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Saudi Arabia, Home Buying, Gold Stocks and “Priced for the Market”

Listeners’ Questions, Peter’s Answers Audio- May 17, 2012

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Joe from American Military, Germany
What do you think about Saudi Arabia only taking US dollars for their oil and do you think this will play out in the future of the dollar’s value?

William from Atlanta, GA
I’m thinking about buying a home for the purposes of living there a few years 5-6 and then selling it. The market for homes in Atlanta is rock bottom right now, and the population is exploding. I wonder if this can give me any comfort in hopefully selling the house when the time comes and not losing a lot of money or maybe even making some by buying low and selling when the market recovers if ever. Do you think it’s a wise decision?

Hardy from San Jose, CA
Why have gold stocks seemed to have lagged behind the metal so much, and when do you see a turnaround?

Mike from Orem, UT
I have heard you say several times that it wasn’t the increased spending and programs that pulled us out of the Great Depression but it was the decreased spending after the end of WWII that allowed us to get back on our feet. It is pretty hard to find any studies or papers that say anything contradicting to the New Deal and FDR. Are there any particular economists that have published papers or have done any studies on the subject?

Kevin from Platte City, MO
I often hear financial/economic analyst on financial networks say that things are “Already priced into the market”. Kudlow said this the other day in reference to Spain’s financial problems that are just now becoming visible. However, I think the phrase is over-used and not really the truth. For example, shouldn’t the market have already known that the employment numbers released on Good Friday were going to be lower than have been for the last several weeks? Surely, the markets didn’t need a “report” to realize this? Yet, the markets reacted immediately the following Monday as if they didn’t know a thing and that this was news to them. Are my suspicions correct here? Or are these analysts referring to something else that I am missing?