Mercantilism began sometime in the 1400s, rising quickly before beginning a long, slow collapse. Its terminal decline began with the success of the American Revolution (England: 1783) and peaked with the independence of India (England: 1947) and the Democratic Republic of the Congo (Belgium: 1960). Mercantilism was, at root, a parasitical economic system whereby the…
The Dust Bowl (1931-1939) extended from southern Kansas to northern Texas, but was centered in the Oklahoma panhandle. This is largely prairie whose native shortgrass once supported innumerable bison. A characteristic of shortgrass is that it grows easily in areas where rainfall is as little as 10 inches per year. You know you’re looking at…
Introduction: Another recession, possibly a very serious one, is inevitable. We know it will happen, for it is part of the normal business cycle. The problem is that we don’t know when it will happen. It might be this year or it might be years / decades from now. Whenever it occurs, there will be…
Continued . . . Opportunity: One can make much money by (a) choosing the right investments or by (b) shunning the poor ones. In many cases poor investment decisions could have been entirely prevented by heeding John Farnam’s Three Rules: (1) Don’t go to stupid places; (2) With stupid people, (3) And do stupid things.…
Information, not Advice #20 Continued . . . The Energy Crisis Recession of 1980 – Duration: 6 mos. GDP Decline: 2.2%. Peak Unemployment: 7.8%. 10 yr T-Note Beg 10.80% / End 10.25%. Inflation reached a bit over 11% and the Federal Reserve, not unsurprisingly, raised interest rates to slow money supply growth. When money…
Background: Ultimately, if one looks deeply enough, the market value of an investment is a function of interest rates. Market value is a specific term, and neither price nor cost is a complete synonym. How often does someone buy a new car at full MSRP? And, technically, cost is what you buy something for minus…
Continued . . . In the mid 1600’s the Dutch Republic was beginning its climb to global power. The Dutch traders, having a monopoly of trade with Japan and the East Indies, had become the middlemen between European nations and the Far East. For a period, Amsterdam’s population was doubling every 20 years (an annual…
Continued from Part 1… The late 1500’s, following the Eighty Years War, and most of the 1600’s were Amsterdam’s apogee. It was then, no longer concerned with Spanish warships, that Dutch merchantmen sailed over most of the known world, alert for new sources of rare spices. They returned from Indonesia with pepper, cloves and nutmeg.…