Dislocations Everywhere….

First off, Happy 4th to Everyone…our country is 243 years old today.  Here is to hoping our success continues another 243 years and beyond.

I sense a very strange economic and financial markets climate…I cant really make sense of it either.

Let’s start with the good stuff:  Unemployment is at a multi-decade low and sits at 3.6%. The economy is growing around 2.5-3.0%, significantly higher than the 1.8% the prior administration produced.  Inflation is at 1.8%.  The stock markets are at new all time highs (the S&P 500 closed yesterday at 2996, it’s never been higher).  All of this should add up to “let the good times roll!”.  But, does it???

So, what’s the problem Jim?  All of the positives above should translate into higher interest rates on long dated US treasuries.  The 10 year US Treasury bond is the most relied upon interest rate in the world.  All other interest rates globally are bench marked to the 10 year.  In the last twelve months, it has declined dramatically:  from 2.83% one year ago to 1.95% today…a  decline of 31%.  This is highly unusual…especially given the backdrop outlined above.  In fact, I don’t remember this ever happening in my lifetime.

The US Dollar continues to climb…approximately 50% of all global government debt yields negative interest…meaning you buy the bond and get less back on maturity (isn’t it supposed to be the other way around???).  Who in their right mind would make that “investment”?  Other central banks would and are doing that…really?   Yep.  Ironically, even though US interest rates are very, very low…they are positive, and are attracting investment capital from overseas.

At the same time, Gold and Bitcoin have skyrocketed this year. Gold is up 11% and Bitcoin has nearly tripled. Why?  I would suggest the “smart” money is moving out of dollar based assets (like stocks, bonds, real estate) and into non-dollar based assets.  Gold (the ultimate judge of fiat currency health, such as the US Dollar) is at a six year high.

Meanwhile, over at the US Federal Reserve Bank…they have put interest rate increases on hold, after raising them from zero to about 2.5%.  However, they continue to reduce the reserve balance on weekly basis…this is a number very few people are even aware of.  It’s a “stealth” tool.  Make the general public happy with no interest rate increases, but quietly continue to take money out of the system.    They are currently taking about 50 Billion per month out of system, reducing liquidity.

What does all of this mean?  I have no idea…all I know is there are dislocations everywhere.  Stay liquid, avoid debt and ENJOY the Holiday!

Until the next time…


Posted in Professional Nail Business | 4 Comments

November 2018

Blog November 2018

I hope you all had a great summer (I started this in September!)…time goes by so fast and we all get so busy we forget to “smell the roses”.  I have been insanely busy this year, but am happy to report that we took some very high quality time off and thoroughly enjoyed it.  I hope you did too!

Lets discuss the stock market, starting with some predictions from November 8th, 2016.  First the facts:  On the day Trump was elected the Dow was at 18,332.  This last Friday (August 31st) it closed at 25,964 for a 42% increase (It is currently up 32%).  Here are some predictions from the day before and after the election and other interesting quotes (I promise, I am not making these up!):

Opinion: The stock market could crash if Donald Trump is elected president (Simon Johnson):

WASHINGTON, D.C.   With the United States’ presidential election on Nov. 8, and a series of elections and other political decisions fast approaching in Europe, now is a good time to ask whether the global economy is in good enough shape to withstand another major negative shock.

The answer, unfortunately, is that growth and employment around the world look fragile. A big adverse surprise — like the election of Donald Trump in the U.S. — would likely cause the stock market to crash and plunge the world into recession.  Update:  Unemployment is at 50 year lows and GDP growth rate is up over 50% over the prior eight years.

This is what could happen to the stock market if Donald Trump wins (CNBC):

Wall Street’s long-running view that Hillary Clinton would easily become the next president has been replaced by a new fear that Donald Trump could win, and it probably won’t be a pretty picture for stocks if he does.  One of the reasons I no longer watch CNBC.

Mark Cuban Predicts a Stock Market Crash if Trump Wins the White House (JN:  I cant add anything more!)

This one is priceless (it’s worth the click!):  https://medium.com/@Moderate/2016-final-electoral-vote-count-228cc8ec7d3f

Jimmy Carter on Ronald Regan during the 1980 campaign:  Carter is all business and believes that Ronald Reagan is not his intellectual equal. He has publicly stated that Reagan is “untruthful and dangerous” and “different than me in almost every basic element of commitment and experience and promise to the American people.”

Paul Krugman: The Economic Fallout (JN:  This is my personal favorite)

Frankly, I find it hard to care much, even though this is my specialty. The disaster for America and the world has so many aspects that the economic ramifications are way down my list of things to fear.

Still, I guess people want an answer: If the question is when markets will recover, a first-pass answer is never.


Can you believe those headlines?  My point in sharing these is you have to be careful in listening to the “experts”.  Political bias rarely lends itself to investing results.  In this case, if you had followed their advice, you would have lost a lot of potential gains in your investment portfolio.


There is a very interesting new underway…Democratic Socialism.  The hallmarks are “free” healthcare, college, and universal basic income (a guaranteed annual income) for everyone.  One of the posterchild’s of the movement is Ocasio Cortez Kennedy, a juvenile…oops, I mean a junior candidate for the House of Representatives.  She has no knowledge of economics…proven by the frequent use of the word “free” in her speeches.  She also has very limited understanding of the world we live in (when asked about the Middle East situation, she wasn’t quite sure where that is!).  Before you consider “democratic socialism”, take some time to understand what is happening in Venezuela and Zimbabwe.  For example, this from the IMF (International Monetary Fund):

(Reuters) – Venezuela’s inflation rate is likely to top 1,000,000 percent in 2018, an International Monetary Fund official wrote on Monday, putting it on track to become one of the worst hyperinflationary crises in modern history.

People are STARVING.  So much so there are no animals left in the streets and the Zoo is starting to empty out too.  It’s all a result of printing money endlessly for “free stuff”.  As Margaret Thatcher famously said…”Socialism is great until you run out of other people’s money”.

It’s really simple, when the free stuff adds up to more (much more) than the  tax revenue coming in, the only way to make it work is to print, print, and print some more.  You don’t even have to print it now…it happens with a wave of a digital wand.  The reality is the United States is already doing that…can you imagine if democratic socialism creeps into the picture?  Postnote:  Cortez was elected to the House.


I am going to make a prediction that I have not seen made anywhere else:  I think labor unions are going to make a comeback…but it won’t be in the steel factories or the car companies.  See this article:

Whole Foods workers aim to unionize after Amazon buyout


Interesting isn’t it?  Labor unions had their big rise in the early 1900’s with the rise of car and steel manufacturers.  Worker’s pay and work conditions were abysmal…and labor supply was abundant.  In the early days, unions actually accomplished some good things.  As the century carried on, they became less and less relevant and in some cases actually hurt the workers they were representing.  They are far more political and far less worker oriented today.

With automation coming on strong, dominant new tech based companies rising, it would not surprise me to see more union activity.  Will it work?   Who knows?  I think it would just push automation faster and further, just like the $15/hour minimum wage has.  Another big factor was the introduction of Obama care which has reduced fulltime work to 30 hours or less.  Two or more jobs is now the norm…and benefits are few and far between.  It’s really sad, but that is how it works now.


The trade talks have been interesting:  As usual, dire predictions have been made about the results of negotiations being conducted around the world.  So far, Mexico has a new agreement with the US.  I think the EU may actually be headed to ZERO tariffs on several major product categories…think automobiles.  The way I see China:  You have two equally skilled players at the poker table…one has $500K in chips and the other has $125K.  Who would you like to be?  I expect the US position will improve after the process is done.  The critical issue is the forced disclosure of our intellectual property, to the tune of 500 Billion per year…we create and invent new ideas and concepts and are forced to hand them over to do business in China. Its remarkable BOTH sides of the isle don’t consider this a crises. So far, the impact has hit China far harder than the US based on market performance.


Some quick takes:

  • A great quote from Maya: The best kind of friends are the ones you call family
  • From Brian Dawkins NFL Hall of Fame speech: My haters became my elevators
  • Me on Famous Names orders I see: Free freight at $75…and ordering $55-70.  Seriously, I see this weekly!  It drives me crazy!
  • Wow, DOUBLE Wow: 2 Rare Bottles of Macallan Just Sold For Over $1 Million Each  https://www.mensjournal.com/food-drink/bonhams-hong-kong-macallan-auction/
  • Quote from Rob Roy. Founder of  Switch:  On the R&D side, you need to do something wrong 30 times before you get it right,” Roy told the Review Journal.
  • Terrific Quote from Robert Kraft (Owner Patriots): Jealousy & Envy are incurable diseases.  The more successful a business or team is, stronger personalities are attracted and this leads to more tension.  But it is a natural part of success.
  • This is a good one: Twenty years ago 95% of all photo’s taken were of other people or places.  Today, well over half (75%) of all photos are of ourselves.
  • EXACTLY: A bureaucrat is a member of a bureaucracy and can compose the administration of any organization of any size, although the term usually connotes someone within an institution of government. Some usages restrict the term so that it only embraces lower-ranked staff members in an agency, excluding higher-ranked managers, or so that it only signifies officials who perform certain functions, such as those who work “desk jobs” (the French word for “desk” being bureau, though bureau can also be translated as “office”).

It’s time for me to send…Linda and I have been to six countries in the last two months, so I am going to start my next issue with a review of our observations. I hope you and yours had a enjoyable Thanksgiving!

Until next time…

Posted in Investing/The Economy, Politics | 7 Comments

New World…or?

It’s been about six months since the election and all of the hysteria that has surrounded it. So, this blog will be mainly about politics…if that does not interest you, cut to the end.  While so much has been said, I would like to make a few comments:

  1. If you don’t like Trump, you know how I felt 8 1/2 years ago. But guess what? We all survived. And we will this time too.
  2. The Presidency has morphed a lot over the last 30 years. It is driven by Executive Orders (EO’s) being issued by the President, rather than laws being discussed, compromised and passed by Congress and signed by the President. EO’s can be easily reversed by the new President since they are not “law”. So, much of what Obama enacted via EO’s has already been negated, cancelled or modified. Not sure how this transition to will play out…who knows? Too early to say.
  3. Hillary is an out of touch Elite Class member…the average American simple could not relate to her and did not trust her. The East and West coasts Elites lover her.  I am not sure she really knows who she is…one thing is for sure, she is a composite of a lot of big money from all over the world. The amount of post election denial being spewed by her and her cronies is quite remarkable.
  4. Influence:  Hillary accepted 10’s of millions in foreign donations (both directly to her campaign and through the Clinton “Foundation”). Russia is being accused of “influencing” our elections and being the “source” of the leaked emails.  Is it strange that no one in the Hillary camp or the DNC is denying the content of the emails? Where is our media in covering this? It is sad day when the American media can no longer be relied upon to report the truth versus influencing our political process by being overtly favorable to one candidate and overtly negative to the other and call themselves “journalist”. Who really influenced our elections?
  5. Washington DC is not a reflection of the people of our country, at least not yet. Many other countries simply don’t understand that about us. They want Ivy League, smooth speaking Elites representing them. The Elites are not what made the US a leader…it is you and me. Let’s keep it that way!

I have a secret to share with you (please keep this just between us)…famous Names does business in Russia. This next one I have to insist that you absolutely keep to yourself and tell NO ONE:  Linda and I have actually been to Russia!!!  Guess what?  Putin is not reflective of the people who live there.  The young generation is learning English, unlike their parent’s generation when knowing English was considered suspicious activity.  They are very “western” in their thoughts, likes, dislikes.  They actually like Americans and have great respect for us.  They try hard to not let politics into their daily lives.  However, guess who really pays a terrible price for the sanctions imposed on Russia?  It’s not Putin, I can assure you that.  We were told he has 23 homes and moves frequently (and quietly) between them.  No, the sanctions hit the average person and HARD. It’s hard for us to watch the effects, in fact heart breaking.


The Russians Are Coming

The Russians Are Coming


If you watch CNN, MSNBC or any of the former “big three” networks, it’s all Russia, all day every day. All other news takes a back seat. I have never seen anything like it. If there is something there, let it come out. There are eight different investigations going on in Congress (remember, they don’t legislate anymore).  So far, the media is desperate for something, anything to come to light. By talking about it ALL of the time they hope that effort will morph into “something”, “anything”. It’s sad.  Let the investigations proceed and let’s let the hysteria go by the wayside.


Questions for you. What is more important to liberals in Congress?

Economic Strength or the Russians?

Tax Reform for US Based Corporations (more below) or the Russians?

Paring Back the Massive Body of Regulations or the Russians?

If you answered the Russians to each and every one of these questions, you would be correct. It’s quite remarkable that revenge for a lost election is more important than improving our country.

Then there is the Republicans…I don’t know where to start. If the Democrats are the perfect iteration of their own “group speak”, the Republicans are the polar opposite. There is no agreement on what they stand for, what they want or can accomplish now that they have full control of all three branches of government.  They are as dysfunctional as they have ever been. Paul Ryan is the epitome of a zombie politician.  The Democrats will “resist” at every opportunity while the Republicans try to figure out what they want as a group.  So, guess what…EO’s will rule the day.

My best advice is take care of yourself and your family and keep Washington DC as far away as possible.

One more comment and then I promise to move on. Last year the CIA released thousands of pages of declassified documents (I believe because 50 years had passed). Contained within were numerous documents outlining other countries’ elections that WE (well, really the CIA) overtly threw or redirected the outcomes, all in the name of US national interest. As The Russians Are Coming investigations move forward, perhaps we should get our own house in order?


Linda and I started famous Names in 2010. Until this year, we have had very few price increase notices. For several of our products we actually order the raw materials (so WE control the quality inputs), so we are on the front line of manufacturing a real thing. This year we have seen significant pricing activity. Example: chip board for packaging just went up 8% across the board. Volatile chemicals seem to go up EVERY TIME we order them.  Organic EVOO is going to go up big, we just don’t know how much yet. Bottom-line:  From our little micro perch, inflation is happening right now.  The new generation have never been through an inflationary period, so it’s on few radars. The implications are massive and too numerous for today’s piece, but keep an eye on it…it’s important. Incidentally, I was sharing this with a service provider yesterday and they replied “it’s probably that idiot Trumps fault!”  I did not have time to explain that in the eight years Obama was in office, the Federal debt more than doubled to 20 Trillion and that the Fed’s balance sheet went from 800 Billion to 4.2 Trillion. That increase in the Fed Balance Sheet is digital “funny money” and that is precisely where inflation comes from. It usually takes several years to flow through. Whatever Trump’s impact is on inflation, we will not know for 2-3 years. My guess is it will increase it further, but a bit unfair to blame him for today’s increases. But then again, The Russians Are Coming.


If the last crisis was rooted in sub-prime mortgage debt, where could the next one come from? It won’t be a replay the last one. It will come from student loans (which under Obama ballooned from 400 Billion to 1.2 Trillion today) and sub-prime (there is that UGLY word again) auto loans. Amazingly, you can now trade in a used car with negative value (meaning the outstanding loan is more than the value of the car) and roll that into a new car loan AND get 90 months to pay. Sound insane?  Does to me. It gets better:  About one third of these loans are sub-prime and given to folks who can’t afford them. Guess we didn’t learn much from 10 years ago. Loan defaults on both types of loans have started to increase and will get worse. Not good.


Quick Thoughts & Quotes:

  • The oft-told story, of the man who fell off the 50-story building, that was heard to say, as he passed the twelfth floor, “So far so good!” appears to apply to our financial world now.


  • Obamacare made insurance more expensive, going to the doctor more complicated, and created bizarre economic incentives that have nothing to do with delivering health care to the people that need it…EB Tucker


  • Trump becomes only the fifth president to never have been elected to public office before his inauguration. The previous four: Zachary Taylor, Ulysses S. Grant, Herbert Hoover, and Dwight D. Eisenhower.


  • Look at the Obama years:

    2017-06 Blog


  • From my daughter Carli: What happens when you excel and succeed? You Succel!


  • Your Ego is not Your Amigo


  • John Kenneth Galbraith: “We have two classes of forecasters: Those who don’t know – and those who don’t know they don’t know.”


  • If you want to read some “real”, alternative news, check out ZeroHedge.com hosted by the mythical Tyler Durden of Fight Club fame. Many of the articles are anonymous and come from in the know sources.

Wishing you all a beautiful and safe summer!


Posted in Famous Names, Investing/The Economy, Politics | 9 Comments

A First in History

To my knowledge, for the first time in our country’s history, digital evidence is having great impact on the US presidential elections. In the past, there were “leaks” released by the (main stream) media with un-named sources. But real and actual emails are being released that show (if you are willing to read them) how corrupt the system has become. The Elites are firmly in control of the US system. They are led by two dominate and criminal families: The Bushes and the Clintons. In this election, its the Clintons in the forefront with the Bushes in the backround, with both firmly committed at all costs, to keeping the power elite in place at a heavy and daily cost to YOU and I.
With the full, absolute support of the main stream media (MSM), the manipulation of the polls, the relative positions of the two candidates and how “well” the US economy and position in the world is doing, the power elites have come close to retaining their absolute power status. However, there is still a vote that will take place. You and I must vote…exercise your right.
Those polls you see daily trying to convince you no vote is needed, HRC has it wrapped up…they are completely stacked to poll those who support the power elite.
The economic numbers you see in the MSM? Conovulated beyond recgnition[Linda Nordstrom] (recognition) to make sure you are at ease. No worries needed, just trust us to do what is best for you and the “country” (translation: please vote to allow us to continue our self wealth and power control status…we will throw you a bone from time to time for the priveledge).
And on it goes. A vote for Hillary is a vote for the power elite, the two leading crime families and a continuation of the disaster that is the Obama regime. Short term history will expose the 12 trillion tab he racked up for all of the “progress” he believes has been achieved that includes sky rocketing health care costs (remember, this is the AFFORDABLE care act, right?); a disaster of a middle east map with our sworn enemy Iran in poll position; and regulation that runs wild. But worst of all race relations have plummeted under his watch. What a complete waste of a golden opportunity to draw us together as a nation.
Finally, when did the Democratic party become the party of war? Obama has spread war into many additional territories. Hillary is obsessed with Putin and Russia…war with them is insured if she is elected. She is a servant of the war machine that has senior status in the power elite. Dont belive me? Look at the money flow. A vote for her is a vote for war.
The election is a clear choice. A vote for Hillary is a vote for the power elite to rest easy for four more years. A vote to continue the destruction of what built America as good, but is today at risk becuase of the corruption, dishonesty and rot the Clintons and Bushes have worked hard to put in place.
Trump? A ray of hope we can reverse course and get back to what made America a respected leader in the world community.
Tuesday is going to be a day to remember. I am writing this on our flight home from Munich, Germany. Our schedule has been non-stop, so news has been a luxury. Make an informed vote on Tueday…

Posted in Professional Nail Business | 9 Comments

Question Answered

Question from my good friend JJ:

Thank you! Always love reading your blog. Regarding unemployment are there any studies you are aware of that tells us how many people are out of work but their unemployment payments have run out? It seems they drop off the radar?

It’s a great question and here is a graphic of the answer which is called the Labor Force Participation Rate:


As you can see, the number of people who can but are not in the “labor force” is at a multi decade low.  If you are out of work and have not actively looked for a job in the LAST 30 DAYS, you are magically teleported from “unemployed” to not in the labor force anymore.  All I can say is what a farce and total manipulation of the numbers.


Posted in Professional Nail Business | Leave a comment

Victory Lap….or?

I find it quite interesting that our president is currently on a “victory lap tour” both here and abroad. He actually gave David Cameron “advice” on how to “run” the British economy.  He also scolded the British people to vote “stay” on the Brexit vote, something the Brits I talked to were very resentful of (good for them…they saw through him big time).  I find the notion that a head of state can actually think he or she “runs” the economy insightful into today’s elite ruling class  dominated global politics. The truth is you and I run the economy. The best one can hope for is that the global elite ruling class doesn’t  screw it up too much during their tenure.  Sadly, I don’t think that is the case for the US.

Expanding on this, let me explain what has happened over the last 7 1/2 years in relatable terms. On his first day as president, Barack Obama walks into the oval office and finds the rarest of credit cards: it has no credit limit, no monthly payment required  and the accumulated interest rate is near zero percent. WOW, what an opportunity!  The question is:  When do the minimum monthly payments start to kick in?  What will the rate of interest be?  No one actually knows…that was not in the credit card agreement.  In fact, there is no agreement, there is just debt.

This is what you hear on the victory lap tour:

Unemployment has been cut in half

The economy measured as GDP has expanded

The stock market and home values have risen greatly

Everyone is happy, right?  Not exactly.  If they were, there would be overwhelming support for Obama’s anointed  successor.  Instead there is the “Bern” and “The Donald”…why?  Maybe the numbers just aint what they appear to be.

Here is what you don’t hear and but what I focus on:

The Federal debt will more than doubled from 9 Trillion to over 20T by the time Obama’s term is done.  As I pointed out in my prior writings, is “economic growth” based entirely on debt, real growth?  Trust me, we are going to find out and you will not like the results.

What are the key issues as I see them?

Do you know Obama is the FIRST President in our history to have sub 3% growth in the economy every year of his tenure?  Government tax receipts are actually down this year…how can this be if the economy is “expanding” as he claims on his victory tour?

Average household income is down 8% over the last 7 1/2 years.  Amazing, isn’t it?  We don’t hear this on the victory lap, do we?  Any wonder the average American is not happy…not feeling it?  Here is the ugly truth:  Most of the money printing that Obama has happily supported through zero percent interest rates has gone to the wealthy.  Anyone who owns assets, has done well.  The problem is, the average American doesn’t have much in the way of assets, particularly after the housing market imploded in 2007/2008.  There was a recent Federal Reserve survey ( http://swtimes.com/business/fed-study-nearly-half-us-households-would-struggle-unexpected-400-expense) asking if the survey taker could afford a “surprise” expense of $400 out of cash reserves.  Nearly half said no…think about that, HALF could not handle a $400 outlay.  The survey was aimed at the middle class.

 So, why is household income down?  I believe there is a new “class” that has been created that I call LMUP, which stands for Lower Middle/Upper Poor.  Who or what created it?  Obama along with Nancy Pelosi (who famously said we need to pass it so we know what is in it:  https://www.youtube.com/watch?v=hV-05TLiiLU ) who proudly pushed and forced “Obama Care” on the American people.  LMUP was created by the 30 hour per week provision which states an employer is not mandated to provide health insurance for anyone who works 30 hours per week or less.  The millions of full-time jobs that were lost during the Great Recession have been replaced by lower paying and lower hour jobs that have no benefits.  Want to know why the unemployment rate is so “low” (at least on the victory lap speeches)?  It’s because that one full-time job has been replaced by two or three jobs for the same person…get it?  One person, three jobs…that unemployment rate really looks great, right?  We know many people dealing with this…they are not happy and we are not happy for them either.

Obama’s zero interest rate policy has destroyed the business cycle, in other words Capitalism is on the ropes.  Driven by this policy, massive mal-investments have taken place.  One (of many) examples is the borrowing by the largest corporations in America:  Nine trillion since 2009…with far more being spent on stock buybacks and dividend increases than new Research & Development and build out of plant and equipment.  New jobs depend on the latter, not the former.  Another example is savers have been severely punished.  There is no rate of interest on savings anymore.  If you are retired and dependent on some rate of return, you have to dramatically increase the risk profile of your savings.  So those savings are now at risk in order to generate at least a bit of return.  When the cost of capital is free (amazingly in some countries their sovereign debt has NEGATIVE interest rates where you pay the government to borrow from you!) the natural “gravity” of Capitalism is completely lost.  Smart, productive investment is replaced by bad, bad ones.

Here is another example, no words needed:

  Auto Loans

Many (most) of these cars were purchased with debt.


The ultimate death knoll for free market capitalism was this:  http://beforeitsnews.com/opinion-conservative/2016/05/obama-you-cant-build-that-and-if-you-succeed-its-because-youre-lucky-3136005.html        Our very own President declaring you cant do it without government.  I happen to disagree…strongly.  Next blog, I will get into some ideas on what we can do to change all of this.  Note:  Hillary is NOT the answer.  Also, this is an amazing article written by Peggy Noonan, I hope you read it:  http://www.peggynoonan.com/trump-and-the-rise-of-the-unprotected/

Until Next Time….


Posted in Investing/The Economy | 7 Comments

The Vote is In…

Brexit wins 52% to 48%…wow!  I was up until 2:30am watching the reaction in the UK and around the world.  If you are invested in any of the major stock markets, you are getting hammered.  If you own precious metals like gold and silver, you are very happy today…gold is at &1322 per ounce, up almost $60.

However the vote turned out, I totally respected the outcome.  Now, I have to say I am quite happy for the UK and their decision.  By nature, I like a decentralized structure over the opposite.  No one knows in the short run what all will happen, but I am optimistic about the long run for the UK.

One of my friends sent over a 30 page review on the vote.  It pointed out that financial services are the #1 export and are priced at approximately a 35% premium to mainland Europe.  I would suggest to my UK friends that are concerned about the vote to “leave” that your financial services business will be fine…you don’t get that kind of premium unless you are very good at what you do.

Finally, I personally bought a meaningful amount of British Pounds this morning…I believe 100% in the UK and it’s people.

Posted in Investing/The Economy | Tagged | Leave a comment

The Vote…

Tomorrow, Britain votes on whether to stay or leave the EU. I just returned from my adopted “second country” last week. While there, I conducted my own survey on the vote: In or Out? Innie or Outie (thankfully only one person thought I was talking belly buttons). I queried around 40 people and can say my survey was very close, with the tilt towards exit. The other question I asked is are you happy you kept the British Pound rather than adopt the Euro. EVERY single person said they were very happy they kept the Pound.
So, why would you want to stay in a situation where unelected, elitist career politicians decide your fate as a sovereign country?
I wish my many friends in the UK the best of luck tomorrow…the results should be interesting to say the least.

Posted in Investing/The Economy | 2 Comments

The IBX Nail Strengthener Revolution Takes Hold in the US

Just received this…IBX truly is a nail revolution!

Hello, Linda..

I was privileged to take your informative IBX class a couple of months ago in Pasadena. My nails were a mess. You examined my hands and advised me not to wear gel polish until my deformed nails straightened out. I took your advice.

I’m delighted to tell you that, with the help of IBX, my nails have not only resumed their natural, flatter contour instead of the impossible C-curve I’d been forcing on them with the gel, the IBX I’ve been applying once a week has worked wonders on restoring the damage caused by all those years of gels. They’re smooth again, growing out nicely, and are strong like they never were before.

I’ve become such an advocate for IBX. I’m living proof.

Best regards, and thank you again for your communications, your instruction, and your marvelous products.

-=- Paula Morris

Posted in Professional Nail Business | 7 Comments

Capitalism, Socialism, Debt and Interest

I get it…people are disillusioned.  Disillusioned to the point they think a socialist may be the answer to an improved life.  The “Bern” is in…The “Donald” is on a roll…HRC, who knows?  Capitalism and free markets are what built our country into greatness.  It is now viewed as evil and associated with huge, global conglomerates that are greedy and bad for the individual. Today, I would like to propose Capitalism is the answer and not the problem.

First, I want to share my perspective on how we arrived to this point.  The two key measures that I focus on (there are many more like the status of the US dollar, but I believe these to be central) are:

  1. The Federal Reserve zero interest rate policy for the last eight years.
  2. The US debt load and the interest owed on it.

We all remember the “great recession” that occurred in 2008 and 2009.  In overly simple terms, it was the result of three Federal Reserve induced bubbles.  The first being Y2K and NASDAQ 5000.  Huge amounts of money was printed to prep for what was viewed as a potential disaster with computers worldwide.  The internet craze was on fire and lots of that money led to the NASDAQ bubble.  Y2K came and went and the NASDAQ collapsed over the next two years, down by over 80%.  That led to a recession.  What did the Federal Reserve do?  Would it surprise you that they printed a load of new money?  That money directly guided us into the next bubble:  Residential real estate.  Ahh, the days of zero percent down, “liar” loans;  home flippers; and of course low-interest rates. 

Guess what?  If a person has no equity in a house and that house’s value drops, what happens?  They leave the keys on the counter and leave.  Lots and lots of people left keys on counters.  And lots and lots of banks, big and small, were technically insolvent…not just here, but all over the world.  You see…even the banks overseas invested in those mortgages and in a hugely leveraged way.  Some mortgage packages were levered 10, 20, 30 times.

 The US entered a severe, fear filled recession.  Markets collapsed (not just the stock market, the bond market collapsed, the housing market imploded, the banking system was on life support).  Enter the Federal Reserve (again) with interest rates lowered many times until they hit zero:

Fed Rates

And zero they have been ever since until they were recently raised ¼ of a percent.  What’s wrong with zero rates?  Everything in which a free market/capitalistic system functions.  Savers are punished…the earn nothing on their savings, in fact saving is a bad thing.  What do large corporations do when rates are close to zero?  They borrow and borrow BIG.  The S&P 500 companies have borrowed BIG over the last five years and used that money to buy back shares and raise dividends.  However, research and development and capital spending have remained stagnant…that’s not a good thing, growth comes from the last two activities and not the first two. 

 Who else has borrowed BIG?  The US government…and they (we) are the biggest of all.  In the years since our current president took office, the Federal debt has increased from 9.0 trillion to 18.2 trillion at the end of 2015.  It’s now over 19T.  We spend more than we take in every year…the gap is debt.


The “official” statistics suggest our economy is growing.  It is, but barely and entirely on the back of new debt:



Seems to me that 9 trillion would have produced more growth?  The 2016 1st quarter GDP has come in at an ANNUAL growth rate of 0.25%.   The real median annual income in the United States has fallen from $57,795 in 2008 to $55,218 today. There are now twice as many Americans on food stamps than before the financial crisis.

 Why is no one talking about this?  Isn’t this a problem?  In short, yes…it’s a massive problem, but the symptoms have not been expressed yet.  It’s like the years of plaque build-up are not seen or noticed until the heart attack occurs.

 At current interest rates (1/4%) we pay $48 billion in interest.  What happens if/when rates go back to “normal”…say the 5% we had a few years back in 2007?  We would owe a WHOOPING 950 BILLION!  In 2015 Federal revenue was $3.1 trillion…by my calculation, that would consume 31% of all our revenues.

Houston, I believe we have a problem…a big one.

That’s if for today…next I will bring this full circle to capitalism and this election’s highly charged emotion.



Posted in Investing/The Economy | 5 Comments