
We (and many, many others) have been very critical of the American, European and British central banks. We freely admit that these people all have very good intentions – they truly do want the World’s economy to return to normal.
Yet in our opinion, it is their analysis of the problem that is leading them to make a very big mistake. The central banks fully believe that the World is currently suffering from what they would call – an aggregate demand problem. They believe growth is slow around the World because people and companies are not spending as much money as they normally would.
To many of the big banks, stock brokers and mutual fund sales people, this “aggregate demand problem” sounds no different than any other economic slow down – it’s a part of a normal business cycle. And during a normal business cycle, the solution to encourage people and companies to spend more money has always been 1) lower interest rates and 2) increased government spending. And if the situation becomes untenable as it is today, you can add 3) money printing to the list.
The reason this combination isn’t working today is due to the flawed belief that all of this extra money sloshing around in the economy will naturally entice people and companies to spend their hard earned (and borrowed) money again.
With trillions in freshly printed money, sub 2% growth, widening government deficits and continued bailouts to banks, it has become crystal clear that the central banks’ money printing strategies are not working.
The reason it isn’t working is simply due to the fact that all of this free money being provided to the banks, is not being distributed back into the economy. US and European banks are hoarding this free money and as a result - the transfer mechanism is broken.
For the game of Tug of War - it is this lack of liquidity-flow-through that is hugely supportive of a return to the 1990 Japanese experience. The lack of spending by people and companies in favour of paying down their debt and increasing their savings guarantees sluggish growth at best.
However, it is also critical to know that despite the hoarding of cash by the big banks, the act of money printing by the central banks strongly encourages investors to shun low paying bonds and cash, and instead focus on stocks and commodities.
This by product of money printing has two effects. First, it pushes commodity prices higher, which inevitably causes the prices of some things to also rise higher (when you have a chance, check out the price of gasoline these days).
Secondly, while a higher stock market does help everyone who owns stocks, it just so happens to help the very wealthy a lot more. It is this growing divide which is fueling the bitter tax debate in the US, as well as being the spark for the recent “Occupy Wall Street” movement. Today, you can also include it as the indirect spark which will lead to the eventual social uprising in Greece.
The bottom line is as follows – the combination of the bursting of property prices and the refusal of the big banks to write-off the corresponding bad debt is resulting in a big wave of deflation. We expect this to continue. Yet, we also are mindful enough to know that pockets of inflation will occur in various countries and within various industries.
The real threat of hyper inflation will occur when a major currency collapses. Any country that leaves the Eurozone will undoubtedly see extreme inflation during their transition years. Outside of the Euro-zone, Britain remains at risk due to it being a key center of global finance and at risk should the World’s super-size banks implode once again.
More in the full presentation (pdf)
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BTW - that's spelled "bid'neth" - just like it sounds.
For anyone interested in the accuracy of my almost 1 year old gold and silver price prediction charts- not bad at all (with further extensions forward):
http://www.tfmetalsreport.com/comment/132166#comment-132166
http://www.tfmetalsreport.com/comment/132799#comment-132799
Inflation is evident in FOOD - which is why North Africa revolted as they are major grain importers - ENERGY - WOOD - PAPER - etc etc
It's not so much that the banks are hoarding all that printed money, it's just simply that all the money is concentrated in the top .00000001%, and they only need so many houses and cars and washing machines. Meanwhile the rest of us need to tighten our belts to keep the value of all that created money somewhere near what it was yesterday.
If all that money cerated were actually trickling down, you would see that 3 dollar hamburger at Mickey Dees cost 30 dollars in no time at all.
Those in control understand this very well and have no intentions to ease up the pressure on the wage suppression schemes unless they are forced to a la arab spring type action by the unwashed masses.
The tools at their disposal, amongst others: The manipulation of all markets, the might and arsenal of the US military, the vast propaganda machine of most of the world media, well the list goes on....you get the drift.
Very insightful Piece - Excerpt
Unreal how wrong this presentation is. A true study in contradictions.
In Tokyo 1994, Makishi Satou paid a whopping 217 Japanese Yen for a delicious McDonalds hamburger. A very long 18 years later, Mr. Satou is still enjoying hamburgers, yet he is only paying 216 Japanese Yen for this very same delicacy.
with productivity gains the burger should be priced even lower. Inflation has held that back
Mr. Satou and others are not at all happy with their money printing experience and the subsequent -77% decline in their stock market and the -90% fall in their property market.
asset prices have fallen but haven't fallen as far as they should have in a country with as bad of economics as Japan has
http://blogs-images.forbes.com/michaelpollaro/files/2012/02/Slide11-
Today, future economic historians are lucky enough to both see and experience what will happen as Europe (lead by Germany), Japan, Great Britain and the United States fully engage in the biggest, coordinated, money printing experiment in the history of the Universe. In its simplest form, only three scenarios are possible:
1) Money printing has absolutely no impact on prices rising or falling
2) Money printing results in a return to the 1922 German experience
3) Money printing results in a return to the modern day Japan experience
Today, trillions of Dollars, Yen, Euros and Pounds are being printed – yet this new money is certainly not being distributed into the economy.
Instead, big banks everywhere are hoarding the newly minted cash for a rainy day. In economic parlance, this is referred to as a “liquidity trap” meaning there is plenty of cash available, however the cash remains trapped and is not being used. This makes today’s situation, perilously closer to the Japanese experience.
The money is being used. The banks are using it as reserves which gives them the ability to continue to operate in the market which drives up assets prices above what their value would be otherwise.
The reason this combination isn’t working today is due to the flawed belief that all of this extra money sloshing around in the economy will naturally entice people and companies to spend their hard earned (and borrowed) money again.
With trillions in freshly printed money, sub 2% growth, widening government deficits and continued bailouts to banks, it has become crystal clear that the central banks’ money printing strategies are not working.
It may be clear to you but I can promise you it is not clear to federal reserve or DC. This means even more printing and more deficits and more Fed asset purchases are on their way further increasing the price of commodities which will eventually flow through to labor costs, and end product costs. Look at the shrinking margins of almost any company. Read almost any year end or quarterly report margis are shrinking and almost every time it is attributed to rising input costs.
The reason it isn’t working is simply due to the fact that all of this free money being provided to the banks, is not being distributed back into the economy. US and European banks are hoarding this free money and as a result - the transfer mechanism is broken.
You have to be blind not to see how the money is flowing into the economy. You really do not think government can replace lost purchasing power of citizens? BTW have you seen home prices in DC and NY? Have you seen the price of corn? Have you read any producers year end reports that discuss increasing input costs? Have you checked the price of gas? Have you read any producers year end or quarterly report?
For the game of Tug of War - it is this lack of liquidity-flow-through that is hugely supportive of a return to the 1990 Japanese experience. The lack of spending by people and companies in favour of paying down their debt and increasing their savings guarantees sluggish growth at best.
Real growth yes. GDP growth no. A huge and ever growing portion of GDP is government spending. They have a blank check to spend how ever much they want and what ever they want.
However, it is also critical to know that despite the hoarding of cash by the big banks, the act of money printing by the central banks strongly encourages investors to shun low paying bonds and cash, and instead focus on stocks and commodities.
This by product of money printing has two effects. First, it pushes commodity prices higher, which inevitably causes the prices of some things to also rise higher (when you have a chance, check out the price of gasoline these days).
Secondly, while a higher stock market does help everyone who owns stocks, it just so happens to help the very wealthy a lot more. It is this growing divide which is fueling the bitter tax debate in the US, as well as being the spark for the recent “Occupy Wall Street” movement. Today, you can also include it as the indirect spark which will lead to the eventual social uprising in Greece.
The bottom line is as follows – the combination of the bursting of property prices and the refusal of the big banks to write-off the corresponding bad debt is resulting in a big wave of deflation. We expect this to continue. Yet, we also are mindful enough to know that pockets of inflation will occur in various countries and within various industries.
You just pointed out multiple instances of inflation (oil, stocks, commodities) Yet we are headed for a big wave of deflation? This is where every single person that cannot properly define deflation and inflation gets mixed up. Once again I will help you out. Inflation is increase in prices caused by an increasing money supply. Deflation is decling prices caused by a falling money supply. Used in this manner they are mutually exclusive. You cannot have both at the same time. Some assets can have declining prices during inflation. That does not mean their faling prices was caused deflation. If you like so many other people want to simply use the terms inflation and delfation for rising and falling prices you will continue to have as many mental contraditions as you have contradictions in this article.
The real threat of hyper inflation will occur when a major currency collapses. Any country that leaves the Eurozone will undoubtedly see extreme inflation during their transition years. Outside of the Euro-zone, Britain remains at risk due to it being a key center of global finance and at risk should the World’s super-size banks implode once again.
Finally one point you are correct on albeit rather obtuse. Hyperinflation is defined as a drastic increase in price due to the complete collapse of faith in the currency.
You nail it riphoward, thanks for the sanity.
Good commentary. The fact that it leaves me even more confused than ever means that it is well worth reading. I totally blew Mish off about his deflation theories @ 2 years ago, now , I see his point.
Don't the banks realize that they are sitting on a bunch of worthless computers storing these 1's and 0's fiat entries?
Eventually, it would seem logical to me that at the first sign of currency collapse, even things that are "depreciating" in value will have more worth than the electronic entries in these computers. A second Oklahoma Sooner rush for land, tangibles etc. The swiftness at which events could unwind is the scariest thing about this. A slow grind down can at least gives the little guy a fighting chance.
"with productivity gains the burger should be priced even lower. Inflation has held that back"
No matter how much you may want it no production can become so efficient that that process becomes instantaneous or free. There's a limit to productivity.
I did not say that anything could be instantaneous or free nor did I say I wanted it to be.
My only point was that increased productivity didn't necessarily make that hamburger cheaper over that time span. Yours was a good post. Thanks for it.
One of the 'features' of the Weimar era was the repatriation of hundreds of tons of gold back into Weimar seeking investment opportunities in Germany.
There was hyperinflation across Europe not just in Germany.
Germany's obligation vis. the Versailles Treaty was in the form of foreign exchange goods: lumber, coal and steel output. All forms of German output increased after the end of the war, adjusted reparations were within the means of Germany to pay.
Germany had a moral obligation to pay the entire costs of the war. The British decided early on to appease the Germans and cut out the French. NOTE: US General Jack Pershing insisted the war continue until the German army was destroyed in the field and Berlin occupied by allied forces predicting a resurrection of Germany and a new war otherwise. The British opposed Pershing as they faced mutiny in their armed forces. The French forces had already mutinied, so had the Russians and the German forces were in the process of mutiny. Thus the war ended Nov. 11, 1918 rather than six-months later.
Reparations were paid on schedule as long as the French occupied Dusseldorf. After 1920 when the French left Dusseldorf the Germans began reneging on payments-in-kind. This in turn led to the occupation of the Ruhr by the French in 1923. Germans repeatedly defaulted on both overseas loans AND war reparations: reduced reparations were finally paid off in 2010.
Occupation of the Ruhr has been blamed for German hyperinflation but the inflation was well-underway BEFORE the French occupied this territory. The occupation allowed the French to gain reparations payment (in kind) from Germany equal to amounts the Germans in the past had little trouble paying. Reparations had little to do with German inflation.
Inflation in Germany spiked after the assassination of German finance minister Walter Rathenau in 1922 by members of German Freikorp. Rathenau was a Jew (he also invented the modern debt-based economy.)
Inflation is the 'footprint' of war. Certainly there was inflation during war period in US (until 1920) due to partially sterilized gold flows into the US prior to 1914. Unsterilized gold flows into Europe after 1920 would cause inflation in Europe which indeed took place.
If gold flows were responsible for Weimar hyperinflation, then the increase in papiermarks was a central bank attempt to sterilize the flows, an attempt which then took on a dynamic of its own. The bank would have needed to issue more bills and bonds on its own account rather than currency. It may be that the Reichsbank, like most central banks, was prohibited from doing so. But understand -- as the article above points out -- had it done so there would have been little inflation in Germany in 1923.
Increasing currency/increasing debt at the same time one cancels out the other.
Unfortunately, the economist who might have provided the sharpest insight -- Keynes -- went off 'on a (political) tangent' and is not that clear on the subject.
What is your source for this?
"One of the 'features' of the Weimar era was the repatriation of hundreds of tons of gold back into Weimar seeking investment opportunities in Germany. "
be careful going down that road - once you see some things, you can't 'un-see' them.
http://www.afn.org/~govern/mcfadden_speech_1932.html
after you get done with that (make sure you read the whole thing) have a look at the fine print on the back of a Series 1913 FRN.
Think of where those banks of redemption were located. Were they just in the USA? or in other nations as well?
this old tome is also of interest...
http://www.archive.org/details/coinsfinancialsc00harvrich
Good luck...
Excellent post! Language that us financial newbs can sink our soft, deciduous teeth into.
A new economic theory of controlled compressed inflationary taxation in combination with selective deflation is well underway through unified monetary policy. The problem with seeing hyperinflation as the result is a misunderestimation of the potential for targeted inflation/deflation to succeed. I would suggest the following...a unified monetary policy exists worldwide that is creating successfully targeted inflation/deflation in combination with targeted austerity leading to increased tax receipt versus debt ratio in a ZIRP environment. Do you need a single world currency to achieve this result or will unified monetary policy suffice?
Gold will continue to be suppressed in this now fully committed world of fiat at the point of a barrel if necessary as will all other assets that produce no or negative tax revenue. To this end the GOP will continue their effort to reelect Obama because he can be trusted to enable compressed inflationary taxation policies to continue. The reality is that the GOP is no more interested in spending cuts than are the DEM. Yes Virginia, Obama is our appointed Banker leader just as surely as the appointed leaders of Greece and Italy CB shills.
For obvious reasons no nation will ever peg its currency to fixed gold again making hyperinflation in a unified environment impossible for every nation but those out of the loop. RIP Iran not for your nuke program but for your brazen assertion of sovereignty. RIP sovereign man for you too will soon be crushed when historic silver/gold ratios are restored in favor of central banking unified policy. Lastly RIP Ron Paul for in the passing of this symbol of barbaric relic-ism coupled with the soon to be declared monetarist victory all memory of what money was shall be forgotten.
sad really.
Dear Mr Statist,
Great to start an argument with "for obvious reasons" reminds me of "you have to agree"
"no nation will ever peg its currency to fixed gold again making hyperinflation"
That is speculation pure and simple. You have no idea what will happen.
Nations can do as they may. People will have the final say. People will be the ones that go back to the "barbarous relic" that leads to greatest gains in wealth and avoids the theft of the statist system you seem to advocate.
You are right about not knowing because none but the few in charge are privy to the stated goals which no doubt continue to generate transcribed belly laughs. I know nothing but what my senses are allowing me see and then present as speculation.
My first assumption is that the FED in conjunction with the other major CB's are trying to fix and stabilize worldwide banking, as well as governments fiscal ailments, via monetary policy without the interference of unpredictable free market outcomes. It is safe to assume that we are witnessing emergency monetary measures so why not guess at what econ geniuses might be doing to manufacture their definition of stability. The ultimate goal in their minds must be a return to free markets but that goal is not being left to chance.
Additionally, I assumed that in their minds it is possible to create sustainable debt, increase tax receipts and suggest the conditions under which this is being pursued. At no point did I say I liked, approved or agree with the speculated method. Gold and silver suppression is a common theme here on ZH. Money printing/creation by all major currencies is an accepted reality. The need to pay down National debts is an obvious goal. The need to increase tax revenue is a constant pursuit of every government on this planet but how do you increase tax revenue sans tax increases. The need to lower certain government expenses IS a universal theme but strangely no such theme regarding OVERALL government expenditures is being advanced. Admittedly not every country has the same problems but all have a stake in stability.
Sometime in the future books will be written that will put to rest once and for all the misbegotten theories of yesteryear in favor of the new normal that 'saved' the world economy. Really, what other outcome is possible?
What I wrote above is disturbing to me but one must commit to honest speculation in order discover unknowable truth. It's an interesting exercise to ponder what Bernanke is doing and how he might succeed but very dark indeed.
You call me a statist but I am in fact a longtime RP supporter.
People will have the final say? Did you miss the overt threat to all those who may try to bypass our pre-approved taxable regimen? Do you think we can stop them? GLWT.
I apologize for the misinterpretation. I agree with your overall anaylsis of what they are trying to do. I do not disagree that they will attempt to stop people from pursuing freedom and separation of economics and state. Where I think I disagree is that they can stop people. My speculation is that they will eventually lose control. USSR, Zimbabwe, Weimar and lots of other examples in history shows this to be the case. When they lose control is obviously the million or is it quadrillion dollar question.
no need to apologize. If it were not the USA that should be going Wiemar I believe the people could win. Since it is the USA you can rest assured that 1000 most unpleasant contingencies stand at the ready to protect our "recovery".
Knowing that we would kill anyone or anything that stands in our economic path makes envisioning our eventual success much easier. This is who we have become in the interest of National Security. Extrapolate the potential uses of an incident such as this from the perspective of a desperate federal government and the sky is the limit.
Feb. 24, 2012
By Billy House
National Journal
WASHINGTON -- More U.S. Senate state-based offices have received mailings containing a suspicious powdery substance, according to an update from Senate Sergeant-at-Arms Terrance Gainer sent to senators on Thursday morning (see GSN, Feb. 23).
Like previous mailings received earlier this week by other congressional state or district offices, that powder was found to be harmless, according to Gainer.
A spokeswoman for Senator Joe Lieberman (ID-Conn.) said the senator's Hartford office received a powder-filled letter at about noon on Thursday. Becasuse the address matched the one issued in an earlier warning from Gainer's office, the package was not opened there, but taken away. The powder was later determined in an initial evaluation to be harmless.
The Burlington, Vt., office of Senator Patrick Leahy (D-Vt.) also received an envelope the same day containing poweder found to be harmless, a Senate official said.
Also on Thursday, the Wichita, Kan., office of Senator Pat Roberts (R-Kan.) reported it had received such a mailing.
“Authorities have assured Senator Roberts that the situation is under control and the office will re-open tomorrow for business as usual,” said Roberts’s communications director, Sarah Little, in a statement. “Senator Roberts’ office in Wichita received a suspicious envelope and reported it to law enforcement who responded immediately.” Little added that the investigation "is ongoing" and that Roberts was in Topeka at the time of the incident.
The Philadelphia office of Senator Pat Toomey (R-Pa.) received a similar mailing on Thursday as well, a spokesman for the senator said, adding that its contents were deemed harmless.
Gainer provided no details as to how many or which lawmakers’ offices have newly joined the list of recipients, which began with news a district office of House Speaker John Boehner (R-Ohio) and state offices of Senators. Dan Coats (R-Ind.) and Patty Murray (D-Wash.) had on Tuesday and Wednesday received such mailings.
The harmless powder in each of those initial cases was determined to be corn starch, possibly mixed with some other harmless substance. As of Thursday morning, no additional House members’ district offices were known to have received the mailings, according to the office of House Sergeant-at-Arms Paul Irving.
But in a separate memo sent on Wednesday to Senate offices, Gainer's office had warned, “The author of these letters has indicated that additional letters containing a powdery substance will be arriving at more Senate offices and that some of these letters may contain an actual harmful material.”
In his update on Thursday, Gainer said that only in some of the additional Senate cases has the return address matched the Oregon address found on the earlier known letters.
“In other cases, however, letters had a different return address (though from the Pacific Northwest),” Gainer said.
“While none of the mail received and tested thus far has been found to be harmful, it is clear that the person sending these letters is organized and committed, and the potential to do harm remains very real,” he advises.
Gainer also urges Senate offices “to take this threat very seriously and remain extra vigilant when handling their mail.”
The FBI is spearheading the investigation that has a number of agencies involved. Gainer states in his message: “This rash of suspicious letters demonstrates once again how important it is for Senate offices to follow recommended mail-handling protocols. For the safety of our staff, our constituents, and the institution, it is imperative that all of us know these procedures and follow them vigorously -- each and every time.”
He reiterates that all letters and packages from unknown sources should be treated as suspicious, and the mail-handling protocols recommended by the Senate Post Office should be adhered to "at all times.”
“As a reminder, suspicious mail -- especially suspicious mail with an Oregon return address -- should be set aside and not opened,” Gainer says.
Obviously your are correct in asserting it could go either way but I would estimate 9 chances in 10 that the FED prevails. just my 2 cents.
The printing presses of 1921 Wiermar did not have a deflationary collapse of their banking system to contend with. They hyper-inflated because Baron de Rothschild decided he wanted it that way because he was short the Reichbunds in size. The BOJ and the FED are singing from the same hymnal in order to save their precious banks because in their minds, they ARE the only part of their economies that pay campaign contributions. The banks in Japan should have died in 1990 and the U.S. big-five NY banks should have died in 2009 but money talked. That is why the money-printing is not filtering down because it is shoring up those bankster balance sheets that they fucked up while still paying themselves those fat bonuses. As Matt Taibbi has said a hundred times: "Why is Wall Street not in jail?"
End the FED - period.
"Water, water everywhere,
And all the boards did shrink
Water, water everywhere
Nor any drop to drink."
The Rime of the Ancient Mariner
I just know there's a "Crime of the Ancient Marriner" joke here somewhere.
Lots of interesting post in this section. Some sound intelligent and logical while some do not. The challenging part for a person like me who has really no economics background other then running my small business in this challenging envirornment since 2005 is trying to determine just exactly where we will end up and is my daily fight and struggle to keep my business running really worth it. It has taken a heavy toll both financially (2 million annual revenue loss) and emotionally with all the daily and weekly stress of meeting income needs (cash flow from very slow paying clients) payroll obligation stress, increased taxes such as cash calls from Arizona unemployment via special assessments placed on businesses to resupply their needed income to continue to fund unemployment (on top of another 1.5% increase in the unemployment cost-now 4%), significantly reduced operating margins, national publically held companies fat with investment dollars squeezing out the small local companies such as myself, the list just goes on and on and this year I am making a decision on whether it is or isn't time to throw in the towel. Lets see, no vacation in 3 years now, 16 hour days versus my previous 10 hour days, see my Son for 30 minutes a day (while driving him to school in the morning) reduced my paycheck 40% in the last year and a half, and more taxes to come along with higher gas prices to cut even more into what is left of my gross profit margins that will certainly put me at break even or slightly in the red if we hit $4. Everyday it sounds better and better to just close it up, take a few months off, see my family, and go to work for someboody else who can have those headaches and stress while I just punch the clock, do my job, and go home and have a life. The incentive for small business just doesn't have a good payback anymore. My two cents worth and hopefully my gold and silver will protect me and my family in the future. Anybody want to buy a nice 2008 Pontoon boat with 10 hours on it? Surely some banker out there with all that excess cash can afford to buy it and put gas in it no matter the gas price because I sure won't be able to.
Read "When Money Dies" to find out where this can end up unless things change. They can still change so do not give up hope.
I saw first hand when money dies when my 12,000 shares of GM went bankrupted as did my 10,000 shares of Charter Communications. The only shares that didn't die was my ford stock which I sold my 15,000 shares off after watching my GM and Charter go bye-bye. Bought Ford at $1.50 and they are now at $12. My luck in stocks stinks so I am never going back in. I stay with silver and gold and some real estate and plenty of ammo now.