November 23, 2014

The Case of Russia's Dissappearing Foreign Exchange Reserves

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Someone (Saudi Arabia and US) has been leaning on the 'produce the f@ck out of oil' button for a long time now and it has sent oil prices plummeting. I believe this is essentially a price war with the aim to put Russia (and incidentally ISIS) out of business (again).

Yes, this harms the growing US energy industry, but the net benefit of lower oil prices plus maintaining hegemony is positive for the US economy. Plus, the US isn't financing government budgets using energy exports. Russia, on the other hand, is the world's largest energy exporter and is HEAVILY dependent on energy revenues. Nowhere is the effect of lower oil prices on Russia's economy more evident than in the following chart showing Russia's plummeting FX and gold reserves, which not coincidentally mirrors a similar decline in the Ruble:

How Hugh Hendry Learned to Stop Worrying and Love Central Banks - Full Moneyweek Interview

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Who is Hugh Hendry? From Wikipedia: Hugh Hendry is the founding partner and, at various times, the chief investment officer, chief executive officer and chief portfolio manager of Eclectica Asset Management. He began to attract attention when his fund achieved a 31.2 per cent positive return in 2008 in the depths of the financial crisis, earning him a reputation as a contrarian investor, but his claim on wider public notice was based in a series of outspoken media appearances. Hendry has been referred to as "the most high-profile Scot" in the hedge fund sector.

Hendry once said to an interviewer: "To my mind, the three most important principles when it comes to investing are Albert Camus's principles of ethics: God is dead, life is absurd and there are no rules." He suggested that a great fund manager was defined by "an ability to establish a contentious premise outside the existing belief system, and have it go on and be adopted by the rest of the financial community".





November 21, 2014

How Adam Smith Can Change Your Life (Russ Roberts)

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Adam Smith's other book, The Theory of Moral Sentiments, is often neglected. Author and economist Russ Roberts says it's an important and valuable guide to important parts of our lives. His new book is How Adam Smith Can Change Your Life: An Unexpected Guide to Human Nature and Happiness.

How Sugary Foods Are Making Us Fat

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Catalyst: Toxic Sugar - The previously unrecognised health impacts of high-sugar diets

Long-term Temperature Chart from 2500 B.C. to 2040 A.D

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A brief discussion of the long-term temperature chart from 2500 B.C. to 2040 A.D by Climatologist Cliff Harris. The pattern of wide weather extremes, climate cycles and forecasts to 2040.