Should the ‘little guy’ start buying stocks? This question is being posed by pundits on financial-casino channels like CNBC who apparently feel sorry that individual investors (who are still down 45% from the net worth levels robbed during the 2008 crisis) aren’t ‘participating’ in this rally. The question is backwards. The question should be, if the public is not investing in stocks how are stocks trading at all-time highs? Buyers in stocks come from several sources; companies buying back their own stock, mergers and acquisitions, institutional investors (like pension funds) and algorithmic trading bots – that constitute over 85% of all trading on the New York Stock Exchange. Do you see what I see? Stocks are trading at all-time highs because computers are buying stocks for other computers; funded by borrowed money lent to them by government computers – kept artificially cheap – thanks to central bank’s computers keeping a lid on interest rates at ½% Unless you are a bot, or a drone, this is not the time for individuals to be buying stocks. This is the time for individuals to buy Gold, one of the best performing asset over the past 12 years, set to continue outperforming for another 12 years. There’s never been a better time to buy Gold. The money supply (and supply of debt) has never been higher in either America’s 238 year history or in Britain, going back to the time of the creation of the Bank of England in 1694. Computers are pushing prices for bonds and paper currencies higher despite this historic moment of unprecedented increased supply: an economic impossibility that can only occur – as it is now – via massive, coordinated market manipulation by governments and their computers. The price of Gold and Silver – during this period of record shattering global demand – has been trading down. Again, an economic impossibility that can only occur via massive government intervention using computers programmed to override price discovery. Don’t get caught up in the hype of the recent Dow Jones spike. Remember that up until just a few months ago shares in Warren Buffett’s Berkshire Hathaway, despite all the recent hype, has been ‘dead money’ (no price gain at all) for a decade. Apple and Google are higher, but the NASDAQ is still about 2,000 points beneath the high it reached in 2000. Stocks have been going sideways for more than a decade even though the government in the U.S. has injected more than $16 trillion in fiat currency coupons to bailout thieving ‘banksters’ and corrupt politicians. Getting back to Gold, adjusted for the increase in money supply, Gold is now cheaper at $1400 than it was at $500. That’s right. There are exponentially more uncollateralized Federal Reserve Notes (aka US dollars) electronically circulating through the dying beast known as the US economy now relative to the supply of Gold than back when Gold as at $500, while debt has increased by hundreds of percentage points and wages are up less than 1%. Margin debt (the money that is borrowed to buy stocks) on the New York Stock Exchange is at an all-time high. The global debt and derivatives pile recently topped $1 quadrillion. The only buyers of stocks are computers who are buying for other computers. And when the market crashes again as it most certainly will, the computers won’t really care much. Remember, on the stock market, when High Frequency Trading wipes out your net worth; computers can’t hear you scream. … Read More
Obamacare to increase healthcare premiums in California up to 146 percent
New data shows that premium rates would only decrease for small employer plans, but that the rates charged to individuals will increase, according to Peter Lee, the executive director of the Covered California, the state’s new health insurance exchange. State officials last week boasted that its version of Obamacare would serve as a “home run for consumers in every region of California,” Lee explained. But the numbers generate a different narrative – one that depicts the flaws of the Affordable Care Act. Due to its overwhelming number of regulations and mandates, Obamacare may increase the cost of health insurance for those who purchase it on their own, argues Forbes contributor Avik Roy. A 25-year-old non-smoking male, for example, is given only the catastrophic healthcare plan as the cheapest option. This Covered California plan has monthly premiums averaging $184. The second-cheapest plan, called the “bronze” plan, costs $205 a month. In comparison, the median cost of the five cheapest healthcare plans for the same individual was $92 per month in 2013. For the typical 25-year-old Californian male buying his own insurance, premiums will be 100 to 123 percent more expensive when Obamacare is fully implemented, Lee told Forbes. Californians over the age of 30 do not have the option to acquire the cheapest plan, and must instead purchase the “bronze” or more expensive packages. A non-smoking 40-year-old on the “bronze” plan will on average be required to pay $261 a month. Overall, individual-market premiums would increase by 64-146 percent, and an average of 116 percent. The numbers starkly contradict the statements made by state officials and President Obama himself. Earlier this month, the president said that “whenever insurance premiums go up, you’re being told it’s because of Obamacare – even though there’s no evidence that that’s the case.” Economist Paul Krugman, a New York Times columnist, on Monday published an op-ed in which he insisted that premiums in the Golden State would decline in 2014. “Well, the California bids are in — that is, insurers have submitted the prices at which they are willing to offer coverage on the state’s newly created Obamacare exchange,” he wrote in the Times. “And the prices, it turns out, are surprisingly low. A handful of healthy people may find themselves paying more for coverage, but it looks as if Obamacare’s first year in California is going to be an overwhelmingly positive experience.” The Covered California exchange data contradicts the statements made by Obamacare supporters who believe premiums will not increase. In a press release from last week, Covered California wrote that “it is difficult to make a direct comparison of these rates to existing premiums in the commercial individual market.” But if the analysis made by Lee and Forbes author Avik Roy are true, then healthy Californians obtaining their own health insurance could see heightened costs, especially in the San Francisco Bay Area, San Diego and Orange counties. … Read More
Has American freedom reached the finish line?
The irony that lurks behind the attack on the Boston Marathon is a cruel one: no other sport better represents the spirit of individual freedom than that of running. The competitor is locked into a contest against himself and time, while the distant finish line exists as an impartial arbiter of victory. The clock does not lie. The moment of passing the 26-mile threshold is meant to be a jubilant celebration of man succeeding in pushing himself beyond the limits of human endurance. But at this year’s finish line at the Boston marathon, where flags from around the world decorated the packed grandstand, the only real winner are those who may be tempted to use the tragedy to launch yet another assault on US civil liberties. After all, it has happened before. Following the attacks of 9/11, which caused the death of some 3,000 people from around the world, Congress rammed through the Patriot Act under the pretext that it was protecting the American people from further acts of violence. That seems to have been a self-serving bit of misinformation. Just as America’s formidable security apparatus failed to intercept four lumbering commercial jets over the most desirable real estate in the free world, legislators failed to protect the American people from administrative acts of violence. American lawmakers failed to heed the sound advice of Benjamin Franklin, who warned that “those who would give up essential liberty to purchase a little temporary safety deserve neither liberty nor safety.” Shockingly, the majority of Congress members never bothered to even read the Patriot Act, which was passed at a time when anthrax-filled envelopes were circulating on Capitol Hill (curiously sent to two Democratic Senators opposed to the draconian legislation, Tom Daschle and Patrick Leahy) and the entire country was in a mental code-red lockdown. People were sealing their homes with plastic wrap in anticipation of the next al-Qaeda strike, which we were led to believe was imminent. The majority of Americans had no idea the real mischief was happening in Congress. Today, law enforcement and intelligence agencies are empowered to monitor private communications and access personal information, such as emails, voicemails and telephone conversations. Even a person’s library book withdrawals are suspect to a federal shakedown. Meanwhile, the Patriot Act amended the Foreign Intelligence Surveillance Act (FISA) to allow the FBI to use National Security Letters to replace court-approved warrants or subpoenas. In 2010, 24,287 NSLs were issued, up 64 percent from the previous year. At the same time, everybody from toddlers to grandmothers was being harassed at the border by the TSA and their diabolical naked body scanners. Despite this super-invasive matrix of surveillance aimed at the American people, the perpetrator or perpetrators of the Boston attacks managed to slip through the web and detonate two bombs at the marathon’s finish line (at least two other bombs were discovered and deactivated). Although it is no small security challenge to guarantee security along the entire 26-mile route, why was security so lax at the point where the most people would be gathered? After all, it is next-to-impossible to enter an American airport or even a baseball game without passing through a phalanx of security layers, including rubber gloves, metal detectors and bomb-sniffing canines. Now, the daunting question for the American people is: Should we enact ever greater security procedures following this latest tragedy to defend freedom and liberty? The question is beset with pitfalls, because as Franklin understood there comes a point when excessive measures to ensure security make the idea of freedom and liberty redundant. After all, even if the garden of liberty could grow behind a barbed wire enclosure, who would want to live in such a foreboding place? So now comes a pivotal point in the debate as to what transpires next in the United States, where cynicism and even paranoia of government is at a record high. Indeed, as countless commentators on social media networks seem increasingly inclined to believe, any effort on the part of government to enhance security is actually a deliberate attempt to further diminish the rights of Americans. For example, as if the black helicopter crowd needed more encouragement, the Department of Homeland Security – an all-encompassing ‘superagency’ made up of 22 federal departments that was launched post-9/11 – has recently announced plans to buy 1.6 billion rounds of ammunition over the next five years.Meanwhile, paramilitary maneuvers in the skies above America’s biggest cities have become a frequent event. Although the authorities explain these activities as initiatives to better defend the homeland, many people are simply not buying it. Although the drafters of the Patriot Act may have had the best intentions at heart, the extreme steps they have prescribed for protecting the homeland seems to have backfired. Today, an entire cottage industry of anti-government dissenters has popped up like weeds on the internet, where no idea is considered too outrageous to entertain. ‘Conspiracy theorists,’ as the media refers to them, suspect that the ultimate purpose of these government initiatives is to deprive the American people of their Second Amendment right to bear arms. For those who dissent, well, they will be systematically locked up in a nationwide system of detention facilities. Alex Jones, for example, the popular and extremely outspoken host of Infowars.com, tweeted immediately after news of the blast that “this stinks to high heaven,” before going on to blame the U.S. government for conducting a “false flag” operation. According to Jones, the Boston tragedy is just the latest case of Washington administering a self-inflicted wound: “You saw them stage Fast and Furious. Folks, they staged Aurora, they staged Sandy Hook. The evidence is just overwhelming. And that’s why I’m so desperate and freaked out. This is not fun, you know, getting up here telling you this. Somebody’s got to tell you the truth.” Meanwhile, other commentators point to extremist organizations, specifically white nationalist groups, as a possible home-grown perpetrator of Monday’s terrorist attack. “Keep in mind…there have been a number of disturbing events in the US in the recent weeks – a number of prosecutors, that is to say those who try to send accused criminals to jail, have been assassinated in the state of Texas, the head of the prisons in Colorado was assassinated with the suspects being affiliated to the so-called Arian brotherhood in Texas,” author and historian Gerald Horne told RT. “So there are number of suspect to investigate. This is going to be difficult to protect oneself from the so-called ‘lone wolf’ attacks.” Horne added that the US has misplaced its security priorities, which may have led to the authorities being unprepared for the attack in Boston. “When it comes to this kind of thing, you may know that the US Treasury Department has more officials and bureaucrats investigating those seeking to travel to Cuba than those involved in so-called terrorism,” he emphasized. That’s obviously a waste of resources, he concluded. … Read More
Assault On Gold Update
Unless the authorities have the actual metal with which to back up the short selling, they could be met with demands for deliveries. Unable to cover the shorts with real metal, the scheme would be exposed. … Read More
Covered at Reason 24/7: Obama Wants To Limit Retirement Accounts
Complaining that “some wealthy
individuals are able to accumulate many millions of dollars in
these accounts,” the Obama administration announced a plan to cap
the total sum of any individual’s retirement accounts at $3
million. Stashing cash beyond that point, the administration
insists, builds sums “substantially more than is needed to fund
reasonable levels of retirement saving.” The administration’s
argument seems to be based on the use of the word “million,”
implying that only nasty rich people would want to accumulate such
a hoard. But is that true? How much is enough for “reasonable
levels of retirement saving.”
As it turns out, that’s one of the toughest questions to answer
for retirement planning. Many advisors suggest you base your
retirement savings on something like 70 percent of your
pre-retirement income, multiplied by how many years you expect to
live. So … Just when do you plan to kick off? As
one article on retirement planning puts it, “basing your
retirement needs on income is like basing your fuel needs on the
size of your car’s gas tank. What really matters is how far you
have to go and what kind of gas mileage you get.” Part of that “gas
mileage” for retirement planning includes inflation. By the time
you retire, will $3 million buy luxury? Or a sandwich?
From
Bloomberg Businessweek:
President Barack Obama’s budget proposal would cap
multimillion-dollar tax-favored retirement accounts like the one
held by Mitt Romney, his Republican rival in 2012.
Obama’s budget plan, to be unveiled April 10, would prohibit
taxpayers from accumulating more than $3 million in an individual
retirement account. That proposal would generate $9 billion in
revenue for the Treasury over the next decade, according to a White
House statement released today. …
Brian Graff, executive director and chief executive officer of
the American Society of Pension Professionals and Actuaries, said
his group will “vigorously oppose” the idea.
“It is a ‘plan killer,’” he said in an e-mailed statement. “As
business owners reach the cap, they will lose their incentive to
maintain a plan, and either shut down the plan or greatly reduce
benefits. This would leave workers with a greatly diminished plan
or without any plan at all.”
Follow this story and more at Reason 24/7.
If you have a story that would be of interest to Reason’s
readers please let us know by emailing the 24/7 crew at
24_7@reason.com, or tweet us stories at ;@reason247. … Read More
That Magical Moment
It is very simple: the resistance will not be organized. There is no way to get people together on anything at this stage and there aren’t many more stages left. … Read More
Justin Amash: Meet the New Ron Paul, Same as the Old Ron Paul?
Politico ;profiled
Michigan Rep. Justin Amash last night as the “new Ron Paul,”
and focusing on his forthcoming decision to seek–or not seek–a
Senate seat in 2014. (I am quoted in the story.)
Amash understands he could cut a more impressive national figure
in the Senate; but that counting on a statewide win in a state that
went for Obama by 9 percentage points is a bit of a risk.
Amash likes to rhetorically call himself a “moderate” compared
to what he paints as the country-destroying madness of endless debt
and civil liberties violations, but surely deep down he understands
that his libertarian leanings scare lots of voters. He’d certainly
be painted by the Democrats as the candidate out to destroy
Medicare, Social Security, the safety net, clean food and air, and
our national security if the Democratic Party had to fight him for
a precious Senate seat.
Some excerpts from the profile:
Amash is chairman of the House Liberty Caucus. There’s no formal
membership list, and Amash said about a dozen regular meetings are
held in his office. He hopes the group gets big enough someday that
they need to move to a bigger space.
“Ron Paul was an educational figure. He was out there really
presenting things that others had not been talking about,” he said.
“This next generation of liberty Republicans, like Rand Paul and
Mike Lee and Thomas Massie and Raul Labrador, we’re interested in
making sure that … we re-brand the Republican Party as a place that
is welcoming to people from across the political spectrum and
follows the founding principles of our country: limited government,
economic freedom, individual liberty.”
Ron Paul still digs the congressman he endorsed, with his
customary modesty:
Ron Paul praises Amash for being “very, very principled.” He
doesn’t believe they’ve spoken directly since he left Congress, but
he continues to monitor what’s going on in the Capitol.
“I’m sort of pleased with what’s happening in the sense that
it’s not just one person,” Paul said in a phone interview. “There’s
a group. I think they will have more influence than I ever
had.”……
“Some will deal mainly legislatively. Some will deal in a sense
of trying to educate and change people’s minds,” Paul said. “I
tried to do both, but I put more emphasis on trying to change
people’s opinions. … The group that’s in Washington now is going to
have tremendous opportunities because there’s a lot more
disenchantment.”
Amash is cautiously optimistic about his Party’s future:
“When I say things are moving in the right direction, I wouldn’t
say that it’s legislatively moving in the right direction
necessarily,” he said. “But the makeup of the Republican conference
is changing in such a way that in five or 10 years, I think you’ll
see a very different emphasis from Republicans when it comes to the
legislation they present and very different for the party. And I
can see that starting. It’s very clear with the people who are
getting elected.”
Amash said he thinks about pursuing a spot in House leadership
if he stays.
“I often take sort of a mini-leadership role on the House
floor,” he said. “I represent an important Republican perspective,
and there are a lot of members who come to me on the House floor
and maybe even rely on me to provide an alternative perspective to
what they’re hearing from leadership. And 10 years from now, you
never know what that translates into.”
Reporter James Hohmann quotes me–accurately–supporting the
notion that Amash is the closest thing to a next Ron Paul in
Congress:
“He has a super stellar record of not pissing off the purists,”
said Doherty. “He really does seem to have that possibility of
really being a genuine next Ron Paul. … From a libertarian
perspective, he feels like the real deal in a way that almost no
one else does.”
Is Amash really the next Ron Paul? I think he’s come closest to
toeing the full Ron Paul line in Congress. Amash likes to emphasize
civil liberties as well as more general “limited government” talk,
which is great, and his away-from-the-pack votes on many budget and
leadership issues show he’s marking himself as more serious on debt
and spending than most of his Party.
There is a key issue I neglected to parse out with
Politico, and which the story doesn’t emphasize: foreign
policy. It is certainly true Amash ;has a less expansive set of
beliefs about where and how to use U.S. power abroad, and is also
quick to say that a more limited foreign policy is an important
issue for his Party.
But his rhetoric about sanctions and the threat of Iran (as
expressed in the video interview with Nick Gillespie below) leave
more room for the possibility of U.S. belligerence in Iran than
most Ron Paul fans are comfortable with. That is, he’s for certain
sanctions, though he thinks they should be crafted as best as
possible merely to keep dangerous things out of the regime’s hands,
not the stuff of life from Iranian citizens hands. And he does seem
to think Iran is seeking a nuclear bomb, something many
non-interventionists of a Paulian bent think is likely not true,
and to boot believe that saying it is plays into the hands of those
spoiling for a war with Iran.
I don’t think either statement proves he’ll be unreliable on
making sensible decisions about when and where to wage war. But as
one vote out of 435 in a world where the President isn’t even
likely to seek Congressional approval for any war that might begin,
lots of the Paul faithful find voting right on these
things less important than being a firm, loud, and consistent voice
that questions and tries to obstruct the presumptions and behavior
of the expansive American “national security” state anywhere and
everywhere.
But certainly in overarching vision of government and a seeming
absence of any desire to go along to get along with his Party to
seem a team player, Amash is building a good record, and the more
reputational juice like this story he gets, the more he will be
influential with colleagues who might be inclined to lean where the
wind blows. As I discussed with Hohmann, a point that didn’t make
it into the finished story, true libertarian victories in
Washington can’t just come from having more Murray Rothbard fans in
Congress: it has to come from having people who never heard of
Rothbard and would run from him if they had deciding that their
political future would be well served by voting along with people
like Amash, because that’s where the Party’s energy and enthusiasm
seems to be coming from.
I wrote a book about Ron Paul and the movement he inspired,
Ron Paul’s Revolution: The Man and the Movement He
Inspired.
I interviewed Amash for Reason’s March
package on liberty-leaning congressmen post-Ron Paul. I also
interviewed Amash for my February
Sunday New York Times ;essay on libertarian trends
in the Republican Party.
Nick Gillespie did a video interview for him for
Reason.TV, excerpts of which will appear in our June print
issue. Here’s the video:
