A new global currency; the rise of the East; and peak oil

Episode 126: Alasdair Macleod interviews Erik Townsend – a specialist on “peak oil investing” and a contributor to the popular Financial Sense website.

Erik sees short-term strength in the dollar due to capital flight out of other markets. But long term, America’s problems will mount, and the country will need to address serious issues. This could result in the relatively-peaceful emergence of a new global currency system, but whether the central planners could avoid an inflationary collapse prior to such an event is questionable.

Both men muse on the reactions to the latest Fed comments, and how quickly markets react to perceptions of the stimulus “punch bowl” being withdrawn.

Erik sees a gradual long-term movement of wealth from West to East. The power games that surround this historical dynamic will affect the commodities market in intriguing ways.

The duo finish off with discussion of the energy section – one of Erik’s speciality subjects.

This podcast was recorded on 23 May 2013.

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Alasdair started his career as a stockbroker in 1970 on the London Stock Exchange. In those days, trainees learned everything: from making the tea, to corporate finance, to evaluating and dealing in equities and bonds. They learned rapidly through experience about things as diverse as mining shares and general economics. It was excellent training, and within nine years Alasdair had risen to become senior partner of his firm. Subsequently, Alasdair held positions at director level in investment management, and worked as a mutual fund manager. He also worked at a bank in Guernsey as an executive director. For most of his 40 years in the finance industry, Alasdair has been de-mystifying macro-economic events for his investing clients. The accumulation of this experience has convinced him that unsound monetary policies are the most destructive weapon governments use against the common man. Accordingly, his mission is to educate and inform the public in layman’s terms what governments do with money and how to protect themselves from the consequences.

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