The End of QE2: Major Policy Shift Ahead

This week’s Outside the Box is from my friend David Galland, an interview he did for The Casey Report, and it represents a philosophical train of thought more in line with Austrian economics and libertarianism than my own. But if we only read what we already think, then how do we learn? It is only when your ideas are challenged and you must determine why the other guys are wrong and you are right, that you can either become more firm in your beliefs, or change. And much of what David says in this interview resonates. (I wrote about the end of QE2 a few weeks ago.)

The guys at Casey are natural resources, commodities, and precious metals investors. Yet David argues that cash might be the wise thing now, after pounding the table for years on gold. He believes that the end of QE2 will be more important and dramatic than most think. That it is coming to an end I have no doubt, so it is important to think about what the effects, if any, will be. There are those who argue that we can live without it now. I argued (and still do) that we should have never had it. The unintended consequences are the ones I worry about. We just don’t know. It was a crazy experiment, with no understanding of what would really happen. But hoping for the best is not a strategy, so let’s think about it. David provides us with some different ways to look at the process.

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Last, a housekeeping item. I “fat-fingered” my inbox and lost about a hundred emails from the last three months or so, which I planned to get around to, but now they are buried in about 25,000 deleted files. (It’s what happens when you don’t touch-type and have to look at the keyboard. Yes, I know…) One way to clean out your inbox I guess, but if I owe you something, you might want to drop me a note again.

Your already buried with 75 new emails in a few hours analyst,

John Mauldin, Editor
Outside the Box

subscribers@mauldineconomics.com

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The Casey Report’s David Galland: The End of QE2: Major Policy Shift Ahead

(Interviewed by Louis James, Editor, International Speculator)

Editor’s Note: David Galland, Casey Research partner and managing editor of The Casey Report, sees a major shift in Federal Reserve policy ahead and has advice on how to invest accordingly. Time is short, so we’ve asked David to share his thoughts with us.

L: David, in recent editorials you’ve warned of what could…