Hoping someone could help me with a question of mine, I didn’t know where to put this since i’m a newbie. Well, for startes my parents always tell me that there’s alot of businessmen that aren’t very nice when they try to get deals or make money. My therapist said that investment, which you don’t really have a say in anything when a person invests. And most investors aren’t really nice people. But my question, which I have two is. Would anyone agree with these statements? And as a young person wishing for go out in the business world, what is it like? Are there stil cuthroat, mean people out there? Or are alot of businessmen and investors alot more friendly? I’m talking mostly about american business aswell as foreign. Thanks much.
Speaking from personal experience in both the US Military and in business and some graduate school, I can say that for the most part, people in the voluntary world (A better term for Business) are more friendly, helpful, polite and more nice than the other areas. I always try to be these things and valuable to the customers of my company as they ultimately pay my salary of their own volition. I was more often rudely treated in the military and less so in the academic worlds.
Lets take your parents position carefully. Why do business with people who aren’t nice. Insist that they treat you as the customer and provide courteous service. Otherwise take your business elsewhere.
As for investments, again you have control here. If you don’t like your investments then sell them and get new ones. It is up to you.
The Anglo-American business model is generally more friendly, more transparent, and less cutthroat. Economies where this model is the norm are more complex and vibrant because they enable anonymous exchange. You can conduct trades involving thousands of dollars with strangers because of uniform enforcement of laws and an ethic of interdependency. This model is jeopardized by socialism–business becomes impossible to conduct without graft. At that point, courtesy and transparency become liabilities and the ethic becomes one of graft and blood ties (because outside the rule of law, you can’t trust anybody but family).
This sounds like the musings of people who either are merely drawing from negative experiences and generalizing, or, who have no clue about the business world in general. The politicization of society at large has led to the proliferation of cynics of all kinds, but not to that extent. Corporations which need not worry about their profitability due to bailouts, for instance, have a lesser incentive to be polite and friendly. Again, whose fault is this?
-Jon
You’re getting investment advice from a therapist?
The investment industry is primarily based on fear and intimidation. Most people are clueless about investing, and ripe for the picking.
If you want good investment advice, physical gold or silver is seriously worth considering. It’s the only investment where you get full allodial title.
The primary reason the business leaders tend to be ***holes is State distortion of the market. Most industries are monopolies or oligopolies. A corporate bureacuracy is much like a government bureauracy. Even if a business is run by idiots and jerks, they are shielded by the State from competition.
You know that when we finally enter a real recession the value of gold and silver will plummet, right? Commodity values depend on supply and demand. When we enter a recession, the demand for commodities - the stuff that makes goods - will fall with along with stocks.
There’s a reason why we’ve had similar gold and silver prices before:
I’m just saying you gotta be careful. Unless you’re planning on using that gold/silver as money for the “SHTF” scenario, you better be ready to short at the first sign of Bernanke thinking about fighting inflation.
In a recession, the price of commodities will fall slower than other investments. In an inflationary boom, the price of commodities should rise faster than other investments.
The late 1970s to early 1980s are an anomaly. At that time, central banks decided to start hoarding their gold, since it was the only asset they had. However, this caused a sharp rise in the price of gold. They adopted a policy of gradually selling off their gold hoard, so that gold can be discredited as an investment. The spike in silver was also an anomaly, primarly caused by the Hunt Brothers and other factors.
Over a short period of time, there are fluctuations. Over the long-term, gold and silver are the best investments until after the State collapses.
Investing in stocks should underperform gold and silver. With a stock investment, you don’t get full allodial title. I can’t prevent management from giving themselves share grants and option grants. I can’t prevent them from mismanging the corporation.
Similarly, investing in real estate should underperfom gold and silver. Property taxes are a drag on my returns. I have to pay income tax on rent collected. I can get a mortgage and use leverage, but then I’m risking bankruptcy during the next recession.
You can’t use the 1980s and 1990s as a counter-example to gold and silver investing. The structure of the market has changed. At that time, central banks had hoards of gold and silver that they used to push the price down. Commodity exchange rules were changed to discourage long speculators. Central banks have mostly exhausted their silver reserves and are close to exhausting their gold reserves.
I’ve read the “CBs hoarding gold/silver” in your blog before, but what’s your source? Are there any reputable sources showing how much the Fed has been controlling the prices of gold and silver over the past 30 years?
The spikes in gold and silver and then the falls make perfect economic sense by themselves. Like other commodities, their value lies in that businesses use them in their products. If output falls, the demand for these commodities will fall as well. Sure the dollar will be debased by continued credit expansion, but commodities will be hurt also when production will fall in the recession.
I think gold and silver will still remain profitable for a while as we’ll have similar economic conditions to the 70s. I’m personally keeping the little money that I do have in several foreign currency CDs and silver coins (just in case SHTF).
If you define “reputable source” as “university economics professor writing in an ecnomics journal”, then I know of no such sources. I don’t consider universities to be an unbiased information source, due to the influence of State research grants.
There are plenty of articles on gold-eagle.com and kitco about gold price manipulation.
Gold price manipulation is obvious when you look at actual market data.
Whenever the price of gold sharply increases, the gold lease rate decreases. This is evidence of market manipulation.
I performed a historic volatility calculation for gold and silver. The primary component of gold and silver price volatility is volatility in the value of the dollar itself. Before performing the calculation, I expected “historic volatility of gold” and “historic volatility of silver” to be nearly identical. Instead, the volatility of gold was sharply less than the volatility of silver. I consider this evidence of gold price manipulation.
What do you expect? Do you want a written signed confession by Ben Bernanke that the gold price is manipulated?
Am I able to think for myself, or am I restricted to quoting the research of others?
See, that’s the kind of thing you need to put a source for. Where did you get the data for gold price vs. gold lease rate?
Silver is known to be more volatile due to a lower supply of silver than gold. Also, you said that CBs manipulate silver. What is your reasoning behind this claim?
And of course the primary source of price volatility of commodities is the value of the dollar. That’s why gold and silver go up so much in our inflationary booms - you have more dollars competing for approximately the same amount of commodities. That’s also why commodity prices tend to fall a bit in depressions - production slows and the use of commodities like silver, gold, iron, steel, zinc, copper, etc. falls. If demand falls (less dollars competing for commodity) and supply continues to expand slowly (due to mining), prices will fall.
This is a far simpler and more economically sound explanation of the price movements in gold and silver.
As for proving something is true:
and
Don’t be ridiculous. All that I’m asking for is a reputable source showing how the Fed and other CBs have been distorting the price of gold. I’ve read the articles on Kitco about gold distortion, and I wouldn’t be surprised if CBs did distort the price of gold. But the burden of proof falls on you to prove that the CB distortion is really large enough to move entire markets. Also, you failed to show how CBs manipulate the price of silver.
Looking at the data, the simpler (and more likely) explanation is, as I’ve said before, supply and demand. Look at the price of platinum, for example:
Palladium (charts):
Both of these charts match with the historical gold and silver prices I posted earlier. There could be a little manipulation in gold, but not enough to explain the huge bust that happened in precious metal prices in previous recessions. The fact of the matter is that basic economic theory tells us that gold, silver, and other commodity prices are likely to go down once we enter a recession. Economic data supports this.
So to prove your point you have to show how much CBs have manipulated gold, and if they even have manipulated silver, platinum, palladium, and other commodities.
Hi jon, it’s a long story. It’s not negative from any outside businessmen, But my parents feel like most investors and businessmen are rotten because of my grendfather. He was extremely shrewd, cunning, and even conniving. He started out with a few friends after world war 2. But it also helped that he had an eye for prediction. He played the oil game with a few friends back in the 60-70’s and make quit a bit of money. But I don’t know for sure wheather he litterly screwed anyone over in his lifetime. I do have another question, and have been trying to find an answer to 3 questions. The truth of how bill gates started to rise to the top when he opened microsoft. My mom says he invested in other technologies back in the 80’s and 90’s. And how he basically got so succesfull and now he’s super rich. And an answer (an intelligent, understable anwer) to how warren buffet invests. And how does george soros become so psychic when it comes to the markets. He’s had a few oop moments, but he’s had many more that were quite succesfull. I loved to know details of how these people got into there professions, and what avenue they took. I still don’t understand who george soros really is. No one really knows his secret to speculating.
Soros and Jim Rogers were partners at one time. The secret is, they understand how markets work, and they aren’t slaves to government propaganda like the fools they surround Peter Schiff with on the Fox Business Channel.
Agreed. There really is no secret. You just need an understanding of how the economy works and an eye for important trends.
Soros ? Is that the same retarded commie who wrote this ?
“The Capitalist Threat” by George Soros Atlantic Monthly, Volume 279, No. 2, February 1997