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It Is Getting Ugly Quick In Fiat Land: S&P Now Down 8% YTD In Non-Dilutable Terms
First the fun stuff: gold hit an all time record today. To those who have had the foresight to realize that in the currency devaluation race to the bottom, the only winners will be non-dilutable precious metals (and not industrial gimmickry and bets on China's excess capacity like copper...well, maybe with the reverse alchemy exception of lead), we salute you. In fact, so does the market: the S&P is now down 8% year to date when expressed in ounces of gold. Because while central banks can monetize, sterilize (whatever that means), and dilutize that last remnant of the dying Keynesian religion, the FRN and its equivalents around the world, gold is untouchable, and increases in value with each desparate attempt to save a failed economic system.
Yet the bandwagon is once again getting heavy: the EUR is getting killed after hours, approaching $1.25 and is about to break the E-mini critical 117 yen support once again. Should central bank buyers not materialize, hello gravity. Which would also mean freefall for the ES. The bailout plan is now null and void, and in need of a bailout plan itself. The French banks won: we expect their FX traders to make a killing this year. We hope their contract demands bonus payment in gold.
At least today's market farce where volume was non-existant and allowed the same algos that killed the market to ramp everything up for no reason, will likely not be repeated again tomorrow. We have now entered the next regime.
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Me thinks there will be a water shortage soon...
When everybody is on one side thats usually the time to go to the other side.
"...gold is untouchable, and increases in value with each desparate attempt to save a failed economic system."
Tyler, if this was the case, then gold would already be in the stratosphere. Although less so, gold is as manipulated as is everything else financial. How could it be any other way?
Corrections Corp. Shows Crime Pays With Private Jails
http://www.bloomberg.com/apps/news?pid=20601109&sid=afUjtigKCvRI&pos=12
With about 2.3 million people in prisons and jails, the U.S. has the most convicts of any country, according to the International Centre for Prison Studies at King’s College London. The U.S. prison population rate of 756 per 100,000 people ranks higher than Russia’s (629 per 100,000) and Rwanda’s (604 per 100,000), and is also the highest in the world.
Paging Mr. Frog, this is your wake up call. Wake the fuck up.
“Fascism should more appropriately be called Corporatism because it is a merger of state and corporate power”. - Benito Mussolini
Incarcerated Americans 1920-2006
http://upload.wikimedia.org/wikipedia/commons/5/54/US_incarceration_time...
What is it going to take for you people to see that we live in a police state?
WE ARE NOT FREE. YOU ARE NOT FREE.
Corrections Corp. = Dick cheney INC
I MOTION the great readership of ZERO HEDGE that.....
...an ARTICLE FIVE CONSTITUTIONAL CONVENTION is organized in order to deal with the new financial crisis before us. Considering how corrupt the Congress is, 2/3 of state legislatures could probably be moved much more quickly. Consider what happened to Utah to Bennett. Things are very liquid. Even the threat of an Article Five convention vote success in a few states could move things along to a tipping point in Congress and the press.
I do not see Congress or the federal branch responding appropriately. The "no trading day losses" in these big banks should be enough for an American to stomach.
http://en.wikipedia.org/wiki/Convention_to_propose_amendments_to_the_United_States_Constitution
This could get interesting...
I'll be damned, paper supply DOES go parabolic... The old Austrian economists are being unsettlingly prescient of late.
Received from Rep. Alan Grayson just now:
The Senate just voted, 96-0, to audit the Federal Reserve. Soon, we will know what the Federal Reserve did with the trillions of dollars that it handed out during the financial crisis.
A few months ago, such a vote would have been unthinkable. One senior Treasury official claimed he would fight to stop an audit 'at all costs'. Senator Chris Dodd predicted that an audit would spell economic doom, while Senator Judd Gregg attacked accountability for the Fed as "pandering populism".
Today, both the Treasury Department and Senator Dodd support this amendment. As for Judd Gregg, he was just on the floor of the Senate discussing -- of all people -- 19th century populist Presidential candidate William Jennings Bryan.
What happened?
People Power is what happened. We built a coalition of people on the right and the left, ordinary citizens and economists, ex-regulators and politicians, all with one question for which we demanded an answer: "What happened to our money?"
No longer can Ben Bernanke get away with saying, "I don't know."
Now, we're going to know who got what, and why.
Releasing this information will show that the Federal Reserve's arguments for secrecy are -- and have always been -- a ruse, to cover up the handing out of hundreds of billions of dollars like party favors to the Wall Street favorites who brought the American economy to the brink of ruin.
But our work isn't quite done. The Senate audit provision isn't as strong as what we passed in the House. The Senate provision has only a one-time audit, whereas what we passed in the House would allow audits going forward. There will be a conference committee that will merge the provisions from the two bills.
The need for audits and oversight over Fed handouts going forward is great. The financial crisis isn't over, and neither are the Fed's secret bailouts. Earlier this week, the Federal Reserve announced it was going underwrite the Greek bailout by lending dollars to the central banks of Europe, England, and Japan. The loans may never be paid back, the Fed accepts the risk that the dollar will strengthen in the meantime, and the interest rate charged by the Fed is very likely at below-market rates. So such loans are in effect just a subsidy, to bail out foreigners.
The Fed has not been chastened. It is bolder and more of a rogue actor than ever. It's clear that without full audit authority going forward, the Fed will continue to give out "foreign aid" without Congressional or even Executive permission.
And it will do so in secret.
So we will be fighting on to get a full audit from the conference committee.
But let's not lose sight of what we have accomplished so far - real independent inquiry into the Fed, and its incestuous relationships with Wall Street banks. For the first time ever.
Our calls, emails, lobbying, blogging, and support really mattered. We made it happen.
Today, we beat the Fed.
Courage,
Alan Grayson
Excellent, thanks for sharing.
The faithful here would also love the following clip from Dylan Ratigan, it expresses my sentiments exactly:
http://www.silverbearcafe.com/private/05.10/bailout.html
You're back and haven't skipped a beat.
I'm concerned this bill might interfere with the Bloomberg FOIA lawsuit. Anyone read it?
Gordon Gekko,
Shave off a few crumbs from one of your bars of gold---or better yet use the paper while someone still accepts it---and enjoy a good celebratory drink.
I long had my own reservations about the exalted position of gold, though I have come to accept that gold---like the one eyed man in the land of the blind---is King. You never doubted it.
I was wrong. You were right. Salud!
Sarah Palin's speech for the tea party has hurt it inmeasurably.
Keep her far, far away if you want your party to grow.
Es Futures down -10.. a little to be excited about on the short side.. but they were down this much last night as well and we saw what the market did today
ES at 1153.50 at 12:47am PDT ... looks like good short ... but again I am daBear
so ya, thought ya, might like to, go to the show......
to feel the warm thrill of confusion, that space cadet glow....
tell me is something eluding you such as
is this not what you expected to see?
Who let all this riff-raff into the room?
I hesitate to post this because I have supported Peter Schiff in the past but...comeon if you visit ZH...well...watch or don't watch but it is Schiff's latest vlog:
http://www.youtube.com/watch?v=syZBdkIwWxw
schiff is da man.
What about all those SP500 in EUR charts we saw here in Oct/Noc/Dec? Why is nobody showing those anymore?
Why gold?
Because of it's historical concept as a "store of value"???
That's the sales pitch going round the goldbug circles as they convince themselves and others that "gold" is the real store of value because "it used to be."
This belief is going to prove laughable in hindsight.
Are governments or central banks returning to a gold standard?
If the answer is no, then buying gold is no different than hoarding tulips.
And don't put up historical charts proving me wrong. All you'll be doing is reinforcing YOUR OWN BELIEF that there is a bigger fool out there than you who is going to pay you more for your shiny metal than you paid.
Overweight, out of shape 40 something psuedo intellectual gold bugs fantasy prognostications of a post apocolyptic world where they finally rule some hypothetical barter town with their sacks of gold.
A) Hard times have really hit before in pre-blog days for real. Post civil war southern states faced much more difficult times than any "survivalist" (huge stretch) could ever imagine or blog about. There really were hordes of thugs roaming the south stealing stuff.
B) This should have been golds nadir, historically speaking, with all due respect to mad max fans. Confederate money was worthless. Gold, by gold bug logic, ie fiat money kaput, did not appreciate 500 percent just because some miscreant had desighns upon your chickens and hound dogs.
C) There really was a great gold rush allready that fizzeled out and paper money still ruled. Chicken eggs went for 50 bucks each and shovels might as well been made of gold.
D) Argentia, Japan, Germany, Zimbabwe; paper money still rules today, not too many Argentinians huddeled in thier backyard bunkers waiting to fend off the masses by shooting them.
E) In a real survival situation, trust me you would come crawling out of that bunker just to get some help and to see what was going on. Its boring maintaining 24 hr watch over anything, let alone instant potatoes and gold that went to 5000 an ounce except 5000 is like 5 bucks.
F) Mad max was a movie.
G) Real survival entails more than parroting crap youve read in your easy chair. Are you prepared to eat a nice fat cockroach? I have and its nasty. Real survival training sucks ass. I dont want to eat bugs, nor c-rats. How long could you really eat canned beans? That alone would drive you to murder long before killing 12 people making a midnight assault on your bunker you never really built anyway.
H) Actually shooting someone even if they are rustling your hog is harder than you think. Marines are trained to kill, or they wouldnt either. Damn, should have been less ammo and more peanut butter after all!
I) The first time you open up with your full-auto ar-15 modded weapon because you heard a possum rooting around, is the first time you waste 20 rounds that could have made survival a lot tastier by killing a deer or rabbits.
j) Fiat paper money being worthless, dosent equate to gold being worth 5000 in todays dollars. theres an inherent contradiction there. Who the fuck would care about 5000 bucks at that point; remember you cant step back in time and grab 5000 dollars worth of 2010 crap in 2015 when gold really is priced at 5k.
k) The real problems like kids with medical needs and a myriad of mundane things previously taken for granted, will become more important than who had more silver coins before the collaspe.
l) I know how to kill, how to survive, how to bring down a house with a little c-4 under the staircase, how to operate and maintain small arms weapons how to set booby traps, and all kinds of crap but if the economy outright collapses and the stores are all closed, I wont be in some concrete shelter eating crappy canned hash, nor joining a band of pirates. I will get by and help my neighbors the best I can and eat good and enjoy the peace and quiet of no tv.
J) I wont trade my jar of peanut butter for a whole ounce of your gold. I will give you what I can spare and you will help me fix my sheep pen.
k) Long before fiat money or lust for gold and long befor mercenary magazines, people got along just fine. During the great depression for example their were bank robbers and not so many survivalist types. Times were hard but people, even goldless ones coped just fine and bred us modern pansies who think he with the most gold/ammo wins.
You have many good points regarding survival. However, the folks here view gold as a way to preserve wealth through the crash.
"However, the folks here view gold as a way to preserve wealth through the crash."
of course they do. and they HOPE other people will see that shiny metals value and treasure it as much as they do.
otherwise it isn't really a "store of value," is it? It's just another commodity, except people "think" it has a pre-ordained future value relative to the dollar and other currencies.
Because, once upon a time and long, long ago in a galaxie not far from here, the value of currency was pegged to some weight of that shiny metal.
But it no longer is except in the eyes (and wishes and hopes) of those who purchase it.
How are those EUR/USD shorts doing?
Since I posted last my EUR/USD long exposure has posted HEFTY gains.
Than again...I DID warn you, so whatev.
Like I said, "my central banker will print more than your central banker"
For the gold short, I expect that to fall into my pillow like a wet egg and early tomorrow EST.
Good luck trading all!
Damn,I thought I was being offensive to groupthink! You just might get junked more than I, especially if your right!
Hb,
Any advice as to where to buy physical? Too many ads, no idea whom to trust.
Thanks,
S in TX
I have used APMEX successfully (small orders). I have not used, but have heard good things about Tulving (larger orders).