Recently by Richard Russell: Move Into Gold
Here I am, a the tender age of 87. How did I ever get here? And one of my problems is that I don’t know many people my age to talk to (except my sister and my first wife). Going – My old pal Harry Schultz has quit the business. And one of my favorites, the brilliant Fred Hickey of the High Tech Strategist, has dropped out of the business from sheer exhaustion (I don’t blame him), which leaves me, Granville and Dines as the remaining godfathers of the investment advisory biz. Thumbs up guys, and keep at it.
I just saw the headlines, Tebow and Lin into the big bucks. Big bucks doesn’t mean what it used to mean when I was a youngster. Today anything in thousands is chump change. To talk about real money, today you have to be talking about millions, and on the corporate level you have to be referring to billions. On the government level you have to be referring to trillions – to tell the truth, most people can’t even describe what a trillion is.
The fact is that the Fed is happy with 2% inflation each and every year. Compound 2% inflation year after year, and you know what’s happening? – you’ve effectively wiped out the middle class. Between inflation, stagnant wages, higher taxes, and no jobs, the middle class has hit the brick wall like a fresh egg hitting the trunk of a redwood tree. Whoosh!
The Dow appears to waffle around during the length of each trading day and then at the close the Dow is down 10 to 50 points. What is this? Reverse inflation? Or is the Dow trying to tell us something? Honest, I don’t know what!