That tells me they expect interest rates to go above 3.63% sometime in the next 45 years. Tell'em they're dreaming.
They reckon they can make a higher rate of return than it is paying in interest. Half of it slated for investment firm Partners Capital, which already manages part of Eton's endowment fund and has delivered annual returns above 3.63 percent in the past. Keen to take advantage of historically low interest rates too. Also building new facilities and funding scholarships for "less privileged" students. Bursar Janet Walker said: 'Of course like any financial plan it may all go horribly awry but I suppose it looks like a good bet.' Daily Mail
Yes, but the whole world seems to be making the most of cheap money and my contrarian side is saying all this debt could be a problem in future. :|
Jim Rickards connections say this according to the Daily Reckoning. Worth a subscription - and free: http://www.dailyreckoning.com.au/subscribe-dr/
Yep, it's all about SDRs. And the Internet doom porn merchants hate this scenario because it is realistic and gradual, not a sudden apocalyptic reset. More from Rickards book The Big Drop when we discussed it here in August: http://forums.silverstackers.com/message-841464.html
Not convinced about the SDR thing. Would need more of a rundown on how they would work in the real world.
You mean, despite all the articles and books on how they work in the real world, and the fact that they have existed for nearly 50 years so you can read about how they work in the real world, you'd want a rundown on how they would work in the real world? We know how they work in the real world. The question is, could they take on far greater importance? That, of course, is speculation, but it does provide a reasonable path towards greater control.
Yes. My understanding is they have only been of limited use and I've not seen much on them myself. I don't see how big volumes of them will be traded for actual currencies to then use in the real world.
I guess what I mean is that in some next 'liquidity crisis' they can print them out the wazoo but that doesn't mean anything for liquidity. The market for SDR seems ad hoc. Liquidity is a function of markets itself not size. They could become something post crisis but they would need work to become so. I imagine they'd only be a help on the margin in a liquidity crisis.
More from Jim Rickards who seems to have become a resident commentator on the Daily Reckoning. Perhaps to answer the above, the SDR will have a gold component, (as Rickards has been saying), increased in value from current price, and local currencies valued against the new SDR and dependent on gold reserves and trade potentials. As he says below, immediate inflation in USD (ie effective devaulation of the current USD) and hence massive influence on trade and interest rate decisions. In the guise of 'curing inflation' interest rates rise massively - again as Rickard says, the 1970s scenario. The depression we'll have to have.
I've lost faith in Rickards after receiving a few of his newsletters. Seems to have sold out big time. Now that he has a frequent association with TDR, he's off my list.
