Ian Mathias

“Transfer payments have reached a higher share of personal income than interest and dividend income,” notes Rob Parenteau, highlighting another issue that plagues I.O.U.S.A.

“Together, that means over 30% of the U.S. personal income flows are now being earned for no increase in work devoted to production of goods and services (although we do recognize loans earning interest may, in fact, finance increased production, rather than financial market speculation). The more people get paid without directly producing goods and services, the higher the inflationary bias likely to arise in an economy. Purchasing power without production is another, perhaps more accurate, way of depicting the old saw about ‘too much money chasing too few goods.’

phpXljNzo

“People spending money who did not produce anything to get the money — now, that’s a recipe for inflation. In this regard, the major rise in transfer payments from 1966-76 may have played a role in the original onset of the stagflationary ’70s, while the surge in interest income from 1978-82 may have contributed to the second wave of stagflation. Higher money incomes without increased production tends to lead to higher prices, unless, of course, saving rates among money income recipients rise sufficiently.”

Rob will once again bring his comprehensive brand of economic analysis to this year’s Investment Symposium. He’s just one of many not-to-be-missed speakers… check out our impressive lineup, here.

Ian Mathias

Ian Mathias is the managing editor of Agora Financial's Income Franchise, where he writes and researches about retirement, dividend and fixed income investing. Much of his work is featured in The Daily Reckoning and Lifetime Income Report, Agora Financial's flagship income investing advisory.  

Previously, Ian managed The 5 Min. Forecast, a fun, fast-paced daily look into the future of global markets and macroeconomics. He's also worked in public relations, where media outlets like Forbes, AP, Yahoo! and MSN Money have syndicated his writing. If he's not at work, you'll probably find Ian on a bicycle, racing up and down the "mountains" of Baltimore County. Ian has a BA from Loyola University in Maryland. 

Recent Articles

Addison Wiggin
One World, One Bank, One Currency

Addison Wiggin

After the 2008 financial crisis, little could be heard over the deafening cries of "mission accomplished." And while the Fed's massive QE program seemed to work, the question remains: for how long? Addison Wiggin explains why the next round of QE will fail miserably, paving the way for the IMF to step in with something called "special drawing rights." Read on...


Who’s Really Profiting from Drone Tech and How to Join Them

Wayne Mulligan

Despite what you hear in the mainstream news, the commercial market for small drones could eventually dwarf the military one. In fact, it’s already happening. This is a big market, and it's getting bigger by the day. Today, Wayne Mulligan explains how to get in on the ground floor. Read on...


2 Simple Charts that Will Help Improve Your Portfolio

Greg Guenthner

While a traditional "buy and hold" investment strategy can be a good way to make money in the long run, it's by no means the only way. For those investors who dismiss technical trading as a "witchcraft" and impossible to figure out, Greg Guenthner has just two charts to show you that could completely alter how you feel about trading stock market trends. Read on...


Why America Needs More Tax Inversion

Clem Chambers

American citizens aren’t the only ones fleeing the country because they don’t like the direction it’s headed. Corporations expatriate for similar reasons. So why are companies desperate enough about corporate tax to leave the U.S., the champion of freedom and enterprise? Clem Chambers explains here...


Video
Floating Exchange Rates are Causing a “Race to the Bottom”

Kate Incontrera

Milton Friedman is roundly regarded as one of the great economists of the 20th century. But his view of the Bretton Woods system was all wrong. And the current mess of floating exchange rates proves that. Today, Lewis Lehrman explains how the current monetary system pits every country against each other in a financial "race to the bottom"...