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Gold Surges On Reminder It Is The Only Currency Without Liability And Counterparty Risk
A few days ago, Erste Bank shared the following spot on description of gold's function in the modern monetary system: "The possession of gold is tantamount to pure ownership without liabilities. This also explains why it does not pay any ongoing interest: it does not contain any counterpart risk. Along with the International Exchange and the Chicago Mercantile Exchange, JPMorgan now also accepts gold as collateral. The European Commission for Economic and Monetary Affairs has also decided to accept the gold reserves of its member states as additionally lodged collateral. We also regard the most recent initiatives in Utah and in numerous other States as well as in Malaysia, and the planned remonaterisation of silver in Mexico as a clear sign of the times. The foundation of a return to “sound money” seems to have been laid." Today, we get a quick reminder of this all too often forgotten truth, after gold has surged by one percent in the span of an hour as the world once again realizes that the best the ECB Titanic (and shortly thereafter, the Fed) can hope for is merely to delay, not prevent, the sinking of the broken monetary system. Furthermore, that this is happening even as China hiked rates for the 3rd time this year may indicate the inflection point in gold has now come and the take out of nominal highs, just $30 higher, is next.
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There is a bit of counterparty risk to gold. Suppose you go to the farmers market with your Krugerand to buy a pig. You offer the gold for the pig and darned if the owner of that pig wants an Elvis poster instead.
Canvas or black velvet?
Aha, a conniesewer I see. Nice Elvis!
Velvet!!!
http://www.youtube.com/watch?v=jPE3p4kLgL8
Another live lamb birth at sheep.com
http://www.youtube.com/watch?v=SgnGaKXnk6Q
Guys, do you think gold will have its usual seasonal low at the end of August, or are we just going up, up, and away?
I'm poised and ready to buy.
Yeah, but do yo think it will go down again at the end of August?
You come here for investment advice? Ever heard of due diligence?
forget gold...SILVER.
I have it on good authority it will be at "49" by the end of the week and 60 next week!!!!!1
not sure what the excitement is all about. haven't we been at these prices in bennybux before? it's just another headfake. until the dam bursts.
agreed - i think the advertisers/google ads need to see X amount of Gold articles for whatever voodoo it does.. Gold ain't 'surging' until it starts doing +$50 a day
steady climb is fine though...if we actually get to $1600 before end of summer
something dramatic bound to be with
eur/usd excitement ahead? the climb,
will it stumble on this/these shores?
and how?
And possibly without a paper trail, account number, or custodial manager. That is to say, something you can easily hide from creditors and pinstriped pirates who see everything else you own, making it easier for them to devise ways of claiming or stealing that for themselves. I imagine there are some well-to-do folks out there already contemplating a strategy to apparently die in debt, leaving an underwater home and $100k in unpaid credit card liabilities as their official estate along with a secret box of gold bars buried in their kids’ back yard. And since I’m already imagining it, I suppose there’s a chance I could turn out to be one of them too.
Trolls are notably scarce today .... wheres the guy that was predicting a 10-25 percent correction yesterday? Of course, we may well have some attempt at massive intervention to drop the paper price, but my sense is that this is launch-time. Read the last GEAB report predicting a perfect storm of economic turmoil for the second half of 2011. I wouldnt sell a gram regardless of paper prices, up or down.
Been a GEAB reader for 3 years, they have been uncannily accurate
"This also explains why it does not pay any ongoing interest: it does not contain any counterpart risk."
Really? I thought you collected interest when you loan someone money. Even if the loan is fully collateralized.
Guess you're lucky they dont make you pay on ongoing TAX just for holding gold. Hmmmm, Obama, you listening.....
Since when is a 1% increase viewed as a "surge"?
When it happens on a brace of consecutive days and the USD rises with it on both.
Now get back to work.
Work? Hmmmm.....no thanks.
For all those folks who talk about 'pump' shotguns
http://video.search.yahoo.com/video/play?p=beretta%20extrema%202&tnr=21&...
Screw that....go with a semi-auto...
http://www.youtube.com/watch?v=_biiE4USjFQ
I got me one of them! Fantastic shotty.
http://www.youtube.com/watch?v=pm-HxhRlqUw&feature=related
Talk about Mexico, one of the largest silver producing countries. They are getting serious about monetization in silver. They also bought 100 tons of gold in April and May because they have large dollar reserves which are loosing value. They are experts in devaluations and silver currency will be the thing. Check out this story.
http://lonerangersilver.wordpress.com/2011/06/20/living-through-a-curren...
hold the Saiga, it aims well for those black feathered scavengers, caw! caw!
I got physical Gold and Silver --- Yeah I'm so happy! :-)
Eric Sprott - Paper Markets Are A Joke: Prepare for Bullion Prices to Go Supernova
http://www.silver-info.com/prepare-for-bullion-prices-to-go-supernova.ht...
Not much purpose to life without kids, living alone or with another old timer and your gold---a worthless existence
Erm, it sounds like you don't get out much... Don't misunderstand me, I'm not saying 'having kids' can't be rewarding, but it's not like doing that and owning Au are mutually exclusive, no?
Your right but some of us have to take what we can get and make the best of it.
Bitcoin.
It will seem absurd to future generations if it was not mentioned in response to this post.
My first post on ZH, and wanted to say wtf, and besides that bought what I think is a goodmutual gold fund. I am a newbie to this, and curious what you think.
I notice Gold has been rather strong lately and now even Goldman "Doing God's Work" Sachs predicts it will go to $2,500 by the end of this year.