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Big government creates less individual freedom because the larger a government is, the more everybody says "Well I've got an idea...we can prevent this from happening by passing a law against that, and we can encourage this by passing this law". So there are all these 'great' ideas that people have that they think are going to fix things and make the economy better...but after a while you find out that you've got limited choice, that the your life is being managed, that you can't do the things that you want to do.
The private sector is what creates an economy, not the government. All wealth comes from the private sector. Government consumes it.
The larger the size and of the government compared to the size of the private economy, the worse the economy gets. So anytime somebody says "They ought to pass a law against this!" or "They ought to pass a law against that!", or "The government needs to rush in and save us against this or that!", what you're doing is hiring a bunch of people that are going to have frictional jobs that do not create wealth. They don't add to the economy and they get paid by extracting wealth from the private economy.
So our prosperity falls with increasing size of government, it rises with a decreasing size of government. Simple as that.
Various commodities, particularly copper but also gold, are allegedly being used as collateral for raising large amounts of cash. The original story concerned onshore leveraged borrowers, which was followed more recently by others implicating offshore investors. Put very simply, a commodity-financed deal requires an offshore bank to issue a letter of credit against physical commodity stocks either in transit or held in bonded warehouses, which can be cashed onshore into local currency. This currency is then invested for a significant yield pick-up over the cost of owning the commodity, and is cheaper than funding this carry trade with US dollars.
It cannot be denied that inventive minds will always find a way round government regulations, but it is unclear how we differentiate these trades from normal trade finance, which also requires letters of credit and similar banking arrangements. The thought that SAFE is not competent to regulate commodity-backed lending and is unaware of its scale is difficult to unquestioningly accept. The foreigners prepared to rashly risk their money in a commodity-financed carry trade are a mystery to rational thought.
Instead, we run into a forest of assumptions. The believers in this story cannot identify the changes in bonded stock levels to support their argument. However, the dubious quality of analysis is even more obvious when it comes to gold.
This past week will go down in history as a pivotal turning point never to be forgotten.
Russia annexed Crimea, the first major land grab in Europe since World War II. A new Cold War has suddenly burst onto the scene. And Janet Yellen testified before Congress that short-term interest rates could be raised sooner than most analysts expected.
Now, to better flush out the real meaning between these unusual events, Martin called me with three timely questions:
What’s the next likely phase in the new Cold War? Is the United States still doomed to a major failure? What could save us from that fate?
Here’s an edited transcript of our call ...
Today was much busier than the closing numbers make you think.
A very surprising jobs report made sleepy traders jump this morning, then an hour later we learned about some new cast members for the Federal Reserve, and then we started seeing corporate earnings reaction.
The employment report has some experts scratching their heads. It was much weaker than anyone expected — and a sharp contrast to the more positive trend of recent months.
What’s going on?
"By printing money, they have convinced many of us that liquidity, provided by ample short-term capital in the system, is a substitute for solvency - the inability to meet our debt obligations.
"But that's like saying that because you have $10,000 in your pocket, that you can sustain a million-dollar mortgage without sufficient income to discharge your debt. The truth is that liquidity will never be a long-term solution to insolvency.
- Rick Rule, December 22, 2013
Silver demand in India jumped an incredible 311% during the first quarter of the current financial year: $1.78 billion, up from $433.8 million year on year. No less impressive is the country's year-to-date silver imports: they've already topped 128.6 million ounces, more than double the total imports of 61 million ounces in the whole of 2012.
The surge in interest in "poor man's gold" is partly attributed to the tight restrictions imposed on gold. Demand for silver comes from both fabrication (silver jewelry) and investment.
It's clear how strongly Indians feel about hard assets. Watch this ongoing saga as it develops—the fireworks at the end should be spectacular.
Banking-System Stress. With Fed monetization of U.S. Treasury debt at 90.5%, and with June monetary base annual growth soaring above 20%, the lack of meaningful movement in June M3 annual growth is suggestive of an intensifying liquidity crisis in the bank system, as discussed in the Hyperinflation Watch.
No Economic Recovery Here. The June 2013 report on labor conditions, published July 5th by the Bureau of Labor Statistics (BLS) included some harsh indications of economic deterioration in the broader unemployment detail (ShadowStats measure hit a record high for the series), along with heavy seasonal-factor distortions in the headline payroll data.
FAME.org reprints the moving plea of Warren Buffett's dad, originally published in The Commercial and Financial Chronicle, on May 6th, 1948:
Is there a connection between Human Freedom and A Gold Redeemable Money? At first glance it would seem that money belongs to the world of economics and human freedom to the political sphere.
But when you recall that one of the first moves by Lenin, Mussolini and Hitler was to outlaw individual ownership of gold, you begin to sense that there may be some connection between money, redeemable in gold, and the rare prize known as human liberty.
Also, when you find that Lenin declared and demonstrated that a sure way to overturn the existing social order and bring about communism was by printing press paper money, then again you are impressed with the possibility of a relationship between a gold-backed money and human freedom.
In that case then certainly you and I as Americans should know the connection. We must find it even if money is a difficult and tricky subject. I suppose that if most people were asked for their views on money the almost universal answer would be that they didn't have enough of it.
In a free country the monetary unit rests upon a fixed foundation of gold or gold and silver independent of the ruling politicians. Our dollar was that kind of money before 1933. Under that system paper currency is redeemable for a certain weight of gold, at the free option and choice of the holder of paper money.
Do you need to buy life insurance? If you do, it is probable you are asking yourself, "How much insurance do I need?", "What kind of policy is best for me?" and "Which insurance company should I buy from?" Buying life insurance can be a daunting task, but it doesn't have to be.
When buying life insurance, it is important that you know how your broker will be paid. If they are working strictly on commission, for example, your needs may be secondary to selling you a policy that gives the best commission. Any commission at all for your broker can lead to a conflict of interest, so always ask to see all of the alternative products before buying.
Be sure to read over all of the information about the life insurance plan that your company offers. You may find that it will not be enough. You may want to invest in an additional policy to be sure that your family is going to have enough money in the event of your passing.
You may be able to save a significant amount of money on your life insurance by paying your premiums annually instead of monthly. Insurance companies often have extra fees for customers who pay every month instead of just once a year. Ask your insurer if you can switch to an annual payment.
If you are working with an advisor to get life insurance, and this person is not fitting your needs, it is important to know that you are able to look for another one. You want to make sure you are working with an experienced, knowledgeable advisor who is looking out for your best interests.
As you can see, buying a life insurance policy is not as hard as you once thought it could be. By using the tips mentioned, you can successfully and smoothly choose and buy the policy that is right for you. Now that you have the information you need, what are you waiting for?
If you're looking into adding gold to your portfolio, how do you plan on doing that? You might have heard a few things from time to time, but you're here looking for more information as to how you can utilize gold within your investments in different ways and to learn more about the market. So, keep reading to get that information.
Do your research on the fee and commission structures for the dealer you are considering. Every dealer will have slightly different commission structures. Some may be more fair to you than others, so use it as a way to comparison shop against multiple dealers. This way, you can get the best deal for you possible.
You don't have to physically own gold to invest in gold. Check out mutual funds that invest specifically in gold. Also look at mutual funds that invest heavily in commodities in general with a concentration in gold. This makes investing in this sector a lot easier to handle for many.
If you're going to get into gold, plan ahead for it. As fun and rewarding as it may be, accumulating wealth is also a very stressful thing if you're not prepared properly. Consider things like storage and insurance long before you get your hands on any gold, and avoid unnecessary headaches and worry.
Remember that gold is not the only type of precious metal that you can invest your money in. Sometimes silver and palladium can actually be better investment that gold. In addition, you can also buy copper bullion bars and copper coins. Therefore, do not think that gold is your only option if you are looking to invest in metal.
Be sure that you pay attention to the advice that has been described so that you can work on making sure that you take advantage of investing with gold. Gold really is a great investment that has historically proven its status. Realize the steps necessary to invest in gold, and start working on a plan.
Liechtenstein Life Insurance Advantages
In a 13-F release issued by the SEC after market close yesterday, it was reported that Soros Fund Management LLC, founded and chaired by billionaire financier George Soros, significantly increased its gold related holdings, most notably, through the purchase of over $25 million dollars worth of call options on the GDXJ Junior Gold Miners index.
This stunning move by one of the world’s top performing hedge funds, suggests a powerful surge ahead for gold equities. It should be noted, that in the forty years prior to 2010, the Soros Fund averaged a 20% annual rate of return.
Bottom Line: While debate continues as to how far gold and gold equities will continue to drop, the Soros Fund is lightening up on physical gold in exchange for gold mining equities and call options on the extremely volatile junior mining stocks.
There couldn’t be any stronger indication by the fund as to its beliefs about the timing of this bottom (outside of selling everything and going all-in on call options of course).
It remains to be seen whether these positions will end up in the green or not, but with a forty year track record of 20% annual returns, I’ll be betting on the Soros Fund.
Regular readers will know I am in the inflation, possibly hyperinflation camp; but there are those that think the future is more likely to be deflationary. In the main this is the view of neoclassical economists, Keynesians and monetarists, who generally foresee a 1930s-style slump unless the economy is stimulated out of it.
Rather than repeatedly go into the errors of their ways, we must accept that they are in charge. They have decided that prices must not fall, and they see moderate price inflation as a necessary stimulant to business: this is the reasoning behind Helicopter Ben Bernanke’s defining statement, when he made it clear that central banks could spray the economy with endless fiat money if need be.
Given this determination to stop prices falling, worries that the outlook is deflationary are unlikely to be realised. But there is a second group of commentators which believes that in a slump there will be an unstoppable credit contraction as banks are forced to foreclose on failing businesses. This, they say, will lead to a mad dash for cash to pay off debt, leading to fire-sales of assets as credit contraction spreads to otherwise sound businesses. The imperative to pay down debt will overwhelm central banks’ attempts to replace it with cash.
David Rosenberg, the veteran Wall Street economist and bearish strategist at Gluskin Sheff, gave an intense presentation on Friday at John Mauldin's Strategic Investment Conference.
Titled "Bernanke: The Wizard Of Potemkin," this presentation offers a sobering look at the anemic U.S. economy, the labor market mess, and the Federal Reserve's controversial efforts to get everything back on track.
Before you can even think about getting bullish, you must consider the eye-opening charts from Rosenberg's presentation.
Thanks to Gluskin Sheff for giving us permission to feature this presentation.
MyLifePlan - discover a unique and complete investment solution via Liechtenstein Life Insurance Policy
Die japanische Solar Frontier KK hat mit der "Development Bank of Japan (DBJ)" eine gemeinsame Investmentgesellschaft gegründet, welche in Japan große Solarkraftwerk-Projekte finanzieren soll. Es soll um Projekte mit einem Volumen von 100 Megawatt pro Jahr gehen. In Japan weist Energieerzeugung aus erneuerbaren Quellen starkes Wachstum vor. Die Photovoltaik-Module von Solar Frontier KK zeichnen sich durch einen hohen Wirkungsgrad und die Verwendung von Kupfer-Indium-Gallium-Diselenid (CIS) aus. Ein verstärktes Wachstum bei der Nutzung dieser Module sollte die Nachfrage nach den strategischen Metallen Indium und Gallium weiter steigen lassen.
Buying insurance can seem like such a chore, but it doesn't have to be. As with anything, knowing what you are doing makes the process much simpler. Educating yourself about insurance isn't difficult. This article will help clear up your confusion and give you the information you need to make the right choice.
If you want insurance companies to deal fairly with you, then you must do the same for them. You might be tempted to pump up your claim or say you lost more than you did, but if you do this, you will add fuel to their concerns about claimant fraud and they are less likely to deal with you in an honest way. It's the Golden Rule, once again: report your loss fairly and honestly, with all the details needed, and accept what appears to be fair value (if in fact that is what you're offered).
Before purchasing any kind of insurance, shop around for a local, independent agent who sells policies from several different insurance companies. These agents are often able to get you the best deals on insurance for your individual circumstances, especially since they are not beholden to just one insurance company.
Any time you have a life event such as marriage or children occur or when you have a lifestyle change such as children leaving the home for good, take the time to evaluate your insurance policies, determine your new needs and where you can save money or need to increase coverage.
As you can see, insurance isn't really that complicated. Once you've mastered these basic concepts, you'll be able to successfully deal with any insurance situation that you may encounter. Just remember what you've learned from this article. Put this information to work for you and soon you'll wonder why you were ever concerned about insurance.
You want the truth about life insurance, not just what some random person has said on the Internet. There are scores of self proclaimed experts out there, but you need to know the correct information and be assured that it is legitimate. You will most likely find exactly what you are looking for in this article.
There will come a time in your life when, if you've been lucky enough to get to that point, you will want to consider long-term care insurance. You should definitely consider it once you hit your fifties. If you become too ill or infirm to continue your current lifestyle, you will want to have a Plan B, so that you can rest assured your care needs will be covered no matter what life throws your way.
Consider your current health when purchasing a life insurance policy. It is less expensive to purchase life insurance at a younger age and when in good health than later in life. Often, even if you experience health problems later, your life insurance is not impacted if it has already been in place. Trying to buy a policy after a health problem can be much more expensive, if not impossible.
If you are considering a whole life policy, you might want to think again. Term life insurance is usually the way to go. Whole life policies often come with fees and commissions, which are considerably higher than term policies. In addition, there are many better options for saving for retirement or investing.
In summary, you want to be careful who you take advice from with regards to life insurance. It is important to you that you have the correct information and that it is portrayed in a clear and concise manner. Hopefully the tips provided in this article will be more than useful for you.
We have seen massive manipulation in the paper gold market in the last few days and weeks. Please read my latest KWN interview which explains that this is nothing to be concerned about since the problems in the world economy are getting worse by the day. So far, into this morning, we have seen a correction in gold of 27% since the $1,920 top in September 2011. Remember that in 2008 gold corrected 34% from $1,032 to $681. From the $681 low, gold then went up almost 3 times in just 34 months.
This correction could last a bit longer, but once gold turns, we should see a very strong rebound which will reflect the deteriorating economic situation worldwide, as outlined in my KWN interview. Since the paper market will have to cover their shorts at that time, we are likely to see a very fast move in the second half of 2013.
The next target is still $3,500-5,000 and much higher over the next few years.
Remember gold (and silver) is held for wealth preservation purposes. It is therefore critical that investors hold on to their physical gold and silver and if possible add at these very low levels.
Egon von GreyerzFounder and Managing Partner
Matterhorn Asset Management / GoldSwitzerland