Archive for Oct, 2008

Buffett goes into shares – has he discounted stagflation?

As mentioned in a previous post, all the ingredients are there to create a pretty noxious soup of inflation and low or negative growth. Read the rest of this entry »

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Money supply growth – ignore it at your peril

As mentioned in a previous post, the Fed decided in early 2006 to kill the M3 measure of the money supply. It is difficult to measure money and costly however scrapping broad money measures is tantamount to saying that money supply growth doesn’t matter.

The monetarist view of economics says that Read the rest of this entry »

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When to sell in a falling market

I am not an investor in shares only investing in index options when I feel that either a major shock is coming or one has been oversold. If however you do hold shares, I would remind you of something that my uncle taught me back when Read the rest of this entry »

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A whole generation of talent wasted

Top graduates have flocked to the financial services sector for decades. Employment in this sector has ballooned. These jobs have not been created to support the two key roles of the financial sector  Рallowing money to be used efficiently as a method of payment and lending to solvent borrowers Рbut to play at the casino table that was created by ever more lax regulation in the face of global competition for the provision of financial services.

The financial sector will massively Read the rest of this entry »

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Parrallels with pyramid selling or MLM

Pyramid selling or multi-level marketing has some interesting aspects to it and some firms have applied these aspects to their distribution models very effectively. Others have applied them less effectively and even dangerously. One sector that has applied some of the principles of pyramid selling is the financial services sector. Here’s how. Read the rest of this entry »

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The consumer and corporate sector need the funds not the banking system!

Keynes is famous because he prescribed that at times of depression the Government needs to step in and spend where others won’t.

The correct response today is to prepare over the coming weeks a signiificant series of internationally coordintated measures to avoid depression. Any money spent on “unblocking the financial system” will be wasted. Read the rest of this entry »

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Almost ¬£1bn deposited with Icelandic banks because they paid a 1/4 point more!

Not a lot to say here except “do you remember your first lesson in finance?” “Well, it was about risk and return”. Does 1/4 point return really compensate you for the risk of an Icelandic bank over and above a UK bank?

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