While the broader media has largely ignored until only recently the flaws inherent in Social Security, our parent organization, AIER, has consistently pointed to these deficiencies. In 1935, when Social Security first became law, AIER warned against the depressive effects of Social Security’s taxes. In 1939, the first of many expansions was enacted, prompting AIER …

Feb. 2011 – Price Inflation, Social Security & Senior Citizens’ Burdens Read More »

The first quarter of the New Year has brought an astonishing sequence of global events. The horrific earthquake in Japan, the world’s fourth largest economy, has claimed at least 10,000 lives. Political uprisings throughout the oil-rich Middle East offer both promise and peril, but instability is the watchword. Domestically, states are struggling to address unprecedented …

Mar. 2011 – Taking Stock of Stocks Read More »

Politicians have met the bond market. Legislators in Washington have spent lavishly for decades, and the bill is now due. Standard and Poor’s change in outlook for U.S. Treasury securities from “stable” to “negative” serves as a stark reminder that profligate spending has consequences. While fiat currencies can mask the ill effects of unchecked fiscal …

Apr. 2011 – Fiat Follies and the Dollar: Where the Buck Stops Read More »

On August 5, after markets had closed, Standard and Poor’s stripped the U.S. of its triple-A rating. Many had predicted that a downgrade would result in a broad sell off of Treasuries and a corresponding increase in yields. These predictions proved to be wrong. The next trading day, August 7, the yield on the 10-year …

Aug. 2011 – Lessons from the Downgrade Read More »

As November drew to a close the European financial crisis grew more severe when the most prudent European government, Germany, could not sell more than about 65 percent of its public debt on offer at an auction. If investors refuse German bonds, then what hope is there for the traditionally more profligate European sovereigns, such …

Nov. 2011 – Gold and Europe’s Future Read More »

Patient investors were amply rewarded in 2010, but it was a rough ride (see our chart on page 6). Investors who adhered to the principles below would have avoided impetuous decisions that so often spell disaster for individual investors. • I will understand my own circumstances and formulate an investment plan based on my needs, …

Jan. 2011 – New Year’s Resolutions Read More »

U.S. Treasury securities have long been regarded as the best proxy for a theoretical risk-free asset. Their payments are backed by Congress’s unique power to tax an economy that accounts for a quarter of the world’s entire economic output. But this risk-free reputation is now in question; as U.S. gross debt approaches 98 percent of …

May 2011- U.S. Default: In the News Read More »

AIER recently published research regarding silver as a potential component of an investment portfolio. Silver was found to have several desirable attributes, but the evidence does not support its inclusion among our recommended asset classes at this time. The emergence of exchange traded funds could have a profound impact on the silver market. We will …

Jun. 2011 – The Question of Silver Read More »

Those of us who attended economics classes dutifully recorded in our notebooks that the returns on obligations of the U.S. Treasury were the “proxy for the risk-free rate of return.” They provide a foundation to which “risk premiums” could be added in order to approximate higher expected rates of return for the universe of inherently …

Jul. 2011 – Treasury Bonds, Defaults, and Credit Ratings Read More »

Capital markets are reflecting bad news throughout the global economy. In the U.S. aggressive monetary and fiscal policy has served to stimulate fears of inflation and growth of the national debt, but little else. European policymakers face a debt crisis that threatens the viability of the European Union, and now growth in China appears to …

Sept. 2011 – The Best Alternative Read More »