BMEWS
 
Sarah Palin's presence in the lower 48 means the Arctic ice cap can finally return.

calendar   Sunday - June 06, 2010

Put ‘em on commission

Yes, as usual I’m late to the party. I only discovered Jackie Mason since he’s been a contributing commentator on WorldNetDaily.

I know, I’m showing my age. Mr. Mason did this routine during the Reagan Administration. But his solution is timeless, timely, and something we citizens/voters should consider.


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Posted by Christopher   United States  on 06/06/2010 at 06:18 PM   
Filed Under: • Finance and InvestingHumor •  
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calendar   Wednesday - March 03, 2010

better banking?

A couple folks sent me this link, which I saw out at Insty yesterday. It seems Canada’s banks are in great shape, and they weren’t damaged by the “housing crisis” at all. Because they do things differently in Canada. Stronger rules and regulations, no tax write-off for interest, and NO POLITICS involved in the lending process. And, while I have no proof of it at all, I’ve always had the feeling that they have far fewer layabouts than we do. A much smaller permanent victim class.

It’s late, so here’s the link. Interesting short read. What’s the catch? I think there is one, but I can’t quite figure it out right now.

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Posted by Drew458   United States  on 03/03/2010 at 04:18 AM   
Filed Under: • Finance and InvestingInternational •  
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calendar   Thursday - February 25, 2010

Greek deputy PM’s extraordinary attack on Germany over debt crisis. It’s the Nazis fault.

I guess it isn’t funny and some are saying that the euro could fall if Germany doesn’t help to prop up the Greeks and see em through this disaster.

I haven’t done a lot of reading on this and don’t know what all the ramifications would be.  It’s surely nothing to bother the US, or might it?

Anyone with knowledge on this topic, welcome please.  I’d really like to understand it better. I find things like this quite interesting, especially living so close to things. 

You might want to see the comments at the end of the article at the MAIL.  Very interesting.  Also, I happen to think while reading this earlier today, isn’t it nice for a change, going from it’s Bush fault to , It’s the Nazis fault.


‘The Nazis took our gold, they should at least thank us’: Greek deputy PM’s extraordinary attack on Germany over debt crisis

By MAIL FOREIGN SERVICE

Nazi theft of Greek gold during the Second World War is to blame for the country’s faltering finances, Athens claimed yesterday.

It came as new protests about the economy turned violent.

Greece said the real culprit for its problems were the Nazis, whose occupation lasted from 1941 to 1945.

‘They took away the Greek gold that was at the Bank of Greece, they took away the Greek money and they never gave it back,’ said Deputy prime minister Theodoros Pangalos.

‘I don’t say they have to give back the money necessarily but they have at least to say “thanks”.’

Germany had failed to offer enough compensation for the economic impact of the Nazi occupation, he added.

Germany swiftly rejected the accusation, saying it paid £50million in compensation by 1960 and more to forced labourers of the Nazi regime.

The economy was crippled, as foreign trade was suspended, agricultural output ground to a halt, and the treasury had to loan Germany money.

The EU has asked Greece to explain reports that it engaged in derivatives trades with U.S. investment banks that may have allowed it to mask the size of its debt and deficit from authorities ahead of its entry into the euro zone.

But Mr Pangalos said Italy did more than Greece to mask the state of its finances to secure euro zone entry.

ARTICLE AND PHOTOS HERE


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Posted by peiper   United Kingdom  on 02/25/2010 at 06:27 PM   
Filed Under: • EconomicsFinance and InvestingInternational •  
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calendar   Tuesday - February 09, 2010

THERE ARE 8 BILLION, COUNT EM, EIGHT BILLION SHORT SELLERS ON THE EURO …..

Do you suppose some folks just happen to know something?

H/T Rich K for emailing me the article from the Telegraph.

I read papers but ... (Drew, where do I get a shamed face avitar for this?) [ Drew: um, like red face this? ] I hardly ever read the financials. It’s my wife who reads the business section.
She it is who informed me about the short sellers.

This is some serious stuff I guess. ??  What the hell do I know? What?  Me Worry? 
I just need to know how the Q’s are running (QQQQ) the tech index.  Buy at the lo and sell later. Or use em for covered calls.  Outside of that, I didn’t even know there was a banking crises till I read it on BMEWS one day. lol.

OTOH .....  What Rich sent sure did stir up things a bit.  Everything is so connected.  But guess what?  It was the same in the 1920s.
SUPER book called LORDS of FINANCE. Very fast read and not overly tech heavy.

And BTW ... oh boy do we know about margin calls.  Been there and don’t ever want to revisit that country.


Greek Ouzo crisis escalates into global margin call as confidence ebbs

For the third time in 18 months the global financial system risks spinning out of control unless political leaders take immediate and radical action.


By Ambrose Evans-Pritchard

Flow data shows an abrupt withdrawal of German and Asian capital from Club Med debt markets. The EU’s refusal to offer Greece anything beyond stern words and a one-month deadline for harsher austerity – while admirable in one sense – is to misjudge how fast confidence is ebbing. Greece’s drama has already metastasised into a wider systemic crisis. The world risks a replay of the Lehman collapse if this runs unchecked, this time involving sovereign dominoes.

Barclays Capital says the net external liabilities of Greece are 87pc of GDP, or €208bn (£182bn). Spain is worse at 91pc (€950bn), and Portugal worse yet at 108pc (€177bn); Ireland is 68pc (€123bn), Italy is 23pc, (€347bn). Add East Europe’s bubble and foreign debts top €2 trillion.

The scale matches America’s sub-prime/Alt-A adventure and assorted CDOs and SIVS of the Greenspan fling. The parallels are closer than Europe cares to admit. Just as Benelux funds and German Landesbanken bought subprime debt for high yield with AAA gloss, they bought Spanish Cedulas because these too had a safe gloss – even though Spain’s property boom broke world records. They thought EMU had eliminated risk: it merely switched exchange risk into credit risk.

THE REST OF THE ARTICLE IS HERE

AND THERE’S THIS BIT FROM ANOTHER PAGE , SAME PAPER.
Naturally, I see the name Soros and it’s akin to waving a Nazi flag at a BarMitzvah.

First the hedge fund manager, Jim Rogers, co-founder with George Soros of the Quantum Fund, says “sell any sterling you might have. It’s finished”. Then along comes another veteran of the hedge fund scene, Bill Gross of Pimco, to insist that “the UK is a must avoid. Its gilts are resting on a bed of nitroglycerine”.


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Posted by peiper   United States  on 02/09/2010 at 03:20 PM   
Filed Under: • Finance and InvestingUK •  
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calendar   Tuesday - January 12, 2010

A MOST EXPENSIVE PARTY LAUNCH. BUT THE PARTY’S OVER.

I don’t suppose many of you have followed this story much if at all.  Being somewhat closer to this, Dubai has figured in the news here quite often since this SPECTACULAR opening of the resort for billionaires.  We’ve been buried in beautiful photos of the place and at the beginning there were all these very positive comments and promises for the bright future ahead.
Well, Aladdin’s lamp has gone darkish as the place has all but gone bust.  Empty and decaying (already) apt. complexes, restaurants that either never opened as scheduled or if they did have now closed.  Nowadays the photos we see of this grandiose dream are sadly not so forward looking and the future does indeed look grim.  The developers had hoped that one of the rich Arab countries might shovel in some needed cash, and they did indeed get some from one of the Arab states.  I forgot which one.

Dubai is a place where a person goes to jail for an offense like a bounced check. They are very serious about that.
Photos we see now show expensive cars simply left in the street to collect dust as the owners have walked away, broke. They have left homes and apts the same way.  Simply abandoned and very many have had to sneak out of the country. Not that they were involved in any criminal activity mind you.  But they found the bubble had burst and their funds were either non existent or near to being so.  They could no longer pay the staggering bills and faced jail, and so left.  Many others have stayed trying as best they can to salvage something.  The people one really has to feel sorry for, are the many who were recruited to work there as waiters and maids and low level jobs, who came from foreign countries and are now at the mercy of ppl who don’t have a large supply of that.  While the money wasn’t huge by our standards, it was by the standards of the countries they were recruited from. 

Until today, I hadn’t seen this 2008 video.  In ‘08 I was busy 27/7 helping the wife with a bed ridden elderly mother and I guess I missed a lot.
Better late then never though because this really is a sight to see.  Notice the cost of the party.  They didn’t.

Dubai resort The Atlantis stages most expensive launch party ever
The global recession may be biting, but try telling that to the Hollywood celebrities and billionaire business moguls who attended the opening of Dubai’s latest luxury resort, The Atlantis.

By Anita Singh, Showbusiness Editor
Published: 4:07PM GMT 20 Nov 2008

More than 2,000 guests attended the event on the man-made Palm Jumeirah island in the Persian Gulf. Robert De Niro, Janet Jackson, Denzel Washington and Lindsay Lohan were among them, while the British contingent included the Duchess of York, Sir Richard Branson, Dame Shirley Bassey, retail boss Sir Philip Green, television presenter Trinny Woodall and the singer Lily Allen.

They feasted on lobster and Middle Eastern mezze and the Veuve Clicquot champagne flowed freely, although the presence of Sheikh Mohammed bin Rashid Al Maktoum, the ruler of Dubai, and a sizeable number of other Muslim guests ensured that the drinks bill was relatively modest.

Security at the party was so tight that a two-mile exclusion zone was thrown around the island.

Kylie Minogue performed on stage for a reported £1.5 million fee but the real entertainment of the night was provided by the pyrotechnics. One million fireworks – almost 10 times the scale of the Beijing Olympics opening ceremony – lit up the Palm, with the organisers claiming the display was visible from space.

Even in Dubai, a part of the world renowned for excess, there had never been a party like it.

“We built something that’s quite extraordinary. We’ve got to tell the world about it,” said Sol Kerzner, the South African billionaire hotelier and casino tycoon.

The 1,539-room Atlantis took two years to build and cost £1 billion. Mr Kerzner admitted that the global economic downturn would have an effect on business.

“We are in a challenging time. The economy is basically in a recession and we have to adjust to the changing circumstances. We have to be careful with our cost levels” he said, although he did not believe he had splashed out too much on his guests: “I didn’t lay on private jets. They either came in their own private jets or by regular airline.”

Colin Cowie, the party planner, likened the logistics of organising the beachside party to the Normandy landings. He added: “People say, ‘How do you have a party like this in these economic times?’ But the funds were allocated a year ago, and you have to dream big to get a big result.”

THE PARTY’S OVER

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From The Times
November 28, 2009

The spectre of “Financial Crisis 2” continued to loom over global markets yesterday after Dubai’s revelation that it may not be able to meet its debt obligations.

Stock markets in Asia and the United States fell sharply while the dollar and Japanese yen rose as investors shifted their money to their perceived safety.

UK banks were also revealed to be the biggest lenders to the United Arab Emirates, which includes Dubai, with more than $50 billion owed by the Gulf state’s residents.

In another blow to the beleaguered UK banking sector, the Royal Bank of Scotland emerged as the largest single loan-arranger to Dubai World, the state-owned conglomerate that sparked this latest financial crisis when it sought a standstill on its debt repayments on Wednesday.
Related Links


RBS, which is owned by British taxpayers, has arranged loans worth up to $2.3 billion to Dubai World.

The Financial Services Authority, the regulator, is understood to have sought assurances from banks that their exposure to Dubai will not threaten their financial strength. The FSA said it would continue to keep a close eye on the situation.

Dubai World, which owns a range of assets including the Turnberry golf club in southwest Scotland, sparked panic when it asked for the debt standstill. The company has liabilities of $60 billion and its Nakheel property division, which built the Palm Jumeirah development where the footballers David Beckham and Michael Owen own houses, was due to repay a $3.5 billion bond next month.

The standstill has raised the prospect that Dubai World and, by extension, the government of Dubai might default on their debt.

TIMES

Here’s a link for a lot of other links on the subject.  Makes for some fascinating reading.

BYE-BYE-DUBAI

notice the dates on these two stories. didn’t take long.


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Posted by peiper   United Kingdom  on 01/12/2010 at 04:03 PM   
Filed Under: • Big BusinessEconomicsFinance and InvestingInternationalMiddle-East •  
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calendar   Thursday - December 31, 2009

Nasty Deal for GMAC

This doesn’t seem to be much of a news item, but the federal government just injected another pile of cash into GMAC, and then took it over. So the feds own yet another bank/lending institution now.

GMAC to Get Another $3.5B in Aid From Treasury

A GMAC spokeswoman declined to comment on any potential government action but said, “GMAC has been conducting a strategic review of its business and evaluating options to address the challenges in its mortgage operation.” The spokeswoman said GMAC wants to prepare itself to repay the U.S. government.

The willingness by the U.S. Treasury to deepen taxpayer exposure to GMAC reflects the troubled company’s importance to the revival of the auto industry. The company was told to raise additional capital as part of government-led stress tests of large banks conducted earlier this year. The tests were to determine whether firms would need more capital to continue lending if the economy deteriorated in 2009 and 2010.

GMAC has only filled a portion of its capital hole and, unlike other banks that participated in the stress tests, has been unable to attract much capital from private investors. The Treasury said earlier this year that it would make as much money available to GMAC as needed to fill its capital hole and projected the firm would need another government infusion of as much as $5.6 billion.

GMAC’s capital needs have turned out to be somewhat less than originally envisioned, in part because impact from the bankruptcies of General Motors Corp. and Chrysler Corp. was not as severe as federal regulators originally projected.



Ok, here’s the part that I don’t get, the part that rather looks like arm twisting thuggery to me. But what do I know, right? Before this latest cash infusion, Uncle Sugar had fattened up GMAC’s coffers to the tune of 12.5 billion. For this gift of our money, the feds took 35% ownership. Basic math: $12.5B / 35% = $357,142,857.14 for every percent ownership. Now the feds are going to drop in another lump sum, a relatively “piddling” little $5.6 billion, and then they’ll own 56%? Less than half as much infusion but way more than half as much new ownership?  Only $266,666,666.67 per percent? Huh? That doesn’t seem right. It’s not like the feds bought up most of the outstanding stock shares that had fallen in value, is it? This doesn’t seem right to me. But then, the federal government owning both the means of production and the banking industry doesn’t seem right either. I’m just one of those simple minded Conservatives.

Auto finance company GMAC got a new majority owner late Wednesday when the federal government announced it was assuming a 56 percent stake in the company with $3.8 billion in aid.

It was the third bailout for GMAC, which had previously received $12.5 billion in direct federal aid and other support. The government already had a 35 percent stake in the company. GMAC had requested an additional $5.6 billion in federal aid in November.

The Treasury Department announced that it also would hold about $14 billion in loans the bank may eventually have to replay. The government will appoint four of GMAC’s nine directors.

GMAC is the primary lender for dealers of General Motors and Chrysler vehicles. It converted to a bank holding company last year to qualify for federal bailout funds.


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Posted by Drew458   United States  on 12/31/2009 at 08:14 PM   
Filed Under: • Finance and InvestingGovernment •  
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calendar   Saturday - December 05, 2009

The French, in the person of Mr. Sarkozy, have managed to anger the Brits this past week.

Just so you know, Sarko is referring to London when he says “city.”
Woo-Hoo and another Hoo.  That caused a bit of a flap this week I must say.  Whatcha gonna do? Brits and French have this love/hate thing. But really, Brits do not I don’t think, actually dislike the French. I may be wrong on that score.  I think they laugh at em a lot though and the French know it.


War has not been declared.

We are in charge now, Sarkozy tells the City

Francis Elliott, Suzy Jagger, Martin Waller and David Charter
The Times

Alistair Darling has delivered a blunt warning to the EU’s new French finance chief against meddling with the City of London.

As Nicolas Sarkozy gloated over impending curbs on the City, the Chancellor said that such moves would drive financial services out of Europe.

The French President’s glee at the appointment of Michel Barnier as Commissioner for the Single Market took on an edge of menace when he said that unfettered City practices must end.

“Do you know what it means for me to see for the first time in 50 years a French European commissioner in charge of the internal market, including financial services, including the City [of London]?” he said yesterday.

One of the very bothersome things about the new French EU finance chief is .... he is very left wing and much given to govt. control.
He hasn’t been very big on capitalism either, and has made no bones about that in the past.
The Brits I think were hoping to get that post btw.  At some point in time, either the EU will solidify and RULE supreme, or else collapse in upon itself. 

“I want the world to see the victory of the European model, which has nothing to do with the excesses of financial capitalism,” he said.

His implicit threat was just what Downing Street had feared when Mr Barnier, formerly an agriculture minister, was given the portfolio last week.

Mr Darling, writing in The Times , said that it would be a “recipe for confusion” if firms were supervised by the EU as well as national watchdogs and that Britain would not accept new laws that could lead to taxpayers picking up the bill for bailouts ordered by Brussels.

He rejects claims that the economic crisis was the fault of the “Anglo-Saxon” model, pointing out that French and German banks were among the biggest creditors of the failed US insurance giant AIG.

Terry Smith, a prominent banker, said that the threat of increased regulation was already threatening the City’s future.

“I’ve never seen so much work going on by companies, individuals and teams of people to evaluate relocation out of the UK,” he said.

SOURCE

SOMETHIN TELLS ME THAT THIS IS THE ONLY SARKOZY THE BRITS WANT TO SEE FOR AWHILE!  LOL

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Posted by peiper   United States  on 12/05/2009 at 01:00 PM   
Filed Under: • EconomicsEUro-peonsEye-CandyFinance and InvestingFRANCEInternationalUK •  
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calendar   Wednesday - June 24, 2009

Hedge fund managers betting Twitter will give them an edge in rapid trading.

I don’t think I have ever posted anything from the financial pages before.
I know I should keep up with things but to tell you the truth, I just don’t read the financial pages too often. In fact, hardly ever.
Wasn’t always thus. I used to faithfully read the IBD, my first port of call in finance and stocks etc. It was always a pretty good source too.
And of course the WSJ.  As time went on and after we moved here though, I seemed to lose interest and there has been so many other things to occupy my time, I just ignore it now. 
However, my wife reads the financial pages here every day, and she brought this story to my attention.

I deemed it interesting enough to share and hope you find it so too.  I don’t wanna bore anyone.  Sometimes it’s hard to know exactly where the line is when I choose a story to share.  Kinda like pot luck and hope for the best.

Anyway ... whodda thought that the CIA would be in Venture Capital?


Hedge fund managers are turning to Twitter in an attempt to steal a march on their rivals.

By Richard Tyler, Enterprise Editor
Finance page, The telegraph

Traders are using software developed by US-based technology StreamBase to monitor “tweets” for price sensitive information.

The software plugs into Algorithm-based automated trading platforms that have been used by traders for years. But rather than searching Reuters or Bloomberg the software now scans Twitter.com.

Streambase – whose client base includes Royal Bank of Canada and London-based hedge fund BlueCrest Capital Management – was commissioned to develop the software by several “unnamed” clients.

The software allows traders to take into account “event-based” information published on Twitter in their automated equity, bond and foreign exchange trading.

The company, whose investors include Inqtel, Central Intelligence Agency’s venture capital arm, claims it could give traders an edge when deciding whether to trade on breaking news, like terrorist attacks and natural disasters, rather than waiting for the information to be filtered through providers like Reuters Thomson or Bloomberg.

Nasir Zubairi, a former product manager for algorithmic trading and foreign exchange e-commerce at Royal Bank of Scotland, said the City would be looking at websites like Twitter.com as a useful market information “broadcast tool”.

“Markets tend to buy on rumour and sell on facts,” he said.

SOURCE

Not just markets either.  Anyone speculating and or investing should be buying on rumor and selling on facts.
Learned that at Wade Cooke’s knee. In a manner of speaking.

Oh hey, speaking of books, (well I am now) if you have any interest in the markets, even just a little bit, grab hold of a book if still in print called,
The Wall Street Money Machine.  True, its outta date by now but even so the information in that book is still very good.


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Posted by peiper   United Kingdom  on 06/24/2009 at 03:08 PM   
Filed Under: • Finance and Investing •  
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calendar   Monday - May 04, 2009

Berlusconi demands an apology AFTER wife says she’s had it and wants divorce.

Now this guy I want ya to know and I believe you already do, is Italy’s top guy. He’s their president, their leader, they’re jealous.

Oh before I forget.

UPDATE May 4th.

Mrs. Berlusconi has today filed for divorce and could get half his 4 BILLION dollar fortune. Hey, they’ve been married 19 years.  If he was gonna mess around, the least he could have done was be considerate enough not to embarrass his wife so publicly for so long. 
Hot blooded Latins.  Hmmm. Wonder if the guys extend that excuse to their women?


‘Shameless’ Silvio Berlusconi buys 18-year-old model a gold necklace for her birthday and calls himself ‘her little daddy teacher’

By Nick Pisa
Last updated at 11:49 PM on 29th April 2009

You would think that Silvio Berlusconi’s wife would be thrilled that her busy husband found time to attend an 18th birthday party.
Well she wasn’t - because the party was for someone else’s pretty young daughter.

Mr Berlusconi’s long-suffering wife, Veronica Lario, lashed out after his appearance was gleefully reported in the Italian press.
She said in an email to Italy’s national news agency ANSA: ‘That really surprised me because he has never come to the 18th birthday parties of any of our children despite being invited.’

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Veronia criticised Berlusconi in an email to an Italian press agency.
The Italian prime minister, 72, has three grown-up children with Mrs Lario - Barbara, Eleonora and Luigi - and two from a previous marriage.
But he also sees himself as ‘little daddy’ to blonde teenager Noemi Letizia, the daughter of a business associate.
He was the surprise guest of honour at her recent 18th party in Naples, and gave her a necklace and signed photograph of himself.

Yesterday Miss Letizia was interviewed by several Italian newspapers and said: ‘It was a lovely surprise to see the man I call Papi (daddy) at my party.
‘I call him Papi but of course he is second to my father. He gave me a lovely necklace as a present.’

Mr Berlusconi said he wanted ‘youthful new faces’ as candidates for June’s European elections.
He named four targets, none of whom has any political experience: soap actress Camilla Ferranti, 30; TV star Eleonora Gaggioli, 29; ex-Big Brother contestant Angela Sozio, 31; and former Miss Italy candidate Barbera Matera, 28.

In her email Mrs Lario said: ‘Someone wrote that all this is to sustain the enjoyment of the Emperor.
‘I agree with this - what has emerged is shameful trash, all in the name of power.

‘I want it to be made clear that my children and I are victims of this situation and do not agree with it, we have to put up with it and suffer with it.
‘Fortunately for some time now we have had women in politics and business - in the past we had (Margaret) Thatcher and now we have (Angela) Merkel - that is to say women can be involved in politics.

‘Women today are and can be beautiful and the fact that there are beautiful women in politics is not a merit or a demerit.’
It is the second time that she has made a public statement on her husband’s antics.

Two years ago she demanded - and got - a public apology after he told one actress he would wed her if he wasn’t already married and then told another he would run away with her.

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Berlusconi babe: Eleonora Gaggioli has been lined up as a prospective candidate for the European elections

Berlusconi demands an apology from his wife as he admits: Our marriage is over
By NICK PISA
Last updated at 4:55 PM on 04th May 2009

Silvio Berlusconi has no plans to seek a reconciliation with his wife and has demanded an apology from the former actress for comments she made.

The Italian prime minister’s wife Veronica said over the weekend she planned to file for divorce, days after publicly criticising Berlusconi’s selection of pretty young women to run in European elections.


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Posted by peiper   United Kingdom  on 05/04/2009 at 03:36 PM   
Filed Under: • CelebritiesEye-CandyFinance and Investing •  
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calendar   Wednesday - March 11, 2009

Why we got off the gold standard

Because there simply isn’t enough gold. Or silver. Or platinum. Or all of them combined. And there never was, even if you could gather every bit ever smelted. There is far more money in various accounts than there is money coined, and there is more money coined than there are precious metals to support them. The mints can only print money. Capitalism creates money, and the mints can’t even come close to keeping up.

So what supports the world’s currencies? Faith. And dreams. And the promise of Free Beer Tomorrow, but Tomorrow never comes. And if enough people share a dream then everyone is afraid to wake up. So don’t look too too closely at the man behind the curtain.

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At times I find myself thinking that our money ought to be backed by precious metals. Usually those times are when I see that the price of something I want to buy has gone up, the value of gold has gone up, but the value of my money has gone down. That’s rather irritating. But what if it were? What if we still based our money on silver and gold? I know, let’s play with some math and a bit of history ...

sterling silver is 92.5% silver, 7.5% copper. Pure silver is just too soft to use for coinage. So is pure gold. But sterling silver is much tougher. Think of it as 22 carat silver.

A Troy ounce weighs 480 grains. 12 Troy ounces = 1 Troy pound, or 5760 grains.

[ An Avoirdupois ounce weighs 437.5 grains, 16 oz = 1lb or 7000 grains. This is the basis for American weights, even though precious metals use the Troy system. So yes, a pound of feathers actually does weigh more than a pound of gold, because they use different weighing systems. Grains are grains regardless of the weighing system. ]

In the money system started by England’s Henry II (d 1189), an old English penny had a pennyweight of silver in it, 24 grains. 20 pennies was a shilling, 1 Troy ounce. 12 shillings made a pound. Of Silver. One Pound, Sterling. Pretty subtle name, what what?

Today, silver is selling for $12.80 per troy ounce. Gold is right around $910 per troy ounce. Copper is selling for $1.612 per Avoirdupois pound.

$12.80/480= $0.026667 per grain.
480*0.925 = 444 grains, value of that much silver in a Troy ounce of sterling silver = $11.840148

$1.612/7000 = $0.000230 per grain
480*0.075 = 36 grains, value of that much copper in a Troy ounce of sterling silver = $0.00828

One Troy ounce of sterling silver, ie one Shilling = $11.84828.

Thus one pound sterling silver, 12 Troy ounces = $142.181136.

Add in a tiny amount of value for the making of the alloy itself.

One British Pound Sterling, £1, based on the precious metals standard, ought to be worth $142.25, not the $1.39 it’s going for today.

But the UK would need several mountains of gold, silver, and platinum to back it up; a standard American ton of 2000 pounds (Avoirdupois) is a mere 2430.5556 Troy pounds; even at gold price of $910/Troy ounce a US ton of gold is only worth $26,541,666.67. So Bill Gates and his $13 billion fortune are worth 490 US tons of the stuff, about 1/3 of worldwide annual total gold production. But that’s the real point: if currencies were based on precious metals, the world economy could only grow by the amount of them smelted per year. For gold, that’s about 50 million ounces: $46 billion, which is a drop in the bucket of international finance.

Speaking of mountains of precious metals ...
1 Troy oz = 373.2417216 grams
density of gold = 19.3 gm/cc
volume of 1 Toz gold = 19.338949cc
volume of 1 US ton of gold = 564079.246907cc, = 19.92027 cubic feet, a cube 2.710806 feet per side (a hair over 2 feet 8 1/2 inches). Your basic $26 million, 2000lb side table.

100’x100’x100’ = 1 million cubic feet, which holds 50,200.1279 US tons of gold, worth $1,322,457,662,471.44; a bit less than 1 1/3 trillion dollars. This is almost twice as much gold than has ever been mined in all of human history. But it’s far less than Obama’s Stimulus Package plus Bush’s Bank Bailout combined.  There simply is not that much gold to go around, there never was, and there probably never will be.

The Stimulus Package plus the Bank Bailout plus this new Federal Budget plus the existing National Debt adds up to about $16 trillion, which is a gold brick 100’x100’x1025’. If you had a box that size you could hide an ocean liner inside.

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A few weeks ago Peiper sent me a book called The Moneymaker. It’s the story of John Law, a Scotsman from 300 years ago who managed to put France on a paper currency money system, because there wasn’t enough metal coinage in circulation. This worked great for a while, and the economy of France bloomed. But nobody listened to him when he said that the brakes should be kept on; he never wanted to print more than 4 times as much paper cash as the banks had gold on hand to cover. Plus he got involved in a major Ponzi scheme called the Mississippi Company, and while it made him and many other people a vast fortune, when that bubble broke it crashed the economy and madness ensued for a while. And the paper money went belly up as well. And the banks. And then the dear little froggies spent the rest of Law’s life getting even with him, in the nastiest ways imaginable, as only true liberals can. Because they had all been greedy, and had lost out when the bubble burst, so it was all Law’s fault. It’s a great little book, and large parts of it seem to be a warning that is still applicable today.

Of course, I couldn’t get past the title without thinking of Terry Pratchett’s recent novel Making Money. It’s nearly the same story, but turned inside out because it’s Pratchett after all. Somewhat reformed con man Moist Van Lipwig puts the city on a fiat currency because there isn’t enough money in circulation, and then it turns out that there isn’t even any gold when there should have been. Except in the end there is, but it’s the kind of gold that really works for you, providing you know the secret. And the Glooper is bi-directional. And the promise of the old currency under the gold standard was great: We promise that this paper dollar is worth a dollar in gold, as long as you promise never to try to make that exchange. Perfection!

Both are very good reads, highly recommended. But both show that to become modern and to grow, any economy has to be based on the productivity and worth of the citizenry. It is a dream, and none of us can wake up, because that would crash the house of cards. Perhaps we should try a currency based on things of real worth, like food. Which would make the US, Canada, Australia, and Argentina the richest nations in the world. But you couldn’t really save it - not enough Mason jars by far - although you could always trade in your paper dollar for a dollar’s worth of food. We call that act “going to the grocery store”.


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Posted by Drew458   United States  on 03/11/2009 at 07:40 PM   
Filed Under: • Finance and InvestingInflation and High Prices •  
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calendar   Tuesday - February 17, 2009

Welcome To Hell

DJI: 7552.60, down 298 today

Down 2000 since election




We are doomed.




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Gold 969.9
Crude 35.04
S&P 789.17

GM needs another $2 BILLION right now, and $16.5 BILLION to stay afloat for the rest of the year. GM plans to close 5 plants and lay off 37,000 employees this year.


SEC charges Robert Allen Stanford of Stanford Investments with fraud over $8 BILLION scam for selling CDs with false return rates; the money was stolen from other funds.


Russain Market tumbles 9.7% in half a day; trading suspended.


Obama signs “stimulus” bill, goes back to campaigning. Forever.

Less than a month into office, President Barack Obama is trying to recapture the energy and common-man feel of the campaign trail to ease the harder task of governing. He’s adopting the “permanent campaign” as a major tool for how he conducts his presidency, ditching Washington for the road, early and often.




Expect worse tomorrow.


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Posted by Drew458   United States  on 02/17/2009 at 11:19 PM   
Filed Under: • EconomicsFinance and InvestingGovernment •  
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calendar   Monday - January 19, 2009

Obama’s utter folly.  ( From the Sunday financial page of the Telegraph)

It’s all Obama all the time now.  There’s even a mens health thing in the paper and they captioned it the Obama Diet.

Man oh man do we have a hell of a lot to overcome before the next national election. 
Heard an edited version of a speech he gave this wkend on radio.  He comes over well even when he isn’t saying anything.

Obama’s utter folly

By Liam Halligan
Last Updated: 6:56PM GMT 17 Jan 2009

Barack Obama’s inauguration on Tuesday is, of course, an event of huge political and cultural significance.

For the first time, a non-white man will control the White House, sitting at the apex of power.

But, for global financial markets, the dawn of a new US administration holds major economic significance too. Anyway, that’s the hope.

Across the world – not least in the City and on Wall Street – fingers are crossed that Obama’s new stimulus plan, worth a staggering $800bn over two years, will rescue the global economy.

Last week, the Congressional Budget Office projected that even without this package, the US budget deficit will hit $1,200bn this year – or 8.3pc of national income. Such a massive gap between spending and taxation already amounts to an unprecedented fiscal stimulus.

Cranking up spending even more is the last thing the US should do.

Excessive government largesse is never a good idea. The demand boost takes time, the inefficiencies are enormous and the scope for cronyism bigger still.

But turbo-charged state spending is especially bad in a country facing massive demographic pressures, with a fragile currency and already servicing debts equal to a mind-boggling 368pc of GDP.

I wish Obama well, but his plan is utter folly
.

FOLLY


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Posted by peiper   United Kingdom  on 01/19/2009 at 11:57 AM   
Filed Under: • Finance and InvestingObama, The One •  
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calendar   Monday - December 08, 2008

Christmas Bonus

You may have $500 in your pocket and not know it

The 2005 Minnesota State Quarter was poorly minted: at least 60 different errors have been found on various coins. These flawed coins are selling for up to $500 each on Ebay.

Coin collectors are in a frenzy as they search pocket change for 2005 Minnesota state quarters with an “extra tree” in the design! They are finding them in bank-wrapped rolls, widely available at coin shops, and in circulation. They are auctioning them off on eBay as fast as they can find them, garnering prices ranging from an average of $150 to $500 from eager collectors willing to pay the price. The coin that is the focus of their attention displays significant portions of an “extra tree” literally floating in the sky next to the fourth evergreen tree to the right of the state outline. Specialists suggest the error occurred during production of the coining die when the master tool used to impress the design into it slipped during the process.

The “Extra Tree” Doubled Die is Getting a Lot of Attention

These Minnesota “Extra Tree” quarters are what specialists refer to as a doubled die; a popular type with collectors, depending on how strong and unusual the doubling is. With the coins attracting front-page coverage spanning several weeks in the national hobby publication, Numismatic News, and a series of features in Coin World, along with Professional Coin Grading Service of Newport Beach, Calif., now certifying hundreds of them for marketing purposes, it appears they are catching on.

Additionally, whatever condition existed in the Mint to produce these coins didn’t get corrected immediately; several additional varieties of “extra tree” Minnesota quarters with slight differences in location and/or shape have also been found in recent weeks and are selling briskly on eBay as collectors try to obtain one of each type!



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Full details of all the errors, with pictures, can be found here.

Ok, this article isn’t exactly new news. And I checked ebay, where most of these things are actually selling for $15 - $160. It looks like the coins with the more noticeable errors sell for more. Hey, it’s news to me. How many of these coins have gone through your hands? You might save one or two when they first come out, but after that you just spend them. And nobody buy coin collectors goes over them with a 20x loupe to make sure they don’t have errors. The “doubling” errors are naked eye visible, barely. They’re about 0.003” tall.




The Hawaii quarter, the final coin in the State Quarters series, was released today. Ok, that is actual numismatic news!

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Posted by Drew458   United States  on 12/08/2008 at 06:14 PM   
Filed Under: • Finance and Investing •  
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calendar   Monday - October 20, 2008

Obama very well funded

Obama Campaign Raises Over $604,000,000.00 So Far

Six Hundred and Four Million Dollars. Far more than half a billion. That’s a huge amount of cash. That’s more campaign money than ... anyone, ever? everyone, ever?

Barack Obama’s staggering fundraising prowess—the Democratic presidential candidate raked in a record-breaking $150 million in September and more than $604 million since the start of his campaign—has raised the game of political cash as well as questions over whether the public financing system is now obsolete.

Public financing, which restricts how much cash a candidate can raise, is meant to curb the influence of money in presidential campaigns. In an interview on “FOX News Sunday,” John McCain took issue with Obama’s war chest, saying the exorbitant amount of cash Obama has raised has created the potential for scandal and lays a “predicate for the future that can be very dangerous.”

“I’m saying that history shows us where unlimited amounts of money are in political campaigns, it leads to scandal ... this is the first since the Watergate scandal that any candidate for president of the United States, a major party candidate, has broken the pledge to take public financing. We enacted those reforms because of that scandal,” McCain said.

Indeed, contributions to Obama far outdistance those of McCain, who kept a pledge to use the public financing system employed by all previous presidential candidates since the Watergate-era reform was enacted.

Obama is the first major party candidate to opt out of public campaign financing in the general election since the law was enacted in 1971 and revised in 1974. George W. Bush dispensed with public financing during his 2000 Republican primary battle, in which he defeated McCain. By accepting public financing, McCain was given $84 million in funds to use between the Republican National Convention in early September and Election Day. His campaign spent $37 million in September and has had an additional $47 million available since Oct. 1. In comparison, even before September’s fundraising haul, Obama had $77 million on hand. When October fundraising is counted, Obama is expected to surpass the $695.7 million that John Kerry and President Bush—combined—raised in 2004.

Obama raised $454 million dollars during the primary campaign—covering the period from the start of his presidential bid to Aug. 31, 2008, days after he accepted the Democratic Party nomination. McCain raised $240 million during that same time.

Obama has bought a good deal of television ads, particularly in traditional swing states like Ohio and Florida, as well as some new battleground states like Colorado and North Carolina. And the campaign has said it intends to increase its ad spending in the final two weeks before Election Day, Nov. 4.  In an unusual move, the campaign has bought a half hour of political ad time to air concurrently on CBS, NBC, and FOX on Oct. 29. Obama’s campaign paid $3 million in total to air the 8 p.m. program on the three networks.

With $604 million, the campaign could buy about 201 prime-time, half-hour blocks to be run simultaneously on all three networks.
For $604 million, the Obama campaign could buy all the shares of La Salle Hotel (with $58 million left over) and almost all the shares of Papa John’s Pizza (with a market cap of $606 million).
The campaign could also buy almost all the shares of the Cheesecake Factory (market cap of $640 million) and more than 50 percent of Fannie Mae’s outstanding shares (market cap of $1.016 billion)

For the average American, the figure could buy 25,036 Ford Tauruses and more than 140 million gallons of milk.
An individual making $50,000 a year would have to work 12,080 years to earn $604 million.

I think there may be something fishy going on here. $604 million is more than 1500 times what the job pays. It’s an amount so large, from so many sources, that tracking down any illicit ones will be just about impossible.


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Posted by Drew458   United States  on 10/20/2008 at 07:46 PM   
Filed Under: • Finance and InvestingPolitics •  
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Not that very many people ever read this far down, but this blog was the creation of Allan Kelly and his friend Vilmar. Vilmar moved on to his own blog some time ago, and Allan ran this place alone until his sudden and unexpected death partway through 2006. We all miss him. A lot. Even though he is gone this site will always still be more than a little bit his. We who are left to carry on the BMEWS tradition owe him a great debt of gratitude, and we hope to be able to pay that back by following his last advice to us all:
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Oh, and here's some kind of visitor flag counter thingy. Hey, all the cool blogs have one, so I should too. The Visitors Online thingy up at the top doesn't count anything, but it looks neat. It had better, since I paid actual money for it.
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