The Economist (November 17)
“More than half of Japanese babies can expect to live to 100.” This blessing presents Japan with a tremendous challenge “to stay solvent as it turns silver.” Among the G7, Japan now has the highest “share of over-65s in work,” but this not enough. “If Japanese people are going to live to 100 they will have to retire much later than 70.”
Forbes (February 10, 2014)
“Beijing is becoming more dependent on the U.S. and the rest of the world for its strength and prosperity.” Though it may be the largest holder of U.S. Treasuries, this is not a sign of strength. “The idea that a government gains strength by piling up dollars or other foreign currencies is a mercantilist holdover from the 16th to 18th centuries, when France, Spain and others thought amassing gold and silver was how a country became wealthy. Trade, not hoarding, makes for a powerful economy.”
Tags: Beijing, China, Currencies, Dependent, Dollars, Economy, France, Gold, Government, Hoarding, Mercantilist, Prosperity, Silver, Spain, Strength, Trade, U.S. Treasuries, Wealth
Financial Times (May 6)
In a single trading session, commodities prices came crashing down on Thursday, with silver falling 13%, oil 10% and gold 4%. While the sharp correction was not predicted, a slew of rationale has subsequently been offered to objectively explain the dip. The Financial Times finds most of this reasoning specious, writing “the ease with which we explain price swings – in any direction – suggests that we do not really understand them at all.” Instead, the FT opts for a simpler explanation. “Last week’s slide probably just means that a self-inflated bubble self-deflated a little, in accordance with its own internal mass-psychological dynamics. Put simply, investors took fright.” Trying to explain what caused the fright or predict where it may lead is a fool’s game. Commodities may go up or they may go down. We cannot know.In a single trading session, commodities prices came crashing down on Thursday, with silver falling 13%, oil 10% and gold 4%. While the sharp correction was not predicted, a slew of rationale has subsequently been offered to objectively explain the dip. The Financial Times finds most of this reasoning specious, writing “the ease with which we explain price swings – in any direction – suggests that we do not really understand them at all.” Instead, the FT opts for a simpler explanation. “Last week’s slide probably just means that a self-inflated bubble self-deflated a little, in accordance with its own internal mass-psychological dynamics. Put simply, investors took fright.” Trying to explain what caused the fright or predict where it may lead is a fool’s game. Commodities may go up or they may go down. We cannot know.
Tags: Commodities, Gold, Oil, Price Swings, Silver
