Ben Bernanke has decided that he needs to teach all of us why the Federal Reserve is good for America and about why the gold standard is bad.  On Tuesday, Bernanke delivered the first of four planned lectures to a group of students at George Washington University.  But that lecture was not just for the benefit of those students.  Officials at the Fed have long planned for this lecture series to be an opportunity for Bernanke to “educate” the American people about the Federal Reserve.  The classroom was absolutely packed with reporters and just about every major news organization is running a story about this first lecture.  So the Federal Reserve is definitely getting the publicity that it was hoping for.  You can see the slides from the presentation that Bernanke gave to the students right here.  It is pretty obvious that one of the primary goals of this first lecture was to attack those that have been critical of the Fed over the past few years.  In doing so, Bernanke “stretched” the truth on more than one occasion.

The entire event was staged to make Bernanke and the Federal Reserve look as good as possible.  Prior to his arrival, the students gathered for the lecture were actually instructed to applaud Bernanke….

The 30 undergraduates at George Washington University sent up a round of applause. It was, they’d been told beforehand, “appropriate, even encouraged, to politely applaud” Tuesday’s guest lecturer.

But as noted above, this lecture was not for the benefit of those students.  AUSA Today article even admitted that “addressing the public directly” was one of the real goals of this lecture….

For Bernanke, the GW lectures serve a dual function:

They give him a chance to reprise the role of professor he played for more than two decades, first at Stanford and then at Princeton, where he eventually chaired the economics department.

And they give him a way to expand his mission of demystifying the Fed. As part of that campaign, Bernanke became the first Fed chief to hold regular news conferences and conduct town-hall meetings.

In addressing the public directly, Bernanke has also sought to neutralize attacks on the Fed, some of them from Republican presidential candidates.

So what did Bernanke actually say during the lecture?

Well, you can read all of the slides right here, but the following are some of the highlights….

On page 6 of the presentation, Bernanke makes the following claim….

“A central bank is not an ordinary commercial bank, but a government agency.”

Well, that is quite interesting considering the fact that the Federal Reserve hasargued in court that the Federal Reserve Bank of New York is not an agency of the federal government and that the various Federal Reserve banks around the country are private corporations with private funding.

So did the Federal Reserve lie to the court or is Ben Bernanke lying to us?

And what other “agency” of the federal government is owned by private banks?

It is even admitted that the individual member banks own shares of stock in the various Federal Reserve banks on the Federal Reserve website….

The twelve regional Federal Reserve Banks, which were established by Congress as the operating arms of the nation’s central banking system, are organized much like private corporations–possibly leading to some confusion about “ownership.” For example, the Reserve Banks issue shares of stock to member banks. However, owning Reserve Bank stock is quite different from owning stock in a private company. The Reserve Banks are not operated for profit, and ownership of a certain amount of stock is, by law, a condition of membership in the System. The stock may not be sold, traded, or pledged as security for a loan; dividends are, by law, 6 percent per year.

The Federal Reserve always talks about how it must be “independent” and “above politics”, but when they start getting criticized they always want to seek shelter under the wing of the federal government.

It really is disgusting.

On page 7 of the presentation, the following statement is made….

“All central banks strive for low and stable inflation; most also try to promote stable growth in output and employment.”

Well, on both counts the Federal Reserve has failed miserably.

Right now, if inflation was measured the same way that it was back in 1980, the annual rate of inflation would be more than 10 percent.

And when you take a longer view of things, the inflation that the Federal Reserve has manufactured has been absolutely horrific.

Even using the doctored inflation numbers that the Federal Reserve gives us, the U.S. dollar has still lost 83 percent of its value since 1970.

The truth is that inflation is a “hidden tax” that is constantly destroying the value of every single dollar that you and I hold.  Those that attempt to save money for the future or for retirement are deeply penalized under such a system.

As far as employment goes, the total number of workers that are “officially” unemployed in the United States is larger than the entire population of Portugal.

The average duration of unemployment is hovering near an all-time record high and almost every measure of government dependence is at an all-time record high.

So the Federal Reserve is failing at the exact things that Bernanke claims that it is supposed to be doing.

But instead of directly addressing many of the specific criticisms that have been leveled at the Fed, Bernanke instead chose to spend much of his lecture talking about the problems with adopting a gold standard.  The following are statements that were pulled directly off of the slides he used during his speech….

-”The gold standard sets the money supply and price level generally with limited central bank intervention.”

-”The strength of a gold standard is its greatest weakness too: Because the money supply is determined by the supply of gold, it cannot be adjusted in response to changing economic conditions.”

-”All countries on the gold standard are forced to maintain fixed exchange rates. As a result, the effects of bad policies in one country can be transmitted to other countries if both are on the gold standard.”

-”If not perfectly credible, a gold standard is subject to speculative attack and ultimate collapse as people try to exchange paper money for gold.”

-”The gold standard did not prevent frequent financial panics.”

-”Although the gold standard promoted price stability over the very long run, over the medium run it sometimes caused periods of inflation and deflation.”

-”In the second half of the 19th century, a global shortage of gold reduced the U.S. money supply and caused deflation (falling prices). Farmers were squeezed between declining prices for crops and the fixed dollar payments for their mortgages and other debts.”

Bernanke spent more time on the gold standard during his speech than on anything else.  At one point during the lecture, Bernanke made the following statement….

“To have a gold standard, you have to go to South Africa or someplace and dig up tons of gold and move  it to New York and put it in the basement of the Federal Reserve Bank of New York and that’s a lot of effort and work”

Bernanke even blamed the gold standard for the Great Depression.  On a slide entitled “Monetary Policy in the Great Depression”, Bernanke made the following claims….

•The Fed’s tight monetary policy led to sharply falling prices and steep declines in output and employment.
•The effects of policy errors here and abroad were transmitted globally through the gold standard.
•The Fed kept money tight in part because it wanted to preserve the gold standard. When FDR abandoned the gold standard in 1933, monetary policy became less tight and deflation stopped.

Bernanke seems to want to frame the debate over monetary policy is such a way that the American people are given only two alternative systems to consider: the Federal Reserve and a gold standard.

But the truth is that there are a vast array of both “hard money” and “soft money” systems that would not include a central bank or a gold standard at all.

So the truth is that the American people would have many different systems to choose from if they wanted to shut down the Federal Reserve and set up something new.

In the past the U.S. government has issued debt-free money and it could certainly do so again.

But in his lecture, Bernanke did not even mention how the Federal Reserve creates money or how whenever new money is created more debt is created.

Under the Federal Reserve system, the money supply is designed to continually increase, and whenever more money is created more debt is also created.

In a previous article I discussed how more money is created on the federal level….

For example, whenever the U.S. government wants to spend more money than it takes in (which happens constantly), it has to go ask the Federal Reserve for it.  The federal government gives U.S. Treasury bonds to the Federal Reserve, and the Federal Reserve gives the U.S. government “Federal Reserve Notes” in return.  Usually this is just done electronically.

So where does the Federal Reserve get the Federal Reserve Notes?

It just creates them out of thin air.

Wouldn’t you like to be able to create money out of thin air?

Instead of issuing money directly, the U.S. government lets the Federal Reserve create it out of thin air and then the U.S. government borrows it.

Talk about stupid.

The designers of the Federal Reserve system intended to trap the U.S. government in a debt spiral that would expand perpetually.

So has their design worked?

Well, just look at the chart below….

Today, the U.S. national debt is more than 5000 times larger than it was when the Federal Reserve was first created.

So I guess you could say that the results have been spectacular.

The Federal Reserve system also greatly favors the big Wall Street banks that it is designed to serve.

When those big banks get into trouble, the Federal Reserve snaps into action.

According to a limited GAO audit of Fed transactions during the last financial crisis, $16.1 trillion in secret loans were made by the Federal Reserve to the big Wall Street banks between December 1, 2007 and July 21, 2010.

The following list is taken directly from page 131 of the GAO audit report and it shows which banks received money from the Fed….

Citigroup - $2.513 trillion
Morgan Stanley - $2.041 trillion
Merrill Lynch - $1.949 trillion
Bank of America - $1.344 trillion
Barclays PLC - $868 billion
Bear Sterns - $853 billion
Goldman Sachs - $814 billion
Royal Bank of Scotland - $541 billion
JP Morgan Chase - $391 billion
Deutsche Bank - $354 billion
UBS - $287 billion
Credit Suisse - $262 billion
Lehman Brothers - $183 billion
Bank of Scotland - $181 billion
BNP Paribas - $175 billion
Wells Fargo - $159 billion
Dexia - $159 billion
Wachovia - $142 billion
Dresdner Bank - $135 billion
Societe Generale - $124 billion
“All Other Borrowers” - $2.639 trillion

What about all the rest of us?

Did we get bailed out?

No, we were told that if Wall Street was rescued that the benefits would trickle down to the rest of us.

Unfortunately, that has not exactly worked out.  In article, after article, afterarticle I have detailed the horrible economic suffering that the American people are still going through.

But what Bernanke and the Fed have done is create inflation in commodities such as oil which is affecting the household finances of nearly everyone in America.

The average price of a gallon of gasoline in the United States is now up to $3.87.  That is an all-time record high for the month of March.

So far in 2012, the price of gasoline in the United States has risen by 17 percent.

Thanks Bernanke.

Over the past several decades, every time there has been a major spike in gasoline prices in the United States, a recession has always followed.  If you doubt this, just check out this amazing chart.

So will we soon see another recession?

If we are lucky.  Hopefully the next downturn will not be a full-blown depression.

The truth is that the Federal Reserve does not help us avoid booms and busts.  Rather, it creates them.  The Fed was at the heart of the housing bubble which helped bring on the last financial crisis when it crashed, and the current ultra-low interest rate policies of the Fed are creating more bubbles which will have devastating long-term consequences.

So Bernanke does not have anything to be proud of, and his track record has been absolutely nightmarish.

Hopefully the American people will not believe the propaganda and will take an honest look at the Federal Reserve.

When you take an honest look at the Federal Reserve, there is only one rational conclusion: Congress should shut it down, lock the doors and throw away the key.

Source: The Economic Collapse.

Sweden was the first European country to introduce bank notes in 1661. Now it’s come farther than most on the path toward getting rid of them.

“I can’t see why we should be printing bank notes at all anymore,” says Bjoern Ulvaeus, former member of 1970′s pop group ABBA, and a vocal proponent for a world without cash.

The contours of such a society are starting to take shape in this high-tech nation, frustrating those who prefer coins and bills over digital money.

In most Swedish cities, public buses don’t accept cash; tickets are prepaid or purchased with a cell phone text message. A small but growing number of businesses only take cards, and some bank offices — which make money on electronic transactions — have stopped handling cash altogether.

“There are towns where it isn’t at all possible anymore to enter a bank and use cash,” complains Curt Persson, chairman of Sweden’s National Pensioners’ Organization.

He says that’s a problem for elderly people in rural areas who don’t have credit cards or don’t know how to use them to withdraw cash.

The decline of cash is noticeable even in houses of worship, like the Carl Gustaf Church in Karlshamn, southern Sweden, where Vicar Johan Tyrberg recently installed a card reader to make it easier for worshippers to make offerings.

“People came up to me several times and said they didn’t have cash but would still like to donate money,” Tyrberg says.

CONTINUED at CBS News.

Benjamin Franklin rose from 17-year-old runaway to successful printer, newspaperman, author, inventor, diplomat, and statesman. His great success came from living the virtues of frugality and industry, and his life offers us many personal finance lessons that apply to modern men just as much as they did to those living in colonial America. So without further ado, let’s dive right into uncovering some of Ben’s timeless wisdom.

1. Understand the True Value of Things

Benjamin Franklin learned one of his first, and most important, personal finance lessons as a boy. When he was seven, he saw another boy blowing a whistle and was so charmed by its sound that he offered the boy all the money in his pockets for it. The boy eagerly agreed to the deal. Young Franklin was delighted with his new possession and blew the whistle happily all over the house. But his satisfaction was cut short when his brothers and sisters, finding out how much he had paid for it, informed him that he had forked over four times as much money as it was worth. “The reflection gave me more chagrin,” Franklin recalled, “than the whistle gave me pleasure.”

But Franklin took an invaluable lesson away from his youthful mistake:

This, however, was afterward of use to me, the impression continuing on my mind; so that often, when I was tempted to buy some unnecessary thing, I said to myself, Don’t give too much for the whistle; and I saved my money.

As I grew up, came into the world, and observed the actions of men, I thought I met with many, very many, who gave too much for the whistle.

When I saw one too ambitious of court favor, sacrificing his time in attendance on levees, his repose, his liberty, his virtue, and perhaps his friends, to attain it, I have said to myself, This man gives too much for his whistle.

When I saw another fond of popularity, constantly employing himself in political bustles, neglecting his own affairs, and ruining them by that neglect, He pays indeed, said I, too much for his whistle.

If I knew a miser, who gave up every kind of comfortable living, all the pleasure of doing good to others, all the esteem of his fellow-citizens, and the joys of benevolent friendship, for the sake of accumulating wealth, Poor man, said I, you pay too much for your whistle.

When I met with a man of pleasure, sacrificing every laudable improvement of the mind, or of his fortune, to mere corporeal sensations, and ruining his health in their pursuit, Mistaken man, said I, you are providing pain for yourself, instead of pleasure; you give too much for your whistle.

If I see one fond of appearance, or fine clothes, fine houses, fine furniture, fine equipages, all above his fortune, for which he contracts debts, and ends his career in a prison, Alas! say I, he has paid dear, very dear, for his whistle…

In short, I conceive that great part of the miseries of mankind are brought upon them by the false estimates they have made of the value of things, and by their giving too much for their whistles. -From a letter from BF to Madame Brillon, 1779

CONTINUED at the Art of Manliness.

The Federal Reserve Open Market Committee (FOMC) has made it official: After its latest two day meeting, it announced its goal to devalue the dollar by 33% over the next 20 years. The debauch of the dollar will be even greater if the Fed exceeds its goal of a 2 percent per year increase in the price level.

An increase in the price level of 2% in any one year is barely noticeable. Under a gold standard, such an increase was uncommon, but not unknown. The difference is that when the dollar was as good as gold, the years of modest inflation would be followed, in time, by declining prices. As a consequence, over longer periods of time, the price level was unchanged. A dollar 20 years hence was still worth a dollar.

But, an increase of 2% a year over a period of 20 years will lead to a 50% increase in the price level. It will take 150 (2032) dollars to purchase the same basket of goods 100 (2012) dollars can buy today. What will be called the “dollar” in 2032 will be worth one-third less (100/150) than what we call a dollar today.

The Fed’s zero interest rate policy accentuates the negative consequences of this steady erosion in the dollar’s buying power by imposing a negative return on short-term bonds and bank deposits. In effect, the Fed has announced a course of action that will steal — there is no better word for it — nearly 10 percent of the value of Americans’ hard earned savings over the next 4 years.

Why target an annual 2 percent decline in the dollar’s value instead of price stability? Here is the Fed’s answer:

CONTINUED at Business Insider.

A combination of several factors, including a declining dollar and the Federal Reserve’s announcement that it would keep interest rates at virtually zero until late 2014, helped to send gold and silver prices soaring to multi-week highs. Analysts expect the upward trend to continue as paper currencies founder and gloomy news continues to dominate the economic headlines.

The spot price for gold was around $1,725 by 2 p.m. Eastern time after jumping more than $60 since the day before, up almost 30 percent from a year ago and more than 7.5 percent over the last 30 days. It smashed through $1,700 on Wednesday for the first in six weeks.

“At the moment everything points to even higher prices, given the strong risk appetite, the better mood among market players, the strong equity markets and the weak dollar,” Commerzbank analyst Daniel Briesemann told Reuters.

Analysts said the single most important factor behind gold’s strong rally was the Federal Reserve. On Wednesday, the privately owned central bank promised to keep short-term interest rates at rock bottom until late 2014, extending the date from its previous pledge to keep rates down until mid-2013.

Also bullish for gold — and bearish for the U.S. dollar, of course — was Fed boss Ben “helicopter” Bernanke’s veiled threat to unleash more so-called “Quantitative Easing,” known in simpler terms as creating new “money” out of thin air and pumping it into the economy by purchasing bonds. The dollar immediately took a hit against other major currencies.

“The framework makes very clear that we need to be thinking about ways to provide further stimulus if we don’t get improvement in the pace of recovery and a normalization of inflation,” Bernanke said during a quarterly news conference after the Fed’s report was released. Analysts and central bank critics, already concerned about massive monetary “easing” in recent years, lambasted the idea that more money would solve the economic problems plaguing America.

“If the Federal Reserve thought the economy was improving, it wouldn’t need this artificial prop to keep sustaining it,” said Euro Pacific Capital head Peter Schiff, noting that wild money printing was helping to drive the nation and its economy off a cliff. “The President and the Federal Reserve are now conspiring to create a much bigger crisis.”

The Fed claimed it would be targeting a 2-percent rate of annual inflation for 2012. However, few analysts take the government’s “Consumer Price Index” (CPI) measure of inflation seriously — especially as Core CPI, one of the most frequently cited figures, omits price increases in key sectors like food and energy.

According to Schiff, the government’s claim based on CPI that inflation for 2011 was 3 percent is completely bogus. It was actually much higher, he said, noting that officials were using phony measures like the CPI to mask the true rate of inflation. And it is likely to be even higher in 2012 before eventually morphing into a full-blown currency and debt crisis in the coming years.

“The reason they have to keep [interest rates] so low is to artificially support a phony economy,” Schiff explained. “This economy is a disaster waiting to happen — the only thing standing between us and economic Armageddon is zero-percent interest rates.”

But it can’t go on forever, and the longer rates are kept so low, the worse the looming crisis will be. For now, Schiff, whose business trades gold and silver, said investors should protect their assets by purchasing precious metals “before the price goes any higher.”

An analysis by Bloomberg published on Wednesday showed that gold — which has increased every year for more than a decade — provided the best return on investment over the last five years when adjusted for volatility. And heavy-hitting financial firms cited in the report including Goldman Sachs and Morgan Stanley are forecasting that gold prices will keep rising to around $2,000 in 2012 or 2013.

“People are still very under-invested in gold, and so there is a huge scope of that increasing,” explained UniCredit analyst Jochen Hitzfeld, the most accurate precious-metals forecaster tracked by Bloomberg over the past two years. Other experts noted that gold is widely and accurately perceived as a safe-haven in times of economic turmoil.

While gold prices have been extraordinarily volatile — spot prices hit $1,923 in September before crashing to $1,523 by the end of 2011 — the longer-term rally has so far been relatively consistent over the past decade. Just 10 years ago, gold was worth less than $300 per ounce.

Silver, which has also seen drastic price fluctuations, was less than $5 per ounce 10 years ago. In 2011, it surged to an all-time high of around $50 before dropping back down to about $33.35 today. The U.S. dollar, meanwhile, has not been doing so well — even when measured against other depreciating paper currencies.

Even billionaire investor George Soros, whose well-publicized sale of some 99 percent of his gold holdings during the first quarter of 2011 spooked precious-metals investors, has jumped back into the market. According to Securities and Exchange Commission (SEC) filings cited by Bloomberg, the hedge-fund manager had increased his stake in SPDR Gold Trust, an exchange-traded fund tracking gold prices, to almost 50,000 shares as of September 30.

Central banks around the world were also buying up multi-ton quantities of gold bullion, according to data cited in news reports. And the trend shows no signs of slowing down.

In other bullish news for the precious metal, unconfirmed reports indicate India has started purchasing oil from Iran using gold rather than U.S. dollars. China could follow, too, according to news reports.

“It shows the exodus from the dollar is gaining speed,” noted precious-metals and currency trader Simit Patel on the investment analysis site Seeking Alpha. “With the major economies of the world facing $7.6 trillion in bond payments due this year, I think the tipping point for a shift out of dollars and into a new monetary system backed by gold is not as far off as it may seem.”

With the steep drop in prices during the last few months of 2011, some analysts and traders were reluctant to get back in the precious-metals market before the appearance of a solid bottom had solidified. But the big banks and respected analysts are forecasting that as long as the fundamentals — out-of-control money printing, sovereign-debt crises, wild government spending, and more — remain the same, gold and silver prices could see massive gains in 2012.

Source: New American.

Stocks Are Cheaper Than They’ve Been in Two Decades … U.S. stocks are trading at their cheapest levels since at least 1990, according to such commonly used valuations as price-to-earnings and price-to-book ratios as well as dividend yield, Bespoke Investment Group says. This realization will lift the S&P 500 Index by 11 percent to 1,400 this year or maybe more, according to the research firm’s 2012 outlook report. “The S&P 500 is currently trading below its historical average P/E and P/B ratios, and these ratios are also at their lowest levels in the careers of a large percentage of money managers,” wrote strategists Paul Hickey and Justin Waters. – Fast Money/CNBC

Dominant Social Theme: Now is a golden buying opportunity!

Free-Market Analysis: OK, stocks are cheaper than they’ve been in 20 years. But cheaper than what?

This is actually a kind of power elite dominant social theme, in our view. We used to believe in the myth of the ever-abundant stock market but not anymore. Nonetheless, equity drummers keep pounding away. Stocks are just like any other widget. Sometimes they’re expensive according to historical indicators and sometimes they’re cheap. When they’re cheap you buy. When they’re expensive you … hold.

In the wonderful world of brokerage, the wisest customers never sell. In about five years from now – if the current system survives, and we doubt it will – there’ll be a virtual flood of articles about the few brave souls who managed to hold onto their equity positions for the past 15 years without flinching.

Now, we’ll be told, they’ll reap the rewards. Their stocks are up! Their patience has been rewarded. What we won’t read is the information about the lost opportunities, the funds tied up in failing stocks for a decade-and-a-half, the lack of capital to participate in gold and silver as both metals rose tremendously in value.

The rhetoric never changes. We remember the euphorias of the late 1990s and mid-2000s. Stocks, we were told, were like heirlooms. If you owned Kodak (oops) you never sold it. Or GM (oops), etc. You were supposed to pass these certificates down from generation to generation, like silverware. Here’s some more from the article:

The S&P 500 is already on track to reach or exceed this forecast, up more than four percent in 2012. Better-than-expected economic data and an emerging bailout solution in Europe are behind the gains.

To start 2012, the benchmark had an earnings multiple of 13, the lowest since 1990 and below the 80-year average of 15, according to Bespoke. It would take a move back to 1,484 to get the benchmark back to this long-term mean P/E.

The price-to-book ratio is 2.05, below the average since the late 1970s of 2.43. To get back to that average P/B, the benchmark would need to increase to 1,491.

So trading multiples are low and so is price-to-book. Sounds exciting but even the most trustworthy and historical numbers can lie. In this case, we’d point out, the analysts are looking at statistics instead of the larger business cycle.

It’s the Austrians who helped invented business cycle analysis, FA Hayek and Ludwig von Mises, and everyone who’s anyone on Wall Street is well aware of it. Central banks print money and generate stock-market bubbles. Then the markets and the bubbles collapse and the cycle starts all over.

But really, that’s not the whole truth because there are cycles within cycles. From at least 1980 to 2008, for almost 30 years, the US Federal Reserve in particular inflated the economy at the first sign of a slowdown.

Alan Greenspan did much of this by raising and lowering short-term interest rates gradually. But the result was a steady inflation of the US (and the world’s) economy. Of course, that can’t go on forever. What such endless amounts of monetary inflation do to an economy is entirely poisonous. They destroy it.

Sooner or later, larger economic forces reject the extra money sloshing around in the economy. Too much has been built, too much created, too much excess capital has been misplaced and mis-allocated. The economy collapses and central bankers rush to inject yet MORE money.

It’s the reason the banking sector (central banks’ distribution arm) is probably the largest or at least most important industry in the world right now. No matter what happens, banks aren’t allowed to fail.

The same cannot be said for the stock market. No matter how the powers-that-be try to prop up the stock market, the larger equity marts reflect the larger economy. When that slumps, so do stocks in aggregate. And it’s a fact that large economic slumps are an inevitable result of central banking monetary “crack.”

Today, and really for the past decade, the world has been in the grip of a fiat-paper bear market. It was most seriously affected during 2008 when the dollar reserve system basically collapsed. The chances are in our view that the fiat-money bear market may last several more years – even as many as four or five more.

Of course, we’re on record as wondering if this market cycle will go that far. We have a feeling that as gold approaches its higher-highs, the powers-that-be will have had enough. The dollar reserve system (which is basically no more, in our view) will be replaced by something else. Some sort of gold standard, we figure.

Of course, we likely won’t be in a favor of it. A potential new monetary standard, whatever it’s supposed to be, will no doubt be suggested and perhaps implemented by the same group that has saddled the world with 100 or more central banks.

This Anglosphere power elite will NEVER let the market have its way. They are determined to impose their will on human events at the expense of whatever human suffering is necessary. We can see them lining up the options already – a state-mandated metals money or perhaps the IMF‘s SDRs, supported by a larger basket of currencies.

Of course, whatever happens over the next few years will be reflected in the stock market. If the world does end up with a new monetary system, we can’t imagine that will be bullish in the short-term for equities. The market is no fan of uncertainty.

And for this reason, we return to our initial question – stocks are cheap, historically, but cheaper than what? Different “investments” are valued differently at different times during the artificial central-banking business cycle that we must function under.

In this case, we would argue, stocks are more likely reflecting potential chaos to come than a buying opportunity. Sure, there may be rallies during this fiat bear market but they should be considered within the context of the larger trends.

What bothers us most about these kinds of analyses is that if you mention the reality of the business cycle to many people on Wall Street, they’ll grant its existence and influence. But then they’ll go right back to banging the drum for equities as if the market can be evaluated solely on its own. (True, if pressed, they’ll suggest a government or corporate bond during a downturn.)

Likewise, regulations have been created without taking business cycle economics into account. Most SECregulations tend to narrow the strategic richness of the opportunities that people have to invest just when they are needed most. What regulations do, therefore, is to create an even more artificial and brittle marketplace where everyone is investing the same way – or trying to leave through the same door.

The regulators and the brokers are really two sides of the same coin. Stubbornly, neither will recognize the REAL business cycle or the culpability of the larger central banking system in its too-often ruinous behavior. With all the emphasis on risk, disclosure and asset diversification, this refusal to recognize the obvious is a little bit like ignoring the elephant in the room.

Of course, more and more investors are “getting it” these days, thanks to all the information available on the Internet. It is the Internet Reformation – as we call it – that is increasingly driving people’s investment behavior, and driving them away from mainstream equities as well.

As understanding about the real factors affecting the market continues to rise, we expect continued skepticism about mainstream stock markets and about the financial industry in general. Soon, we would not be surprised if the buying public begins to understand more about business cycle investing then the investment pros are willing to discuss. That will certainly make their jobs more difficult and lead to increasing confusion all around.

Conclusion: On the bright side, however, the talk about treating stocks like heirlooms may subside once and for all.

Source: The Daily Bell.

*Written by Rob Rimes.

Gordon Gekko affected me as a child. When I first saw the film ‘Wall Street’, I was around nine or ten-years-old. I remember my father watching it on HBO or Showtime. I certainly didn’t understand the film at that time but I do remember my first impression of Gordon Gekko and knowing, even at that young age, that the film misrepresented him and made him the villain when in reality, he was the hero.. or at least, the anti-hero. I didn’t know why he was the hero at the time, I just remember being somewhat afraid of him but also respecting him and seeing him as sort of a mentor. Granted he was a mentor to Bud Fox in the film but I saw him as a mentor to the film’s audience. Something about that character stuck with me and became a weird obsession. I didn’t know what he meant with his “greed”speech but I knew it was important and the most pivotal point in the film. It was ‘Wall Street’ and Michael Douglas as Gordon Gekko that really got me into being a huge fan of film on a more intimate level. ‘Indiana Jones’, Hammer Horror, Back to the Future and ‘Predator’ mixed with Oliver Stone’s masterpiece ‘Wall Street’ made me want to be a filmmaker.

I never became a filmmaker, unless you count videos of me chugging vodka and shooting bottle rockets from my mouth on YouTube as real cinema, but I did become a writer. Often times I would write outlines and even scripts for films that I wanted to make. At 15, I started to write a script called ‘Gekko’ which was a sequel to ‘Wall Street’ that had a time traveling twist to it. Essentially, the film ended with Gordon Gekko, as a member of the “Greed Party” defeating FDR and Herbert Hoover in the presidential race of 1932. Yeah, it was a fucking horrible idea and I think I used the script as scrap paper for another project I started writing; I think that one was about vampires and the Culper Ring during the Revolutionary War. Anyway, Gekko obviously affected me and influenced some of my creative endeavors during high school.

As I got older, I was more of a liberal shit. Still, something about Gekko continued to resonate with me. At that point in my life, I had more of a mentality like Bud Fox and his father but deep down, I knew they were wrong. I mean, Bud Fox was a snitch and a bitch in the end and with that, he lost any street cred he could’ve potentially had. As I educated myself, learned the ways of the world and experienced things, I became a libertarian. In many ways I have also become an objectivist. Having that stance and knowing what I know, I truly understand why Gordon Gekko was the hero of the story in ‘Wall Street’, contrary to what the director himself tried to convey.

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An acute butter shortage in Norway, one of the world’s richest countries, has left people worrying how to bake their Christmas goodies with store shelves emptied and prices through the roof.

The shortfall, expected to last into January, amounts to between 500 and 1,000 tonnes, said Tine, Norway’s main dairy company, while online sellers have offered 500-gramme packs for up to 350 euros ($465).

The dire shortage poses a serious challenge for Norwegians who are trying to finish their traditional Christmas baking — a task which usually requires them to make at least seven different kinds of biscuits.

The shortfall has been blamed on a rainy summer that cut into feed production and therefore dairy output, but also the ballooning popularity of a low-carbohydrate, fat-rich diet that has sent demand for butter soaring.

“Compared to 2010, demand has grown by as much as 30 percent,” Tine spokesman Lars Galtung told AFP.

Last Friday, customs officers stopped a Russian at the Norwegian-Swedish border and seized 90 kilos (198 pounds) of butter stashed in his car.

Source: Times Live.

*Taken from Business Insider.

Muammar Qaddafi was three times as rich as Carlos Slim and ten times richer than King Abdullah of Saudi Arabia — easily the richest man in the world.

Qaddafi was supposedly worth over $200 billion with assets in bank accounts, real estate and corporate investments around the world.

This staggering new estimate comes from senior Libyan officials and seems to be legitimate, according to the LA Times.

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