James G. Rickards
Encyclopedia
James G. Rickards is an American lawyer, economist and investment banker with 35 years of experience on Wall Street
, working in capital market
s. He is a writer and is a regular commentator on finance
and the emerging field of threat finance. Rickards advised clients of an impending financial collapse, of a decline in the dollar and a sharp rise in the price of gold, all years in advance. He believes the United States needs to go back to a gold standard
and was one of the first to promote this view. Rickards is the author of the New York Times bestseller "Currency Wars."
, New Jersey in 1969. He graduated from The Johns Hopkins University in 1973 with a B.A.
degree with honors and in 1974, from the Paul H. Nitze School of Advanced International Studies
in Washington, D.C. with an M.A.
in international economics. He received his Juris Doctor
from the University of Pennsylvania Law School
and an LL.M in taxation from New York University School of Law
.
In 1981, Rickards was involved in the Iran hostage crisis
and as former general counsel for the hedge fund
, Long-Term Capital Management
(LTCM), he was the principal negotiator in the 1998 bailout of LTCM by the Federal Reserve Bank of New York
.
Rickards worked on Wall Street for 35 years. In 2001, Rickards began using his financial expertise to aid the U.S. national security
community and the U.S. Department of Defense. From 2002 to 2006, he advised clients of an impending financial collapse, of a decline in the dollar and of a sharp rise in the price of gold, years before any of these events took place.
Rickards is now the senior managing director for market intelligence
at Omnis, Inc.
, a consulting firm. On March 24, 2009, Rickards presented his view at a symposium at Johns Hopkins, that the U.S. dollar is vulnerable to attack from foreign governments through accumulation of gold and establishment of a new global currency. The same week, Zhou Xiaochuan
, governor of the People’s Bank of China, called for a new currency to be introduced and operated by the International Monetary Fund
to replace the dollar as the basic unit of international commerce.
On September 10, 2009, Rickards testified before the U.S. House of Representatives about the risks of financial modeling
, VaR
and the 2008 financial crisis.
Rickards lives in Darien, Connecticut
, where he is on the Republican Town Committee.
. Rickards believes that it is inevitable that the U.S. will return to a gold standard and says the question is whether the process of returning to the gold standard will be a smooth process with public debate
, congressional hearings, commissions and government announcements that will enable markets to adjust or if it will be handled in a chaotic fashion with collateral damage
, civil unrest and some sort of domestic military operations. Rickards says currently, the U.S. is following the chaotic path. He says that a return to a gold standard would enable people to have confidence in the currency
because they would know they could convert their paper money to gold at any time and the government would make payment and this would keep the system honest. Rickards believes that on an open market
, the price of gold would be around $7,000 an ounce. He says the target price is between $5,000 and $10,000 per troy ounce
in current U.S. dollars.
, national security and global capital markets. He has written op-ed
columns for the Financial Times
, The New York Times
and The Washington Post
and has been interviewed in The Wall Street Journal
and on CNBC
, Fox News, CNN
, NPR
, Bloomberg
and C-Span
.
On the LTCM bailout and the late-2000s financial crisis
:
"What strikes me now, looking back, is how nothing was changed: no lessons were applied. Even though the lessons were obvious, in 1998. […] Regulatory oversight needed to be ramped up […] The government did just the opposite. Glass-Steagall was repealed in 1999, so that banks could become hedge funds. The U.S., in effect stared near-catastrophe in the eye, with LTCM, and decided to double down."
On national security
:
"A lot of my clients are in the national security area, so I work a lot with the [U.S.] Department of Defense and the Director of National Intelligence and others. We obviously spend a lot of time thinking about threats to national security. And I have spent a lot of time in the counter-terrorism
field and terrorist finance
and other aspects of that. And if I had to rank threats to national security, I would rank Ben Bernanke
above Osama bin Laden
. […] Ben Bernanke is not on the run. He's sitting in a very high office but he's actually a greater threat because of what he is doing to destroy the [U.S.] dollar."
On the Federal Reserve:
"I think there's a huge credibility problem to begin with. Here's the Federal Reserve that has done nothing right as far back as I can recall. They missed the tech bubble, they missed the housing bubble, they kept interest rates too low for too long and the [financial] crisis, they underestimated the severity of it. When the crisis hit, they had no idea it was going to get that bad. Then they over-reacted by giving too much money away on no conditions whatsoever
. And even to this day, they continue to believe the economy is getting better."
. In it, Rickards argues that currency wars are not just an economic or monetary concern, but a national security concern. He maintains that the United States is facing serious threats to its national security, from clandestine gold purchases by China to the hidden agendas of sovereign wealth funds and that greater than any single threat is the very real danger of the collapse of the dollar itself. Rickards explains what he calls "the greatest gamble in the history of finance," a sustained effort to stimulate the economy by printing money on a trillion-dollar scale.
Selected articles
Wall Street
Wall Street refers to the financial district of New York City, named after and centered on the eight-block-long street running from Broadway to South Street on the East River in Lower Manhattan. Over time, the term has become a metonym for the financial markets of the United States as a whole, or...
, working in capital market
Capital market
A capital market is a market for securities , where business enterprises and governments can raise long-term funds. It is defined as a market in which money is provided for periods longer than a year, as the raising of short-term funds takes place on other markets...
s. He is a writer and is a regular commentator on finance
Finance
"Finance" is often defined simply as the management of money or “funds” management Modern finance, however, is a family of business activity that includes the origination, marketing, and management of cash and money surrogates through a variety of capital accounts, instruments, and markets created...
and the emerging field of threat finance. Rickards advised clients of an impending financial collapse, of a decline in the dollar and a sharp rise in the price of gold, all years in advance. He believes the United States needs to go back to a gold standard
Gold standard
The gold standard is a monetary system in which the standard economic unit of account is a fixed mass of gold. There are distinct kinds of gold standard...
and was one of the first to promote this view. Rickards is the author of the New York Times bestseller "Currency Wars."
Biography
Rickards graduated from Cape May High School in Cape MayCape May
Cape May is a peninsula and island ; the southern tip of the island is the southernmost point of the state of New Jersey, United States. It runs southwards from the New Jersey mainland, separating Delaware Bay from the Atlantic Ocean...
, New Jersey in 1969. He graduated from The Johns Hopkins University in 1973 with a B.A.
Bachelor of Arts
A Bachelor of Arts , from the Latin artium baccalaureus, is a bachelor's degree awarded for an undergraduate course or program in either the liberal arts, the sciences, or both...
degree with honors and in 1974, from the Paul H. Nitze School of Advanced International Studies
Paul H. Nitze School of Advanced International Studies
The Paul H. Nitze School of Advanced International Studies , a division of Johns Hopkins University based in Washington, D.C., is one of the world's leading and most prestigious graduate schools devoted to the study of international affairs, economics, diplomacy, and policy research and...
in Washington, D.C. with an M.A.
Master of Arts (postgraduate)
A Master of Arts from the Latin Magister Artium, is a type of Master's degree awarded by universities in many countries. The M.A. is usually contrasted with the M.S. or M.Sc. degrees...
in international economics. He received his Juris Doctor
Juris Doctor
Juris Doctor is a professional doctorate and first professional graduate degree in law.The degree was first awarded by Harvard University in the United States in the late 19th century and was created as a modern version of the old European doctor of law degree Juris Doctor (see etymology and...
from the University of Pennsylvania Law School
University of Pennsylvania Law School
The University of Pennsylvania Law School, located in Philadelphia, Pennsylvania, is the law school of the University of Pennsylvania. A member of the Ivy League, it is among the oldest and most selective law schools in the nation. It is currently ranked 7th overall by U.S. News & World Report,...
and an LL.M in taxation from New York University School of Law
New York University School of Law
The New York University School of Law is the law school of New York University. Established in 1835, the school offers the J.D., LL.M., and J.S.D. degrees in law, and is located in Greenwich Village, in the New York City borough of Manhattan....
.
In 1981, Rickards was involved in the Iran hostage crisis
Iran hostage crisis
The Iran hostage crisis was a diplomatic crisis between Iran and the United States where 52 Americans were held hostage for 444 days from November 4, 1979 to January 20, 1981, after a group of Islamist students and militants took over the American Embassy in Tehran in support of the Iranian...
and as former general counsel for the hedge fund
Hedge fund
A hedge fund is a private pool of capital actively managed by an investment adviser. Hedge funds are only open for investment to a limited number of accredited or qualified investors who meet criteria set by regulators. These investors can be institutions, such as pension funds, university...
, Long-Term Capital Management
Long-Term Capital Management
Long-Term Capital Management L.P. was a speculative hedge fund based in Greenwich, Connecticut that utilized absolute-return trading strategies combined with high leverage...
(LTCM), he was the principal negotiator in the 1998 bailout of LTCM by the Federal Reserve Bank of New York
Federal Reserve Bank of New York
The Federal Reserve Bank of New York is one of the 12 Federal Reserve Banks of the United States. It is located at 33 Liberty Street, New York, NY. It is responsible for the Second District of the Federal Reserve System, which encompasses New York state, the 12 northern counties of New Jersey,...
.
Rickards worked on Wall Street for 35 years. In 2001, Rickards began using his financial expertise to aid the U.S. national security
National security
National security is the requirement to maintain the survival of the state through the use of economic, diplomacy, power projection and political power. The concept developed mostly in the United States of America after World War II...
community and the U.S. Department of Defense. From 2002 to 2006, he advised clients of an impending financial collapse, of a decline in the dollar and of a sharp rise in the price of gold, years before any of these events took place.
Rickards is now the senior managing director for market intelligence
Market intelligence
Market intelligence can refer to*Marketing Intelligence - commercial information for marketing purposes*Market Intelligence - a form of market research and analysis...
at Omnis, Inc.
Omnis, Inc.
Omnis, Inc. is a technical and scientific consulting and training firm. It also has a concentration in market intelligence and the emerging field of threat finance. It was founded in 2004 and has clients in government, academia and private industry....
, a consulting firm. On March 24, 2009, Rickards presented his view at a symposium at Johns Hopkins, that the U.S. dollar is vulnerable to attack from foreign governments through accumulation of gold and establishment of a new global currency. The same week, Zhou Xiaochuan
Zhou Xiaochuan
Zhou Xiaochuan is a Chinese economist, banker, reformist and bureaucrat. As governor of the People's Bank of China since December 2002, he has been in charge of the monetary policy of the People's Republic of China....
, governor of the People’s Bank of China, called for a new currency to be introduced and operated by the International Monetary Fund
International Monetary Fund
The International Monetary Fund is an organization of 187 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world...
to replace the dollar as the basic unit of international commerce.
On September 10, 2009, Rickards testified before the U.S. House of Representatives about the risks of financial modeling
Financial modeling
Financial modeling is the task of building an abstract representation of a financial decision making situation. This is a mathematical model designed to represent the performance of a financial asset or a portfolio, of a business, a project, or any other investment...
, VaR
Var
Var, VAR, VAr, VaR or var can mean:VAR* Varna Airport IATA airport code* Vacuum arc remelting, a process for production of steel and special alloys...
and the 2008 financial crisis.
Rickards lives in Darien, Connecticut
Darien, Connecticut
Darien is a town in Fairfield County, Connecticut, United States. A relatively small community on Connecticut's "Gold Coast", the population was 20,732 at the 2010 census. Darien was listed at #9 at CNN Money's list of "top-earning towns" in the United States as of 2011...
, where he is on the Republican Town Committee.
Gold standard
Rickards was one of the first to say that the United States should return to a gold standard, which would be more stable than fiat moneyFiat money
Fiat money is money that has value only because of government regulation or law. The term derives from the Latin fiat, meaning "let it be done", as such money is established by government decree. Where fiat money is used as currency, the term fiat currency is used.Fiat money originated in 11th...
. Rickards believes that it is inevitable that the U.S. will return to a gold standard and says the question is whether the process of returning to the gold standard will be a smooth process with public debate
Public debate
Public debate is a formal style of debate. Two teams of two compete through six rounds of argument, giving persuasive speeches on a particular topic.- Pre-Debate :...
, congressional hearings, commissions and government announcements that will enable markets to adjust or if it will be handled in a chaotic fashion with collateral damage
Collateral damage
Collateral damage is damage to people or property that is unintended or incidental to the intended outcome. The phrase is prevalently used as an euphemism for civilian casualties of a military action.-Etymology:...
, civil unrest and some sort of domestic military operations. Rickards says currently, the U.S. is following the chaotic path. He says that a return to a gold standard would enable people to have confidence in the currency
Currency
In economics, currency refers to a generally accepted medium of exchange. These are usually the coins and banknotes of a particular government, which comprise the physical aspects of a nation's money supply...
because they would know they could convert their paper money to gold at any time and the government would make payment and this would keep the system honest. Rickards believes that on an open market
Open market
The term open market is used generally to refer to a situation close to free trade and in a more specific technical sense to interbank trade in securities.-Use of the term in economic theory:...
, the price of gold would be around $7,000 an ounce. He says the target price is between $5,000 and $10,000 per troy ounce
Troy ounce
The troy ounce is a unit of imperial measure. In the present day it is most commonly used to gauge the weight of precious metals. One troy ounce is nowadays defined as exactly 0.0311034768 kg = 31.1034768 g. There are approximately 32.1507466 troy oz in 1 kg...
in current U.S. dollars.
Quotes
Rickards writes and speaks on geopoliticsGeopolitics
Geopolitics, from Greek Γη and Πολιτική in broad terms, is a theory that describes the relation between politics and territory whether on local or international scale....
, national security and global capital markets. He has written op-ed
Op-ed
An op-ed, abbreviated from opposite the editorial page , is a newspaper article that expresses the opinions of a named writer who is usually unaffiliated with the newspaper's editorial board...
columns for the Financial Times
Financial Times
The Financial Times is an international business newspaper. It is a morning daily newspaper published in London and printed in 24 cities around the world. Its primary rival is the Wall Street Journal, published in New York City....
, The New York Times
The New York Times
The New York Times is an American daily newspaper founded and continuously published in New York City since 1851. The New York Times has won 106 Pulitzer Prizes, the most of any news organization...
and The Washington Post
The Washington Post
The Washington Post is Washington, D.C.'s largest newspaper and its oldest still-existing paper, founded in 1877. Located in the capital of the United States, The Post has a particular emphasis on national politics. D.C., Maryland, and Virginia editions are printed for daily circulation...
and has been interviewed in The Wall Street Journal
The Wall Street Journal
The Wall Street Journal is an American English-language international daily newspaper. It is published in New York City by Dow Jones & Company, a division of News Corporation, along with the Asian and European editions of the Journal....
and on CNBC
CNBC
CNBC is a satellite and cable television business news channel in the U.S., owned and operated by NBCUniversal. The network and its international spinoffs cover business headlines and provide live coverage of financial markets. The combined reach of CNBC and its siblings is 390 million viewers...
, Fox News, CNN
CNN
Cable News Network is a U.S. cable news channel founded in 1980 by Ted Turner. Upon its launch, CNN was the first channel to provide 24-hour television news coverage, and the first all-news television channel in the United States...
, NPR
NPR
NPR, formerly National Public Radio, is a privately and publicly funded non-profit membership media organization that serves as a national syndicator to a network of 900 public radio stations in the United States. NPR was created in 1970, following congressional passage of the Public Broadcasting...
, Bloomberg
Bloomberg L.P.
Bloomberg L.P. is an American privately held financial software, media, and data company. Bloomberg makes up one third of the $16 billion global financial data market with estimated revenue of $6.9 billion. Bloomberg L.P...
and C-Span
C-SPAN
C-SPAN , an acronym for Cable-Satellite Public Affairs Network, is an American cable television network that offers coverage of federal government proceedings and other public affairs programming via its three television channels , one radio station and a group of websites that provide streaming...
.
On the LTCM bailout and the late-2000s financial crisis
Late-2000s financial crisis
The late-2000s financial crisis is considered by many economists to be the worst financial crisis since the Great Depression of the 1930s...
:
"What strikes me now, looking back, is how nothing was changed: no lessons were applied. Even though the lessons were obvious, in 1998. […] Regulatory oversight needed to be ramped up […] The government did just the opposite. Glass-Steagall was repealed in 1999, so that banks could become hedge funds. The U.S., in effect stared near-catastrophe in the eye, with LTCM, and decided to double down."
On national security
National security
National security is the requirement to maintain the survival of the state through the use of economic, diplomacy, power projection and political power. The concept developed mostly in the United States of America after World War II...
:
"A lot of my clients are in the national security area, so I work a lot with the [U.S.] Department of Defense and the Director of National Intelligence and others. We obviously spend a lot of time thinking about threats to national security. And I have spent a lot of time in the counter-terrorism
Counter-terrorism
Counter-terrorism is the practices, tactics, techniques, and strategies that governments, militaries, police departments and corporations adopt to prevent or in response to terrorist threats and/or acts, both real and imputed.The tactic of terrorism is available to insurgents and governments...
field and terrorist finance
Terrorist Financing
Terrorist financing came into limelight after the events of terrorism on 9/11. The US passed the USA PATRIOT Act to, among other reasons, attempt thwarting the financing of terrorism and anti-money laundering making sure these were given some sort of adequate focus by US financial institutions...
and other aspects of that. And if I had to rank threats to national security, I would rank Ben Bernanke
Ben Bernanke
Ben Shalom Bernanke is an American economist, and the current Chairman of the Federal Reserve, the central bank of the United States. During his tenure as Chairman, Bernanke has overseen the response of the Federal Reserve to late-2000s financial crisis....
above Osama bin Laden
Osama bin Laden
Osama bin Mohammed bin Awad bin Laden was the founder of the militant Islamist organization Al-Qaeda, the jihadist organization responsible for the September 11 attacks on the United States and numerous other mass-casualty attacks against civilian and military targets...
. […] Ben Bernanke is not on the run. He's sitting in a very high office but he's actually a greater threat because of what he is doing to destroy the [U.S.] dollar."
On the Federal Reserve:
"I think there's a huge credibility problem to begin with. Here's the Federal Reserve that has done nothing right as far back as I can recall. They missed the tech bubble, they missed the housing bubble, they kept interest rates too low for too long and the [financial] crisis, they underestimated the severity of it. When the crisis hit, they had no idea it was going to get that bad. Then they over-reacted by giving too much money away on no conditions whatsoever
Term Asset-Backed Securities Loan Facility
The Term Asset-Backed Securities Loan Facility is a program created by the U.S. Federal Reserve to spur consumer credit lending. The program was announced on November 25, 2008 and was to support the issuance of asset-backed securities collateralized by student loans, auto loans, credit card...
. And even to this day, they continue to believe the economy is getting better."
Publications
Rickards' first book, Currency Wars: The Making of the Next Global Crisis was published on November 10, 2011 by Portfolio, an imprint of Penguin GroupPenguin Group
The Penguin Group is a trade book publisher, the largest in the world , having overtaken Random House in 2009. The Penguin Group is the name of the incorporated division of parent Pearson PLC that oversees these publishing operations...
. In it, Rickards argues that currency wars are not just an economic or monetary concern, but a national security concern. He maintains that the United States is facing serious threats to its national security, from clandestine gold purchases by China to the hidden agendas of sovereign wealth funds and that greater than any single threat is the very real danger of the collapse of the dollar itself. Rickards explains what he calls "the greatest gamble in the history of finance," a sustained effort to stimulate the economy by printing money on a trillion-dollar scale.
Selected articles
- James G. Rickards, "A Mountain, Overlooked" The Washington Post (October 2, 2008). Retrieved May 16, 2011
- Charles Duelfer and Jim Rickards, "Financial Time Bombs" The New York Times (December 20, 2008). Retrieved May 16, 2011
- James Rickards, "How markets attacked the Greek piñata" The Financial Times (February 11, 2010). Retrieved May 16, 2011
External links
- Lori Ann LaRocco, Interview with Jim Rickards CNBCCNBCCNBC is a satellite and cable television business news channel in the U.S., owned and operated by NBCUniversal. The network and its international spinoffs cover business headlines and provide live coverage of financial markets. The combined reach of CNBC and its siblings is 390 million viewers...
(January 13, 2011). Retrieved May 14, 2011 - Ron Hera, "Interview: Jim Rickards on Inflation and Currency Wars" Financial Sense (February 4, 2011). Retrieved May 14, 2011
- Jim Rickards - "Just like the 1930s" YouTube. (March 19, 2011). Retrieved May 14, 2011
- "Jim Rickards on Quantitative Easing… Currency War… Inflation… Political Instability" Fiat Collapse blog, with video link to Rickards on Fox News (January 29, 2011). Retrieved May 14, 2011
- Currency Wars on Amazon
- Currency Wars on Barnes and Noble