More Of The Same... And That Isn't Good

The Daily Reckoning

Weekend Edition

August 18-19, 2001

Paris, France

By Addison Wiggin

MARKET REVIEW: More Of The Same…And That Isn’t Good

Yikes: “Profit warnings” from across the board – Dell one of the mighty techs, and the Gap, the equally mightyretailer – plus layoff announcements at Ford and badnews from the Commerce department about the currentaccount deficit all conspired to beat up on stocksFriday.

The Dow recovered 53 points late in the session to close down a measly 151… to 10,240. The Nasdaq tumbled 63 to1867 – wiping out all of the gains from this spring’slate bear ‘suckers’ rally. The S&P 500 shed 19 to 1161.

Investor hopes for a corporate profit revival in late
2001 are waning…

THIS WEEK in THE DAILY RECKONING

Week 3 of the Bonner Vacation features among other notables James Grant, founder and editor of Grant’sInterest Rate Observer: http://www.grantspub.com

08/17/01 THE SWEET NOTHINGS OF A TOASTER OVEN
by Daniel Denning

“…Wall Street has made a living from offering painfully generic investment advice to the entirecountry…and the results have been disastrous for many.If your investment goals are ambitious, there ARE waysto achieve them…but only with better-targetedsolutions…”

08/16/01 THE SECOND MOST POWERFUL MAN IN THE WORLD
by James Grant

“…Greenspan, having failed to call a bubble a bubble, was slow to recognize a bust as a bust…he refused towaver from his previously established line, thetransforming significance of new technologies.[Greenspan]never understood the problem. This defectdoes not mean he will never hit on the solution. What itdoes suggest, however, is that he will come to itbelatedly, and likely for the wrong reasons…”

08/15/01 GREENSPAN’S PEAK WAS NASDAQ’S
by James Grant

“…Insofar as Greenspan leads the market, it is a case of a one-eyed man leading people with two. Perhaps,after they refresh themselves on the chairman’s errantjudgment – especially off the beam on the eve of the2000 stock-market peak – the sighted will have moreconfidence in their own judgment…”

08/14/01 ‘FOOL ME TWICE’
by Fred Hickey

“…Don’t be suckered by the Street’s latest high-tech hype. Last year, the [semiconductor] trains brought thedupes to the slaughterhouse instead of the promised landof plenty. Trillions of dollars of wealth were destroyedand trillions more will be destroyed later on this year,once the train cars are packed full…”

08/13/01 TRAFFIC ACCIDENTS
by Bill Bonner

“…The Theory of Ignorance maintains that people know a whole lot less than they think they know. But as someonehas observed, it’s not what they don’t know that getsthem into trouble, but what they think they know thatain’t so…”

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HEADLINE, NEWS And INSIGHT:

Return To The First World
by Kathleen Peddicord

I travel regularly in Latin America. Everywhere I go, I ask the expats I meet how they came to be where theyare. They all tell similar stories. They left the Statesto escape taxes, crime, and government. They wanted abetter qualify of life. A lower cost of living. Betterweather. And, of course…a little adventure. Article

The Next Enemy
by Doug Casey

Although there’s no innate reason for a conflict between the US and the Islamic world, the odds are high therewill be. Boobus Americanus has been programmed for ageneration to see Muslims as The Enemy. The USgovernment consistently supports Israel, which theMuslims view as an outlaw, terrorist state. Are thesefears at all founded in reality?.

Angel? No Devil
by Harry Schultz

It’s the creation of Applied Digital Solutions, Inc. It’s a “convergent” technology, combining the mostadvanced innovations from a range of medical & hi-techareas-sensory & bio-sensory, micro-electromechanicalsystems, real time wireless transmission, GPS &miniaturization-into a single under-the-skin microchipimplant. But what are its implications for privacy?

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FLOTSAM AND JETSAM: Thoughts on Personal Privacy

– from John Pugsley,

Chairman, The Sovereign Society

“… throughout July, the tabloids and talk shows have bubbled with gossip about the disappearance ofWashington intern Shandra Levy.

While I have zero interest in her affair with U.S. Congressman Gary Condit, or even her disappearance, theevents surrounding the case remind me that in the UnitedStates – and in all high-tax democracies – the beliefthat our actions are private is a dangerous illusion.Our lives are private only until the government decidesto look.

The news reports revealed that the FBI has recovered a reasonably detailed history of Levy’s private life: hermovements, her bank records, credit card records, andphone records, including a call detail identifying thesource and destination of every incoming or outgoingcall. No doubt, the government now knows more aboutShandra Levy’s life than her parents, Condit or anyoneelse.

In the name of efficiency and crime-fighting (in particular, the phony War on Drugs), our normal use ofeveryday services-banks, phones, mail, the Internet,roads and even the trash-collection services-leaves anearly indelible trail. Governments are keenlyinterested in making certain that they always haveaccess to this trail. This surveillance technology isexpanding at a frightening pace. Video cameras nowmonitor streets, highways and even shopping malls. Face-recognition technology scans crowds and identifiesindividuals.

A new generation of high-tech surveillance comesfittingly from Singapore; one of the world’s mostefficient surveillance states. Scientists there havedeveloped software that promises to identify suspiciousindividuals before they commit a crime. And beyond that,a future generation of surveillance technology promisesto implant identity chips in humans. If only ShandraLevy had one of these implanted in her, governmentapologists might say, surely she would have been foundby now.

In contrast, in countries where taxation is low or non-existent, the state has neither the reason nor the meansto monitor citizens’ activities. These jurisdictionshave no need to develop domestic intelligence-gatheringagencies or keep dossiers on private citizens…”

Enjoy your weekend…

Addison Wiggin,

The Daily Reckoning

p.s. For key financial strategies emphasizing maximum financial privacy, off-shore – and otherwise – please visit…

The Sovereign Society