This is default featured slide 1 title
This is default featured slide 2 title
This is default featured slide 3 title
This is default featured slide 4 title
This is default featured slide 5 title
 

Monthly Archives: March 2018

Bitcoin Vs Goldcoin

Bitcoin… Monetary Nirvana?

If you don’t know what Bitcoin is, do a bit of research on the internet, and you will get plenty… but the short story is that Bitcoin was created as a medium of exchange, without a central bank or bank of issue being involved. Furthermore, Bitcoin transactions are supposed to be private, that is anonymous. Most interestingly, Bitcoins have no real world existence; they exist only in computer software, as a kind of virtual reality.

The general idea is that Bitcoins are ‘mined’… interesting term here… by solving an increasingly difficult mathematical formula -more difficult as more Bitcoins are ‘mined’ into existence; again interesting- on a computer. Once created, the new Bitcoin is put into an electronic ‘wallet’. It is then possible to trade real goods or Fiat currency for Bitcoins… and vice versa. Furthermore, as there is no central issuer of Bitcoins, it is all highly distributed, thus resistant to being ‘managed’ by authority.

Naturally proponents of Bitcoin, those who benefit from the growth of Bitcoin, insist rather loudly that ‘for sure, Bitcoin is money’… and not only that, but ‘it is the best money ever, the money of the future’, etc… Well, the proponents of Fiat shout just as loudly that paper currency is money… and we all know that Fiat paper is not money by any means, as it lacks the most important attributes of real money. The question then is does Bitcoin even qualify as money… never mind it being the money of the future, or the best money ever.

To find out, let’s look at the attributes that define money, and see if Bitcoin qualifies. The three essential attributes of money are;

1) money is a stable store of value; the most essential attribute, as without stability of value the function of numeraire, or unit of measure of value, fails.

2) money is the numeraire, the unit of account.

3) money is a medium of exchange… but other things can also fulfill this function ie direct barter, the ‘netting out’ of goods exchanged. Also ‘trade goods’ (chits) that hold value temporarily; and finally exchange of mutual credit; ie netting out the value of promises fulfilled by exchanging bills or IOU’s.

Compared to Fiat, Bitcoin does not do too badly as a medium of exchange. Fiat is only accepted in the geographic domain of its issuer. Dollars are no good in Europe etc. Bitcoin is accepted internationally. On the other hand, very few retailers currently accept payment in Bitcoin. Unless the acceptance grows geometrically, Fiat wins… although at the cost of exchange between countries.

The first condition is a lot tougher; money must be a stable store of value… now Bitcoins have gone from a ‘value’ of $3.00 to around $1,000, in just a few years. This is about as far from being a ‘stable store of value’; as you can get! Indeed, such gains are a perfect example of a speculative boom… like Dutch tulip bulbs, or junior mining companies, or Nortel stocks.

Of course, Fiat fails here as well; for example, the US Dollar, the ‘main’ Fiat, has lost over 95% of its value in a few decades… neither fiat nor Bitcoin qualify in the most important measure of money; the capacity to store value and preserve value through time. Real money, that is Gold, has shown the ability to hold value not just for centuries, but for eons. Neither Fiat nor Bitcoin has this crucial capacity… both fail as money.

Finally, we come to the second attribute; that of being the numeraire. Now this is really interesting, and we can see why both Bitcoin and Fiat fail as money, by looking closely at the question of the ‘numeraire’. Numeraire refers to the use of money to not only store value, but to in a sense measure, or compare value. In Austrian economics, it is considered impossible to actually measure value; after all, value resides only in human consciousness… and how can anything in consciousness actually be measured? Nevertheless, through the principle of Mengerian market action, that is interaction between bid and offer, market prices can be established… if only momentarily… and this market price is expressed in terms of the numeraire, the most marketable good, that is money.

So how do we establish the value of Fiat… ? Through the concept of ‘purchasing power’… that is, the value of Fiat is determined by what it can be traded for… a so called ‘basket of goods’. But his clearly implies that Fiat has no value of its own, rather value flows from the value of the goods and services it may be traded for. Causality flows from the goods ‘bought’ to the Fiat number. After all, what difference is there between a one Dollar bill and a hundred Dollar bill, except the number printed on it… and the purchasing power of the number?

Gold, on the other hand, is not measured by what it trades for; rather, uniquely, it is measured by another physical standard; by its weight, or mass. A gram of Gold is a gram of gold, and an ounce of Gold is an ounce of Gold… no matter what number is engraved on its surface, ‘face value’ or otherwise. Causality is the opposite to that of Fiat; Gold is measured by weight, an intrinsic quality… not by purchasing power. Now, have you any idea of the value of an ounce of Dollars? No such thing. Fiat is only ‘measured’ by an ephemeral quantity… the number printed on it, the ‘face value’.

Bitcoin is farther away from being the numeraire; not only is it simply a number, much as Fiat… but its value is measured in Fiat! Even if Bitcoin becomes internationally accepted as a medium of exchange, and even if it manages to replace the Dollar as the accepted ‘numeraire’, it can never have an intrinsic measure like Gold has. Gold is unique in being measured by a true, unchanging physical quantity. Gold is unique in storing value for thousands of years. Nothing else in reach of humanity has this unique combination of qualities.

In conclusion, while Bitcoin has some advantages over Fiat, namely anonymity and decentralization, it fails in its claim to being money. Its advantages are also questionable; the intent is to limit the ‘mining’ of Bitcoins to 26,000,000 units; that is, the ‘mining’ algorithm gets harder and harder to solve, then impossible after the 26 million Bitcoins are mined. Unfortunately, this announcement could very well be the death knell of Bitcoin; already, some central banks have announced that Bitcoins may become a ‘reservable’ currency.

Wow, sounds like a major step for Bitcoin, does it not? After all, the ‘big banks’ seem to be accepting the true value of the Bitcoin, no? What this actually means is banks recognize that they could trade Fiat for Bitcoins… and to actually buy up the 26 million Bitcoins planned would cost a meagre 26 Billion Fiat Dollars. Twenty six billion Dollars is not even small change to the Fiat printers; it is about a week’s worth of printing by the US Fed alone. And, once the Bitcoins bought up and locked up in the Fed’s ‘wallet’… what useful purpose could they serve?

There would be no Bitcoins left in circulation; a perfect corner. If there are no Bitcoins in circulation, how on Earth could they be used as a medium of exchange? And, what could the issuers of Bitcoin possibly do to defend against such a fate? Change the algorithm and increase the 26 million to… 52 million? To 104 million? Join the Fiat printing parade? But then, by the quantity theory of money, Bitcoin would start to lose value, just as Fiat supposedly loses value through ‘over-printing’…

We come to the key issue; why search for a ‘new money’ when we already have the very best money, Gold? Fear of Gold confiscation? Lack of anonymity from an intrusive government? Brutal taxation? Fiat money legal tender laws? All of the above. The answer is not in a new form of money, but in a new social structure, one without Fiat, without Government spying, without drones and swat teams… without IRS, border guards, TSA thugs… on and on. A world of liberty not tyranny. Once this is accomplished, Gold will resume its ancient and vital role as honest money… and not a moment before.

Rudy J. Fritsch was born in Hungary in 1947, and fled Socialist tyranny during the Hungarian Revolution of 1956. His family had lived through WWII and the consequent Hungarian hyperinflation, thus he has intimate experience with financial destruction.

As an engineer and entrepreneur, he ran a successful family business in Canada for decades, at its peak employing over 100 workers, until economic upheaval destroyed the profitability of North American manufacturing. Driven out of business, he decided to study economics… to discover the cause of this unhappy circumstance.

As mainstream economics “The Dismal Science” made no sense to him, he ended up studying Austrian economics, the only school of economics grounded in the realities of Human Action. When he discovered Professor Antal Fekete’s work he came to admire it and made a firm commitment to help preserve and disseminate the Professor’s legacy.

Financial Planning Service Companies – Why Select the Best?

The world without any considerable doubt can be easily considered as one big market. Trade and business are the only two things that keep the world running. Yes, there are inventions and discoveries as well, but they are also traded to get through with an ample amount of profit.

People can easily come around with one or the other form of business. Either they own it or work for it. Each of these businesses thus has their financial statements and records. Without these, the business may well disappear.

There are many forms of finances that a person might practically have to deal with. There are the mutual fund investments. There are the hedge funds and many more. There are many best financial services companies that are present nowadays that help people.

These financial services companies ensure of the very fact that people do get the best results from the business that they are in. There are various advantages that people may enjoy if they hire the financial service companies.

Financial planning:
Before moving further on the topic, people should understand that what exactly is the financial planning? This is something that can help people in a long course of time and thus help in managing the finances the best.

Why Recruit the Financial Service Companies?
There are many reasons why a person should think of hiring these services. Financial services can be well considered as one of the very important services, and the following are the various advantages that the companies providing them can guarantee:

• Consulting: Yes! The financial consultancy services are one of those most important things that are necessary before any decision to invest. Consulting helps in various things. People can ensure that they are getting through with the most important knowledge of finance and these companies do provide with that.
• Taking Care: the main aim is to take care of each and every financial gains and loss in the company. Evaluating them and taking the necessary actions. These can be done by the professionals only, and this is the only reason why people should ensure that they do have one of these financial companies to aid them.

Apart from these two important advantages that people can come around with they should also ensure that there will be much more advantages if people select the best ones for themselves. Only the very top financial services companies can ensure of the fact that the best services will be provided.

The following are the best advantages of recruiting the top notch services:
Free Services: The top financial service companies believe in the very fact that the people can only get the very best of the results if they do have a hope in the fact that their services by no means are frauds. This is the exact reason why they provide the people with the various free financial planning services.

Varied Services: This is again one of the major advantages of the top notch companies. The very first thing is that each and every company that is top notch is there because of the excellent knowledge that they do possess. They believe in the fact that the various services that they will provide ill attract the customer’s attention. They have knowledge about various things like portfolio management.

Creation of The Portfolio: This is something that cannot be achieved excellently just by any company. Only the top notch ones will work the best to provide with absolutely marvellous results on the portfolio. They will change as well as customize them according to the customers. Also, they will help in managing them.

Appointing the financial management companies can be the best thing that people can do. Remembering to select the best financial planners though is really important.

A Career Choice – Can I become a Successful Stockbroker

When choosing to enter a new career path it is important that you ask yourself the important questions, is it for me? Can I succeed? Will I enjoy it? There are many pro’s as to why so many individuals want to become a stockbroker. Stockbroking allures many people to its depths because of the possible profit which is involved and the flexible working times. There are many factors which will also determine if stockbroking is for you, for example your career length as a whole because the longer you work, the more clients you will have. Secondly, it also depends on your location, for example bigger cities are home to bigger firms who pay out bigger chunks of money.

If you really want to throw yourself into stockbroking and you have the motivation to succeed then have a read below at what it takes to be a successful stockbroker.

Skills to Succeed

As well as requiring the specific regional licenses to act as a stockbroker these following skills are vital for every stock broker to have.

You need to be a self-starter. A stockbroker needs to have the motivation and willpower to start from something very small and make it into something big. As a stockbroker you can’t give up at the first hurdle.

You need to know how to deal with rejection. Rejection and loss are common players in a stockbroker’s career so it is important that you can’t get emotionally involved. If a client rejects you or if you have a huge loss on your side then to be able to keep mentally positive is essential.

The will to work long, long hours. Although a stockbrokers working time is flexible and essentially you can choose the hours you work, you need to be prepared to work long hours and possibly nights and even at weekends. The stock market won’t wait for you to wake up. You need to follow the markets like a hawk at all times of the night and day.

Patience. As a stockbroker you will need to have patience to build up your business. Reeling in clients and earning profits could take years and it could take even longer to become an established stockbroker. It doesn’t happen overnight.

Good Communication, sales and time management skills. As with most jobs you need to be able to communicate well with your clients, manage your time properly and effectively and to be able to ‘sell’ your services to others.

Perseverance. If you are highly motivated to succeed in stockbroking then then key skill to own is perseverance. You will need to persevere to get the results you want. Keep at it and don’t give up.

If you have these skills or you think you work on gaining these skills then you have a plus over stockbrokers who don’t have them. If you really want to get a head start in your stockbroking career then check out these other steps you should take while pursuing your career.

Jumpstart your career

Jumpstart your career by finding a mentor who can give you a push in stockbroking. You will learn some seriously vital skills and strategies which you will need in your future career and it also good support to have someone to call when you aren’t sure what direction to take. Try blogging and using social media to gain customers. Keep it simple but tweet and post about your career changes and earn followers through simple networking measures. If you can make it through the first years, the hardest years as a stockbroker then you are on the right track and don’t give up when it gets cloudy. Keep up the hard work and it will begin to pay off.

My Tips on Improving Your Finances for Life

There is no way to avoid dealing with money and finances these days. Therefore you should try to learn as much as possible to help you make good financial decisions and to increase your confidence about money.

When you make a budget, it should be realistic regarding your income and spending habits. Be sure to include all of your income such as alimony, child support, rental income, or any other. Always use your net income not your gross earnings in these calculations. Once you have the numbers, you can consider how to adjust your spending to stay within your income range. To maintain your budget never exceed your incoming cash flow.

The next step is to total up your expenses, and you should make a list of all monthly expenses. Your list should document each and every expense that you have whether it expense, spontaneous or just a one time expense. Remember that this list needs to have a complete breakdown of your costs. Be sure to add in expenses that you have from restaurant dinners and fast food as well as grocery bills. Reduce expenses linked to your cars, such as gas and insurance. If you have payments that you make quarterly or less frequently, divide them up to reflect a monthly payment. Make sure you include incidental expenses, for instance, baby sitters or storage unit rentals. Try to have the most accurate list possible.

Now that you have a good idea of your income and expenditures, you can start planning a new budget. Look at each expenditure on your list, and decide what you could do without. If you normally buy coffee from a cafe, calculate how much money you would save on a weekly basis if you bought it from McDonald’s instead, or made it at home. Exactly what and how much you are willing to compromise is completely up to you. The first step is identifying expenses that are not necessary so you can use the money for something else.

If your utility bills are rising, you may want to upgrade your appliances to save some money. Upgrading to well-fitted double-glazed windows, for example, can reduce your heating bill dramatically. Besides you can repair any leaky pipes and only run the dishwasher with a full load.

Swap old, inefficient appliances for those that use less energy. Although doing so may cost you some money upfront, over the long-term you will save a fair penny on your utility bills. Unplug the appliances you do not need. In time you will notice significant savings in your energy consumption.

You can make a significant decrease in your heating and cooling bills by improving your insulation, as well as the roof above it. Insulation or roofing issues can be very costly, as maintaining a regular temperature in the home can be expensive. If you invest in the upgrades, it will save you a lot of money in the long run.

Using these tips not only saves you money, but it also helps you start bringing your budget under control. An expensive upgrade can save a lot of money in lowering electricity or water bills. This is one way that you can make your budget more reliable.

Financial Skills – Writing Checks & Paying Bills

I was surprised when I asked parents to tell me the life skills they wish their kids knew, and there was a resounding request for a few topics:

  • How to open a bank account
  • How to budget & balance accounts
  • How to write checks and pay bills
  • And how to start saving for retirement

It seems some of the things we take for granted are, as a result, missing from what we teach kids.

In the last article, we focused on budgeting & balancing accounts. We even looked at games and contests you could set up for your kids. This article is the third article in the four-part series and will look at how to teach kids to write checks and pay bills.

Paying Bills

I was a bit surprised when several parents recently reported they had teens that were going to pay a bill by sending cash. I guess the obvious isn’t so obvious.

Paying bills is often done online, so it’s important to teach kids how to protect their identity online and store their login information where it can’t be stolen or accessed.

However, there are still quite a few companies that don’t offer online payments, and the only way to pay their bills is via check in the mail.

All kids should know why you NEVER send cash, and how to write a check specifically for paying a bill. For example: putting your account number and any other required details in the memo.

This brings us to the next topic: writing checks.

Writing Checks

When I was 12 years old, I went to outdoor ed. Oddly enough, part of the experience was that we could only write checks to buy goodies there, and our parents put a certain amount in our accounts so that we would also have to budget and balance our register.

Most of the kids were nervous! They weren’t sure how to fill out a check, and it was a great learning experience. I remember being nervous because we were required to fill out the amount in cursive, and I had trouble fitting it into the space.

These days, many kids never even think about writing checks because there are so many other means of transacting much more common; however, I’ve still found myself in need of checks for bills, paying contractors, and even helping me out of a pinch when I’ve forgotten my wallet.

Additionally, in my previous articles, I’ve expressed the dangers of using and relying on a debit card.

So how do you get your kids to learn how to write checks, and why would they care?

Getting Kids Involved

The best and most interactive way to teach kids to work a checkbook is to come up with a reason for them to write checks.

Here’s how it’s done:

Give your kids an old checkbook, play checkbook, or make your own (complete with a register). Then tell them in order to get certain things around the house, they’ll need to write checks. For example, to use their electronic device, there’s a rental fee that requires them to write you a check.

In addition, you can also give them a budget for the month to help them balance and budget their spending. You should balance a separate register so you can compare at the end of the month for accuracy.

Kids absolutely love this game.

Here are a few things you can charge for:

  1. Using electronic devices
  2. Watching TV (by the hour)
  3. Special snacks or treats
  4. Bicycle rental fee
  5. Getting out of a chore (limited usage)

At the end of the month, if your kids keep a positive balance they get a prize. If you have more than one kid, whoever is the most accurate in balancing their register can also get a prize.

Tips for beginners about Investment banking

Basically, investment financiers are the go betweens amongst investors and bankers with regards to stock. A venture financier plays out various administrations that help both the investors and the organization being referred to. This is the reason they are so vital to the monetary market. Here are a few things they do:

1. Buy and re-offer stock

This type of investment keeping money does not take after the customary way. These venture banks buy stock from organizations who have quite recently had their IPO (first sale of stock). In the following stride, these organizations offer it in the market at a higher cost to what they had already gotten it for. This is a noteworthy hazard, however because of their aptitude, they are typically fruitful at it. A portion of the biggest organizations on the planet are venture banks including JP Morgan, Morgan Stanley, Deutsche Bank, Barclays, and others.

2. Providing guidance to customers

The customers of a venture broker incorporate organizations, annuity stores, flexible investments, the legislature of its nation and other expansive monetary establishments. Investment banks give counsel with respect to what is the perfect stride that ought to be finished. The Chinese divider is an idea where there is a conflict between the counseling and exchanging divisions of the bank. It is significant that they keep up their autonomy else they won’t give suitable guidance to their customers.

3. Help discover investor for obligation financing

Obligation financing is a method for raising capital for ventures through corporate securities. Corporate securities are much harder to come to fruition, when contrasted with government securities. Thusly, investment brokers are expected to discover a customer for these corporate securities.

4. Financing substantial undertakings

Conventional banks are typically much littler than investment banks. This is because of the way that they don’t embrace extends as large as venture banks do. The main way that extensive tasks get financed other than an IPO and offering stocks is through a investment bank. This is the reason they are so essential for the working of the economy.