We're hit on all sides by the media. News comes prepackaged in ever-decreasing bites and it is easy to just let it all happen.
Ever since I happened upon Chris Martenson, I've been paying much closer attention to the news, especially the economic news, and asking some questions...sometimes here, sometimes elsewhere.
Then I found Steve Keen, a local bloke (and economist) from the University up the road, and I began to listen even more carefully to the news.
I am not "into" economics. In fact, just a brief glance at my mark in the HSC for economics will indicate that 40% of the students who studied economics that year did better than I did.
But even a limited understanding of economics can lead to the asking of questions that are being ignored in the MSM (main-stream media), or brushed over by the economic reporters.
Here's just a few questions that I wold like to propose:
1. How can 27100 people have lost their jobs in Australia in August but there be no change to the total unemployment rate? Sounds like someone is cooking the books to make things seem rosier than they actually are. Why are they hiding the information and what are they frightened will happen if they tell the truth?
2. Why has the price of gold shot through the roof in the last two weeks? The gold price is (quickly) sandwiched between commodity prices and the currency rates on the news. It's usually stated without comment. So what, you may ask? Gold has broken through the $1000 an ounce barrier. That's BIG news, but no one is mentioning it in the MSM. I wonder why? (see point 3)
3. A parity party is becoming more likely. What's a parity party?? That's when the US dollar and the AUD are both worth $1. It means the Aussie dollar is stronger, but that also means that the US dollar is weaker. The weaker the dollar, the more money being used to buy gold rather than currency. (See point 2.) Gold, unlike paper money, has intrinsic value. A dollar is only worth a dollar because the Reserve Bank (or the Federal Treasury in the US) says it is. Gold has -real- value whereas paper money only has imputed value. The Aussie dollar is currently at about $0.86US but that figure is slowly climbing.
If the Aussie dollar is climbing against the greenback AND the price of gold is sky-rocketing, that probably means a loss of confidence in the American dollar, forcing those who know what they are on about to buy gold rather than paper money (or any assets grounded in paper money like bonds and securities and things...I said I was no economist!!) High demand for scarce resource = high prices. Why is gold going up? Because lots of people are buying gold. Why are they buying gold? They have no confidence in currency with imputed-only value. Why this lack of confidence? There's a debt bubble about to burst.
Steve Keen has had a lot to say about dodgy economic theory and practice on his website and I encourage you to have a close look at his site and his articles, especially the one today which was published in the Sydney Morning Herald.
If you are further interested in this subject, may I direct you to Chris Martenson and Karl Denninger, who maintain comprehensive websites devoted to the GFC and what it means for the little person. Unlike me, they know what they are talking about.
It seems to me that it's better to know what's going on, than to stand back afterwards and say "I didn't see *that* coming".
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