The latest buzz word to join those most-hated headline grabbing words that editors love is post-truth. We are now in an era of appeals to our emotions as the evidence is swept away by a tide of nationalism. We have had two world wars driven by nationalism. Do we really want another?
Basic economics tell us that supply and demand dictate prices. The current over-supply of oil has reduced the price to under $50 a barrel but is this rule always true and what drives demand? If everyone gets a pay rise, demand is increased but where does the money come from? All money comes from central banks, of course, and so it is the central banks that create demand by printing money.
This week I’ve been following the progress of the oil well at Horse Hill near Gatwick which has been flow-tested with good results. It’s producing about 450 barrels a day which is good for all the small companies involved. For Solo Oil, this is another investment to bring in revenue. (more…)
A Featured post by Mike Maynard (editor).
I like this photo, it looks like they are suspended in mid-air. I took a few photos last weekend at Tipton Carnival and was hoping to photograph Willenhall Carnival yesterday, but the rain came… (more…)
Differing investments have different risks. The higher the risk the bigger the return investors expect. A savings account at a bank in the UK is protected by a government guarantee up to £85,000 and so there is little risk. The returns though are often less than inflation, which is a negative return in real terms. (more…)
Buying in a bear market
When there are more sellers than buyers in the market, traders call it a bear market and when the buyers outnumber the sellers, they call it a bull market. This appears to be a bear market; but the government is buying back it’s bonds by ‘printing’ money. What will the financial institutions do with the new money they get from selling bonds? I think they are buying shares in the markets again but being very selective. I have bought shares in another company that is making a loss; the Royal Bank of Scotland Group.
If you burn paper money, do you destroy it? The answer is technically, no. The value of money is all about supply and demand and so if you burn a 50 pounds note, a 50 dollar note or a 50 Euro note; you are decreasing demand and making all the rest of the money in circulation more valuable. You may be destroying one note, but you aren’t destroying overall value! The Bank of England is currently doing the opposite, creating rather than destroying money but in doing so they are increasing demand and so making the money already in circulation less valuable. (more…)