I remember going to New York back in the 50’s and 60’s. (Here goes another true story) Times Square was a riot back in those times. There was the Camel sign that blew smoke rings, and the Bond Clothing sign with a real waterfall. The Paramount Theatre was in operation, as was the Astor Hotel. Lots of “schlock shops,” which purveyed the sleaziest of Oriental junk, and other assorted garbage ’take home’ stuff for the unwary tourist. Then there was Rosie, who held forth on the Square with her long seedy robes, crown, sequined Bible and shepherd’s staff. She bellowed at all the sinners, urging them to repent and be saved. Of course there were the “merchants” with folding tables and $10 Rolodex watches or three card monte games too, similar to a scene from a Damon Runyan film or story. The most unique and funniest of the shysters were the dancing balloon guys. They always had to be on a semi-dark street, off the Square, because it wouldn’t work with bright lights. Here would be this guy with his quick fold table, and these balloons with little feet and a head, looking just like a miniature man. They danced! They jumped up and down, seemingly miraculously. They went for $3 as I remember, and of course the hicks bought them. Off in a corner, would be another guy, and if one looked carefully, his hands were locked in back of him, and a finger was moving wildly. A black thread was hooked to his finger, looped over a closed store’s gate, over a street sign, and down to the “dancing” balloon. Till the cops arrived, they had a good thing going. “Follow the instructions,” were the explanations given, as they pocketed the bucks.
Today, the world is full of the dancing balloon shysters. Be they salesmen of all types, or gypsies painting roofs with kerosene diluted paint, there are frauds by the hundreds, anxious to take your dollars with promises of untold riches, when the stock goes up, interest goes up, or whatever the current line is for the hucksters. Selling is an art, and there are thousands of cubicles in America, often called “boiler rooms,” that are populated with people calling, calling, calling, with the latest gimmick or gimcrack you just have to have, in order to increase your wealth, or contribute to a seemingly wonderful charity. “Hello, this is the Policeman’s Benevolent Fund calling, to try to get you to help the homeless children in Lower Slobovia,” or whatever.
Faith is what is required. As in Hebrews chapter 11.
Faith that the dollar will still buy next year, close to what it buys today. Faith that the stock market will go up. Faith that Dubya knows what he is doing. Faith that a year from now United will still be flying. Faith is paramount, just like the theatres and film company. The thing to have faith in, first of all, is the thing that has a good record going back as far as is necessary to be sure. In a marriage it may be several decades, and in a religion, it may be hundreds of years. Knowledge supports faith. Knowledge of something mechanical, makes it easier to trouble shoot appliances or cars. Knowledge of the history of a stock or investment, provides faith that it won’t go bust next week. Am I getting carried away? Maybe, but continue with these thoughts, please.
When one buys a stock, knowledge of that corporation’s profits, assets, sales, and prospects, should determine whether it is a good buy. When the market went the way of all flesh a couple of years ago, the lack of knowledge, plus listening to the creeps in the cubicles, cost Americans $8 trillion. Had they the knowledge they should have had, they wouldn’t have bought the stocks which had no profits at all. Even with no P/E ratios, some stocks were selling like hot cakes. Major stock brokerages, who hired the dancing balloon salesmen, knowing some stocks were turkeys, sold them anyway, for the commissions, and to hell with the customer. These firms are now paying hundreds of millions in fines. The customer needs to investigate and gain knowledge, to have the needed faith required to invest profitably. Faith in mining stocks, seems to be the current way to go. I own thousands of them, but think they may be oversold, due to their prices going up so fast and far, with little or no production or profits. One of my mine stocks added a million shares to their total, which is almost 50%. Guess what happened? The price fell by almost exactly that percentage. None of the stockholders had a say in it, or the power to veto it. The CEO did it, and I am sure the board of directors profited handsomely. Far too many mining stocks today have no profits, and negative P/E ratios. Several other mine stocks have been similarly diluted by management. Faith is what is required to buy them, and I have about lost mine. Some of them are like the NASDAQ at 5000.
What’s the difference between the dollar supply being increased by huge percentages, thereby losing purchasing power, or that mine company doing the same thing, with the same result? Little, as far as I can see. A couple of weeks ago, a Federal Reserve Governor made the statement that the Fed has the “power of the printing press” at its disposal. (I’ll bet Sir Allen had a fit over that statement) The mining company had the power of the printing press at its disposal also. The result is the same. Dancing balloons, made to operate by a thread strung over pipe in a dark street. A mine company prints a million shares. A government prints zillions of dollars. The fraud is so evident, that whoever can’t see it, needs to get sent back to the first grade. Trillions of dollars sit in banks, earning 1% taxable interest. It’s the faith in the dollar that is so difficult to overcome. When one has faith in a currency, politician, auto, or anything for that matter, that faith is extremely difficult to break. “Don’t bother me with the facts, I have already made up my mind.” Who is responsible for the World Trade Center bombing, and who failed to notify in time? The internet has gobs of explanations that blame everyone except my Aunt Tillie, and she was dead by then anyway, or maybe she did it. Should we have faith in our government, when it lies about so much? The government tells us Lee Harvey Oswald shot JFK, TWA 800 was felled by bad wiring, and a hundred other fables, which most of us long ago realized were falsehoods. Should we still have faith in the dollar, even though it has lost 99% of its value? Why? Does the government have balloons that really dance, if we read the directions? Everyone saves in dollars, invests in dollar denominated instruments, and still believes that they have intrinsic value.
I wonder if the French really believed that the assignat had value, after it kept falling in value day after day? Did the Germans believe the Reichsmark still was “valuable,” even as it fell down, down, down? Maybe they did. Americans, by huge majorities, still think the buck is sound. It is being printed by the ton every year, and is going down the tubes, even compared to other fiat currencies. They are pieces of paper with ink on them, and it’s that simple. 90% of Americans die and live within 10 miles of their birthplace, it is said. Few ever change habits acquired in childhood. If your parents didn’t teach you to speak correctly, have good table manners, or bathe regularly, you probably haven’t changed in your adulthood. This is why the government still sells T-Bills, and trillions are tucked away in banks, both of which are dribbling away the capital of the owners of these certificates, even before taxes.
Words cannot express my hatred of dollars. I have changed since childhood. I don’t live anywhere near Washington DC where I was born and raised. I have changed attitudes, economic habits, weights, wives, and preferences for all sorts of things. I changed because I found a better way, and am not sorry for that decision. If someone calls you, hawking something, who has the need? Isn’t it the caller? If you call someone, isn’t that an indication that you need something? Do grocery stores call you? Do doctors call you? Think about that one. We went to Salt Lake City last weekend, and Salt Lake City didn’t call me, trying to get me there to buy rooms, concerts and shopping. We wanted to go. Next time someone calls you, telling you about his bargain or opportunity, ask yourself who has the need, and the answer will be the caller, not you. Protect yourself.