Posts filed under 'Politics and stocks'

The Underground Investor™ Database Archives

We’ve moved the archives to the bottom of the page but they are still here. Of course you may always access the archives by clicking on the listed categories in the left hand column of this page as well. Learn the best ways to invest money during the developing dollar crisis, possible stock market crash, and developing financial crisis. Our goal is to be the only website that consistently provides you, the reader, with the REAL stories behind the stories in the investment world today and the facts you need to know about gold investments, the oil crisis and how to recession proof your investment portfolio against coming bank failures and continuing economic mayhem.

For a much higher level of premium information and specific guidance about how to achieve financial freedom with our PROPRIETARY investment system, consider our subscription services. Learn more about our premier investment research and education services, the SmartKnowledgeUInvestment Education System here, and our premier stock research newsletter,the Global Stock Picker, a newsletter where the return of our Model Portfolio is 21.68% just 12-1/2 months after our launch, a figure that is outperforming U.S. and U.K. markets by nearly 40%, the Chinese Shanghai SSE index by more than 63.03%, and the India BSESN index by more than 24.41%!

Most Read Posts (52 articles) - Discover which articles Underground Investor™ readers are most interested in. See the full database by clicking the link above.

Sept. 27, 2007 - 101 Reasons Why Managing Your Money is the Quickest Way to Build Wealth
Sept. 25, 2007 - 10 Surefire Ways to Make an Investment Fortune
Sept. 15, 2007 - Why the U.S. Feds 0.50% Rate Cut Won’t Save the Markets
Sept. 15, 2007 - U.S. Interest Rate Cut to Have Little Long-Term Positive Effect
Aug. 20, 2007 - How Much Does the Gov’t Really Manipulate Markets
Aug. 9, 2007 - More Gov’t Foolishness (or Lies) Again: Markets are Sound…NOT!
Aug. 9, 2007 - Chinese Tariffs and the Nuclear Option
Jul. 24, 2007 - How to Invest Like the World’s Greatest Investors
Jun. 17, 2007 - Get Out of Dollar-Denominated Bonds While You Still Can!
May 1, 2007 - Uranium Stocks are Finally Getting the Attention They Deserve
Apr. 23, 2007 - The Emperor’s New Clothes Abound in the Investment Industry. Don’t Get Cheated by Your Advisor
Apr. 20, 2007 - Use Intelligent Strategies to Push Risk Back onto Investment Firms
Apr. 19, 2007 - In Risky Markets, Follow the Behavior of the Ultra-Rich, Not the Rich
Apr. 12, 2007 - The Secret to Investing

Gold Investments (32 articles) - Use traditional rules to invest in gold stocks and you’ll lose money hand over fist with this asset class. Learn more about one of the most important components of every portfolio for future years to come. See the full database by clicking the above link.

April 23, 2008 - Will U.S. Markets Crash Now or Later?
Feb. 4, 2008 - Could Chinese New Year’s Fuel the Next Rally Higher for Gold Stocks?
Jan. 29, 2008 - Even After This Strong Run, Gold Stocks are Still a Bargain Today. Here’s Why.
Jan. 5, 2008 - A Sneak Peak at Our Premium Level Information
Nov. 4, 2007 - Is Hyperinflation Coming to the U.S.? It’s Time to Stock Up on Gold.
Nov. 4. 2007 - Gold is the Best Investment Today, History Tells Us So.
Nov. 2, 3007 - Gold Expensive at $791/oz.? Not by a Longshot
Jun. 5, 2007 - Learn How NOT to Invest in Gold
Mar. 30, 2007 - Navigate the Minefields of the Investment Information Highway
Mar. 7, 2007 - This Bounce in Gold Markets Merits a Cautious Approach
Mar. 6, 2007 - Gold Stocks Correction - What it Means?
Feb. 28, 2007 - How to Profit from a Weakening Market, Gold Stocks, & More, Part II
Feb. 28, 2007 - Buying Opportunity in Gold Stocks
Feb. 28, 2007 - How to Profit from a Weakening Market, Gold Stocks, & More, Part I
Feb. 23, 2007 - Uncover the Ignored Asset Classes
Feb. 12, 2007 - How Do I Know that Institutional Money is Still Not on Board with Gold?
Jan. 25, 2007 - If You Don’t Own Gold Stocks, You Need To
Jan. 23, 2007 - Building Wealth Requires More than Just Contrarian Investing
Jan. 14, 2007 - Use the Long Tail of Investing to Accurately Predict the Price of Gold
Jan. 11, 2007 - The REAL DEAL about Gold and Energy
Dec. 13, 2007 - Commodities and Asians: Apparently We All Look Alike
Nov. 6, 2006 - Sometimes Silence is Golden
Oct. 10, 2006 - Shock and Awe Awaits Global Markets
Oct. 4, 2006 - Is Gold’s Correction Over Yet?
Oct. 2, 2006 - Fiat Currency Concerns Give Rise to a Gold & Silver Backed Currency System
Oct. 1, 2006 - The Gold Timeline - A History of Gold Prices
Sept. 16, 2006 - Has the Commodities Bubble Burst? No, No, No!
Sept. 13, 2006 - Sell the Rumor, Buy the News
Sept. 11, 2006 - Gold’s Speculative Stigma is Unwarranted
Sept. 3, 2006 - Gold’s Glitter is Genuine
Aug. 14, 2006- Knowing Your History is More Important to Creating Wealth than Fundamental Analysis

Financial Crisis, Dollar Crisis & Recession Proof Investing (26 articles) – Foolish investors’ eyes lit up as New Century Financial dropped from $30 to $20 a share during the recent subprime mortgage fiasco. Their hearts thumped with excitement as shares dropped from $20 to $10 and they doubled down. When shares dropped to $5 they thought it had to be the bottom and put their last remaining money into New Century. A month later, they lost everything. There is similar optimism surrounding the dollar today from self-declared currency experts. Discover why the dollar is much more likely to go the way of New Century than experience a comeback like Muhammad Ali’s Rumble in the Jungle.

June 26, 2008 - The One Question That Will Have the Greatest Impact on Your Financial Future
May 14, 2008 - What’s Driving the Price of Oil Higher? It’s the Dollar, Stupid!
April 30, 2008 - How Low Will the Feds Go?
April 17, 2008 - Monetary Inflation. How Increased Paper Wealth Can Translate into a Lower Standard of Living
March 3, 2008 - Why Investors Will Never Make Money in this Bear Market
Feb. 20, 2008 - The Secret to Building Wealth in Volatile Markets
Feb. 6, 2008 - Is Recession in the U.S. Coming? We’re Already in One.
Jan. 28, 2008 - The Outcome of the Fed’s Interest Rate Cuts? History is the Best Oracle.
Jan. 24, 2008 - The Fed’s 0.75% Interest Rate Cut - A Recipe for Future Disaster
Dec. 7, 2007 - The Dollar Panic. Is it Real?
Sept. 19, 2007 - Signs of a Peak Investment Crisis Keep Coming
June 18, 2007 - Alan Greenspan’s Call of Checkmate on China is Premature
June 17, 2007 - PIMCO’s Bill Gross and the Economist Agree with SmartKnowledgeU 6 Months After the Fact!
May 28, 2007 - The Politics of Higher Oil Prices
May 26, 2007 - Asian Countries Pooling Reserves to Protect Themselves from the Incredible Shrinking Dollar, Part II
May 25, 2007 - Asian Countries Pooling Reserves, Part I
May 3, 2007 - The Death of the 3-Year Treasury Note
Apr. 1, 2007 - The Next Cold War Will be an Economic One
Jan. 25, 2007 - Dollar-Denominated Bonds Faltering
Jan. 9, 2007 - Use the Longtail of Investing to Accurately Predict Dollar Behavior
Jan 7, 2007 - 10 Reasons Why Dollar-Denominate Bonds Aren’t Safe
Dec. 21, 2006 - Iran Presents More Trouble for the U.S. Dollar
Dec. 7, 2006 - The U.S. has Perfected the Incredible Shrinking Dollar

Free Stock Picks (22 articles) - While our top-shelf stock picks and ideas that have since returned 100% to 200% returns are reserved for our members only, here read articles about some mid-shelf stock picks and ideas that have already returned 30% returns in less than a year. Access the full database by clicking the link above.

Jun. 4, 2007 - To Prove the Effectiveness of Our SmartKnowledgeUInvestment System, Even Our Weakest Picks that We’ve Given Away for FREE Have Soared
Apr. 29, 2007 - After BAIDU, Possibly Focus Media
Apr. 2, 2007 - Profit, Don’t Lose From Market Corrections
Apr. 2, 2007 - Global Warming Presents Easy 30% Gains for Underground Investor Readers
Mar. 13, 2007 - Beware the Perpetual Bulls, Part II
Feb. 18, 2007 - Banking Sector FY 2008 - Positive for Japan & India, Negative for China
Jan. 4, 2007 - Chinese Technology Companies to Watch in 2007
Dec. 19, 2007 - MSFT and Internet Protocol Version 6
Dec. 12, 2006 - It’s Time to Keep a Close Eye on Indian Stocks ICICI & HDFC
Dec. 7, 2006 - The Ocean Becomes a New Growth Point in the World Economy
Oct. 30, 2006 - What’s the Safest Place to Invest in the Oil Industry Now?
Oct. 30, 2006 - You’ll Find Ignored Investment Opportunities in the DRC & Libya
Oct. 23, 2006 - Indian Banks Anyone? Four Letters: HDFC
Oct. 9, 2006 - Don’t Believe the Hype - Avoid Chinese Bank Stocks


The Peak Investment Crisis & Stock Market Crash (12 articles)
- Bubbling underneath the surface, there lies a peak investment crisis. When it hits, savvy investors will build a fortune. Unfortunately, most investors will be blindsided and lose great fortunes instead. Access the entire database by clicking on the above link.

Nov. 4, 2007 - Is Hyperinflation Coming to the U.S.? It’s Time to Stock Up on Gold.
Nov. 4. 2007 - Gold is the Best Investment Today, Part II
Oct. 15, 2007 - Our New Forum on Facebook: Crisis Investing
Oct. 9, 2007 - Beware the Turbulence that Lies Beneath the Surface, Part I
Sept. 20, 2007 -The Signs of a Peak Investment Crisis Keep Coming
Sept. 19, 2007 -Why the U.S. Fed’s 0.50% Rate Cut Won’t Save the Markets
Aug. 9, 2007 - More Gov’t Foolishness Again
Jun. 29, 2007 - Don’t Let the Strength of the U.S. Markets in the First Half of 2007 Fool You
Mar. 11, 2007 - It’s the Difference Between Chasing & Building Wealth
Mar. 6, 2007 - What this Correction Means for Gold Stocks
Feb. 28, 2007 - How to Profit From a Weakening Market & Gold Stocks
Sept. 9, 2006 - The Peak Investment Crisis
Aug. 11, 2006 - How to Protect Your Portfolio During Turbulent Markets

A New Investment Paradigm for the 21st Century (10 articles) – Fundamental and Value investing may take years of patience to pay off (i.e. Apple Computers was a huge value stock at $13 a share and took more than four years of waiting to pay off huge), Growth investing often leads to chasing hot sectors that correct rapidly. Discover why changing conditions in today’s global market has created a new investment paradigm that is hands down the best way to invest today. Click the link above to see all articles in this category.
Jul. 24, 2007 - How to Invest Like the World’s Greatest Investors
Feb. 25, 2007 - Frontrunning Can Make You a Fortune
Jan. 30, 2007 - The New Paradigm of Successful Investment Strategies
Jan. 21, 2007 - 10 Reasons the Longtail of Investing is the Only Way to Build Wealth
Jan. 16, 2007 - Use the Longtail of Investing to Predict Major Market Events with High Accuracy
Jan. 9, 2007 - Accurately Predict U.S. Dollar Behavior
Sept. 1, 2006 - What Mark Cuban Failed to Realize About Investing

The Biggest Investment Myths (59 articles) – All investment professionals, from investment firms to financial consultants to the financial journal purposely spread tales of lies and deception. Jim Cramer, an investment professional that amassed a fortune as a hedge fund manager, recently stated that the last thing he ever wanted to do is to tell the truth. Find out why deception is part of the game in the investment industry. Click the link above to access the full database.

Oct. 25, 2007 - New Home Sales Went Up. So What?
Oct. 15, 2007 - Beware the Turbulence that Lies Beneath the Surface, II
May 6, 2007 - Economic Reports Drive Short-Term Behavior, but Hardly Represent the Truth
Mar. 21, 2007 - The Short-Term May be Rosy, but Beware the Financial Crisis that is Building Steam
Mar. 4, 2007 - Foreign Markets aren’t as Risky as the Pundits Say
Feb. 23, 3007 - Evolve Your Investment Strategies with Evolving Technology
Feb. 6, 2007 - My Problem with Investment Newsletters (except ours, of course!)
Feb. 4, 2007 - 10 Questions to Help You Find a Superior Financial Consultant
Jan. 30, 2007 - A New Paradigm of Successful Investment Strategies
Jan. 25, 2007 - Despite Evidence to the Contrary, Millions of Investors Will Believe Whatever they Want to Believe
Jan. 7, 2007 - 10 Reasons Why Dollar Denominated Bonds Aren’t as Safe as You Think
Jan. 5, 2007 - How Understanding MMA Champions will Make You a Better Investor
Dec. 18, 2006 - The True Determinants of Wealth Have Nothing to do with Asset Allocation
Nov. 12, 2006 - The Greatest Investment Myth Exposed: Why Modern Portfolio Theory WILL NEVER Make You Rich.

Wealth Literacy (74 articles) – Wealth Literacy is the new Financial Literacy. Financial Literacy may teach you to be fiscally responsible but you can still be financially literate and remain poor. Wealth Literacy fills in all the holes of Financial Literacy and teaches you how to build wealth today.

Oct. 15, 2007 - Our New Facebook Investment Group - Crisis Investing
Oct. 9, 2007 - Beware the Turbulence that Lies Beneath the Surface, I
Apr. 23, 2007 - Beware the Emperor’s New Clothes -Don’t Get Cheated by Your Adviser
Apr. 20, 2007 - Intelligent Investment Strategies Push Risk Off of You & Back onto Investment Firms
Apr. 19, 2007 - In Risky Markets, Follow the Behavior of the Ultra-Rich, Not the Rich
Apr. 17, 2007 - Why Wealth Literacy is More Important than Financial Literacy, Part II
Apr. 15, 2007 - Why Wealth Literacy is More Important than Financial Literacy, Part I
Apr. 13, 2007 - Pop Investing is All the Rage, but it’s a Loser’s Game
Apr. 12, 2007 - The Secret to Investing in 3 Easy Rules
Apr. 10, 2007 - Build Wealth by Answering These 5 Questions
Mar. 30, 2007 - How to Navigate the Minefields of the Investment Information Highway
Mar. 12, 2007 - The Short-Term May be Rosy, But Beware the Financial Crisis that is Building Steam
Mar. 11, 2007 - The Difference Between Chasing Wealth and Building Wealth
Feb 23, 2007 - Uncover the Ignored Asset Classes
Feb. 21, 2007 - Why Traditional Education Stifles Your Ability to Build Wealth
Feb. 15, 2007 - 7 Habits of Highly Effective Investors
Feb. 8, 2007 - 10 Reasons Why a Professional Athlete’s Best Friend Needs to be his Financial Adviser

Politics and Stocks (27 articles) - Think you don’t need to understand politics to be a good investor? Think again. If you don’t understand politics, you’ll never fully understand the most likely future direction of global stock markets, oil, gold, and currency markets. Click the above link to see the full database of articles.
Apr. 11, 2007 - Building Great Wealth in Stocks Requires Understanding Politics
Apr. 1, 2007 - The Next Cold War will be an Economic One
Apr. 1, 2007 - Possible U.S. Military Intervention in Iran
Mar. 13, 2007 - To Err on the Subject of Chinese Tariffs May Expedite a Shakespearean Tragedy
Dec. 17, 2007 - Do Free Markets and Free Trade Exist?

Oil Crisis (13 articles) – Think oil prices are controlled by supply and demand, futures traders, or Peak Oil Theory? Think again. Discover the true determinants of oil price behavior, primarily dollar devaluation.
May 14, 2009 - What’s Driving the Price of Oil Higher? It’s the Dollar, Stupid!
May 28, 2007 - The Politics of Higher Oil Prices
Nov. 26, 2006 - Does the end of Mid-Term Elections Mean Higher Gas Prices Again?
Nov. 8, 2006 - The Peak Oil Theory was Created by - You Guessed it - Big Oil!
Oct. 30, 2006 - The Safest Place to Invest in the Oil Industry Now? - Oil Refiners, Pipeline Manufacturers, Deep Sea Platform & Drilling Manufacturers, and 4D Imaging Companies
Oct. 30, 2006 - You’ll Find Ignored Investment Opportunities in the DRC and Libya
Oct. 12, 2006 - How Has Prince Bandar bin Sultan Affected Oil Prices in Years Past?

Uranium Investments (2 articles)– The bulk of this information is contained within our members only area, but you’ll find an article or two here.

May 1, 2007 - Uranium Stocks are Finally Getting Some Attention. Better Late than Never.
May 1, 2007 - What Does Uranium Futures Mean for the Future of Uranium Stocks?

Africa Investments (4 articles) - For the more daring investor willing to place small bets for HUGE returns, Africa awaits.

Canada Investments (3 articles) – Articles about Canada and the Canadian stock market and hands down some of the best opportunities in ANY global stock market.

China Investments (19 articles) – Articles about Chinese stocks and the Chinese stock market.

India Investments (3 articles) – Articles about Indian stocks and the Indian stock market.

Japan Investments (3 articles) - Articles about the Japanese economy and stock market.

Russia Investments (1 articles) - Articles about the Russian economy and stock market

U.S. Stocks (23 articles) - Articles about U.S. stocks and the American stock market.

Vietnam Investments (1 article) - Articles about Vietnam and the explosive yet unregulated Vietnamese market.

Investment Psychology (20 articles) – One of the most important but yet most overlooked and ignored aspects of investing is psychology. Discover how an improper mindset can be the difference between huge losses and huge gains in your portfolio.

Feb. 7, 2007 - Investors Should Apply the Rule of Shopping 101 to Buying Stocks
Jan. 3, 2007 - Will the 2006 Year End Rally Continue into 2007?
Dec. 21, 2006 - Perception Can Overrule Reality in Driving Behavior but Reality Will Overrule Perceptions in Driving Outcome
Nov. 30, 2006 - The Recency Effect Hurts Investment Decisions
Nov. 2, 2006- Canadian PM Stephen Harper & Hungarian PM Ferenc Gyurcsany - the More Things Change the More They Stay the Same
Nov. 2, 2006 - Irrational, Not Rational, Behavior Often Drives Markets
Oct. 24, 2006 - The Financial Media are Like Bad Weatherman
Oct. 8, 2006 - The SmartKnowledgeU Reader’s List
Oct. 4, 2006 - Hungarian PM Ferenc Gyurcsany: We LIED Morning, Noon, & Night!
Sept. 26, 2007 - Move Over Harry Potter! The Deceptive Wizardry of Fund Managers
Sept. 17, 2006 - When it Comes to Investing, You Get What You Pay For
Sept. 16, 2006 - Why Do People Believe One of the Dumbest, Most Flawed & Deceptive Measures of Economic Conditions?
Sept. 13, 2006 - Why Book Smarts Won’t Help You Build Wealth
Sept. 10, 2006 - Investment Psychology 101
Aug. 24, 2006 - To Become Wealthy, Abandon Widespread Beliefs About Investing
Aug. 18, 2006 - Following Mainstream Media Will Lead You Down a Disastrous Investment Road
Aug. 3, 2006 - Following Short-Term Fluctuations Will Create Poor Investment Decisions

Options Investing (9 articles) - We don’t discuss options much here but occasionally, if there is a compelling play, we’ll write an article or
two.

Water Investing (1 article) - Read articles about investing in water as a commodity as the world’s fresh water supply becomes more scarce.

The Zen of Investing (41 posts) - Read articles from our resident martial arts expert regarding how understanding principles of martial arts can make you a much better investor. A combination of “The Art of War” and “The Art of Investing” if you will.

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1 comment May 14th, 2008

Has Executive Order 12631 Effectively Ended the Era of Free Markets?

May 11, 2008

There has been a lot of speculation for many years now that during extreme financial crises, the U.S. Federal Reserve and other entities intervene in free markets from behind the scenes and do not allow free market forces to operate. There are usually two schools of thought that dominate this hotly contested issue. One group of people asserts that free market interference is entirely acceptable because the alternative of allowing free market conditions to create a market crash is not an option. Another group of people asserts that interference in free markets is undemocratic and self-destructive as intervention in free markets do not solve problems but only cover-them up and delay them, thereby only allowing the elite money who truly understand such actions to exit stock markets at the heights of these artificially manufactured rallies while laying waste to the wealth of the common investor when things inevitably fall apart in the near future.

Those that argue that free markets are dead state that free markets ended when U.S. President Ronald Reagan signed Executive Order 12631 into law on March 18, 1988, establishing the Working Group on Financial Markets, known as the Plunge Protection Team (PPT) in more conspiratorial circles. The Working Group’s members consist of the most powerful men in global finance - the U.S. Secretary of the Treasury, the chairman of the Board of Governors of the Federal Reserve, the chairman of the SEC and the chairman of the Commodity Futures Trading Commission. Reagan’s decision to form the Working Group was inspired by Black Monday, a day when U.S. Dow Jones index shed an incredible 508 points, or 22.6% of the index’s value at the time, in a single day.

The Working Group was assigned the mission of ensuring that such an event would never happen again. Instead of addressing the root causes of Black Monday such as money supply growth that encourages the formation of speculative stock market and real estate market bubbles that lead to inevitable crashes, many have contended that the Working Group instead operates by intervening in the free markets Read more …

1 comment May 11th, 2008

Recent Anomalies in U.S. Stock Markets - Proof of Free Market Intervention?

May 11, 2008

In Part I of this two-part article, “Has Executive Order 12631 Effectively Ended the Era of Free Markets?” I discussed publicly made statements by various officials of the U.S. Federal Reserve that indicated they would resort to free market intervention and manipulation “if necessary”. Since many of those statements have been made, there have been fierce arguments about whether or not the U.S. Federal Reserve takes such actions during periods of crisis. Such behind-the-scene actions, were they to occur, would certainly bring into question numerous legal, moral, and ethical issues. Just because former Board Member of the U.S. Federal Reserve Robert Heller stated that it is quite easy to manipulate stock markets and reverse free-market behavior through the purchase of stock futures, does this mean it happens? Of course not.

But a quick glance at market behavior ever since the Working Group has been formed, especially in the past several months, seems to indicate that some form of behind-the-scenes free-market interference occurs at regular intervals during crises. In past articles on my blog theUndergroundInvestor.com, I have reviewed statements of finance ministers from the G7 nations in which they admitted they were undertaking secret actions out of the public eye for fear that public knowledge of their actions would destroy the very effectiveness of their actions. To me, this sounds like an incredible admission of propping up action. Recently, “the SEC said it aims to slash margin requirements for institutions and hedge funds on stocks, options, and futures to as low as 15%, down from a range of 25% to 50%.” At a time when overleveraged funds have collapsed and created great stress in the global financial markets, a decision to allow funds to increase their leveraged positions seems not only foolish but seems to have no purpose but to prop up stock markets. Read more …

3 comments May 11th, 2008

Beware the Turbulence that Lies Beneath the Surface, Part I

October 9, 2007 - Those of you that have been reading my blog and newsletters for a while know that I view the vast majority of government released economic reports as nothing but manufactured, cooked reports designed to generate whatever confidence governments need from their citizens to keep the economy and stock markets stable and growing. In the U.S., the reported numbers about inflation, housing starts, and so forth are so distorted and distant from reality that they are virtually meaningless. I’ve always said the same about the statements made by the most powerful Central Bank in the world, the U.S. Federal Reserve. Yet at times, their Chairmen have been exceedingly honest in their comments, though the masses seem to ignore them. Years before he would spend more than two decades as the Chairman of the Federal Reserve, Alan Greenspan stated, “This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard.” At least Greenspan told us the Fed Reserve’s plan and before they executed it and explained why a bear market would be manufactured in gold for 21 years.

Likewise, current U.S. Fed Reserve Chairman Ben Bernanke explained his deep 0.50% rate cut on September 18th with the following statement: “We took the action to try to get out ahead of the situation and try to forestall (emphasis mine) potential effects of tighter credit conditions on the broader economy. The resulting global financial losses have far exceeded even the most pessimistic estimates of the credit losses on these loans.” Read more …

Add comment October 9th, 2007

U.S. Federal Reserve Decision on Interest Rate Cut on September 18th Will Have Little Long-Term Positive Effect on Stock Markets

September 15, 2007 -

Everybody is waiting now for this Tuesday’s decision by the Feds to finally learn how much the Feds slash interest rates. This decision is truly not that important for a number of reasons. (1) The Feds have already slashed interest rates in a couple of manners. One, by already injecting billions and billions of dollars into the banking system, they have already expanded monetary supply (which is the effect lower interest rates would have); and two, they have already slashed the discount rate (the rate at which banks can borrow from the government) again expanding money supply. True, the fed funds rate is what matters to the end consumer, but the actions the Feds already have taken will be harmful on the value of the U.S. dollar. It’s just a sneaky way of doing it without announcing to the world that they’ve slashed interest rates.

Thus, the news this Tuesday is likely to be less than overwhelming from the standpoint of the consumer that is looking for a substantial 50 to 75 basis point cut. Furthermore, the Fed has stated that inflation concerns are more worrisome than concerns of slowing U.S. economic growth. This is a curious statement as the Feds are primarily responsible for creating inflation through their easy money, monetary expansion policies. Their solution to any economic problem in the past has always to break out the printing presses and print as many dollars as is needed to provide a band-aid fix to the problem. And they probably will continue to sacrifice the dollar’s value for the sake of keeping up appearances in the future as well. Read more …

1 comment September 15th, 2007

How Much Does the Government Really Manipulate Markets?

August 20, 2007 - On Monday, October 23, 2006, reporter Deborah Solomon wrote in the Wall Street Journal:

“Mr. Paulson is chairman of the Working Group, which coordinates government policy on financial markets and includes the heads of the Federal Reserve, Securities and Exchange Commission, and Commodity Futures Trading Commission. Mr. Paulson has insisted that they meet about every six weeks. Before his arrival, the group met every few months and sometimes as infrequently as once a quarter.”

The Working Group on Financial Markets, consisting of the U.S. Secretary of Treasury, The Federal Reserve, the SEC, and the Commodity Futures Trading Commission, is also known in other circles as the Plunge Protection Team (PPT). The very existence of the Plunge Protection Team, and its supposed interference in stock markets, has been a hotly contested topic, with some people even doubting that it actually intervenes in markets altogether. The PPT has been accused of a widespread number of actions, from buying massive amounts of futures to prop up stock markets and prevent further panic during this recent correction to spurring Central Banks all over the world to release rumors about selling gold to artificially depress the price of gold and thus keep the dollar’s heartbeat, however feint, still alive. I for one, believe that it does exist and believe that it does manipulate markets to serve its own agenda. To what extent they manipulate markets is anybody’s guess however. If I had to guess, I would say it’s somewhat more than the disbelievers think but less than what the believers presuppose. Certainly we can conclude that the government is not forthright about its participation (or others may say, interference) in the markets. Read more …

2 comments August 20th, 2007

More Government Foolishness…Again

August 9, 2007 - Back in March, we had U.S. Secretary of Treasury Hank Paulson telling investors not to worry because the economy was “fine” as he put it. Then just the other day President Bush issued statements saying that the economy was fine again. However, don’t say that I didn’t warn you against such foolish talk and I’ll warn you again here. This current volatility is just a small speck on the screen compared to what is eventually coming. What is happening in today’s global markets is not the Peak Investment Crisis I speak of on my homepage, but it’s coming. This current fallout are just the cracks that serve as warning signs of a greater danger. Read more …

2 comments August 9th, 2007

You Heard it Here First…Again

August 9, 2007 - Once again, something we predicted months ago is happening and being reported by a major world newspaper. And yet, the foolishness in the U.S. Congress continues, illustrating that they “just don’t get it.” Thank God U.S. Congressman and women are not responsible for our nation’s fiscal policy though they really couldn’t possibly have done a worse job then the U.S. Federal Reserve has in the past couple of decades. In any event, on March 13th, I wrote in this entry the following:

“If U.S. Congress imposes prohibitive tariffs on Chinese imports, if China then follows that move by dumping dollars, this would be a double negative blow to the Chinese economy. So in imposing tariffs, such a move would in essence be a pre-emptive economic strike against the Chinese government that prevents them from offloading U.S. dollars.”

“However, such a short term victory would only cause a long term, much more significant defeat. Such actions would certainly alienate the Chinese government further, and any pleas by President Bush, U.S. Fed Chairman Ben Bernanke, and U.S. Secretary of Treasury Hank Paulson to the Chinese government asking them not to offload dollars in the future would almost certainly fall on deaf ears. I would guess that if tariffs do pass through Congress, that in the future, if the Chinese can dump massive amounts of dollars without such actions seriously hurting their own economy, then they will do so without concern for its effect on the U.S. economy.”

Today, five months later, the London Telegraph reported that the Chinese are threatening to do exactly what I predicted. But there’s even more to this incredible story. Read more …

1 comment August 9th, 2007

Building Great Wealth in Stocks Requires Understanding Politics

April 11, 2007 - It is very difficult to understand where and how to invest your money without understanding politics. I know, I know. At first your reaction will probably be the same as 99% of all other investors. “What are you talking about?” is what you are thinking right? But understanding politics will help you pinpoint exactly what specific asset classes, what specific countries, and even at times, what specific stocks offer the best investment opportunities in the risk-reward paradigm of stock investing. Read more …

2 comments April 11th, 2007

The Next Cold War Will be an Economic One

April 1, 2007- Several big stories hit the financial news this past week but the real significance of these stories were not discussed anywhere. Number one, the U.S. Congress pushed to file unfair trade practices against China, stating that the Bush administration’s quiet behind-the-scenes negotiation strategy was unacceptable as a tactic to bring economic reform to China. Read more …

1 comment April 1st, 2007

Possible U.S. Military Intervention in Iran

April 1, 2007 - In Novermber, 2006, in a blog titled “I’m Playing Nostradamus Today”, I wrote this : even if the Iranian conflict eventually materializes, a prior short, surgical strike elsewhere seems much more likely. In fact, Venezuela, or a smaller South American country such as Bolivia or Ecuador would seem to be a prime target if this is the case.”

The reason why I believed that a future U.S. military intervention, one that was a quick, surgical strike, but a very powerful one, was inevitable Read more …

1 comment April 1st, 2007

To err on the Subject of Chinese Tariffs May Expedite a Shakespearean tragedy.

March 13, 2007-

chinese stocksSometimes the U.S. Congress is foolish. In order to cover up the inadequacies of the federal reserve and poor fiscal policy, Congress wants to impose tariffs on Chinese goods, and in doing so, supposedly make U.S. goods more competitive against Chinese goods. Read more …

3 comments March 13th, 2007

Free Markets & Free Trade = Controlled Markets & Controlled Trade

December 17, 2006 - This past week, U.S. Secretary of Treasury Henry Paulson was in China, urging the government to let market forces determine the direction of the Yuan. U.S. Federal Reserve Chairman Ben Bernanke has also gone on record as urging the Chinese to let the Yuan rise from its current levels. The obvious reason is because a stronger Yuan and an even weaker dollar would help close the trade deficit between China and the United States. Read more …

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      J.S. Kim is the Founder & Managing Director of SmartKnowledgeU™, LLC. He attended the University of Pennsylvania, and received a double master in Business Administration and Public Policy from the University of Texas at Austin. Read more...


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