Gary Rathbun maintains a current recommended reading list that includes articles and books on financial planning and wealth as well as video clips worth watching.
November 7, 2012
Dear Friends and Valued Clients:
I wanted to get a quick message out to everyone regarding the results of Election Day. Simply put, nothing has changed the overall structure of Washington or who is sitting in what office.
That being said, we now have a clearer direction for our portfolios than we did before knowing who was going to be president and which party would hold the majorities in Congress. The Obama administration will likely continue with the same policies the government has followed since FDR. Unfortunately, history has shown these policies generally are detrimental for the United States economy and free markets.
Federal Reserve chairman Bernanke has indicated the Fed will continue its monetary policies which continue to devalue the dollar on the world market. The danger is this policy alone could possibly cause the dollar to no longer be the world’s reserve currency. Barring any Congressional action to the contrary, taxes will increase along with government spending. (It should be noted this would have happened if Romney had been elected.)
At Private Wealth Consultants, we also have a clearer picture of the investment strategies we will employ in the coming months. We will increase our holdings and investments globally, using other currencies for direct investment and CD’s. Of course, we will continue to hold and possibly increase our precious metal holdings. We expect technology and health care stocks to continue to do well. We will maintain our holdings and look for consistent dividend pay outs. The best investments will be in the Private sector rather than Public. As such, we anticipate investing in a higher percentage of private companies and bonds since they will not be influenced by government monetary policy.
In the weeks ahead, we look forward to sharing with you our strategies and thoughts for taking advantage of profitable situations. Please contact us with any questions.
Private Wealth Consultants, Ltd.
Gary L. Rathbun, President & CEO
Douglas S. Miller, Executive Vice President
Teresa Ghilarducci is the director of the Schwartz Center for Economic Policy Analysis at the New School for Social Research and the author of the book When I'm Sixty-Four: The Plot Against Pensions and the Plan to Save Them. She also wants to see 401(k) and Individual Retirement Accounts replacedby "government retirement accounts."(Yes, I am having a bit of fun with the "most dangerous" tag.) In an interview with my guy, Kirby Wilburof KVI 570 AM in Seattle, Ghilarducci says one of her goals is—you guessed it—to "spread the wealth." Go about 12 minutes into the interview to hear it for yourself, gang.
Capital Flows
Capital Flows
Harry Binswanger, 08.01.12, 06:00 PM EDT
Forbes Magazine dated August 20, 2012
Outsourcing is the U.S. at its best.
Mitt Romney and President Obama are currently fighting over who is more against outsourcing. Obama slams Romney for Bain Capital’s outsourcing of jobs to China. Romney counters by labeling Obama “Outsourcer in Chief.” John Boehner and Harry Reid are both outraged over America’s Chinese made Olympic uniforms. “Burn them!” thunders Reid.
Republicans and Democrats agree that outsourcing is destructive and unpatriotic, and that the practical and patriotic thing to do is to “Hire American.”
Wrong on both counts. Count one: Protectionist economics is as fallacious in regard to importing labor services as it is regarding importing goods. Count two: Hire American, far from being patriotic, is un-American.
Americanism means individualism, but “Hire American” is collectivist, urging businesses to pay more just to patronize “our guys.” This is not rational patriotism, it is not Americanism, it is primitive tribalism.
An individualist makes his purchases based on economic merit, not nationality. Let’s be clear: Economic nationalism is as outrageous as racism. Men, their products and their services must be judged on the basis of their individual, factual qualities, not on issues of race or nationality.
Purchasing labor services abroad, if it saves money, is beneficial to everyone, including American workers. Outsourcing does not destroy American jobs, it simply changes the kind of work Americans specialize in. If fewer Americans need to work in manufacturing, then more Americans will be hired in nonmanufacturing jobs. That’s the Law of Comparative Advantage, covered in any decent economics text. It pays each country to specialize in producing the things in which it is relatively more efficient.
Outsourcing reduces cost per unit. That means more can be produced with the same supply of capital. More products mean a higher standard of living. The equation is: cost-saving = more for less.
Outsourcing reflects the win-win nature of all forms of international trade--in fact from all trade on any scale. The mutual gains from trade do not depend upon lines drawn on a map. There is no economic difference between outsourcing a job to India and outsourcing it to a firm across the street. If the outsourcing saves money, it saves resources and is to be applauded.
Hire American assumes everyone must cling to his own tribe and fight all the other tribes over share of a fixed pie. China is getting richer? Then we must be getting poorer.
But the interests of nations do not conflict. It is in America’s interest that other nations be prosperous and productive. Just ask yourself: Which nation adds more to your standard of living--Germany or Uganda? And would you be better off if Germany were reduced to the economic level of Uganda? Yet the Hire American attitude implies we should fear other nations’ productiveness--as if we should desire a world in which everyone but Americans were starving.
It’s time to drop the xenophobia and paranoia. No one benefits from the poverty or incompetence of others. It’s in your interest that other men--in every country--be smart and productive, not stupid and incompetent. Would you be better off if Thomas Edison and Steve Jobs had been dim-witted? Nothing is changed if it’s an inventor in India and an entrepreneur in China.
Cost-savings are good for all men, everywhere. He who cuts costs saves money, expands production and raises the global standard of living. The money saved goes into the global capital market--to fund existing production and technological innovation.
Any outsourcing that saves costs and increases profits is to be celebrated. A Congressional Medal of Honor should go to the CEO who cuts his costs the most, whether he does it by outsourcing or any other means. He is the true friend of humanity.
Harry Binswanger is a member of the Ayn Rand Institute ‘s Boar d of Directors and has taught philosophy at Hunter College (City University of New York) and the University of Texas at Austin.
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The Ultimate Krugman Take-Down
Forget Ali - Frazier; ignore Santelli - Liesman; dismiss Yankees - Red Sox; never mind Silva - Sonnen; the new undisputed standard by which all showdowns will be judged happened in Spain over the weekend. During a debate on Europe's crisis, Pedro Schwartz (a mild-mannered Spanish 'Austrian' economics professor) took on the heavyweight Paul 'I coulda been a Fed Chair contender'Krugman, and - in our humble opinion - wiped the floor with his Keynesian philosophy. From the medicinal use of more debt to fix too much debt, to the Japanization of world economies and the demand-side bias of every- and any-thing - interested only in the short-term economic growth; the gentlemanly Spaniard notes, with regard to the European crisis, the fact that "Keynesians got us into this mess and now we have to sacrifice our principals so that theycan get us out of this mess". Humble and generous in his praise - though definitively serious with his criticism - Schwartz opines: "Often Nobel prize winners are tempted to pontificate on matters that are outside the specialty in which they have excelled," noting"the mantle of authority whereby what ever they say - whether sensible or not - is accepted with resignation from some and enthusiasm by others."Krugman's red-faced anger is evident at the conclusion as he even refused to shake Schwartz's hand after the debate.
For 15 minutes of both education and entertainment - this is as good as it gets...
- Starting from around 35:00 the Spanish professor praises and criticizes in a thoughtful and gentle tone
- At around 39:00, he addresses the demand-side description of the world
- Krugman's less-than-happy response (which sparks quite a rowdy argument) begins around 48:20