Economics is one of the most difficult things to understand. It all seems incredibly complex. I expect that some of us still believe, for example, that the Federal Reserve is a government agency, that few of us can explain a derivative, that most of us don’t understand the bond market or know the first thing about trading a commodity.
We grasp somewhat that Europe is in trouble, that business is down in the US, that the real estate market is in the dumps and that gold and silver have increased in value.
If you listened to the Ann Barnhardt interview in the last post on this blog you will have learned something about MF Global and how, in her opinion, their confiscation of customer funds was thievery which should lead to prosecution and convictions. Yet, the head of MF Global appeared before Congress this week to “answer questions” but not in handcuffs (handcuffs were reserved for peaceful demonstrators protesting an unfair system).
It’s hard to find people who can succinctly explain what the heck is going on. Ann Barnhardt does a nice job. So does Jim Sinclair. I’ve been following Mr. Sinclair’s blog for several years now and he always makes a lot of sense to me and his predictions on the price of gold have panned out. In the interview that I am going to suggest you listen to he describes some of the ramifications of what is happening to us right now. The Crash of 2008 he describes as a market failure. But MF Global is a system failure, something much more serious.
It’s worth a listen. Go to this web page and click on the arrow in the lower left hand corner of the photo of Mr. Sinclair who is seated behind some shiny objects.