Author: Petros

I am victim

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Leftists always claim to be on the side of victims, the poor, and the marginalized.  Often these so-called victims are criminals, the worst elements of our society, who are sociopathic in behavior, e.g., substance abusers, and are unable to function in normal society.  Some Christian leftists claim that since Jesus said, “Blessed are the poor”, these poor are the true church.  They are the focal point of God’s love and care, not the “rich”.  And you, because you are middle-class or “rich”, you belong to the oppressors.  It doesn’t matter how many good jobs you provide and how many families depend on you, you are an abuser.

When you turn the tables on these leftists and claim, “I am a victim”, they ignore you, mock you, claiming that you are an extremist or mentally ill.  But those of us who pay taxes are being robbed regularly by government.  We work hard and we risk our capital, and the government expects its pound of flesh and strips us of our wealth, and then gives it to the “poor”–such as the banksters or the people who refuse to get a job and call their welfare cheque their “pension”.  This is abuse and we are oppressed victims.  We are like the people in biblical times called the Am haEretz, the people of the land, who were oppressed by Roman tax collectors.

Consider that Charlie Engle went to prison for mortgage fraud while not a single bankster went to jail.  I’d sure love to put my mortgage broker in jail, but I’m sure he’s still free.  I won’t mention his name to protect the guilty, but he received over $5000 in fees for his claim that my brother’s business could earn more than three times its historical cash-flow in SBA loan papers for a commercial building that he couldn’t afford.  As my brother’s partner, I lost a lot of money on that deal.  Yet Engle goes to jail, and the big fraudsters are free.  And so are the Congressmen who pass the unjust laws and receive sweet-heart loans from the banksters.

Today I read an essay on “Morality and the IRS” which claimed that many people are so frightened and demoralized by their treatment at the hands of IRS that they commit suicide.  Indeed, it doesn’t take long to find stories to that effect.  Joe Stack who flew his plane into a IRS building in Austin, TX, left a public suicide note explaining that the IRS drove him to self murder–and the leftists who run the media call those who sympathize with Stack “extremists in the patriot movement“.  One IRS agent testified to the Senate Finance Committee in 1997 that she knew of at least five suicides but thought that the number could be much higher.  If the IRS threatens a person with prison and fines, or steals from their bank accounts and garnishes their pay cheques, then it can really cause a lot of domestic havoc, marital discord, and personal suffering.  I know.  My own wife is tired of hearing of my woes and is not above threatening me.  Such tribulations could lead the weak among us to Selbstmord.

The socialists want this.  They want big government that takes care of us cradle-to-grave.  They begrudge even our little savings accounts, such as the TFSA, where we are allowed to gain interest without taxation–even though the pathetic returns from interest accounts don’t even keep up with organized government robbery called “inflation”.  And yet government does a very bad job of providing services, and we would be much better off if they would just get off our backs and let us fend for ourselves.

The IRS–and probably every other revenue service in the world–is no better than the mafia.  Consider that American citizens are required to pay taxes to the USA no matter where in the world that they happen to live.  Non-residents cannot receive US healthcare, grants, education, or whatever the service might happen to be, because they don’t even live in the United States.  But this taxation is justified because they receive “protection” from the US government.  It makes me think of how Richie Aprile offers protection to Beansie (See video below: viewer discretion is advised because of foul language and violence).  Yeah, the US government has the right to tax me here in Canada because it is protecting me from all the bad guys out there who want to harm me or steal from me.  Wait a second, the only ones who are constantly threatening me work for the government.  You see!  The government has become a criminal organization and I am victim.  Well, excuse me IRS sirs.  I am now under the protection of Canadian organized crime.  In order to make that clear, I’ve lost my right to live in the United States of America.  Poor Beansie, Tony Soprano didn’t protect him from Richie.  Hopefully, the Canadian mob boss will do a better job for me.

You keep using that word … III. Investment

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Previous posts:  I. Consensus; II. Recovery.

The lamestream media loves Obama.  When it comes to this man, they lose all semblance of objectivity and their critical faculties, if they ever had any, get flushed down the toilet.  Consider Henry Blodget, stock analyst par excellent–though you have to catch him off the record if you want his real opinion–did a cynical piece yesterday saying that well both President Obama and Trig Palin should be disclosing their birth certificates publicly.  I like you Henry, I real do, but that’s really, really stupid.  Business Insider is a bit like the National Enquirer and Forbes magazine all combined in a single publication.

So when the media classifies Obama as a conservative and smart investor, it is really malpractice.  So MSN reported about candidate Obama during the presidential election had dumped some stocks of companies who had made contributions to his campaign:

The 50th-richest senator, with a net worth at the end of 2005 of between $1 million and $2.5 million, has most of his assets in bank and retirement accounts, owning only three publicly traded securities.

All three, two Vanguard mutual funds and a Nuveen closed-end fund, are partly or entirely invested in fixed income securities. Despite providing little opportunity for capital appreciation, they delivered combined returns of around 15% in 2006, only slightly less than theS&P 500 Index ($INX).

“The man is conservative and smart,” says Linda Gadkowski, a financial adviser with CFP Beacon Financial Planning in Centerville, Mass.

Sycophantic worship is what that’s called.  Obama has a lot of capital but a completely unimaginative portfolio that requires no research, no knowledge and no gumption.  And the media portrays that as conservative and smart.  Gimme a break.  But the man has shown that he knows little about investing when he said that “profits and earning” ratios looking enticing, recommending that Americans  invest in the stock market.  So there is no reason to believe that Obama has any knowledge of investing.

While his use of “investment” in the place of “spending” is a huge lie, don’t expect the sycophantic adoring media to ever call him on it.  You see government spending is lost, never to be recovered.  Investment on the other hand, looks to preservation of capital and a return on investment (“profits and earning ratio”, in Obamatalk).  When governments borrow money, they only rarely put the money into anything that will have a ROR.  Even its so-called “investments”, which are just subsidies, like ethanol and wind energy, are money losing ventures.

Havilah, where there is gold : a post-Sinaitic theology of gold

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The name of the first is Pishon; it is the one which flows around the whole land of Havilah, where there is gold; and the gold of that land is good; bdellium and onyx stone are there. Genesis 2:11-12

Economist Nouriel Roubini says that gold has no intrinsic value.  He like many others, including Warren Buffet, take a utilitarian approach whereby the value of something is only what the market will bear at any given moment.  So in a Black Swan event, such as when all are dying of famine, a bag of gold could potentially buy a loaf of bread to stave off starvation.  In such cases, gold is only worth what people are willing to trade for it–so the thinking goes.

Others argue that silver is a better investment because at least silver has an industrial use.  But the gaping hole in this entire utilitarian argument is it misses an important aspect of gold: its aesthetic value.  Now, aesthetics is about an appreciation of beauty.  The gold-has-no-intrinsic-value cult thus downplays the ornamental and the artistic value of gold in jewelry, in works of art, and in religious artifacts. But since the dawn of history, these qualities have made gold one of the most desired elements in creation.  I would argue further, that God actually created gold to have this aesthetic value.  But let’s not make the opposite mistake as Roubini et al. and downplay the utilitarian value of gold.  Genesis 2.11-12, the first mention of gold in the Bible is making an implicit statement about why God created gold.

My very first undergraduate class in Bible was on the Pentateuch.  Prof. Darrel Hobson at Northwest College taught that the theology of the entire Pentateuch was post-Sinaitic.  If Moses is the essential author of first five books of the Bible–a traditional view–then he wrote everything from the vantage point which occurs after the Exodus and after his experience of God’s presence at Mt. Sinai.  The Creation narrative tells us that God made the heaven and the earth and everything which is in them.  He thus made the gold of Havillah and that gold was good–like everything else he created (see Gen 1).

This says something implicit about the function of gold in Moses’ time.  In those days, gold had its obvious aesthetic value to make beautiful things.  But it was also used as money.  Therefore, Genesis 2.11-12 implies that the utilitarian function of gold as a intermediary of exchange and a store of value, i.e., the monetary use of gold was good and an aspect of the creational purpose that God had for gold.

Weimar America: II. O Happy Day, a compromise has been reached (rev.)

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Update:  I learn from Rick Moran that the $38.5 billion in cuts weren’t from the quarterly deficit but of the annual budget.  I revised the post to reflect that.

I am as delighted about the compromise arrangement between Obama and Congress as anyone.  You see, my portfolio is 125% hedged against hyperinflation.  Congress has cut 38.5 billion.  That’s seems like a lot of money doesn’t it?  Let’s just all proclaim the victory.  You see, when the US Federal government is spending 1,600 billion per year more than what it brings in, $38.5 billion cuts less than 2.4% of the deficit.

Let’s try to get some perspective on this.  The Federal Reserve Bank is buying most of debt now since Japan is rebuilding in the aftermath of the Tsunami and the earthquake, and the Chinese are rebalancing their portfolios away from US debt while buying into the Canadian resource sector, among other things.  When Ben Bernanke buys the debt, it is called monetization; i.e., the money is created out of nothing and put into circulation via government spending.  This is creating hyperinflation–just look at commodities: gold is at $1475, oil at $113, silver over $40.  Now $38.5 billion savings will mean that the US will only borrow 97.6% of what they were planning to borrow before the compromise.  That’s a big deal.

Imagine your family had too much debt and expenses.  Every year you bring in $100,000, and borrow $50,000 while spending $150,000.  Now, you have a growing debt base, but you are not making a penny of payments on it to reduce its principle, and balance is now at $500,000.  Your payments are 2% interest, and so you are paying $10,000 of that $150,000 just to service the debt.  You’ve got a problem, because in one year that debt could cost you 5%, in which case your debt payments would become $27,500, and so you would have to borrow another $17,500 that next year just to cover the extra interest, so now instead of  borrowing $50,000, you are borrowing $67,500.  This is called a debt death spiral.  So lets say you and your wife compromise, and you decide to reduce your overspending by 2%, i.e., now instead of borrowing $50,000 you only add $49,000 to your $500,000 debt.  So in year two, your interest at 5% is only $27,450, meaning that you will only have to borrow $67,450 in year two.  Wow.  You’ve really made a difference by cutting your deficit by 2%!  Congratulations.

Thanks to the Tea Party we have a cost cutting Congress.  So I am now predicting that hyperinflation will be slowed down by a day or two.

Great job guys!  It makes my job as an investor easy:

Long: Canadian oil & gas sector; long Canadian gold mining companies, physical gold and silver (Sprott Physical Gold and Silver Trusts)

Short: US dollar.

Stuck on stupid I: More education bubble stuff

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I saw a young man, whose mother is from Boston, at the US Consulate General in Toronto; the consulate refused to acknowledge his US citizenship and issue him a passport yesterday.  He blamed the Tea Party movement’s influence on Congress.  He is by all counts a East coast liberal, 18-year old brain full of mush, wanting to emigrate to the US, get involved in the Democrat Party and the support the unions.  But is it his fault?  When the smartest people in the world are also stuck on stupid.

Look at Dr. Benjamin Bernanke, PhD.  He says the current inflation is low but caused really by a spike in commodity prices (from Reuters):

A recent increase in U.S. inflation is driven primarily by rising commodity prices globally, and is unlikely to persist, Federal Reserve Chairman Ben Bernanke said on Monday. …

Along the same lines, Bernanke argued that supply and demand factors are driving energy and commodity costs higher, but that these should eventually stabilize, allowing the United States to avoid any inflation troubles.

“I think the increase in inflation will be transitory,” Bernanke said in response to questions after a speech. “Our expectation at this point is that in the medium term inflation, if anything, will be a bit low. We will monitor inflation and inflation expectations very closely.”

Let me see if I understand Bernanke’s logic.  He believes that he can triple the money base in two years, but that commodity inflation is transitory.  Huh???  Get real.  If you want commodities to decrease you have to shrink the money supply.

Formerly with the Obama administration’s brain trust but now back in academia, Dr. Christine Romer, PhD, fears that there will be no QE III, for QE II worked so handsomely to get things going again.  Be careful with this video interview of Dr. Romer with my favorite Yahoo personality, Aaron Task: it can cause brain freeze, incredulity and a desire to throw things at your computer monitor.  Dr. Romer believes the best way to solve unemployment is through debauching the currency.  Of course, for the last two years, that’s exactly what the Fed has done, and the employment rate is pretty pathetic.  So what do you do when a policy doesn’t work?  Well it is obvious that you didn’t do enough of it.  So QE II is faltering because Bernanke hasn’t yet promised QE III.  Amazing.