Axel Merk's Blog

Founder, Portfolio Manager
info [at] merkinvestments [dot] com ()

Axel G. Merk is the portfolio manager for the Merk Hard Currency Fund, a no-load mutual fund that provides U.S. investors with exposure to a basket of hard currencies from countries with strong monetary policies to seek protection against the depreciation of the U.S. dollar. He is also founder and president of Merk Investments, an independent investment advisor implementing growth, value, gold and cash strategies. He closely follows trends that affect world markets and watches global currencies with a macroeconomic approach focused on building long-term value for his clients. For more information, go to MerkFund.com.

U.S. Dollar: Don’t Worry, Be Happy

May we suggest a Twitter version of today's FOMC statement: "Don't worry, be happy!" – No, the economic outlook hasn't improved. In fact, the Fed may want you to take a valium to stomach the ride ahead.

Euro: Looks Like a Duck, Quacks Like a Duck

If it looks like a duck, quacks like a duck, it just might be a duck. We are talking about the euro: it now looks like a currency, acts like a currency, it might as well be yet another currency. The new framework of the European Central Bank (ECB) morphs the euro from a currency of nations to a currency of the United States of Europe.

Bernanke: To Print or Not to Print…?

To print or not to print? Odds are that Fed Chairman Bernanke has been contemplating this question while drafting his upcoming Jackson Hole speech. The one good thing about policy makers worldwide is that they may be fairly predictable.

Gold: Escape from Slavery

Vice President Joe Biden was accused of racism when suggesting a Romney administration would “unchain banks” that in turn might put the black audience he was talking to back into “shackles.”

Ryan: Boon or Bane for U.S. Dollar?

Good news: Vice Presidential candidate Paul Ryan may put the focus of the presidential campaign on the sustainability of the U.S. budget. Bad news: Ryan’s plan delivers some tough medicine; if the European experience is any guide, “austerity” makes bad politics. What are the implications for the U.S. dollar?

Euro to Beat Dollar? Draghi’s Genius

Investors have not woken up to it, but last week may have been a game changer. European Central Bank (ECB) President Draghi took tail risks out of the Eurozone, while at the same time forcing closer fiscal integration.

Gold at ECB: Accident or Strategy?

When the euro was launched, the European Central Bank (ECB) held approximately 15% of its assets in gold. That ratio has remained reasonably stable, giving rise to a variety of chatter, including suggestions that it may displace the U.S. dollar.

Currencies: from Nullifying to Negative

The once unthinkable might become policy: negative nominal interest rates. Investors should care as they may be increasingly punished for not taking risks. Yet masochistic investors believe they may be the prudent ones given the risks lurking in the markets.

Spain’s Molasses Jeopardizing Eurozone?

Spain's regional government debt is in focus again. Spanish 10-year government bond yields are trading near 7.5% as Spain’s central government is expected to bail out its regions – and in return may ask for a bailout itself.

Eurozone Needs Process, Not Money

Crises are always going to happen, but they are less stressful when sound institutional processes are in place. The most positive takeaway of the recent Eurozone summit was the announcement of an integrated supervisory mechanism as a precondition to any bank bailout.

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