ShareBuilder Young Investor Starter Kit

ShareBuilder Young Investor Starter Kit

The ShareBuilder Young Investor Starter Kit encourages an early start to long-term investing with a little iTunes incentive to make it fun. With financial news and advice from Young Money & Money Magazine along with education tools to help track performance online with ShareBuilder. The Young Investor Starter Kit is a great gift for someone in their early investing years.

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Gold The Once and Future Money

Gold The Once and Future Money

For most of the last three millennia, the world’s commercial centers have used one or another variant of a gold standard. It should be one of the best understood of human institutions, but it’s not. It’s one of the worst understood, by both its advocates and detractors. Though it has been spurned by governments many times, this has never been due to a fault of gold to serve its duty, but because governments had other plans for their currencies beyond maintaining their stability. And so, says Nathan Lewis, there is no reason to believe that the great monetary successes of the past four centuries, and indeed the past four millennia, could not be recreated in the next four centuries. In Gold, he makes a forceful, well-documented case for a worldwide return to the gold standard.

Governments and central bankers around the world today unanimously agree on the desirability of stable money, ever more so after some monetary disaster has reduced yet another economy to smoking ruins. Lewis shows how gold provides the stability needed to foster greater prosperity and productivity throughout the world. He offers an insightful look at money in all its forms, from the seventh century B.C. to the present day, explaining in straightforward layman’s terms the effects of inflation, deflation, and floating currencies along with their effect on prices, wages, taxes, and debt. He explains how the circulation of money is regulated by central banks and, in the process, demystifies the concepts of supply, demand, and the value of currency. And he illustrates how higher taxes diminish productivity, trade, and the stability of money. Lewis also provides an entertaining history of U.S. money and offers a sobering look at recent currency crises around the world, including the Asian monetary crisis of the late 1990s and the devastating currency devaluations in Russia, China, Mexico, and Yugoslavia.

Lewis’s ultimate conclusion is simple but powerful: gold has been adopted as money because it works. The gold standard produced decades and even centuries of stable money and economic abundance. If history is a guide, it will be done again.

Nathan Lewis was formerly the chief international economist of a firm that provided investment research for institutions. He now works for an asset management company based in New York. Lewis has written for the Financial Times, Asian Wall Street Journal, Japan Times, Pravda, and other publications. He has appeared on financial television in the United States, Japan, and the Middle East.

User Ratings and Reviews

5 Stars The Most Important Book on Money
First, it is disheartening that there are not even more positive reviews on this book considering the times that we exist in with the Federal Reserve purposefully destroying the value of the dollar. This book is really important on understanding that a dollar is meant as a storage of value, and not as a tool to inflict trade wars or inflate your way out of debt, therefore the gold standard is the best way of maintaining that storage value throughout time.

This book advocates the correct gold standard which is pegging the dollar to a gold ounce, such as using a 10 year moving average of gold prices to find an average price of gold or as an example say it takes $500 dollars to buy 1 ounce of gold. This allows the Federal Reserve to contract or expand the number of dollars in the economy to maintain that gold peg (less dollars are needed in a contracting economy and more dollars are needed in a growing economy to conduct transactions, both situations can be accommodated by maintaining the gold peg and the storage value of a dollar stays the same no matter what.) Those who advocate a “hard gold standard”, aka using only gold coins, do not understand the gold standard and are usually just the constant doom and gloom types.

So, I would strongly recommend this book if you want to know why a dollar is worth less than it was 30 years ago or now just 6 years ago or how monetary policy plays out across the world. This book uses the best teaching method, which teaches through economic history so you can learn what really caused the Asian Crisis of the 90’s, or Japan’s Stagnation, or our own hyperinflation of the 70’s.

Finally, if you really enjoyed this book I recommend reading The Way the World Works, 20th Anniversary Edition (Gateway Contemporary) this is the fiscal side of the government equation. If you read these two books, you will know more than 99% of the politicians who are supposed to be running our economy and will greatly help in making your own profitable investment decisions.

4 Stars Yes, it’s long. That’s what makes it a great history book.
This is a great book discussing the reasons why Gold will be the ultimate monetary standard and why an individual should consider making gold a part of his personal portfolio. However, the people looking for an investment guide should look elsewhere. This is a history book discussing the possible future of the gold standard in America by historical example from the US and select countries.

It doesn’t take 400+ pages to give you reasons why to put some of your money into gold, but this kind of historical detail helps a potential gold buyer understand the yellow metal is not so much an investment as it is an insurance policy. This book reinforced my already skeptical leanings towards the Fed and US monetary policy. It also made me wonder what’s being taught in high school history nowadays with respect to economics as it relates to the causes of war. The sections discussing the civil war and WWII in particular were great gap-fillers for me, and the authors explanation of the Japanese financial slump made perfect sense.

Importantly, the author makes it clear on page 114-155 that he does not advocate a 100% gold-backed currency. That is, it is not possible and we should not be expected to back every last dollar with gold. Rather, gold should be part of the system to include a convertibility aspect. The strength of the gold standard comes not from digging up gold and burying it again in government vaults, but from the strength of the governments promise to uphold the integrity of the monetary system. A fixed reserve requirement would assist this promise tremendously. Currently, there is little to reassure anyone of the validity of the “full faith and credit” we now depend upon.

The sections discussing IMF and the upheaval for which they are responsible should be required reading for all members of congress. The IMF is directly responsible for the Asian monetary crisis, the Balkan upheaval and countless other disasters and yet they escape blame every time. The author points out the IMFs hypocritical habit of meddling in less-developed countries with ridiculous and irresponsible policies that would be laughed out of the room in stable economies.

Though the author picks apart nearly every US administration with regard to the dismantling of the gold standard, the book is refreshingly bare of the usual tin-foil-hat-wearer conspiracy theories - always a problem when reading anything about gold standards and monetary policy in general.

There are two small negatives to this book: First, the look forward suggested by the author is highly unrealistic. I pessimistically think there needs to be outright economic collapse and perhaps even conflict before anything will budge bureaucratic inertia. Second would be the books length, but that’s a small price to pay for a very worthwhile history lesson.

Overall its a great read.

5 Stars absolute must read
This book is absolutely unbelievable vuluable and probably worth paying 1000$ for it (or should I say, 1 oz of gold!).

Not only does it explain in details what the gold standard is, and how it has worked in the past, but it also gives a very good overview of the various currency systems used in the past, the various fallacies about currencies, gold, politics, economics schools, etc.

It also reviews the history of our society through a different angle/lens. I feel like I understand the history now, and all the crises, wars, chaos that seemed to come out of nowhere has found a rational and sensible explanation. I had turned off my TV set and my radio receiver about 10 years ago, stopped reading the news papers and any other kind of useless noise, and all of the sudden, the world makes sense again.

Unfortunately, ignorance is bless…

Many thanks to Nathan Lewis for sharing his knowledge and wisdom. I just wish that the book was twice as thick, so that you could go into more details about the causes and consequences of the various policies and actions taken by the governments or the IMF, etc. because sometimes the short cuts you take are more than hard to follow and even though I think I was able to follow you, I would have preferred to be sure about it.

3 Stars Conceptually good, but too detailed for my liking
The book starts and finishes strong–the first 100 pages or so and the last 50. But the middle gets very bogged down in intricate economic history with lots of minutiae. The author begins in the mercantile ages, perhaps the 1600s or thereabouts, and continues to the early 2000s. I was disappointed that the last few years were pretty much not covered, as that is what I’m most interested in. Discussion is not limited to the USA and covers the entire world. I think every economic event, significant or not, was touched on. Discussions of US presidents are mostly limited to Nixon, Carter, and Reagan.

So aside from the start and finish of this, this is mostly a book of economic history. Maybe I was expecting something otherwise when I picked it up. I support the author’s premise, and he seems very confident in it. I’m new to the gold standard and I plan to learn more about it. I ended up skimming the middle 200 pages or so as I could not bear to read them in depth anymore after entering them. I understand that history is important for lessons, but I prefer summaries of it. It’s never been my strong point, and this book is littered with dates and years that have always been anathema to me.

If you’re new to the subject of the gold standard like me, this may not be the best initial choice. Or you might want to skip it entirely and instead seek other books or shorter articles online. This review might be somewhat useless, but if anything I would say to be mindful of the history in this book. Consider using Amazon’s preview feature to see what I mean.

*Wow, coincidentally it’s unbelievable how much I’m in agreement with Average Joe. I also have “The Coming Collapse of the Dollar” on my reading queue.

4 Stars Insightful but Left with Unanswered Questions
Good Insights But Unconvincing

Fiat money serves three purposes: legal tender, token for exchange and store of value. The author seems to propose a money system pegged to gold and believes that it will serve to stabilize the value of the paper money as the value of gold is relative stable in the long run. The author argues that, under the new gold based money standard, the value of paper money can be maintained through adjusting the money supply, possibly by the central bank. The author also believes that a gold-based money system is better than commodity-basket based system or a currency board system exchange system. The author points out that there is an inherent conflict between a country’s domestic monetary policy in terms of maintaining an interest target and its foreign exchange policy in terms of keeping a fixed exchange rate.

The question that is not clearly answered is how the supply and demand of gold, and therefore related fluctuations of gold price/value, affects the value of money and the equilibrium between money supply and demand. Equally important and not clearly answered is how a country using the proposed gold-pegged money can defense itself against currency attack by speculators. When there is sell-off of the currency, according to the author, the central bank needs to retire the excess currency (money supply) it took in from people for exchanging gold. This is to maintain the value of the paper money pegged to gold. Reducing money supply seems to push up interest rate and restrain economic growth. A large scale currency attack may also push up gold price as the demand of gold for exchanging the currency intensifies. To keep the pegging creditable, the central bank has to exchange gold for the currency when it is demanded. The central bank either has to keep a gold reserve large enough or buy/borrow gold from the market. To buy gold, the central bank may have to borrow foreign currency (hard currency) to do so, especially when its currency is under attack (weak). Then the problem is essentially no difference than the familiar one we have seeing for a currency-pegging exchange system except the author claims that the value of gold, in the long run, is more stable than all paper money including “hard currencies” such as the dollar, pounds, etc. The author claimed that if the central bank maintains its credibility, then it does not need to keep a large gold reserve. However, if the credibility is better or at least as good as gold, we wouldn’t need a gold-pegging or any pegging system. The whole idea to have the money pegged on something is because that people believe the value of that “something” in itself is stable.

As society has not find any universal stable measurement for “value” as we did for length and weight, we just don’t have a stable media to store the value. Actually length and weight are only relatively stable under normal conditions on earth. The light of speed is probably the only constant in the universe we know so far. The value of gold, just like all other currencies and commodities, changes when the supply and demand fluctuates. It may be arguably more stable than other paper money. Nevertheless, it does not totally eliminate some major problems faced by the paper money. Plus, gold system may have its own problems. Is it immune from short-term speculations that could bring down a nation’s economy?

Overall, I found the book valuable in providing a lot of economic insights on historical events. But I found the argument for a gold-pegged standard as the solution unconvincing. The ultimate solution may be, when globalization reaches its summit, one world currency is created. Then there is no currency risk. Only business cycles need to be dealt with. Then the money does not have to be pegged on anything except people’s faith in the stability and survivability of themselves and responsible management on money supply. When there are multiple currencies, good management of and consistency among policies of exchange, monetary, and fiscal seem to be the gold standard demanded.

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Great Minds of Business Investing

Great Minds of Business Investing

Legendary investor Peter Lynch, who managed Fidelity’s Magellan Fund during the 13 years when it racked up record gains, sits for a one-on-one interview with financial editor Gretchen Morgenson in this video produced by Forbes magazine. Lynch’s basic approach to investing is that opportunity exists all over, and he has always stressed that practical research into a company’s potential can make virtually anyone a great investor. Know what the companies do, Lynch stresses, noting, “You should be able to explain to a 10-year-old in three minutes why you own a stock.” If you don’t understand a company, Lynch notes, when the stock goes down you don’t know whether to add to your position or get out entirely. Lynch is not a believer in fast riches, noting that while you can lose money fast by investing recklessly, your best returns will really accumulate after several years of owning a stock. Throughout the interview, Lynch gives good practical advice, and his down-to-earth manner will give confidence to those who may be thinking of investing but aren’t quite sure how to begin. Even experienced investors will benefit from the stories from his career that Lynch imparts in this highly informative video. –Robert J. McNamara

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Ruffs Little Book of Big Fortunes in Gold and Silver A Middle Class License to Print Money

Ruffs Little Book of Big Fortunes in Gold and Silver A Middle Class License to Print Money

“Ignoring gold and silver this year will cost you more than all the dumb financial decisions you can make put together.”

Ruff’s Little Book of Big Fortunes in Gold and Silver is not written for Wall Street, but for Main Street.

It is a detailed guide to a once-in-a-lifetime chance for middle-class Americans to get rich investing in one of history’s greatest bull markets. Ruff makes a usually arcane subject easy to understand, and even humorous. This bull market will dwarf even the 500% to 1700% profits his readers made in the metals in the 70s, and as usual, Ruff is out in front.

As Yogi Berra said, “It’s déjà vu all over again.”

This small book is deliberately designed to teach the investment novice exactly what to do as the bull market unfolds, including why, how and where to buy precious metals and mining stocks - as well as how to avoid costly mistakes. It is also an essential review for dedicated gold bugs to help them in this new and ever-changing market.

User Ratings and Reviews

3 Stars A good beginner’s guide
From my point of view, this book is generally good but the contents are too brief.

5 Stars Printing money
This is a very informative book for those who don’t understand the system or conformation for those that do. It confirmed what I thought I had known for 35 years. I highly recommend it.

5 Stars “RIGHT ON THE MONEY!”
Mr. Ruff is right on the money (or gold). In a short and succinct volume he lays out the rationale for owning gold investments ( physical as well as gold stocks) In these perilous times, his book is a veritable ‘Bible” on owning precious metals. His “down home” style of writing adds to the enjoyment as well. The book is not for the professorial type and academic but for the middle class American who simply wants to know WHY he should have gold and silver in his portfolio. I would like to recommend a wonderful website for gold investments that will add to the information in his book: WWW.GOLD-ULTIMATESAFETY.NET. Highly recommended!

4 Stars Good read for the gold and silver investor
The book is mostly, though not at all exclusively, about silver investing. The first half of the book makes the case for owning the precious metals. While interesting, it has little to do with investing.

I did find some valuable information about silver.

I found a few problems with what Ruff says. He, and many authors on this topic, make the same mistakes. He suggests the investor use ETFs if they want to. ETFs that specialize in gold and sliver and the like, are great. But what so many people do not know and fail to report is that they are not treated like investments by the IRS. So when you sell, you pay 28% because the IRS treats gold and silver as collectibles. With cap gains, they charge the regular lower cap gains rate if you hold an asset over one year.

So when an author makes a glaring mistake like this, I question some of the other things he says. For example, he says that ALL GOLD COIN sales are reportable to the IRS unless they’re semi-numismatic. That’s not true.

While I’d want you to verify what I say, it’s my understanding that you can own gold or silver American Eagles without any reporting being done when you buy or sell (unless the amount you sell meets certain criteria.)

The California Numismatic Investments has a report on its site, which says in part:

First: You can place any size order and pay with a check. No one cares, not even the government. The only time they want to hear from us is if you invest more than $10,000 in cash. Then you must fill out I.R.S. Form 8300. There is nothing wrong with large cash transactions, but the government wants to know about them. And, by the way, you can’t spend $5000 today and $6000 tomorrow, for Uncle Sam does not like to be fooled.

Second: There are rules which apply only to bullion and only when you sell. They have nothing to do with your purchases, and do not apply to rare coins. Kilo bars are 32.15 troy ounces of gold and are subject to reporting. We are also required to report any gold bar sale totaling 32.15 ounces are more. Concerning 1 troy oz. gold coin transactions: If you sell 25 coins or more of the Krugerrand, Maple Leaf or Mexican Gold Onza we are required to report them on I.R.S. Form 1099B. Such reporting is not required on transactions involving the U.S. Gold Eagle the Australian Kangaroo or the Austrian Philharmonic. There is also no reporting on any small gold bullion coins.

Third: We are required to report $1000 face 90% silver bags and 1000 ounce silver bar transactions only when you sell to us. We are not asked to report the sale of 40% bags or less than $1000 face in 90% silver coin. The 10 and 1 ounce silver bar is exempt as long as the sale does not exceed 1000 ounces.”

Another gold company says, “Totally Private Gold, Non-Reportable - We keep all American Eagle transactions strictly private and do not report your the purchase or sales of American Eagle gold coins to the IRS or any government agency.”

I bring these issues in only to point out that the author may not be totally correct in his information and that the reader should study other material. When you start investing in gold or anything, you enter legal areas that can complicate your life. You also meet up with unsavory sorts who tell you numerous lies. I’ve run into several. So you should know the real truth and not what a few ill-informed people say.

Ruff doesn’t really go into what to buy to a large degree. But for the person just getting into gold or silver investing, I recommend this book as a good starting point.

4 Stars Ruff’s Little Book of Big Fortunes in Gold & Silver
Another wonderful EZ to read book by our long time advisor, Howard Ruff. The message is always the same and it is refreshing to learn that we are still on the same track or trail. I’m loaning my copy to my friends who are a bit behind times but are anxious to learn how to save themselves from the big flush and I don’t mean anything about playing cards or action in the bathroom.

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Investment Portfolio ARM

Investment Portfolio ARM

Difficult to track monitor your transaction of stocks ?

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