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Mr. Denninger and Gold or Why the Dollar-Deflationists Are Wrong
Those who know Mr. Denninger know that he, well, for lack of a better word, hates Gold. It only goes to show the level of disinformation and ignorance prevalent in our society when even smart people like Karl fail to get it. From what I hear anybody even mentioning the word Gold runs the risk of being permanently banned from one of his "forums". In a recent commentary entitled "Ten Things for 2010" he was at it again bashing Gold. Here is what he had to say:
We're not looking at hyperinflation folks, in my view - we're looking at a deflationary collapse…If you fear hyperinflation do not look to Gold, instead buy a small (5% of your total portfolio) position in far out of the money LEAP CALLS on the major indices, spread across them. Why? Because (1) the tax structure on gold is unfavorable, (2) gold has never performed well on a contemporary basis .vs. inflation and (3) you can't eat it. If you try to get around the tax man structure you're going to get creamed; governments can and WILL prevent that from working. My recommendation thus is to buy insurance against a hyperinflationary event using instruments that do not try to evade the formal financial structure, are levered (to get around the tax hit) and are defined risk (so as to avoid losing your ass if you're wrong.)
Really Karl? LEAP Calls? In a hyperinflation? That’s a good way to lose 5% your portfolio. I’m assuming you know what hyperinflation is - in a hyperinflation the currency becomes worthless, as in toilet-paper. Why would anyone want to get paid their "winnings" in a worthless currency, assuming there are stock indices and counterparties left who can pay off these worthless winnings when countries collapse?
And the tax structure is FAR more favorable for Gold than ANYTHING else, if only you are not in the habit of bending over. Buy cash and keep your mouth shut – it’s very simple – or just move to another country where the government is not as intent on raping its citizens. I know privacy is a foreign concept in America these days, but still. All your other assets, including stock market profits, are fully open to the government and there is nothing stopping them from taxing them to the hilt. Trust me, when it all hits the fan Gold in your personal possession will be your best friend.
Which brings me to my favorite part:
gold has never performed well on a contemporary basis .vs. inflation
Poor Gold. The thing gave an instant 75% profit when Roosevelt confiscated it in 1933 and rose 24x (yes, that’s 24 TIMES) from $35 to about $850 in a space of 10 years from 1970 to 1980. And even during the past decade from 2000-2010 it has risen 5x outperforming ALL asset classes. Overall, from 1933 till date it has risen about 60x. That is, if you simply held Gold since 1933 you would be now 60 times richer, at least in nominal terms. Yet nobody remembers all that. All they remember is the lousy 20 years from 1980-2000 when the full force of the derivatives market was brought to bear upon it to suppress it’s price (well, that’s a topic for another post), as is being done even now absent which it would have easily crossed 10x (from the 2000 low) by now – which it will at some point in the future as the market cannot be suppressed forever. Indeed, the longer the suppression, the more forceful the eventual price rise as happened when the London Gold Pool collapsed during the late sixties soon after which Gold shot up 24x during the next decade. If you’re not that devoted a disciple of Karl I suggest you hang on to your Gold for a little while longer. In my humble opinion, it will outpace all gains in all other asset classes since the creation of the dollar – in not only nominal, but real purchasing power terms.
And then there was this again:
The last time I checked they didn't take 100oz bars at WalMart, but they sure do take $100 bills
And the last time I checked Karl, they weren’t taking stock certificates and bonds either. Also, there was a funny thing I noticed: there was NOTHING stopping me from getting dollar bills, euros, yen – you name it – for my Gold. In fact, everytime I sold some Gold I got even more paper tickets than the last time – which meant that I could buy even more stuff with the same amount of Gold. How surprising, no?
Well, Karl was definitely surprised:
Precious metals will not be a safe haven: Clean miss. Gold and silver have both performed well.
And talk about reaching wrong conclusions:
Discovery that the metals market has been "polluted" to the point of irrelevance would mean that those around the world who had bought and were holding alleged gold bars that in fact aren't gold had tendered good money for nothing. This would be a monstrous deflationary event - after all, the definition of deflation is the destruction of money, and that's exactly what would have happened, just as if you took a stack of $100 bills and burned them in your back yard.
No Karl, the bills still exist – in the bank account of whoever was paid to obtain the said Gold. It is the Gold which is discovered to be no longer existing, thus causing the apparent supply to be further reduced and spiking the price.
Karl thinks he’ll be safe watching these “fireworks” from the sidelines. Not so Karl. By not buying Gold (and holding dollars), you are smack in the middle of them. You are not simply “missing out” on some investment gain but stand to lose everything as the purchasing power of the dollar is decimated. This is why those advocating holding only paper cash as a “safe alternative” are in fact harming those who listen to them.
Now don’t get me wrong - I agree with a lot of what he says in general – he’s a good reporter (which is why I keep him on my “must read” list) - but when it comes to Gold, Karl simply doesn’t “get it”. First of all, when you talk about deflation you have to ask the question, “In terms of what?”. Most people ala Mish, Prechter, Karl et. al. when they talk about deflation are referring to deflation in terms of the dollar, i.e. they are, in fact, “dollar-deflationists”*. One can’t really blame them since the dollar is considered by most people as “money” today and is therefore their frame of reference. But this is a critical error of perception that will prove fatal to those who hold their life’s savings in dollars when it all finally implodes. The dollar today is just another fiat currency created at will out of thin air by bankrupt and corrupt governments and their Central Banks. It is an illusion of money, not money; which brings us to the question of:
What is money?
This is a topic which can fill an entire book, but I’ll just quote the best one I found (Mises):
In the marketability of the various commodities and services there prevail considerable differences. There are goods for which it is not difficult to find applicants ready to disburse the highest recompense which, under the given state of affairs, can possibly be obtained, or a recompense only slightly smaller. There are other goods for which it is very hard to find a customer quickly, even if the vendor is ready to be content with a compensation much smaller than he could reap if he could find another aspirant whose demand is more intense. It is these differences in the marketability of the various commodities and services which created indirect exchange. A man who at the instant cannot acquire what he wants to get for the conduct of his own household or business, or who does not yet know what kind of goods he will need in the uncertain future, comes nearer to his ultimate goal if he exchanges a less marketable good he wants to trade against a more marketable one. It may also happen that the physical properties of the merchandise he wants to give away (as, for instance, its perishability or the costs incurred by its storage or similar circumstances) impel him not to wait longer. Sometimes he may be prompted to hurry in giving away the good concerned because he is afraid of a deterioration of its market value. In all such cases he improves his own situation in acquiring a more marketable good, even if this good is not suitable to satisfy directly any of his own needs.
A medium of exchange is a good which people acquire neither for their own consumption nor for employment in their own production activities, but with the intention of exchanging it at a later date against those goods which they want to use either for consumption or for production.
Money is a medium of exchange. It is the most marketable good which people acquire because they want to offer it in later acts of interpersonal exchange. Money is the thing which serves as the generally accepted and commonly used medium of exchange...
(All emphasis mine)
Money was created by the markets; by humans trading goods and services amongst themselves; by the need for indirect exchange. This is one of the major misconceptions of the dollar-deflationists - that money is what the government says it is. Although Governments do their best to convince people otherwise, including putting a gun to their collective heads via legal tender laws, they cannot dictate what money is – not for long periods of time anyways – which is why whereas Gold has been money for thousands of years, you’d be hard pressed to find a fiat currency that has existed past a few decades. The present period is one such short period of mass delusion where the majority has been convinced – including, apparently, Mr. Denninger - that the colored pieces of paper being printed by various men behind the curtains is, in fact, money.
Gold is the commodity that humans chose to be “money”- the most marketable good. It didn’t happen overnight, but over thousands of years of evolution. Billions of trading decisions over centuries made by free men of their own volition – the collective wisdom – installed Gold as money. It needs no government violence to enforce as money because the force of nature that is the market chose it to be money. Indeed, it was the governments who hijacked the free-market commodity money of Gold into “backing” their various fraudulent paper money scams using fractional reserve systems. Why? Because the power to create money is the ultimate power. It is not for no reason that Mayer Amschel Rothschild said:
“Give me control of a nation's money and I care not who makes her laws.”
And why do we know Gold is still money today? It’s simple – Gold has the highest stocks to flow ratio of any commodity i.e. its total above ground stockpile is very large compared to its annual production which is NOT the case for other commodities. The reason for this is that while other commodities are primarily mined for consumption, Gold is not consumed but hoarded. Its primary function is that of a store of value – a wealth reserve. Why do you think the Central Banks keep Gold on their balance sheet even today? Right. Even the Gold jewellery demand in countries like India is, in fact, investment demand in disguise – hidden firmly behind veils of religion and culture to protect their real wealth from the depredations of various rulers and governments that have pillaged her over the many thousands of years of her existence.
Moreover, even though most people don’t realize it, even today the dollar is only acceptable as money because it is indirectly “backed” by Gold (via the derivatives market) i.e. you can get Gold in exchange for paper dollars on the open market. The proof of this lies in the fact that were, for some reason, the convertibility of Gold into dollars suspended today [on the open market], the dollar would instantly collapse.
Gold IS Money – not the dollar, not ANY fiat currency. Period.
As the king of banksters J.P. Morgan himself testified before the Pujo Committee in 1913:
“Gold is money and nothing else”.
The Fiat Money Scam
Throughout history no fiat currency has survived – ever. There is a reason for it. Paper money is inherently a scam – a scheme to loot the people who actually produce the goods and services in the economy. Just because it is legalized and its perpetrators hold fancy government titles does not mean it is not a fraud. The issuer can create unlimited pieces of paper – or computer bits today – at essentially no cost and use them to appropriate real goods and services in the economy. So whereas you and I have to actually do real work to procure it, the printers of the currency can basically print whatever they need. This is why there is a constant inflation of money supply under a fiat money regime as has been the case since the Federal Reserve was established in the US in 1913, as constant theft requires constant creation of new money. The evidence of this inflation is the annihilation of the dollar’s purchasing power since then:
The Dollar's Purchasing Power Since the Creation of the Federal Reserve in 1913
This is why we have legal tender laws making the unconstitutional Federal Reserve Notes legal tender with the monopoly of the private banking cartel (i.e. the Federal Reserve) enforced by the courts enabling the banks and the government to essentially enslave the populace. This is also exactly why the founders of America prohibited anything except Gold and Silver to be used as money, and why the governments go to great lengths to suppress their price. Indeed, America today is the very antithesis of what its founders intended.
The fraudulent money system today is the source of all the rottenness. The various scams in progress today - the entrenched corruption - can be all be traced back to it. The rot is at the very top of the pyramid from which the fountain of fiat money emanates. It is indeed telling that the two World Wars occurred right after creation of the Federal Reserve. Further, no amount of prosecution will fix the system because the prosecutors themselves have been corrupted. As Ayn Rand said:
"When you have made evil the means of survival, do not expect men to remain good. Do not expect them to stay moral and lose their lives for the purpose of becoming the fodder of the immoral. Do not expect them to produce, when production is punished and looting rewarded. Do not ask, 'Who is destroying the world? You are.”
It is too lucrative a scam to be given up voluntarily by those owning the printing press while the going is still good. It is like expecting a thief to stop stealing while not only being immune from any sort of legal prosecution, but actually having the power to create laws. The system cannot be fixed - the only way this will stop is a collapse of the existing system so that a new one can be built – and we are in the middle of it right now.
Deflation in Terms of Gold, Hyperinflation in Terms of the Dollar
By its very nature, due to economic control being concentrated in a few hands and fraudulent creation of money out of thin air, the fiat money system creates massive misallocations of capital and resources throughout the economy. The economy under a fiat money system is no different than a centrally planned one, such as the Soviet Union. Moreover, since the entire world is on a fiat money standard today – with the various fiat currencies themselves being “backed” by the fiat dollar - misallocations of capital have occurred throughout the world resulting in malinvestments. These misallocations are both material and human, as exemplified by the skyrocketing unemployment rate. The malinvestments now need to be liquidated i.e. converted to the most liquid form – “the most marketable good” or money - so that the capital can be reallocated to more productive uses. Loans are called in as they can no longer be serviced. This results in deflation, i.e. rising demand for money in relation to everything else, and consequently falling prices and increasing purchasing power of money. Moreover, economic uncertainty means that more and more people want to hold “the most marketable good” i.e. money thus further increasing the demand for money.
Now normally – since a lot of debt-money is destroyed in the process and there is a rising demand for money - this would lead to a rising dollar (in terms of purchasing power, not the meaningless DXY), but that would mean that the whole “theft-via-inflation” scam would fall apart. The government can’t tax a rising purchasing power! They simply CANNOT allow deflation in a fiat money regime as it would defeat its very purpose – that of allowing them to appropriate resources from the rest of the economy. This would threaten their very existence. This is why holes created on the banks’ balance sheets by defaulting loans – which would normally create deflation - are being eagerly filled by the Central Banks. This is why the Fed is now simply printing money out of thin air – both overtly and covertly, with the derivatives market being cleverly used to absorb the excess money creation (so you were wondering why the derivatives monster is increasing exponentially in size?) - to fund the government’s operations as there is not enough money in the market to lend to the government. Hiding under esoteric nonsense terms like “quantitative easing” does not change the fact that it is simply creating money via ledger entries and outright STEALING.
Whether they “allow” it or not deflation WILL take place – not in terms of dollars, but in terms of Gold. It’s simply forces of nature – the market – at work. The dollar deflationists expect the dollar to suddenly reverse its 100 year long drop in purchasing power. Ain’t gonna happen. What the government is doing now – i.e. spending raw printed money into a contracting economy - assures us that we will end up with the hyperinflation of the dollar. The only thing they can do is prolong its demise with intermittent bouts of induced apparent “deflation” to keep the inflationary scam going a little bit longer - remember 2008? (h/t Gary). Initially, of course, many people (such as Mr. Denninger) – mistakenly thinking the dollar to be “money” – will rush to its perceived safety causing the dollar to rise. But ultimately, as more and more people realize that the government will not – indeed, cannot – stop inflating the currency into oblivion, will choose to hold the ultimate “marketable good”, i.e. Gold. This is the reason why Gold is the only asset class at new all time highs. Rest assured, even the big boys are holding Gold in their private vaults, not dollars. Is there any sense in holding something you can create at will?
Ultimately, there can only be deflation in terms of commodity based money such as Gold since it cannot be created out of thin air. Indeed, we have already been deflating in terms of Gold for the past decade. Just look at the various commodities, the stock market, real estate – pretty much anything - priced in Gold – it’s all going down.
SPX priced in Gold (2000-2010)
As capital goes down the liquidity pyramid in search of the most marketable good, all the money derivatives – including the dollar – will collapse returning all capital to where it came from: Gold; a global reset, if you will, with only holders of Gold left standing when the dust settles:
Exter's Liquidity Pyramid
You Cannot Eat Gold, But You Can’t Eat Dollars Either
That has to be one of the lamest arguments against Gold – ever. It is the sign of a closed mind. It shows that you don't know ANYTHING about human history, which is not surprising considering the sorry state of our government controlled "education system". You cannot eat FRN’s either – why not just burn them? The function of money is not to be eaten but to be used as a medium of exchange and store of wealth i.e. to get what you want to eat at an indefinite time in the future. And while with Gold you are assured of getting at least something in return in the future, whether it is an edible product or not, it is not so with dollars. Fiat money has a problem in that it lasts only as long as the government enforcing its use does. In times of economic uncertainty, such as today, when the very survival of various governments is at stake (yes, that includes the US Government) do you want to hold Gold or their worthless colored paper tickets? Gold is the only money that has outlasted empires and governments - no fiat currency has. Think about it - what will your dollars be worth when there is no government to enforce it as legal tender? Yup – zip, zilch, ZERO. And to those who say that we will not need Gold (but something else like food or guns) in such extreme circumstances, I say that empires and governments have constantly collapsed throughout history but it did not mean the end of the world. As long as you believe that human society will exist and there will be division of labor, you need money (i.e. Gold) – because:
a) You cannot store indefinitely all your needs especially perishable items such as food.
b) You do not know with 100% certainty what you will need in the future.
c) You cannot produce/manufacture everything that you will need today or in the future by yourself.
Even if the government does not collapse there is nothing stopping it from devaluing the currency at will in a step function thereby instantly appropriating a vast amount of your savings, as has already happened not once but twice with the dollar since the creation of the Federal Reserve. I mean really, the facts are so obvious that you have to be either be in total and complete denial (perhaps due to having already put all your eggs in the dollar basket) or in collusion with the people promoting the paper money scam.
Gold is the currency beyond Governments. It is the most liquid form of money accepted throughout the world – the true reserve currency of the world - whereas Dollars, Yuans and Euros etc. are only guaranteed to be accepted within their own respective countries, and as long as their respective governments last. Why would you want to tie yourself down to the paper currency of a particular nation, especially in times of such turbulence? It points to a very limited sphere of thinking when you advocate that holding only dollars is the best strategy. It is a fallacy to believe that there is no refuge outside the system; that you have to be trading paper tickets all the time to “keep up” with the dilution of your purchasing power or just stand by idly holding dollars while the government rapes you. Gold is your refuge outside the system.
Got Gold, Mr. Denninger?
*In general we can state that they are “fiat-money deflationists” since the process of money creation is same in all the countries i.e. money is created as debt and the collapse will follow a similar route. The only caveat in my opinion is that since the dollar backs all the other fiat currencies, it *might* collapse last. Also, to keep things simple, for the rest of the discussion, we’ll simply use the term “dollars” with the understanding that it can be used interchangeably with the general terms “fiat currency” or “fiat money” since it is one itself.
For an excellent discussion refuting the dollar-deflation theory and why the dollar WILL eventually hyperinflate, please refer to "No Free Lunch".
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Excellent article.
I'll always keep my time to time purchases of gold.
But, the problem is: it's going to implode sometime, that's certain. But when is the question. I could make a lot of money if the next move is deflacionary in terms of the fiat dollar or if it is inflationary.
I could now buy gold with all fiat paper I have. But that's the best option right now?
Deflation is bull. It's always thrust out into the collective conciousness as some thing real and a workable strategy but it IT'S not. It's a trick. A last gasp of a dying math problem trying to get everyone to sit with dollars in hand while it corrects itself by destroying a 30 40 percent of it's debt while simultaneously raising it's GDP through massive inflation some 30 to 50 percent. That's why there are always crashes before it happens. To give the illusion of deflation. But as soon as it crashes they try to reinflate it and it crashes again. Then they finally give up and do a massive currency inflation.
What we are seeing now is an attempt to seal off the exits. They want to do this not against the US's economy because doing against it alone would be tooo outlandish and too painful since it's a global reserve currency. So they have to drive and corall people around. They'll try to destroy as many alternate hiding holes as possible. They will nuke euro, nuke nikei, nuke anything and everything but treasuries. Hoping the whole time that not enough people hide in gold to pull the rug out from underneath them.
The problem is it's a reserve currency. They can't even do the revaluation till they nuke every market on every country driving everyone out of equities and into treasuries or bonds. And they have to hope that most of it drives to US treasuries.
It'll become apparent what is happening when suddenly a europe shock turns into a simultaneious europe, china, asia pacific shock. But they can't do it too fast. First europe has to be shattered up a bit. Europe went to gold so they will probably try something very very fishy to drive people out of gold. What that is I don't know but it's going to happen soon.
If deflation is a myth, what is the relation of housing prices to their levels in 2008?
How about oil?
Etc, etc?
Johnny johnny johnny. You're like a never ending retard looking at an aggregate rock mix where 5 out of 100 rocks shrink and you go loook looook loook deflation!!!
Have a waterboy.
http://www.youtube.com/watch?v=pu7AR0-FRro
ok mr engineer . psych minor,
A last gasp of a dying math problem trying to get everyone to sit with dollars in hand while it corrects.
storing gold is tough for a chick. i always get screwed by the gold and money handlers.
now that i learned about sociopaths, thinking these could be some of the handlers!
just my 2¢s
tough for a chick? Like how, you can't add or something? Buy on the internet, same price M/F
Velo, are you pawning your clothing? You poor dear.
Someone get her a blanket or something.
not necessary dear,
it's summer, slendor in the grass, as some say†
"so they will probably try something very very fishy to drive people out of gold". Observing what they did to gold / silver in fall of 2008 is what they will do. Also in July 2008 when the manipulators hammered PMs before the crash. The fiat hammer came down on PM's when bearn stearns went belly up and the transfer of their short position went to JPM in March 2008.
They will talk up deflation big time and tell everyone that all assets will get hammered during deflation... then like precogs, it actually happens (thru manipulation) and it reaffirms what they had been telling people about deflation. People forget how all the mainstream blowhards couldn't see a bubble forming for all those years. But, 'all of a sudden' the media people, on the surface, look like they know what they are talking about. The media just reads the script.
You can't double dip gold. It gets sold off on the first crash but there's never any in the hedge funds hands to crash it again. It's got to be something like a wild huge consipiracy about a new mine discovered with 4 bajillion tons of it. Then they just take a bit from private stashes dump it on the market to try to set off a massive sell off.
Maybe after all the oil gushes out of that hole in the gulf, it'll then start gushing gold.
Headline!
New gold mining deposits discovered on Mars! 30 countries planning mining operations to start by 2011!
or
Gold created from fairy dust mixed with FRNs! Get your FRNs while they're hot! *(Fairy dust not supplied.)
cost to mine gold on mars 6000 an oz.
If I knew the future that precisely, I wouldn't be writing blog posts now, would I? :-) If you are hesitant to go all in, the best option is to just buy some every month and then forget about it, IMHO.
GG, what about the argument that by buying gold, we forcing dollars back into the system and are starving TPTB of oxygen? Would you say that it is our patriotic obligation to the founders of the country to dump FRN's and buy gold in order to end this farce?
Since I figured out the game, I've thought of the purchase of PM as an act of civil disobedience. That is perhaps the largest benefit, though there seem to be many.
Si Senor
exactly as ze germans did 2weeks ago
Si Senor
Aye. Johnny Silver Bear said it best here:
http://www.silverbearcafe.com/private/02.09/ipledge.html
Confed,
Here's the ANSWER to all our issues!!!!!!!!
http://www.cnbc.com//id/37400587
The payment of interest by the Fed on required reserves and the excess reserves currently at the Fed, is another transfer of wealth from We the People (taxpayers) to the Banksters.
Where do the funds come from to pay the interest if they are not created out of thin air? From the "investments" the Fed has purchased with monies created from thin air, including Treasuries, MBS, etc.
This is but another scam and theft from We the People, wrapped in the cover story of a monetary tool to prevent monetary expansion from getting out of control.
-----------------
"You are a den of vipers and thieves. I intend to rout you out, and by the grace of the Eternal God, will rout you out." - Andrew Jackson
Fortunately, or unfortunately for them, 80% of Americans are for auditing the Fed.
"Eighty percent (80%) of Americans now agree with Congress that auditing the Federal Reserve Board is a good idea, according to a new Rasmussen Reports national telephone survey"
http://www.rasmussenreports.com/public_content/business/general_business...
Yes, but:
1. Won't happen. Or the audit itself will be corrupted.
2. Most people will not understand why this plan is bad. If they did, this would trigger the massive bank run.
3. We better learn to Tango, they're going Argentinian on us.
"We better learn to Tango, they're going Argentinian on us."
one more milonga madamoiselle?
http://www.youtube.com/watch?v=oCJq7SJqtAc
http://www.youtube.com/watch?v=psM4UsC0YCQ
going Argentina on us. cha'
Hearings have already been held:
http://edlabor.house.gov/testimony/2008-10-07-TeresaGhilarducci.pdf
and here's her cv:
http://www.newschool.edu/scepa/Ghilarducci_longCV_2009.pdf
I'd say c-word, but there's ladies present so qwm will do.
- Ned
Hee, hee. The Brando made my hairs stand on end. That was actually a pretty tame Tango in the first vid tho.
Wow, they REALLY ARE just going for broke, aren't they. This is an Act of War. Now that they've stolen all the big money, they are going after the gasping, hapless fish, who will be more than willing to suck them off to survive. Greatest show on Earth!
ABSOLUTELY.
+1000000000
CDHS to appear soon at your front door Gordon.
(Confederate Department of Homeland Security)
There is no hiding place. If they really want to find you, they will.
Yes, a good act of subversion.
Game of comparatives.
Which to hold? Enron stock--Argentinian bonds--US Treasuries--Residential real estate? Gold?
Living in a world of vaporware. Gold protects SOMEWHAT (perhaps the best of flawed security) against the vagaries of conspiring men. Paper money IS their instrument of vagary. The devaluation of the FRN in the above graph represents the subtle destruction of value in times of relative quietude. What will their reponse be in times of historic strain and duress?
We live in a system of their design, transacting with their game pieces. Only one readily available and widely recognizable commodity provides some exit, and relief from the puppet strings. Gold. And in a way it is one of the most effective means of quietly alerting a dysfunctional gov't of an imminent strike by market participants.
It is the ultimate vote of no confidence for rampant malfeasance and market mischief.
Hold it or no. Time will eventually make this trade a "make or break".
Couldn't agree more, Alexandre Stavisky.
We are small pieces in a big game. As I see what really happens in this world, everything seems so easy to understand, so logical.
The FED, central banks, the goverments, money, the "news" across the globe.
We, people, may have only one shot to change things. Forever.
But now the big mass only wants to see television and their money each end of month...
Alexandre Stavisky
Books would be nice to hold.
In a collapse they become a limited resource. Woodworking, survival, farming, so on. After that fiction.
i have lots of red wine, but currently out of luck and no caddy.
the pic suggests you are not without assets with income-earning potential
Just like Primus said below:
Gold. Silver. Organic farmland. Guns and ammunition. Canned goods.
It is all the same 'investment'.
And also, now: "technical books".
=)
Yes, that's what I'm doing.
I live in Brazil and real state here have simply skyrocketed. I could buy one good apartment now (paying a more or less high interest) and wait (hope) for an inflationary event.
Or wait for a depression to buy at a lower price.
Or even buy some land that I can have some food growing!
In the end, I know we'll see some dark times ahead of us. Maybe doesn't matter even if I own great amount of gold or not. All we can do is have some "insurance".
Anyway, Brazil is booming. And it is one of the good places to live when the worst comes, if it comes. Don't forget this.
Would love to buy some land in Brazil !!!!!!!!!!!!!!!!!!!
Karl Denninger gets it wrong all the time. He seemed like the typical angry bear in the runup from March 2009. I'm guessing he was short and didn't have stops in place.
Denninger has some useful insights, but he is way too much of an egotist to ever admit that he is wrong, so he'll go to his grave arguing against gold, despite all evidence to the contrary.
I have to wonder, at this point, if one of the rabid gold-hating trolls such as JayBayBaker or JohnnyBravo who invariably infest this forum whenever the topic of gold comes up is not in fact Karl Denninger himself? He is arrogant, insecure and egotistic enough to make it a plausible scenario.
I am not Karl Denninger.
Akak, I've never seen you make any argument to support your position, aside from attacking those who disagree with you as "trolls."
Meanwhile, I on the other hand will often say why hyperinflation is a myth.
The reason why hyperinflation will not occur is because the money supply NEEDS to be increased just to return economic activity to normal levels.
The money supply was no longer consistent with economic activity.
THIS is why we got recession. Recession is the same thing as deflation.
So what do you think will happen to the price of gold when the economy recovers? History shows that it will decline.
Or do you believe that the economy will never recover?
If so, LOL on you.
That's because you clearly were far too busy spreading your anti-gold lies and filthy disinformation to ever bother reading what I had to say.
You are nothing but a sociopathic, malicious troil who is maniacal in his hatred of financial independence for the common man, as you have proven to everyone here time and time again throughout your whole relentless, hate-filled campaign against gold on ZH. It is people like you who do not deserve a place in society, as you offer nothing but lies, deceit and destruction.
Now that's really a bit much, don't you think?
If you were familiar with, and had read, the literally thousands of nasty, misinformative, illogical, and completely hate-filled posts this troll has dumped in EVERY ZH thread touching on gold, then you would see that my response to him is in fact NOT "a bit much". This person is downright obsessed in his hatred of gold ownership, the only real financial independence the average man can assert over our criminal financial and political elites, and that brands him as malicious and evil in my book. Yes, evil ---- you know, that thing that far too many people nowadays refuse to confront or even acknowledge that it exists.
I'm pretty sure that KD posts here under a pseudonym but I can't remember which one I thought it was...
In any event, the style-of-prose is REALLY obvious when it is Karl -- and that style does not really resemble JBB or JB etc.
Like it or not, KD's delivery in print and in-person (video) is fully-steeped in a certain 'style'.
KD isn't always wrong. Made a few shekels off some of his analysis.
He just tends to overcompensate for having voted for 'The One'.
Anybody care to discuss the price of saffron in gold?
http://faculty.ucc.edu/biology-ombrello/pow/saffron.htm
Going for the comestibles, as usual.