This is Why We Must Gain Knowledge

The numbers are in and as suspected, there was something wrong with the last unemployment numbers. California did not report their jobless claims and clearly this had an effect on the numbers. But, this is secondary.

The fact is can we trust any numbers? We have been trained to trust the government numbers, after all they were produced by independent agencies, free of bias. However, now it appears these numbers are biased leaving the investor wondering where to turn.

The answer is turn to everything. Sponge information from all resources, take in all reports and then decipher the information. Ignore the analysis, but build knowledge. Learn about the effects of inflation, deflation, higher and lower interest rates, monetary policies and housing market. Observe what is going around you. Are your neighbors and friends employed? Are businesses in your area hiring? How are things going at your place of employment. There are indicators all around us, clues as to how the economy is going. Learn to read them and drop the middle person, take away the bias opinions and trust yourself.

Unemployment Rate?

The most recent unemployment number came in as 7.8 percent and almost instantly many were yelling BS!
This is one of those moments where politics and economics are mixing and the end result is not good.

Take a look at Jack Welsh, one of the most successful CEO thinks about the number:

Visit NBCNews.com for breaking news, world news, and news about the economy

Jack Welch says it all...

 It is a scary day when the president is being given numbers and intelligence  to meet someone's agenda. It happened with the Iraq War and now appears to be happening with Libya and the unemployment rate...

Update...More questionable numbers coming from the federal government...Job Claims.

There is a danger of this blog sounding political, but the fact is economics and politics don't mix. Good investors stay away from politics. Sure they watch it, learn from it and are concerned by it, but to become a strong investor and make good financial decisions political neutrality is a must. 

Looking at the current world situation things are unsettled and getting worse. Spain and Greece continue to boil over. Their unemployment numbers are astronomical and debt suffocating.  Numerous bailouts have been tried and after a few months nothing changes. But these two nations are not alone. Nations around Europe are facing devastating economic issues.  Yet, nothing has changed and the same old worn out ideas are being recycled. The turmoil in Europe will continue to be a drag on our economy, along with our own issues, that is a fact. So what does this mean for the common investor?

Europe is a prime example of why political neutrality is so critical. Sure the ideas are failing, but don't get caught up in debating why, leave that to Rush Limbaugh, Sean Hannity and Rachel Maddow. Instead, do your homework, search out investing opportunities.  Remember, money will be going somewhere and if Europe is becoming a grave yard look for the new boom town (likely Asia). 

Political debate is fun, no doubt. But it is a waste of time and a waste of money. Stay above it, move with it and take advantage. 

It become official this past week, QE III is going to happen. For those of you wondering, QE III stands for quantitative easing. In other words, the federal government is going to increase spending in hopes of jump starting the stagnant economy. This marks the third time such an action has taken place.

So what exactly are they going to do? The answer is found in the bond world. No, not James Bond, but U.S. Treasury Bonds, the little pieces of paper the government sells to help raise money.  This time the government will crank up the magic money machine and print more green paper. With that paper they will buy up Treasuries or mortgages from private banks and in theory pump money into the system. Does it work? The answer might be in the second part of the name III.

This marks the third time QE has been tried and of course reviews vary, but it can be argued, if QE worked they would not have been a II and III.  There are a number of problems in the theory. First interest rates are so extremely low the risk to benefits for a lender is out of balance.  Why would a bank take a risk on a loan when the return is so low? The answer is most won't, they will just sit on the money or invest in other areas. Second as more money floods the system, the value of the dollar is at risk of dropping, in one word, inflation. That is a major problem.

Regardless of the debate QE III is coming and only time will tell what the outcome will be.

Morgan Silver Dollar and APMEX

Ready to invest in gold and silver? I have purchased many items over the years from APMEX. The customer service has been thumbs up and the product high grade. Even if you are just looking to make a few small investments, coins can be really great! I also like to use them as gifts and my kids really enjoy getting Morgan Dollars. The Morgan is a great piece of American history. Used in the Wild West, the Morgan is the coin you might see John Wayne tossing on the bar or Clint Eastwood laying down on the poker table! They really are a great investment and conversation piece.

Even for those not wishing to invest in commodities, the prices are still very important. I have put up a link for commodity prices. Take a look at corn, the price for this item is going to go up because of the drought in the Midwest. This means higher beef, pork and poultry prices are in the pipeline.

http://money.cnn.com/data/commodities/

Watch out world! The price of gold and almost all commodities shows little signs of letting up. The reason is simple, the world's finances are in a tumble and everyone is looking for something safe. That something is gold and silver, always has been and always will be. The reason being is they hold a true value, unlike paper money.

Keep investing in this safe place until the things settle down, but don't forget to take some profit....