Posted by Eric Solis on December 29, 2010 under Banking, Financial Crisis, General, Global/International, U.S. Treasury Markets, Uncategorized | 
Oil Prices-Surrogate Interest Rate; Low rates are the problem not the solution.
Oil is priced more like a bond than a commodity. As interest rates go down, prices of oil rise and as interest rates go up, oil prices fall. Why is this important? Because the Federal Reserve is choosing to leave interest rates at or near zero to keep oil prices artificially high. The result of this is that money that is being funneled to OPEC could be going to the American people by way of lower gas prices at the pump, heating oil and lower consumer prices. The distribution of freed up capital as a result of lower oil prices is far reaching when prices drop. The economic benefit hits the economy immediately and is spread far and wide across all socio economic classes. Low interest rates on the other hand, unevenly distribute relief to those persons owning assets which require financing in particular BANKS. The problem is that in an economic climate where savings not debt is the required behavior; lower interest rates are a bastardized strategy towards stimulating economic growth.
Even more disconcerting is that low interest rates are essentially a vehicle for funneling money to OPEC by way of artificially high interest rates. What do I mean by this? Think about it this way. If interest rates were to increase to 5% which is the historical average for 100 years, then oil would drop back to 1990 levels. Think about a world today with $1 gas prices at the pump and natural gas bills for heating your home cut by 65%.
This would distribute 100’s of billions of dollars immediately and tangibly right into the pockets of the American people. Instead what the government is doing is keeping rates at zero; so that oil prices remain high and thereby American consumers are channeling these hundreds of billions of dollars to Saudi Arabia instead. The other benefactor to this strategy is the BANKS. Since they borrow at 0%, they are basically getting free money at the direct expense to the consumer. The consumer is getting hoodwinked into thinking that low interest rates are stimulative to the economy. But you need not be an economist to determine that the supposed tsunami of capital that the government has injected through fiscal and monetary policy, is NOT finding its way into the hands of consumers. In fact it is being sucked out of the pockets of consumers by way of an artificially high oil price. This tax on consumers is then monetized by way of printing more dollars and then loaned to banks at zero percent.
IMHO
Posted by Eric Solis on February 6, 2010 under Banking, Financial Crisis, General, Investment Strategies, Prophetic Visions, Saving & Investing, Stewardship/Spiritual/Finance, Stock Market, U.S. Treasury Markets |
Eric wrote this article while sitting at his desk in 1997, staring out the window gazing upon the San Jacinto Mountains in Indian Wells Ca. God gave Eric a vision for what was to come in the future of our country. Read with amazement the accuracy of the vision and get ahead of the curve as we are only half way through the events to come. Eric had his entire client base load up on gold at under $300 an ounce (to be stored in their homes in a safe), he steered them into commodities, had them pay off their mortgages and eliminated all credit card debt as a result of this vision. He also saw that the only way to stop this coming economic catharsis was for Americans to save more. He launched www.savedaily.com and www.save252.com in 1999 and 2005 respectively in pursuit of creating solutions to this coming disaster. fall-of-capitalism-092319971
Posted by Eric Solis on August 10, 2009 under Financial Crisis, Investment Strategies, Public Policy, Saving & Investing, Stock Market |
With all of the chaos in the world of finance, I was recently asked to appear on Fox News kttv_s2521, to discuss financial principals that would work for the average American in today’s uncertain world.
I spoke on issues regarding the impact that the global financial crisis and economic meltdown can have on you, your family and your wallet. I postulate a strong belief that now is the time to reclaim our country; together we can “buy America back one dollar at a time, one day at a time, and one person at a time” through an increased National savings rate and personal stewardship.
I am an unwavering champion of the “little guy”. My goal is to create sustainable financial solutions for all of man kind by thinking differently and being willing to do the hard work of breaking down barriers (and believe me it is not easy).
This interview demonstrates how a highly complex financial breakdown can be utilized as an opportunity to improve on your personal vision and financial goals.
Now watch the interview kttv_s2521 and pass it along to family and friends. Also, remember to post a comment when you are done as your feedback is important to me.
God bless,
Eric
Posted by Eric Solis on November 17, 2008 under Banking, Financial Crisis, General, Housing & Mortgage, Housing & Real Estate, Investment Strategies, Saving & Investing, Stewardship/Spiritual/Finance, Stock Market, U.S. Treasury Markets |
I recently appeared as the featured guest in a 10-minute segment on KTLA’s Morning News. We discussed some solutions for braving these rough economic times. Have a look at the video below …
KTLA Morning News appearance
