Yes, there are a few other asset and income plays as well in the market. After all, there’s still an economy to run out there. There are 303 million Americans, and 6.2 billion other people in this world, who want to eat every day. But much of the stock market is a crapshoot. If you love pain, then the broad stock market is the place for you. While gold and silver represent the flight to safety and quality.

The U.K. Telegraph put it nicely: “As investors scrambled to make sense of last week’s events, already one conclusion was all but irrefutable — the U.S. dollar will have to take another major fall. The dollar rally that began in July and pushed the pound’s value against the greenback significantly lower has come to an abrupt end as markets face up to the fact that the currency will have to absorb the effects of a sudden shocking increase in America’s budget deficit.”

So we see lots of bad news for the dollar. But when you own gold, it’s your asset. With a specific gravity of 19.3, gold is dense, non-reactive and otherwise immutable. Gold is nobody’s liability. As one of my old professors at Harvard used to say, “That’s physics.”

Gloomy News from Wall Street

Speaking of physics, I’ve looked east of the sun and west of the moon. I can’t see much good news for the U.S. dollar on any horizon. Really, what’s gloomier than the news from Wall Street? The investment model of the modern era (borrow short, lend long, pay big bonuses) is dying before our eyes. “And it’s about time,” some might say. But it’s happening on our watch. So we had better suit up in battle-rattle.

Wall Street’s losses are in the range of hundreds of billions, maybe trillions. Which prompts me to inquire, where are Bonnie and Clyde when you need them? At least the Barrow couple knew who they were and what they did for a living. To their credit, on their last foray the dynamic duet had the guts to shoot it out with the cops and go out in tragic style.

But now the modern bank robbers are talking about how they should get big bonuses for all the good work they put in right until things blew up. Really, I’m serious. Lehman Brothers wants to pay $2.5 billion in bonuses to 10,000 employees. That’s an average of $250,000 per person. (Except I think the office runners and secretaries will get less than $250K and a select few will rake in a lot more.) What has anyone there done to deserve $250,000? Did I miss the news about somebody at Lehman discovering a cure for cancer? It’s all just so… Baby Boomer.

At the end of the day — and the clock is ticking fast — it’s too bad that the wrong people are going to get paid. And bonuses? Oh, if only I could be a bankruptcy judge for just one hour.

The War on Risk

Do you recall the $700 billion of borrowed money that the U.S. paid over the past seven years to fight the War on Terror? Well now, with the stroke of a pen the U.S. taxpayers will pay another $700 billion (and probably more) for the “War on Risk” in the next year or so.

War on risk? It seems that way to me. Let’s back up. In the past few years — seven or so, coincidentally — a lot of people gambled and lost. People bought houses they couldn’t afford. Brokers arranged the loans. Bankers lent the money. Other bankers bundled-up the mortgages and sold them as “asset-backed securities.” Rating agencies sprinkled their holy water on the transaction. Insurance companies insured everything against default and loss.

A lot of people were making a darn good living for a while. But it was all a farce based on cheap credit and an abiding faith in a “something-for-nothing” way of life. And it’s too bad that a lot of people bought — as the saying goes — “as much house as they could afford.” Except they couldn’t afford it.

So now the whole mess is falling apart. And in true Baby Boomer fashion, the key perps on Wall Street want to change the rules and stick the house with the bill. That is, the White House and the House of Representatives, and your household as well.

The advertised number of $700 billion for the Wall Street bailout is just the posted price — the “loss leader” to get the American people into the store, so to speak. But get set for a bad case of sticker shock as events unfold. A group of business reporters at Bloomberg tallied up the raw numbers and came up with their own number of $1.8 trillion.

$700 billion? $1.8 trillion? When the numbers are that big, does it even matter? It’s the inflation-adjusted equivalent of fighting World War II again. Except who is the enemy?

Whatever the final tally may be, it cannot be good for the U.S. dollar. So buy gold and silver. If you can’t acquire the metal in the form of coins or bars, then buy precious metal stocks of companies with ore in the ground.

Until we meet again…
Byron W. King
September 26, 2008

The Dollar and Precious Metals was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

And so, without more circumstance at all, I hold it fit that we shake hands and part.

— Shakespeare, Hamlet (Act 1, Scene 5)

I’m not much for gooey goodbyes — even if they’re most likely only temporary.

But on the other hand, I couldn’t just up and stop writing for Whiskey & Gunpowder indefinitely without giving something more to my readers than simply a few parting words. After all, love me, hate me, or love to hate me, some of you have been reading my work in this forum for nearly 3 ½ years. And I don’t take that relationship lightly…

Yes, like it or not, friend or foe, we have a relationship. I know this because I’ve gotten literally thousands of letters and e-mails from you or readers just like you — some of them nearly as long as some of my essays. These notes have ranged in tenor from “attaboy” and “go-get-‘em” to “shame-on-you” and various other things I can’t print.

They’ve also included pleas that I run for office and that I leave the country, the most ribald of jokes and the most somber of personal anecdotes, death wishes, threats, and flirtations that border on marriage proposals, argumentations and affirmations from elected officials, industry leaders, and political insiders — plus the warmest of invitations from ordinary folks to hunt, fish, ride, shoot, drink, or just plain chat with them…

To all those who reached out to chide or cheer me, I give my heartfelt thanks.

But today, I want to give something back to you that transcends mere words. And I honestly believe that whether you like or hate me — or agree with the things I’ve written in these pages over the years or not — what I want to give you today could prove to be one of the best things that has ever happened to your bottom line.

This is not something I’m offering you only as a “thank you” for your readership. It’s something I’m doing because I owe it to you. Literally.

A Debt to My Readers, and My Chance to Repay It — to 115 of You

If I had a buck for every time I’ve claimed in these pages that I’m no economist, market analyst, stock-picker, or financial advisor, I’d have…

Well, I’d have at least twenty bucks or so.

But just last year, something happened to me that — while it didn’t instantly confer onto me an economics degree or Series-7 certification — gave me a near-instant wealth-building and investing advantage over 99.9% of the investors out there…

And it was all because of YOU. Let me explain what I mean, starting with an anecdote:

Whiskey’s Managing Editor, Greg Grillot, once said to me, “Jimbo, I can always tell when your articles run because my e-mail inbox gets crashed!”

Now, this isn’t to say that more people are reading my essays than those of my Whiskey brothers. In fact, I’d lay odds that far fewer folks read my articles than those of any other regular contributor. My stuff tends to be controversial, so I’m sure a fair number of readers see my name on a piece and automatically hit the “delete” key…

However, for one reason or another, I tend to provoke a lot of action from those that do read my stuff. You’ve written replies of every stripe to my articles, forwarded them to your friends and enemies, posted them on your personal blogs and Web sites — even printed and mailed them to elected officials. This fact alone is what has kept a quasi-literate rube like me writing in this letter alongside such esteemed financial thinkers as Jim Rogers, Doug Casey, Lord Rees-Mogg, Mark Skousen — and Agora’s own wizards Byron King, Chris Mayer, Dan Amoss, Dan Denning, and so many others.

Here’s what I’m getting at…

Because your feedback has kept me in the mix among minds I have no right to call “peers,” I was able to attend an event last July that put me in the midst of those great minds. This changed me from a dollar-dolt into a well-informed observer of monetary policy, markets, commodities, and macro-economics — and made me a much better investor.

That event: The eighth annual Agora Financial Investment Symposium.

As a result of 2007’s Symposium, I’ve completely revamped my approach to money. I’ve seen how the status-quo ways I’d been investing were boneheaded compared to the real money I could be making — if only I had the info the money mainstream’s ignoring or misinterpreting (like what many of this event’s speakers churn out on a regular basis). I also learned ways to protect (and even enhance) my assets from uncertain or volatile economic conditions — secrets that have saved me from losing thousands of dollars in just the last year alone…

Your support of my 3.5-year, 67-article run in Whiskey & Gunpowder has given me a rare opportunity to change the way I think about money and investing — and has likely made me a multi-millionaire over the long term. And because of your continued readership and engagement with my articles, I’m going to get to attend and participate in that event again this summer…

But this time, and by way of a heartfelt “thank you,” I want to invite YOU to come along with me this July 22-25 to the ninth incarnation of this event — once again set in scenic, historic, diverse, temperate, culturally rich, progressive Vancouver, British Columbia.

Here’s the kicker, though:

There are only 115 spots left before the 2008 Symposium is sold out…

How I Went from “0” to “Plugged-In, Knowledgeable Investor” in Four Days Flat

An open-minded and inquisitive investor (like I am now) could glean several lifetimes worth of information and borderline insider savvy from the dozens of exhibitors at a typical year’s Agora Financial Investment Symposium.

For instance, on each of the four days of the 2007 event — before, after, and in-between marquee speakers and special presentations — I meandered through the gorgeous exhibition halls of the elegant Fairmount Hotel Vancouver. And every minute of this time, I found a new, potentially money-making revelation that mainstream investors and the major money press overlook…

In that vast multi-room exhibitor area, I found myself surrounded on all sides by some of the world’s foremost experts from small-to-medium-sized, yet sometimes under-the-radar companies poised for huge growth in industries like:

• Mining
• Oil and gas
• Geothermal energy
• Gold and silver
• Industrial metals
• Diamonds and minerals
• Renewal and alternative power
• Real estate and mortgage
• Shipping and logistics
• Asset and money management
• Mutual funds and other investing vehicles
• Even stamp collecting and investment…

But as dizzying as this wealth of information and opportunity was, it was the Symposium’s captivating roster of A-list speakers that really brought me up to speed on what I was doing wrong with my money, what I should be doing with it, and where we’re headed as a nation and world. I learned an incredible amount from them — and about far more than just money and investing…

Each year’s Agora Financial Investment Symposium has a theme. In 2007, that theme was Rim of Fire: Crisis and Opportunity in the New Asian Era. These themes don’t dictate the content at these events — far from it — but they do loosely color the general commentary…

However, the dialogue at last year’s Symposium was some of the farthest-reaching and diverse economic, financial, and political commentary I’ve ever seen assembled in one place. Just a few such highlights I remember from last year’s event:

BILL BONNER — An animated-yet-soft-spoken, humorous and often improvisational presence at the podium, Bill blows you away with what he’s saying, not how he’s saying it. More than any other speaker I’ve ever heard, he has the ability to make incredibly complex concepts both digestible and entertaining. He also has rare ability to hurl the conversational boomerang far afield, yet still bring it safely home to his core concept. In one of his two speeches, Bonner clued us in on the pitfalls of “crack-up booms” vs. bona-fide booms, the virtues of doing nothing (and how humans can’t stand it), how keeping your assets in cash dollars is becoming a dangerous speculation, and how buying gold can be both the worst AND best thing you can do with your money…

JAMES HOWARD KUNSTLER — The blunt, shocking, misanthropic, borderline profane, yet utterly credible Kunstler regaled us with The Long Emergency, a synopsis of his own book of the same title. This treatise debunks the common myths about oil in our time, reveals how U.S. oil extraction history uncannily mirrors Hubbert’s Peak, warns of the dangers of climate change, and blasts the oft-cited, rose-colored notion of a coming “hydrogen economy.” He also illustrates for us in stark (and darkly humorous) terms the diminishing returns of technological innovation in the energy fields, plus what we should be doing to counteract the coming energy crisis…

THE MOGAMBO GURU — Sarcastic, sardonic, wisecracking, hilarious, over-the-top and utterly on-the-mark about a broad cross-section of not only the money world, but also the world in which we live, long-time columnist for Agora and other outlets Mogambo (AKA: Richard Daughty) uses his acid tongue not only to self-aggrandize and self-deprecate, but also to flagellate the American monetary system. He reminds us of the idiocy of fiat currencies like the dollar, how the near-criminality of mercantilism’s rules and tariffs fuel the institutional corruption of the U.S. government, and the dangers of an approaching boom in inflation and rising costs that an Asia-centric global economy could portend for America. Scary, entertaining and thought-provoking all in one animated, acerbic package. That’s the Mogambo Guru in a nutshell…

DOUG CASEY — Everyone’s favorite globetrotting anarchist-investing wizard, wildly successful New York Times bestselling business-book author Doug Casey is truly one of a kind. Gravel-voiced, incendiary, incisive and unabashedly America-bashing, Casey’s talks could be rehearsed, but they come off like 100% improvisation. His presentation, The End of the World as We Know It, outlined the four sections of America’s “big picture,” and how they’re all pointing toward an impending depression. Yet for all his jokes, irreverent anecdotes, doomsday predictions and anarchic rhetoric, Casey’s chock full of nuggets you can take to the bank. His seemingly off-the-cuff speech taught me the basics of stocks, bonds, currencies, real estate, commodities, and the reasons why the corrupt system we live under prevents us from making money on most of them. Casey also explained why, aside from a few select mining stocks that he’s worked hard to uncover, gold is the best investment for the near future. Oh, and he also rattled off the five reasons why none of us should vote in the upcoming Presidential election…

NASSIM NICHOLAS TALEB — Profoundly original and mind-bogglingly intelligent international bestselling author of Fooled by Randomness and The Black Swan, essayist and polymath scholar Taleb explains why conventional methods of data analysis and predicting just about anything under the sun (but especially things economic) are horribly inaccurate, and why so few mainstream experts will ever realize it. To illustrate his point, he eviscerates a mainstream investing bestseller called The Millionaire Mind. Citing the book’s flawed methodology and skewed-toward-sales message, Taleb builds upon this using his mathematical wizardry and grasp of the concept of “randomness” to expose the unsettling reasons why so much of what the conventional wisdom tells us about money and investing is exactly wrong…

Again, these are only a few highlights from four days worth of seminars and advice that I found especially riveting. Space doesn’t permit me to tell you what I got from other favorites like master money wizards Rick Rule and Larry Grossman (also hugely entertaining and humorous speakers, by the way), or my own favorite Agora advisor, Chris Mayer — whose presentation includes multiple jokes from the far-from-PC comic and “redneck” favorite Larry the Cable Guy…

At the time of this writing, nearly all of these folks are coming back for this year’s Symposium. And as if this weren’t enough of an incentive for you to skip down to the bottom of this page and sign up right now, I just found out that one more incredible speaker just signed up for this year’s event for the very first time. Even to a neophyte to money and investing like me, he needs no introduction…

But despite his pristine reputation, I can’t simply blurt his name onto this page. There has to be some sort of build up. And if this is going to be my final Whiskey contribution (for now) how could I wrap it up without some modicum of suspense. That wouldn’t be my style, would it. So for now you’ll have to sit tight and wait for tomorrow’s installment.

Cliffhanging to the very end,

Jim Amrhein
Freedoms Editor
May 29, 2008

The Only Financial Advice I’ll Ever Give You was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.