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Should Australia Have a Shortage of Natural Gas or Cash?
he Americans continue to play silly buggers over their budget. It’s fantastic stuff to watch. Especially if you’re a ‘Deal or No Deal?’ fan, unlike us. Last night’s episode ended with ‘No Deal!’
Stocks dropped, gold plopped and bonds face planted. One bank after another is dumping bonds that pay interest or mature over the coming months. Last night it was Citigroup.
One interesting tid-bit of news on this topic is that commentator Marc Faber reckons, if push comes to shove, rather than balancing their budget by cutting spending, the politicians will ask the Federal Reserveto buy bonds directly from the government. That’s called ‘monetisation’ Weimar Republic style. It would break the 1913 law that created the Federal Reserve in the first place, but heck, when you make the laws, breaking laws isn’t a problem.
Sick of the American shutdown story? On to something new then. Fair warning though, the rest of this Daily Reckoning is going to be mighty unpopular. Even more so than yesterday’s housing bubble analysis. It’s all about the hidden opportunity in this image:
click to enlarge
Source: 5 Minute Forecast
If you can buy something for $3.15 in America and sell it for $16.40 in Mexico, should you? Not if you’re a patriotic Australian, as you’ll discover below.
Oddly enough, Australia is at the centre of the story the image is trying to tell, but we don’t even get a price label. Maybe that’s because there are some foul smelling goings on within our borders. We’re talking about the natural gas industry, of course.
‘Rip and reap, baby’ is for the wimpy resource cowboys of the past, reports The Age. ‘Rip, reap, hoard and flog overseas’ is the new motto of the Australian gas industry. And they’re infuriating the greenies, industry, politicians and every other busybody in the country. So, as a matter of principle, let’s give the scroungedrels some support.
Read the rest of this article at The Daily Reckoning
