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Gold 75% Underowned In 20 Years, Or Exter's Pyramid For Gen X/Y
Paul Kedrosky has posted an informative chart from JPM's Michael Cembalest indicating that ownership of gold in dilutable terms (aka dollars), as a portion of global financial assets has declined from17% in 1982 to just 4% in 2009. And even thought the price of gold has double in the time period, as has the amount of investible gold, the massive expansion in all other dollar-denominated assets has drowned out the true worth of gold. Were gold to have kept a constant proportion-to-financial asset ratio over the years, the price of gold would have to be well over $5,000/ounce.
Of course, the chart above pales in comparison with the true Exter pyramid, which incorporates all those wonderful JPM/Goldman inventions known as derivatives, amounting to $1.8 quadrillion, which certainly did not exist in 1982. If one were to factor the above table to include this Exter securitized credit money as well, then the true constant worth of gold would be well north of $10,000.
h/t Adam
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That's probably enough about gold now - these last few days. Yawn....
Holder?
There is never enough. You should know that by now. And remember, if GLD goes lower, its a VICTORY FOR THE BULLS.
Why is it a victory for the bulls if GLD trades lower ? I am unable to understand this.
That's because your IQ is 145.
LMAO
IQ 145, he is actually, delicately, trying to tell you that physical gold will go up, GLD probably not so much if the rumors are true (and seem to be, that GLD and their custodians and sub-custodians DO NOT have the physical they claim to).
Uncle Fester was, of course, my favorite character in The Addams Family.
Money put into GLD is supposedly used to short physical. Sort of like a Ponzi scheme that will blow up really, really badly.
you were supposed to just give him clues, then he'd figure it out with his 145 IQ
he may also have a PhD
Because all the gold bugs can keep buying and averaging down from the 12xx high which they bought into.
I see more liquidation through the next great flush of hedge funds shopping any liquid asset to meet liquidation requests and margin calls - don't know low price. And next a slow then parabolic move to acquire hard assets as the toilet paper currencies get used for...toilet paper.
I just tried a Franklin, too rough. Am saving for the winter to be used as kindling.
I can remember the day that Nixon took us off the gold standard. I was a kid, but can remember how irate my dad got. He was so sure of the eminent collapse of the financial system that he stocked up on toilet paper. He bought pallet loads of it. Enough, he calculated to last the rest of his life. He had grown up in the great depression, and did not want to ever go back to corn shucks. The day he brought his TP score home, happened to be the day my mom had all the ladies over for bridge party. Well, my dad starts unloading the truck and tracking through the bridge party bringing the TP in. Ladies all laughed at him, and he told them they would not be laughing when they had to wipe their be-hinds with corn husks. The collapse he was anticipating did not happen. I went on and had a normal life, although I always remembered the lessons my dad taught . . . never borrow money, never waste anything, always buy hard assets, never trust the bank or a banker, never trust someone selling financial advice, work hard, choose a career that you make or do something people need. Funny thing as I read zero hedge . . . it is just like sitting around my dinner table in the 60's and 70's. In the end, I don't think my dad was wrong, I think he just underestimated the amount of time the ponzi scheme could continue. Again, I led a normal life despite the rather unique (for the time) perspective my dad had, but I do think that we are approaching the point that the ponzi scheme collapses.
Great story!
Ditto, great story! And you always had enough toilet paper.
cheers on the little story, smokey!
Your dad is my hero!
My dad taught me about scams and hustles (small time pool player when I was little), mainly how to avoid them, but even he got taken in by the great ponzi (401k). One of the great life lessons a father can share with his son, if it sounds to good to be true, it is. We have all been amazed by the skill in which the ponzi has been kept in the air, so have to give them that. Looking at history I would have thought it would have crashed pre Volker to, at least now we know we are to far down the tracks for them to pull a Volker.
My dad passed away last month, peacefully, with his family at his side, and full of years. He did not live to see the collapse he had anticipated, but he did live to see gold at $1200, and the banking crisis pretty much confirmed his thesis in 1971 was right.
R.I.P.
Sorry for your loss. Wish I had a dad like that! That was a very funny story!
But a Jackson could be used as an ass-on too!
Yah SuperDollaR, bring back 'specie' and I'd be all over the USD.
Rebel, nice perspective.
Regards
Nice story.
cool story bro
You know, my dad was also furious and predicted a crash. Same story minus the toilet paper.
How do you use your corn shucks now?
Mrs. Rebel makes tamales from corn shucks, as they were intended to be used.
I think you're missing an opportunity here - cooking them makes them a lot softer. Hence, they might make a heavenly TP. Let me know how that works out.
It could be a bs internet story, but it read well, at least. The problem with thinking that you will be around for some major historical event is that major historical events occur so rarely.
-1
I guess trolls define history differently than the sincere.
My dad showed me a silver certificate and a federal reserve note and said one was money and one was not, back when Kennedy was squabbling with the Fed.
The lesson is that when you prepare for a crash by stocking up on guns, food, and toilet paper, when the crash doesn't come...hey, you've still got guns, food, and toilet paper. It's win-win!
Except gold was at a record high when the DOW hit 6500. So don't hold your breath on gold suddenly behaving like something other than sound money.
Never underestimate the power of junk. My 401K is up to 1,263,865 orange crayons. CPI in orange crayons doesn't look too bad! Can't buy a gallon of gasoline or a steak for less than 500 of them, but plastic purple hippos made in China can be had for only ten!
i just spit water all over my laptop
thank you. i needed that laugh
U sure tha was just H2O?
I am not Chumba Bumba Numba Rotumba or anyone else
Fucking hilarious!!
We need more comedians amongst all this doom and gloom.
I'm here all week...
try the veal - and don't forget to tip your waitress...
..try the veal!
Those hippos don't last for shit...Word!
word
And next a slow then parabolic move to acquire hard assets as the toilet paper currencies get used for...toilet paper.
Oh, no you don't!
http://moneytipcentral.com/wp-content/uploads/2009/03/zim-dollars-toilet...
Yes, I'm hoping for another 2008 selloff as good assets are sold to prop up bad ones. The 14-day RSI has been a pretty reliable indicator of places to buy on the way up. Daily is heading toward oversold but weekly still has plenty of room to go down.
Blythe Masters. Thank you.
LOLOL...
Thank God someone gets this joke.
FYI; I believe an ex-Merrill Lynch-er junked me.
I get it now after I googled it. I thought you just lit up a cigar or something.
...Dutch Masters...kidding...my head hurts....
Take your finger out of your eye...Just sayin'.
http://www.booktv.org/Watch/10527/Fools+Gold+How+the+Bold+Dream+of+a+Sma...
Essentially its a statement that the world economy has been inflationary for 20+ years; and this has not been reflected in the gold price, (actually the currency price); Having lived and speculated and studied through this period I intuitively believe this is so; but of course, I can't demonstrate it. Reality will let us know.
But of course it hasn't and it's not. That's the beauty of running a fractional reserve fiat currency global ponzi scheme complete with a perpetually running printing press and with no cops on the beat.
Sorry, but the only cops on this scale are the BRICs and the Middle East. Remind me again...where is our Navy parked?
"Our" navy?
Touche'
That's the beauty of running a fractional reserve fiat currency global ponzi scheme complete with a perpetually running printing press and with no cops on the beat.
That is why its time for a citizens arrest.
Starring: Torches and Pitchforks!
http://www.youtube.com/watch?v=Zw5pmDgWMaU
Ponzis don't collapse because the cops find out about them. Ponzis collapse because the laws of mathematics find out about them. The greatest conceit of the 20th century is that the government can use fiat to nullify math.
"Were gold to have kept a constant proportion-to-financial asset ratio over the years, the price of gold would have to be well over $5,000/ounce."
Or, conversely, the price of all of the other financial assets should tumble precipitously.
That is the same thing. The dollars have to go somewhere, and if everything but gold sells off, the money HAS to go into gold. That is, unless they are banished back to the aether from which they were first conjured.
Hence, Exeters Pyramid!
"The dollars have to go somewhere"
Yeah, they're going to money heaven, NOT into other assets. This is a variant of the "cash on the sidelines" fallacy.
You are confusing money and wealth. Here's a good discussion of the issue: http://mises.org/daily/4507
Even if they are destroyed or hoarded (for some reason), gold still goes up in value, as the total amount invested in gold grows in percentage terms.
And no, no-one is going to hold onto just dollars. At least, they won't after the FDIC collapses taking the entire banking sector with it. The fees for the next three years have already been collected by the FDIC, and they have already used them all on bank seizures. They will be forced to raise their rates over and over again until banks are forced to charge people to take their deposits. That's right, negative interest rates. It's closer than you think.
If people are forced to physically hold cash, why not do it in something that is going to hold its value against debasement, which will be widely apparent to the general public by that point?
A negative interest rate is just another name for a tax. A tax - payable in fiat currency - on holding fiat currency - they don't know when to stop.
Look my dear, Cash[Printed]is only 4 trillion dollars
Rest is all hocus pocus, ben bernanke will need all the trees in amazon to print cash for all the 2 quadrillion 'things'
Don't bust TMosely's retard bubble, he told me dollars are so plentiful they are coming out the toilets. I said why are people not paying their mortgage if they have plenty of dollars? Of course there was dead silence next.
He has some type of brain injury. He thinks people have tons of money right now.
Hahahahaha
It doesn't _have_ to go into gold. Gold is not the only storage of value. There are other tangible assets that can be used. Barter economy here we come...
I guesstimated gold @ $10,000 / oz on thedailybell.com, and I was pretty well right on, using the world GDP @ $50T / all the gold ever mined (and not currently dressing up middle fingers or transferring signals on RCA jacks).
Only once the global debt bubble is completely deflated, will you know what anything is really worth.
So are all you guys going to be massively rich then?
Some of us. Others will be desperately poor.
Hahahaha... he is sitting in his trailer with 30 oz of gold saying how rich is going to be.
"Rich" is such a relative term. In the end it will be your interaction with others that matter. If you live in a large city high-rise and don't know the people who live on your six sides...you are pretty much screwed.
Ouch! I livev in a condo, and though I have PMs and have started Preparations 101, I think you are right!
But I do feel better that I have Mr. Beretta 9mm and Dr. Kalashnikov AK-47 (w/ 500 rounds each) will help defense-wise.
Too bad I can't grow a garden on the balcony of my condo...
Notice that the Beretta and the AK are for defending what you currently have, not what you will need tomorrow. Unless, of course, you plan to steal it at the point of your gun. No offense DoChen, but isn't the offense that got us here in the first place?
People will run out of food before they run out of bullets. Before they run out of food, they'll run out of gas.
If it came down to an emergency of that size, 90% of the urban and suburban population will be put into camps and I doubt you'll be allowed to pack heat if you want to be given shelter and food.
That's why I think I am over prepared, see below.
The firearms are great. Your ammo is a starter kit. You need another zero if it gets serious.
Of course you can!!! Google "urban farming" and "suburban farming". Also check into aeroponics - cheap and easy, with excellent yields. It's amazing to see the yields on even a 2x3 foot balcony landing. If you're saavy, you can even have chickens inside, but you'll have to buy their food :)
I thought the Dutch invented derivatives. Yeah, pretty sure they beat the squid to it during the Tulip Bubble.
Where are all the CLOWNS talking trash about EVERYBODY including the shoeshine boy is talking and buying gold? Where is that snakeoil salesman Prechter with EVERYONE is bullish on the PMs?
Gold Bitchez! (there)
Careful, typing the word "Prechter" will get you a reply post from GG.
:)
I have read his material. I like to keep up with all sides when it come to predicting monetary apocalypses.
The only problem I see in every position I read is that they are basing their predictions on how how the populace reacted the last time something like that occurred (inflation or deflation). Consumer sentiment has changed enormously since those observations were made in the past.
Who knows how we will all react to any sudden hiccup in the monetary world?
No kidding. The last time around, financiers had the common courtesy to throw themselves out of skyscraper windows. This time, they may need some help.
They will get help. Politicians will go first, though.
well said
Classic ..., +100
All those dealers in Europe who "ran out" of inventory sure were stupid to let that happen. And their customers were smart to buy it all right at the top.
Some things never change.
Pray tell, what makes this the top?
tmosley - seems so.... Happy gambling.
Funny how simple savings can be considered gambling in this world gone mad.
I'm just saying be careful - money = the things you actually want to buy. If you actually want to die with some gold bars buried within then fine - if it's a means to an end.... have a care.
You're not wrong--the world has just gone mad.
Money= things you want to buy today,tomorrow and next.....
...and shall want to buy next year and would want your sons to buy when they become old
Do you know such 'money'
I think I do [patting glittering bars][sigh]
the bottom line is most of the assets above gold in exeter's pyramid are susceptible to counterparty risk. as such, when the UST market fails and the world realizes counterparty risk is THE black swan, all assets will flow into goods that do not have any counterparty risk (ie physical assets). gold, as the most liquid and most monetary of all physical assets, will benefit most from this transition. buy physical and accept no substitute.
As much as I am bullish on the metals (long term), Exeter's pyramid is bunch of bullshit. Why not put Silver there as a tiny dot below the Gold market? Less Silver so will Gold holders move into Silver? Scarcity of Gold relative to other assets does not mean things will flow in that direction, at least nowhere near the extent to which Exeter implies.
Prices are nominal not cardinal.
In so much as Ag is "viewed" as an industrial metal, then economic contraction will pull on Ag more than Au. Scarcity is not the entire story, I may have the most unique and the most scarce doo-hickey on the planet...who gives a shit?
Do ya UncleFester have the most scarce doo-hickey?
Silver has been money longer and in more countries and civilizations than Gold. Besides supply of silver will also be decreased by falling mine supply for base metals in an economic contraction.
maverick,
I thought you knew...the larger the doo-hickey, the more scarce.
Seriously, I'm not disagreeing with you. In so far as prices are nominal, the "view" that Silver is not only the red-headed step-child of gold, but also an industrial metal keeps the ratio high at the moment. Gold has already put its "commodity" crowd to shame, soon Silver will too. Until then we will continue to see >50:1.
Why is it that everyone forgets you need a Silver bullet to kill a werewolf?
After all of the zombies have been dispatched, wooden stakes run through the hearts of the vampires, they will come knockin' on our doors to buy up our silver AE's to melt into 45 cal. chunks o' manwolf killin' slugs!
I don't know about you - but I plan to charge them quite a premium for mine by then! Might even trade it one-for-one with gold AE's...
I have more oz in Silver than Gold. But lots more value (now) in Gold.
And Platinum is a PM with industrial uses. Might be a hedge for those of us (like me) against a gold confiscation....
In "normal" times your actions would be fruitful. However, these are not "normal" times. The only things you should be diversifying are the hiding places for your PMs. Wherefore art thou GG?
Be wary - those who have no gold are cutting back. Someone, somewhere, deep in the system, realises that a policy of hyperinflation plus staying friends with your neighbours won't work (well played China - parity = equal pain at every stage!).
Most countries in the Euro-zone + the UK are now on a payback plan, realisng you can never get (comfortably) rich on invested credit.
Admire your hedge against the dollar here chaps, but I don't see the future as clearly as the (increasing) numbers on ZH do.
Tyler you're sliding well away from a once-interesting counter-cultural site into a one-bet propaganda machine. May I write an article to put the contra?
Mac - your post intrigues me, but I just don't know what you're saying. Can you rephrase or make your point differently?
Frank - I think I'm trying to say the idea of "money" itself is fiat - a hierarchy of "fiat-ness" within money is a sick joke. Gold, notes, bonds etc...
Of course you/I live within a world where we have to maintain our self-respect (without becoming bored), keep or wives happy and protect our children.
"Real human money" is the idea that you hear about somebody whose house has collapsed in Africa, or who is starving, and you break your very arse to get there and help them. Weirdly (for some) it's the idea of money to do "good". Your time. Your life. Not your cash. For some fucking poor unlucky soul.
Sounds incredibly stupid doesn't it? But what the hell else is there?? A bigger telly? A stupidly overpriced car to impress people you hate? I dunno.
over the millennia man has used everything but Gerbils as money (eggs, nails, salt, sea snail shells). Abstract though it may be, the concept is here to stay. Any "money" can (and has been) fucked/scammed with but....
The "thing" with the best track record through it all is gold.
I suppose that's why i have some...the dude abides.
Besides,i think Richy Rich likes it almost as much as land and serfs.
Very big of you. That was Big, Mac. Nice one.
Reminded me of this guy a bit:
"Courage my friend, it's not too late to make the world a better place." -Tommy Douglas
Money is supposed to = energy. Money is supposed to be a storage of energy be it human effort or fossil fuels. It's not. It's a bunch of leeches sticking their blood funnel into everything saying they are allowed to freely use everyone and everything as they see fit. The enlightened ones are only practicing enlightened self interest. They just avoid the = sign in the self=other equation.
In the end, they rely on us...we do not rely on them. In the not too distant future we will remember.
To add to that, Bernanke might be evil and stupid, but he's not so evil (I think) that he would deliberately absolutely destroy everyone's money, and he's not so stupid that he has no clue where hyperinflation comes from. We might get inflation up into the low double digits, but I doubt Bernanke would let it get into the triples.
FOf course, it sucks that we have to have faith in the wisdom and benevolence of our all-empowered technocrats. Because if they are either too stupid or too evil, we get Zimbabwe.
the problem with the payback plan is the math. if anyone who can add and subtract actually thought the payback plan was economically/politically feasable, i dont think there would be so much chatter about gold. the problem is in order to pay back our debts, we need to massively cut govt spending and increase taxes, which will drag on growth and decrease tax revenues. where do you think the money to back debt comes from? thats right, taxes. so either we deflate and default, or we inflate and spook the bond market, leading to a defacto default.
that being said, i dont have any emotional attachment to the barbarous relic. its just that on a macro level, i dont see any way out other than some sort of restructuring/default. the CBO numbers are an exercise in magical thinking, and even if their assumptions pan out, we are still a few T short of where we need to be. i would love to hear a counterargument that relies on math and facts with respect to political realities.
brush it's a fair point and (with my head) I think you are reasoning correctly.
I'm angry (particularly angry as a Brit where it is some sort of pathetic "mainstay" of the economy) at how the *custodianship* of money has become a leading factor in our economy. "Real work" that is worth "real money" does some good for people. Shuffling paper is not wealth-generating.
But shuffling paper is all the paper-money aristocracy is good at. They lost real skills a long time ago. Once economic growth is solely dependent on selling each other cell phone plans and insurance, the game"s up. Wherefore art thou Mako?
Most of these guys are so wacked out it's hard to have a conversation.
I mean you have this TMosley that think M1 is a huge number at $1705B because it rose from $700B very quickly. M1 is a fart in the wind to the size of the credit system, it's less than 2% of the actually system.
Most of them think their gold is the only thing that is going to rise, basically they all believe Helicopter Ben is coming to make them rich, they'll simple cash out and be rich.
Hahahah.
They are wacko, believe Ben has magical power to beat a dead horse to make him run faster. All they have to do is tell me when they are going to be rich.
TMosley said there is so much FRNs around that is coming out of toilets, I said send me some by the truck load, matter of fact I will send the trucks. Oh all of sudden all those dollars can't be found.
Your thesis is wrong, Mako, because CREDIT IS NOT THE SAME AS MONEY!
If it were, we would be seeing rampant, across the board, double-digit DEflation, not the ongoing (if momentarily) creeping INflation that continues in consumer prices and the general cost of living.
True deflation under a fiat currency regime is nothing but a myth --- it has never happened once in history, and almost certainly never will.
No gold bug here, but...the "barborous relic" was a reference to the broken "gold standard". Broken would be the key word (hence italics), the "gold standard" would be in quotes because it didn't exist, and central bankers in London and NY would be the brokees.
Funny, now that I think about it...Is that where the term "stock broker" came from or is it b/c if you send him your savings, he'll make sure you go broke?
No gold bug here, but...the "barborous relic" was a reference to the broken "gold standard". Broken would be the key word (hence italics), the "gold standard" would be in quotes because it didn't exist, and central bankers in London and NY would be the brokees.
Funny, now that I think about it...Is that where the term "stock broker" came from or is it b/c if you send him your savings, he'll make sure you go broke?
Wow loads of posts there UncleFester. Think you're in a similar boat to me.... If they're selling gold *now* with the world looking like a turd in a pressure cooker - why?
My view on it (and its just mine) is it's a goldy, yellowy metal - quite rare. Whoopy dooo etc....
the selling you're referring to smells like an all in bet on the fiat system and not an indication of gold's worth. the US stands to gain so much from controlling the printing press on the world's store of wealth that they will go bankrupt trying to preserve the status quo. if that means selling every last ounce of gold, so be it. think about it from america's perspective. if the dollar is replaced by a gold or other reserve system, we lose the best thing that ever happened to us. its essentially game over for the american way of life, as we will no longer be able to print paper to buy whatever we want (tanks, taliban allegiance, oil). rather, we will have to earn it via productive work. as someone who works very hard, let me tell you, it sucks. if i had the ability to print wealth i would do everything i could to preserve that power. selling gold is a head fake to sustain the illusion that dollars are money and gold is a yellow metal with limited industrial uses. open your eyes.
Diversification is the key.
If you have no gold (< 5%), then IMHO you should get work at buying The Ancient Metal of Kings.
If ANYONE here is wealthy and has little or no Gold, I would advise ALL of you to buy Gold (physical) ASAP!!
McHoo,
This is what happens when I drink an afternoon coffee. Not enough Whiskey in the house to slow me down. I think the simple answer is...by keeping the yellow metal down via paper Ponzi merry-go-round, they also keep $/oil down. Once OPEC stops taking $ for barrels: "Game over man, game over". It's all about resources and 'street cred'. Russia and China want to transfer their reserve balance into gold (other currencies) while simultaneously not imploding the US $. Meanwhile the US desperately needs access to more barrels to support the Petro-$. The race is on! The Merkel-Obama spat at the G20 was interesting, no?
I don't know how it's all gonna pan out (pun intended). But I have some physical, a Beretta 12 ga., access to well water, and enough freeze-dried and canned foods to feed the family for 6 months. Personally, I think I over-prepared. If this ain't resolved in 6 months when the shake down happens, we're f*cked.
Gold post ambushes...smells like Johnny Bravo...
Decreasing spending won't crash the economy. Never has, never will. Didn't happen in the 20-21 depression or in the 1945 postwar economy. And even if Keynesianism weren't a complete fiction, suppose that 1.5 multiplier is real, so every dollar of deficit spending translates into $1.50 of new growth. Okay, well, the government eats around 40% of GDP, so a dollar of deficit spending turns into 60 cents of new tax revenue. With a profit margin of -40%, the government is still headed to bankruptcy.
Cut off the burgeoning debt at its source--old people entitlements and the vast war machine--and we will gradually chip away at our national debt and pay it off. It'll take decades, but it'll get done. The problem isn't that it's mathematically impossible, but that it's politically impossible. Old people love them some juicy entitlements, and the rank and file Tea Partier in this country thinks the old way of doing things (i.e., the 80s and 90s) was sustainable.
Would like to read your counterargument. I disagree that Euroland is on the payback plan. Reducing massive defecits to something less massive, but still defecits, is not the payback plan. Its delay. The delay just makes the math look worse in the future.
GS - the new Tory government in the UK talks like it's hell-bent on doing just that. And actually it can - the public sector will lose maybe nearly 2m jobs in the process, but at least we won't be munching our own poo for sustenance.
Europe will be slower - but what else can it do? The PIIGS (with maybe the exception of Ireland) can't really borrow trillions more to make it all nice again. Nobody will lend to Germany (say) if the next day Merkel pledges it as collateral for the Greeks.
The US - hmmmm.... Seems senior but apart from Windows7 what are you going to sell?
Mac - I have to agree with Brushfire here - it's already too late. The math is physically impossible. The budget deficits are so huge, that you just can't make it work anymore. Plus you have poor demographics and health care working against you. Don't forget having to re-neg on many of the false pension promises. Just as an example, Illinois is running a budget deficit equal to its revenues. It would have to cut spending by 50% to break even, much less start paying back (and not counting unfunded future pension liabilities). If you lay off all of the state workers necessary to balance the budget - where do they work? How do they pay their mortgages? It's not as if there are a bunch of available jobs.
The problem really is that we spent all of this money as a society on consumerism - running up debt to buy [imported] stuff, instead of investing it in infrastructure, technology, grids, etc. So, our interest/principal service requirements are above our ability to pay.
Love to hear a counter argument that refutes the math, but the numbers are just too massive (and the political system too broken).
traderjoe - no way do I disagree with you. The global debt is in the thousands of trillions - if properly accounted for.
My (contoversial?) point - is what does gold have to do with it?
There's not a state on earth that can pay its way with its gold reserves. The US is, by many a measure, the *least* able to pay its way by that medium. I'm just massively unsure and seeming at odds (with the majority on here) in thinking gold is any kind of ultimate "money".
Oil is more useful - and had a "500%" swing in 6 months. Until anyone can convincingly explain to me what happened there I'll have to stay wary.
To be sure, I cannot at this time explain everything. We serfs are only exposed to so much...need to know and all that BS. (I could talk about Enron, but that is a side show really.) The crux has to do with the oil/$/gold trifecta. The $ is the reserve currency and de facto unit of account, oil is a modern energy necessity, and gold is an historical wealth reserve. The volatility in the oil/$ and the markets (priced in $) is caused by the current "phase change". We have had many in the past 100 years. They cause World Wars, Depressions, Stagflations, etc. How this one plays out is anyone's guess, but the steady march of Au/$ makes me want to side with the yellow metal.
This isn't a sprint, it's a marathon.
Why not "none of the above"?
"There's not a state on earth that can pay its way with its gold reserves."
That's not what AU is for.
Gold is for "starting over". Gold is for "year zeros" and the interim leading up to same...
Gold is a time traveler and a means to end. That end being a store of value when, "Today the government announced a currency revaluation".
Gold is "local" (at least compared to HYPER POWER EMPIRE STATES!!).
What else are you gonna do? Swap eggs?
Mac, if your are serious about understanding the arguments for gold, read the fofoa articles. If you do and believe you can refute those views, I would love to read your counter-arguments. I have requested at least three times that someone offer a rebuttal/critique of fofoa and nobody has come forward. Perhaps you will be the first, I invite you to do so.
How can anything that gets used up be real money? Not to mention oil's storage problems. Money is what men say it is at any given time. Physical gold is indestructible, relatively rare and the worlds defacto money.
Please explain to me why most of the worlds governments keep physical in vaults if it has no value.
I believe that eventually man will solve the money problem. I'm also pretty sure though that the world fiat experiment will disappear in a cloud of smoke...perhaps nukyouler.
I own some gold, bought in 98...but I'm not delusional enought to think that it will make me rich. Golds value is constant in real terms as far as I can tell, and when measured against the pressed shit they hand out now looks pretty good.
Are you kiddin'? We make all kinds of cool and expensive stuff.
Need an airplane? We have lots. 'Specially planes that can fly really fast and blow up other really fast planes, or really slow stuff on the ground.
Maybe planes are too slow for you. Well, we have missiles too. They can even catch the really fast planes we make.
Maybe you just want to blow something up. Great, we've got you covered. Bombs and plastic explosives are some of the things we do best.
Maybe you just have a lot of infantry and want them to feel like they have a fighting chance. Great, we've got handguns, rifles, machine guns, semi and full automatic rifles and lots of grenades. Did I mention rocket launchers? Your team will look like contenders if you equip them with hardware that's handmade right here in the U.S of A.
Maybe your infantry looks naked without some ground support. Say no more. We can back them up with a full line of tanks, armored carriers and good old jeeps.
There's plenty more, just look around and let me know if you have any questions.
Just remember, we've got people building this stuff in every congressional district in the country with plenty of taxpayer seed money, so you know we stand behind it. Hell we'd be crazy to stand in FRONT of it.
Windows 7, my fuzzy butt. We're Americans and we know how to make heavy equipment that will knock your socks off. And they'll probably take your boots with them.
Now that was righteous...
Ubuntu. I'm going to learn ubuntu.
http://www.collegehumor.com/video:1886349
Hepha, I am alone, no?
Don't forget drugs and medical equipment. Wait, no, that's about to become a thing of the past. You're right, invest in bombs; it's all we've got.
You could write it, but it maybe that it's your contra thats 'the one bet progaganda machine'.
I wouldnt count on calling TD names to get him/them over to your point of view. Stay golden Tylerboy
Why is there always such conflict in the Middle east?
"It is a centuries old religious conflict involving land and suspicions and culture"
Jed Bartlett: No it is because it is incredibly hot and there is no water.
We are witnessing the same thing with gold. It is because is there is much confusion and there is so much paper and no actual value. The rise in gold is telling you the opinions of the intelligent that placing your wealth in the ideas of incompetent flawed men, their promises and stamped with the brand that is the United States ceases being valuable when the brand is tainted and poisoned by corruption. More succinctly it is a vote of no confidence in our leaders.
amen
The mid -East is so violent because it is infested by three of the most violent prone religions in the world, all believing they are truly chosen by the one and only true god. Augmented by the usual human greed, territorality, scarcity of resources. In other words, if there every was a region the world averse to peace, this is it, and all of these monotheistic religions are equally adolescent and equally detestable.
I like that term, "Power Money" it explains alot.
Maybe Exeter was a goldsmith who just got a printing press? Who was he/she anyway? Looks like a barbarous relic based on thosed numbers. Go long paper? Hmmm...
What's that say on the bottom? World Cup $55T?
You are almost certainly joking, but it's GDP.
I've had a crazy day and I'm just being silly.
Has anyone a chart of the currency price of physical gold (all major currencies against Gold) since the foundation of the Euro?
I think you understand my question.
Is Gold, despite all the manipulation, displaying a “value” that fiat currency does not have?
I will ask this question again and again on every Gold thread.
"manipulation"
Most overused word in finance.
"displaying a “value” that fiat currency does not have?"
I would say food has a value gold can never have. Chicken wire has value that gold does not have, water has a value gold can never have, etc.
When the destruction comes it isn't going to care if you have gold coin, silver or a copper coin in your pocket or a paper dollar.