Eating the Inner Organs of Beasts and Fowls

Mr. Leopold Bloom was clearly given to sensuous pleasures but he wasn’t entirely immune to the pleasures of the mind. Following yesterday’s market action, most of us probably feel the need to scale back a little from our sensuous pleasures, such as eating the “inner organs of beasts and fowls”, and give more weight to reflective […]

Freedom Works

In the U.S. the boundary of space within which we are free to make our own decisions is shrinking year by year. In daily life we face a bewildering array of restrictions on our behavior. The government now dictates what medications we can purchase, the size of our drink cups, what advertisements we can see, […]

Naive and Sophisticated Economics

Imagine a financial planner who tricked his or her clients into behaviors that were against their long-term best interests, encouraging them to spend, when years of overspending had left them in perilous financial shape, and scheming to have them sell their safe, conservative assets and instead, have them invest their funds in unsuitable risky assets. Furthermore, what if […]

Does Anarchy Have A Bad Rap?

The other day someone tried to cut in line at my local Starbucks and although it was probably unintentional, the sense of outrage from the other customers was palpable. It was as if customers had suffered a grievous personal blow, and it was not directed at their grande mocha cookie crumble frappuccino. Their sense of fairness […]

The Future Of Currencies

In an earlier post I wrote about the likelihood of continued market volatility as asset prices veered back and forth between the effects of monetary stimulus and the deflationary forces unleashed by a generational deleveraging event. In this tug-of-war between the forces of inflation (money printing) and deflation (deleveraging) the dollar is the medium through which […]

We Have To Cultivate Our Garden

I am told that successful blogs have to have strong graphics for the same reason that people need to shout in a crowded room to make themselves heard. The idea that the size of the audience can affect the message is an interesting one. Think about the mainstream press. The larger the circulation of a publication the more likely it is that the […]

A Little Rebellion Now And Then Is A Good Thing

I often have cause to drive from Nevada to California on interstate 15 and so have been stopped innumerable times by the California Fruit Border Control, and asked where I am coming from and whether I have any fruit in my car. The ostensible purpose of these checkpoints is to protect California from exotic invasive species. While there are […]

The Unintended Consequences Of Human Action

With QE3 the Federal Reserve has initiated another massive round of money printing, buying $40 billion worth of mortgage securities while continuing to reinvest its income from the securities  purchased during QE1 and QE2. In addition the Fed has changed the emphasis of its mandate, from targeting price stability to making itself responsible for employment, promising […]

Whisky’s For Drinking, Water’s For Fighting.

Whenever I do some serious backpacking I’m reminded of the central importance of water to our existence, particularly here in the American West. The earliest articulate description of the problem was made by Colonel John Wesley Powell (1834-1902), the famous ethnologist and geologist who was the first to run the Colorado River through the Grand […]

Why The Worst Get On Top And What To Do About It

My wife grew up in Lithuania when it was part of the Soviet Union, so she had plenty of opportunity to observe the new Soviet man that the ideologists of the Communist Party thought they had created in their planned society.  She was not impressed and nor were the rest of the Soviet people. Popular culture and specifically anti-Soviet jokes, […]

Abundance Or Stagnation?

This morning I congratulated a client on the successful surgery she underwent to replace one of her knees. At 82 she was delighted to be pain free and resume her regular activities after years of degenerative arthritis. She described the technology used in the operation in almost reverential terms. Truly, we are living in an amazing world, full of wonderful possibilities. Technology in […]

Eating Fried Chicken Reduces Breast Cancer

Starbucks will give me 10 cents off  my next drink if I bring in a reusable tumbler and save a paper cup.  Their advertising blurb encourages me to think of the effect on the environment if thousands of people traded their paper cups for Starbucks’ reusable mugs.  Retailers are feeling increasingly charitable these days.  The […]

The State: Engine of Creation or Engine of Plunder?

While in England recently I visited Buckland Abbey in Yelverton, Devon, the home of Sir Francis Drake (1540-1596).  As every English schoolboy knows Drake is famous for successfully raiding Spanish ships loaded with treasure from the New World, being the first man to circumnavigate the globe, and helping to defeat the Spanish Armada.  Of course, […]

Pickled Onions and Thatched Cottages

I’m writing this while on vacation in England, in a beautiful thatched cottage in Devon, built in the early 1700’s. There’s no internet so it is easy to ignore unsettling news from the outside world, the Batman massacre, Eurozone concerns and Middle Eastern turmoil. The setting, gardens and décor are idyllic.  The cottage has seen witchcraft […]

Human Nature – Take Your Pick

Sinceritus: People are basically good. Most of the world’s problems could be solved if only we all learned to act a little less selfishly. It just comes down to education and changing the environment, so we can help make people better. Economicus: I disagree with your basic premise. Man is an imperfect, selfish, fallible creature […]

Bond Buyers Beware

Interest rates fell earlier this month to the lowest level in U.S. history.  The fall in the rate of the 30-year Treasury bond since 1990 alone is 65%. This has happened despite record money printing by the Federal Reserve, which many predicted would lead to rising rates.  However, in an uncertain world, U.S. bonds have […]

Bloody Bloody Andrew Jackson

The daughter of a friend of ours has a leading role in ‘Bloody Bloody Andrew Jackson’, a rock musical about Andrew Jackson, the seventh President of the United States, at the San Jose Stage, so I am looking forward to seeing it in a few days. The review in the San Jose Mercury News quotes the […]

Platonic Dialogues For Our Times: Part II

Optimistopheles: Pessimisticles, you’re so negative. At the party this evening I’ve told all my tech friends not to talk to you about the economy because you will ruin their festive mood. They all work in Silicon Valley, at cutting edge companies, and are convinced that technology is the solution to most of the world’s problems. […]

Platonic Dialogues For Our Times: Part I

Inflacionatus: How on earth can you continue to hold on to your deflationary views Deflaticus? The monetary base has exploded, inflation is rising and while the dollar has not fallen over the last 12 months, it has not risen much either, as one would expect during a deflation. Deflaticus: The monetary base may have exploded, […]

Planning or Scamming?

As a long-time financial planner I know how hard it is to do good planning work for individuals and couples.  Such planning requires, among other things, meticulous attention to detail, an effective process to elicit the values behind the numbers and a constant review of assumptions and goals over time to make sure the client […]

A Meditation On Forgiveness

I upset a very old friend the other day with something I said in an email. When I sent the email I didn’t think there was anything wrong with it, but I was mistaken. Re-reading the email I can see exactly why he was upset. I had acted foolishly, rushed the email and used the […]

Hayek, Candies and Keynes

The debate between Friedrich Hayek and John Maynard Keynes over the nature and future of economics, spanned momentous times such as the Great Depression and the age of dictators, and it continues today posthumously in the discussion of how best to nurse back to health a wounded world economy.  Keynes, the optimist, believed that solutions […]

The Plus Side Of Debt Default

Back in September, 2008 Professor Jeffrey Rogers Hummel gave an online presentation to Sterling Futures’ clients and friends on the state of the economy. In 1993 Hummel was the first economist to go on record predicting that the U.S. government will default on its obligations. At that time the prediction was considered extreme but now […]

The Fed: Money Wizard Or Wizard Of Oz

In November, 2010, George Selgin, an economist at the University of Georgia, gave a presentation on the Federal Reserve System, in which he concludes that in virtually every conceivable respect, the economy performed as least as well pre-1913 (the year the Fed was created) than post-World War II, and usually better. He also finds that there […]

Society At The Edge Of Chaos

We tend to assume that history moves slowly and cyclically. For example, it is commonly thought that empires grow old, over extend themselves and finally collapse and that this will eventually happen to the United States just as it has with every other empire. Similarly, most people believe that global warming will eventually have serious […]

The Rise And Fall Of Empires

In his eminently readable book, Empires of Trust: How Rome Built – and America Is Building – a New World, historian Thomas Madden, compares the United States with the Roman Republic and argues that what is unique about both states is that they acquired their empire, not by conquest but by a series of alliances […]