Once again it’s time to review basic economics. When we invest in equity, we take a dollar from current consumption to gain title to capital goods (a company) which will pay out dividends and/or our investment will eventually be sold for dollars for future consumption.
If you do not understand money in a free society and how government came to meddle with money, you will not understand our ponzi financial system.
A short, clear book on money by Murray Rothbard is excellent. http://mises.org/books/whathasgovernmentdone.pdf
If you read any book to understand our current situation read that one. To understand more about money, banking, and monetary history read the following:
- http://mises.org/books/mysteryofbanking.pdf How fractional reserve banking works.
- http://mises.org/books/historyofmoney.pdf The history of American Banking
- http://mises.org/Rothbard/AGD.pdf The definitive study of the the cause of the Great Depression
Investors discussing the dangers of inflation in today’s investment environment
Julian Robertson Part 1: http://video.cnbc.com/gallery/?video=3000062558
Kyle Bass: part 1: http://watch.bnn.ca/library/#clip584881
Economic ignorance Refuted
Here is an article by an investing pundit that is riddled with nonsense and ignorance. No wonder the writer blew up his clients as a securities analyst in the late 1990’s and early 2000’s. http://www.businessinsider.com/keynes-was-right-2011-12
A reply to the above article and an excellent blog: http://finance.townhall.com/columnists/jeffcarter/2011/12/18/obama_and_the_keynesians_total_fail/page/full/
If you read the above recommended books, you will have an excellent grasp of our current monetary chaos, possible solutions and the consequences of our nation’s current course of action. Ignorance is not an excuse.