Interest Rate Hike – The First Measure to Correct the American Economy

US federal reserve buildingIt’s been long overdue, according to many financial analysts, but the US Fed has finally begun cleaning house. A series of interest rate rises, meant to rebalance what has become a structurally distorted financial setting, is under way. But is it too little, too late? The decision from Yellen & Co. was met by mixed reactions from economists, with some claiming the correction being insufficient to stave off another financial crisis.

The Fed went ahead and raised rates after a number of warnings from the Office of Financial Research, tasked by the US Treasury to evaluate the nation’s financial health. In its stability reports, the OFR points to an increasingly unstable financial system due to years of low interest rates. You would think such a statement would cause massive panic among speculators and the general population, but because the distortion has mainly emerged in non-conventional niches, and because there’s an election going on, not too many seem to have taken notice. The last economic crisis was triggered by the collapsing housing market and the financial sector itself – banks and investment firms. The Democratic administration sought to heavily regulate these sectors after the great debacle of 2008, but has simultaneously allowed other credit bubbles to inflate in a similar manner.

It appears the chickens have come home to roost, because there’s an overall concern that these artificial inflations have grown too big for higher rates to have any correcting impact. Instead, we could be facing another cycle of financial defaults that could potentially spread across markets and destabilize the global economy once more. This couldn’t have come at a worse time for the investors, who in the last years have purchased long-term assets that carry greater risk. There’s a large number of investment portfolios out there that suddenly find themselves extremely vulnerable to rate increases, including the big banks.

financial market reactions

After the last recession, many of the banks that were either bailed out by the taxpayers, or made it out the other end fairly unscathed by their own means, started putting their funds in the capital market. As the capital naturally finds its way back to the banks and the Fed, it becomes much harder to regulate the price of currency on both domestic and global markets.

While no one argues against the decision to implement the rate hikes, it’s the pace of them that has investors and money lenders on edge. The Fed needs to ensure the markets that prices of the dollar is climbing at an adaptable rate in order to avoid financial havoc in terms of bond yields and defaults. Four raises have been scheduled so far, and will have to be implemented while keeping a close eye on market reactions. Whether the Fed manages to successfully correct the system, or trigger another economic recession, remains to be seen, and will require just as much luck as financial savvy.

federal reserve seal

Gold Bars for Sale – Where Do They Come from and Why Do We Desire Them So Much?

gold nuggetAs Walter Emerson famously wrote: “The desire for gold is not for gold. It is for the means of freedom and benefit.”

Ancient myths describe gold as a metal with mystical properties, sent to Earth by the Gods above. The old Sumerian scrolls depict an entire culture where gold was the foundation of society and the most desired metal in the known world. The same can be said for the Incan, Mayan and Aztec kingdoms in Latin America. They used gold in everything from ritual ornaments, jewelry and currency for trade. When the Europeans discovered the new land across the ocean, and its massive riches, the hunt for the precious metal sparked an unprecedented gold rush that ultimately led to the conquest of the continent.

Whenever there’s been an advanced civilization present, there’s always been a great demand for gold. This legacy has endured throughout the ages. While nations and empires have risen and fallen, the desire to own gold has remained until this very day. Gold bars for sale is still one of the most wanted commodities on international markets, with investors and financial institutions spending billions each year on purchasing the metal for economic profit and political power. When the global economy faces a crisis, the qualities and historical value of physical gold bars make them a highly sought-after price for anyone who wishes to maintain a financial leverage in precipitous times. While paper money and company shares become sinking vessels, the price of gold bars for sale tends to climb to soaring heights. The desire for gold is universal, creating an everlasting high demand in all countries and guaranteeing its value and purchasing power.

a wealth of physical gold

Investing in gold bars used to be restricted to big banks and millionaires. But with the rise of the worldwide web, finding gold bars for sale has also become available to private investors and everyday people looking to diversify their funds in the precious metal. Anyone can go online and setup a gold investment account for profit and financial security. There are plenty of gold companies to choose from these days, enabling you to buy gold bars from all corners of the planet. At bright golden future, you will find one of the highest rated gold providers online that offers both gold bars for sale and home delivery as well as stored in a self-directed individual retirement account. Whether you decide to store your gold bars in your personal safe or kept in a secure storage facility with a trusted custodian, keeping a healthy supply of gold remains one of the best options to simultaneously insure your wealth and generating good profits over longer time periods. You can increase your gold supply whenever the price goes down, only to put up your gold bars for sale at a later date. By keeping a close eye on gold’s market performance, an investor can start buying and selling gold bars with a fairly small startup amount. The profit generated from your sales will be reinvested in more gold bars for sale. This way, your gold supply can keep growing at a steady pace while producing enough income for you to live on. Any market crash or financial recession will only benefit you, as your wealth will remain intact and the price of your gold bars will only go up further.

gold bars and coins for sale

The value of gold and the consistent demand for gold bars for sale are both based in mankind’s history and the evolution of our earliest societies. Gold has been with us for a long, long time and our desire for its unique qualities dates back many thousands of years. The metal itself is far older than us. Researchers have found compelling evidence that gold was first deposited on Earth by meteorites containing large amounts of metals that rained down a couple of hundred million years after our planet was initially formed. As our newborn home began to take its original shape, most of its heavy metal deposits started to sink down into its core, including the majority of its gold reserves. There’s actually enough precious metals in the Earth’s core to cover its surface many times over, only we can’t get to it.

But if most of the planet’s gold can be found at its center, where does the metal used in all our gold bars, coins and jewelry come from? Fortunately, the original meteorite storm that hit Earth was followed by a second one once the core had been fully formed. This time, the precious metals didn’t sink that deep, but were instead deposited in our planet’s outer layers. As a result, we have our current gold mines that provide us with all the available resources until we figure out a way to extract metals from our central core. It may not be as abundant as in the middle, but there’s still plenty of gold in the Earth’s mantle. Scientists estimate that about 20 billion times a billion tons hit during the last event, resulting in most of the gold and other rare metals that our economy and industries rely upon today. One day, that gold will run out, as we haven’t been subjected to any major meteorite collisions lately, which has to be considered as a blessing from the skies. Another golden shower would refill our precious metal supply but would also be devastating for us as a thriving species. As the gold deposits in the Earth’s mantle are being depleted, scientists begin to look to its origins to replenish our resources: outer space. With new unmanned expeditions to the outer rims of our solar system and beyond, there’s a good chance we’ll stumble across some gold and platinum asteroids in the process.

gold treasure

Until then, we’ll have to make due with what nature has given us on our own home planet. Gold is plentiful but ironically enough also rare, resulting in a rather strange paradox that only boosts its already mystical reputation. It seems like the old legends about gold being sent down from the heavens are true, and gold bars for sale are just as desired in modern times as they were 5,000 years ago. It’s the metal of choice for both gods and mortals alike, and will outlast us all. The gold bars you buy today will not only last you until you retire but will be here long after you’re gone from this world – just like the Sumerian treasures outlived them.

The Creation of Earth: How Planets are Formed

planet earthThe Earth, that blue beacon of light in the empty vastness of space. It is the only planet in our solar system able to sustain life and as far as we know, the only terrestrial body in the Milky Way to be inhabited by an intelligent species. It’s been here for billions of years, with a wide diversity of plants and animal life in different ecosystems that make our planet truly unique in our little corner of the universe.

Scientists studying our planet’s history generally adhere to one out of two possible theories of how the Earth was created. The most widely accepted idea is known as the core accretion theory and it starts with the forming of our sun. 5 billion years ago, there was no sun, only a giant cloud of gas and particles. Trapped in an ocean of cosmic currents and pushed by gravitational forces, this solar nebula slowly began to gather in a centralized point, eventually forming the sun. According to the law of gravity, larger bodies attract smaller ones, and that is exactly what happened to the sun. Tiny dust particles gathered into bigger clouds. As the solar winds gradually eliminated lighter gases from the immediate surrounding space, only the heavy particles remained. These continued to coalesce until entire solid planets like the Earth were formed, along with comets, asteroids and moons. Farther out in our solar system, the effects of solar winds had less of an impact on lighter elements, creating gas giants such as Jupiter and Saturn.

our solar system

Our planet’s core was the first to take shape, created by an unceasing barrage of colliding heavy particles. The surrounding lighter materials formed the Earth’s crust, and the least heavy elements laid down the early foundation for our atmosphere. At some point, another large body crashed into Earth, ripping off big pieces and blasting them into space. They didn’t get very far, however, as they got caught in our gravity field. Just like our planet, these parts were drawn together into a single, solid mass. This is how we got our Moon.

The planet’s center of gravity keeps the mantle under the top layers liquid and in constant motion. The never-ending flow beneath the crust makes the rocky surface shift and move. Ever so often, cracks appear and gases are released into the atmosphere. This, in combination with icy asteroids hitting the Earth and creating our water supply, is directly responsible for creating an environment suited for the evolution of life.

While this theory works very well in explaining the formation of Earth and its closest neighbors, it has a harder time to quantify the creation of gas giants. This lead researchers to come up with a secondary theory of how planets are made: the disk instability model.

The model revolves around gas giants being able to gather particles at a much faster rate than terrestrial bodies due to them mostly consisting of lighter and more volatile substances. Rather than their core developing over the course of millions of years, gas giants have the potential to form in a matter of millennia. As soon as a sufficiently stable mass is formed, gases like helium are easily drawn to the planet as the sun hurls them in its path. Scientists are still in disagreement which of the two theories applies to the creation of our planet, although the majority lean towards the former. The study of our solar system is a work in process and as we find new facts and collect more data, our understanding of our place in the universe continues to evolve.

the cosmos