Daily Reckoning

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  • Money =/= Currency

    Money =/= Currency

    This post Money =/= Currency appeared first on Daily Reckoning. From the beginning of time many things have been considered currency. Livestock, grains, spices, beads, and paper have all been forms of currency, but only two things have been money. You guessed it: gold and silver. In 1971, the U.S. dollar died because it was no longer money—it became a currency. And there is a big difference between money and currency. It’s a common misconception to think currency is money. For instance, when someone gives you some cash, you presumably think of it as money. It is not. Cash is simply a currency, a medium of exchange that you can use to purchase something that has value. The word “currency” comes from the word “current,” like an electrical or an ocean current. The word means movement. In overly simple terms, a currency needs to keep moving. If it stops moving, it rapidly loses value. If the loss of value is too great, people stop accepting it. If people stop accepting it, the value of the currency plummets to zero. After 1971, the U.S. dollar began moving to zero. Money, unlike currency, has value within itself. Money is always a currency, …Read More »
  • Why the Game of Money Is Rigged

    Why the Game of Money Is Rigged

    This post Why the Game of Money Is Rigged appeared first on Daily Reckoning. In a few months, my new book, FAKE: Fake Money, Fake Teachers, Fake Assets, is set to be released. To be honest, I’m still writing it. My publisher isn’t happy with me right now, but it’s something we’ve gone through with every book I’ve written. In the end, I meet the deadline and she can finally get some sleep. When I wrote Rich Dad Poor Dad in 1997, it was to sell the board game that Kim and I created called CASHFLOW®. I never in all my life would have guessed that it would become the #1 personal finance book of all time. It has been said that it’s changed the way people think about money. With the new book, I want to change more than the way you might think about money. I want you to understand the lies that have been told to us for decades. A Brief History It all starts with this diagram below: 120 years of the DOW. If you look closely, you’ll see the GIANT crash of 1929. This crash put us into a depression that lasted 25 years. It …Read More »
  • Are You Playing by the Rules of the Rich?

    Are You Playing by the Rules of the Rich?

    This post Are You Playing by the Rules of the Rich? appeared first on Daily Reckoning. When I was a young boy in elementary school, my rich dad was already putting ideas in my head about the differences between the rich, the poor, and the middle class. My rich dad would say, “If you want job security, follow your dad’s advice” — my real father — “if you want to be rich, you need to follow my advice.” Rich dad then went on to show me the difference between his investment plan and my dad’s investment plan. “My business buys assets with pre-tax dollars,” said rich dad as he drew the following diagram. “Your dad tries to buy assets with after-tax dollars. His financial statement looks like this,” said rich dad. To sum it up nicely, rich dad combined the two diagrams to highlight the difference between my dad and him. Playing by Different Rules The point that rich dad was making was that even though we live in a free country, not everybody plays by the same rules. The rich have laws of their own that allow them to become richer. Rich dad went on to teach me that …Read More »
  • [BREAKING] Canada Abandons Free Market Capitalism

    [BREAKING] Canada Abandons Free Market Capitalism

    This post [BREAKING] Canada Abandons Free Market Capitalism appeared first on Daily Reckoning. Desperate times call for desperate measures. That is the justification for Canada’s most right-wing Province abandoning free market capitalism this week. On Sunday, the Alberta Government announced that it will be enforcing a mandatory production cut of 8.7 percent for all oil producers operating in the province. There is an exclusion for the really small operators, many of whom could be bankrupted by such a cut. For all other producers, however, there is no option. Starting January 1, 2019, the production reduction is mandatory. These private sector companies have no choice. This is a shocking measure — similar in size to the state of Texas doing the same thing. But as always, The Daily Edge has the best way for you to play the action… It Seems Very Wrong, But It Is Probably Right To appreciate how bad things have gotten, you need to understand that Alberta is Canada’s version of Texas. I’m talking about big trucks, cowboy hats and very conservative politics. In Canada, Alberta prides itself on being the home of the free market — the province of privatization. Alberta is a hotbed for libertarianism …Read More »
  • Deadly Accurate Recession Indicator Just Went Off

    Deadly Accurate Recession Indicator Just Went Off

    This post Deadly Accurate Recession Indicator Just Went Off appeared first on Daily Reckoning. Start off every day with a smile, said W.C. Fields — “and get it over with.” Thus we force a grin to start today’s reckoning, here expressed verbally: The stock market did not lose one solitary point today. Our duty to Mr. Fields now discharged in full, we proceed with a scowl… The exchanges were closed today in honor of the nation’s late 41st president, George Herbert Walker Bush. Hence no losses today. Hence our insincere, dutiful smile. But investors are still mourning for the money they lost yesterday. The Dow Jones hemorrhaged 799 calamitous points — its fourth-worst single-day point loss in history. Both the S&P and Nasdaq absorbed murderings on similar scales. Partly responsible were comments issuing from the West Wing of the White House. “I am a Tariff Man,” said Trump. His chief economic man also expressed doubts about a Chinese trade deal before the 90-day “truce” lapses. But it was not trade news alone that panicked the horses yesterday. What else? A Bloomberg Op-Ed gives the overview: “The U.S. Yield Curve Just Inverted. That’s Huge.” What is the yield curve, precisely? And …Read More »