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Oil, Gold Rise And Silver Surges To Record On MENA Contagion And Greenspan’s “Faulty” Fiat Currency Concerns
- Alan Greenspan
- Ben Bernanke
- Bloomberg News
- Central Banks
- China
- Consumer Prices
- CRB
- Crude
- Crude Oil
- European Central Bank
- Fail
- Federal Reserve
- Foreclosures
- Germany
- Hyperinflation
- Iran
- John Paulson
- Middle East
- None
- Precious Metals
- recovery
- Reuters
- Saudi Arabia
- Stagflation
- Switzerland
- Too Big To Fail
- Trichet
- Wen Jiabao
From GoldCore
Concerns about Libya, Saudi Arabia and the Middle East and North Africa continue to dominate markets. There are growing concerns of contagion and oil supply disruptions from the region. Oil and gold have risen and silver for immediate delivery surged another 2.3% after climbing to $36.5375, the highest price since Feb. 14, 1980 when silver reached a it’s nominal high $50.35.
WTI Crude Oil – 5 Year (Daily)
Oil (WTI) rose 6.7% last week and contributed to silver rising 6.94% and gold rising by 1.33%. These gains have been added to again this morning. Growing concerns that surging oil prices will lead to further inflation and snuff out the already tentative global recovery will lead to continuing safe haven demand which will support the precious metals on dips.
Gold in US Dollars – 1 Year (Daily)
Currency debasement on a scale never seen before in modern history continues in the U.S. and other countries. This is leading to a real risk of stagflation and possible even hyperinflation if sane monetary policies are not returned to soon.
The fiat currency experiment of the last 40 years (since Nixon came off the Gold Standard in 1971) grows more precarious by the day. Ironically, Alan Greenspan, the central banker most responsible for the cheap money policies and asset bubbles of the last 20 years, has again warned about the euro and dollar being “faulty” fiat currencies.
Greenspan again said how gold is the ultimate form of payment and currency (see interview and transcript of interview in News).
Reuters Thompson CRB Commodities Index – 5 Year (Daily)
"What the price of gold is saying is essentially that there are elements within the marketplace which feel very uncomfortable with respect to what's going on generally," the former Federal Reserve chairman said. "It's not an accident that you're finding that central banks are going in to buy gold."
Greenspan emphasized that he isn't calling for a return to the gold standard. That's just not doable, he said. "I do think that to get a sense of the stability of the system, watching the price of gold is not too bad."
NEWS
(Bloomberg) -- Barnes Tells CNBC Sees Silver Prices Extremely High Over 3-5 Yrs
Peter Barnes, chief executive officer of Silver Wheaton Corp., told CNBC that he sees silver prices going to $50 in two to three years, and will be “extremely high” over the next three to five years and possibly longer.
(Bloomberg) -- Spot Silver Extends Gain, Rising as Much as 2% to $36.3125/OZ
Silver for immediate delivery extended gains, rising as much as two percent to $36.3125 an
ounce in Singapore today. That was the highest level since February, 1980.
(Bloomberg) -- S&P GSCI Commodities Index Extends Gains, Led by Cotton, Silver
The Standard & Poor’s GSCI Spot Index of commodities rose to as high as 728.58, the highest level since August 2008. Cotton, silver and crude oil led the gains.
(Bloomberg) -- Gold Advances to a Record on Libyan Unrest; Silver Reaches a 31-Year High
Gold climbed to a record in London and New York as escalating violence in Libya and concern inflation will accelerate boosted demand for the metal as an alternative asset. Silver rose to a 31-year high.
Clashes during the past two days have become more deadly as Libyan rebels moved along the coast toward Tripoli and government troops loyal toMuammar Qaddafi escalated their use of force. Concern oil supply disruptions may spread through the Middle East pushed the fuel to a 29-month high in New York. Gold typically moves inversely to the dollar, which fell to a four- month low against six other major currencies.
“We have a mix of inflation fears and safe-haven buying,” Peter Fertig, owner of Quantitative Commodity Research Ltd. in Hainburg, Germany, said today by phone. “As long as the political unrest in the Middle East and North Africa region continues and oil prices stay at elevated levels,” gold will be supported, he said.
Immediate-delivery bullion rose as much as $12.05, or 0.8 percent, to $1,442.95 an ounce and traded at $1,440.93 at 11:42 a.m. in London. Prices beat the previous high of $1,440.32 set March 2 and gained the past five weeks, the longest winning streak since October. Gold for April delivery was 0.9 percent higher at $1,441 an ounce on the Comex in New York after reaching an all-time high of $1,443.30.
Silver for immediate delivery was up 2.6 percent at $36.5275 an ounce after climbing to $36.6625, the highest price since Feb. 14, 1980. That year the metal reached a record $50.35 in New York.
Weaker Dollar
Gold rose to $1,437 an ounce in the morning “fixing” in London, used by some mining companies to sell output, from $1,427 at the afternoon fixing on March 4. The U.S. Dollar Index declined today as a report showed European investor confidence rose to the highest level in 3 1/2 years.
“The U.S. dollar weakening is supporting gold prices,” said Bayram Dincer, an analyst at LGT Capital Management in Pfaeffikon, Switzerland.
Concern about rising inflation and currency debasement drove gold prices up 30 percent last year for a 10th annual gain. Asian countries from China to Indonesia raised interest rates this year to curb rising consumer prices. Increasing food and commodity prices have contributed to unrest that toppled leaders in Tunisia and Egypt, with protests also erupting in countries including Iran, Yemen and Oman.
The United Nations estimated as of Feb. 26 that 1,000 people had died since the Libyan uprising began in mid-February. In Saudi Arabia, websites have called for a nationwide “Day of Rage” on March 11 and March 20, according to Human Rights Watch.
China Inflation
Chinese Premier Wen Jiabao told the annual National People’s Congress in Beijing on March 5 that reining in inflation is the nation’s top priority. European Central Bank President Jean-Claude Trichet said last week that the ECB may raise interest rates next month to fight accelerating inflation pressures. Federal Reserve Chairman Ben S. Bernanke has signaled he will keep the Fed on course to finish $600 billion of Treasury purchases through June.
“Basically you have an environment where you have rising inflation and increasing liquidity,” Juerg Kiener, chief investment officer at Swiss Asia Capital Ltd. in Singapore, said in an interview with Bloomberg Television. “We have a very large physical position of gold and silver in the market.”
Palladium for immediate delivery rose 0.5 percent to $816.25 an ounce. It touched a 10-year high of $862.25 on Feb. 21. Platinum was 0.1 percent lower at $1,839.50 an ounce.
(Bloomberg) -- Vietnam Stops Gold Bullion Trading and Production Licenses
Vietnam’s central bank said it is ceasing to issue licenses for gold bullion production and trading, without giving a specific timeframe, according to a statement on its website today.
The State Bank of Vietam will eventually eliminate deposits in gold at banks, it said.
Vietnam’s banks have about 112 trillion dong in gold deposits, according to the statement.
(Bloomberg) -- John Paulson Hedge Funds Gain in February as Gold Price Rallies
John Paulson, the hedge-fund manager who earned about $5 billion last year, posted gains last month in all his gold-denominated funds as the metal rebounded from its January lows, according to a report sent to investors.
The Paulson & Co. Gold Fund gained 13 percent in February, erasing most of the January losses and leaving the fund down 0.5 percent for the year, according to the report, a copy of which was obtained by Bloomberg News. The Advantage Plus Fund rose about 7 percent in the gold share class.
Gold gained the most last month since April as violence in Libya and other states in the Middle East spurred investor demand for precious metals. Paulson, 55, is betting inflation will accelerate and fuel demand for the metal in coming years.
His investors can choose to have their stakes denominated in gold rather than dollars, meaning the value of their investment rises and falls with the price of the bullion.
Armel Leslie, a spokesman for Paulson, declined to comment on his February performance.
The dollar-denominated Advantage Plus Fund, which uses strategies designed to profit from corporate events such as takeovers and bankruptcies, rose 2.3 percent in February, according to the report.
Paulson’s dollar-denominated Advantage Fund gained 1.6 percent, while the gold-share class jumped 6.6 percent. The dollar-denominated Recovery Fund climbed 3.5 percent and the gold-share class rose 7.5 percent.
2010 Gains
Paulson benefited last year from his stake in the gold-share classes of his funds, whose gains were at least double those of the comparable, dollar-denominated shares after a 30 percent jump in the precious metal. His earnings in 2010 also
included a portion of the 20 percent performance fee the firm collected on its gross profit of $8.4 billion.
The Gold Fund, which can buy derivatives and other gold-exposed investments, jumped about 35 percent in 2010.
The dollar-denominated Paulson Partners Fund, which invests in the shares of merging companies, was up 1.6 percent last month and rose 8.4 percent in the gold-share class. The dollar-denominated Partners Enhanced Fund increased 2.8 percent, while the gold-share class climbed 6.2 percent.
Paulson’s dollar-denominated Credit Opportunities Fund rose 1.9 percent last month and its gold-share jumped 5.6 percent.
(CNBC) -- CNBC EXCERPTS: DR. ALAN GREENSPAN, FORMER FEDERAL RESERVE CHAIRMAN, ON CNBC'S "SQUAWK BOX" TODAY
Following are excerpts from the unofficial transcript of a CNBC interview with Former Federal Reserve Chairman Dr. Alan Greenspan today on CNBC's "Squawk Box."
GREENSPAN ON OIL:
"One thing that economists have been bedeviled by over the years is that the correlation between oil prices on a global basis, and global economic activity is far more precise than any evidence we have that it should be, in short, as a leading indicator, global oil prices are a very useful statistic, the only problem is we don't know fully where all the channels are."
GREENSPAN ON MOMENTUM:
"My view is that when oil prices get up to this area and start to move up even higher, you do have to start to worry, but there is no question at this stage that the momentum of this economy, leaving out the oil price issue, leaving out the Euro problems that have emerged, and very specifically leaving out the budget problems, this economy is really beginning to pick up momentum."
GREENSPAN ON MOMENTUM:
"There is no question at this stage that the momentum of this economy, leaving out the oil price issue, leaving out the Euro problems that have emerged, and very specifically leaving out the budget problems, this economy is really beginning to pick up momentum."
GREENSPAN ON FORECAST:
"The fascinating issue for forecasters is how do you factor in all of the negatives because there are not sort of modest rises here, modest costs here, these are big stuff on both the debit and the credit side, and how its going to work is not all together clear-- but for the moment this economy is moving."
GREENSPAN ON CURRENCY:
"When you have two faulty currencies, and the euro and dollar are both faulty, but probably almost equally faulty, so that the exchange rate between the dollar and Euro is not really moving all that much."
GREENSPAN ON GOLD:
"What the price of gold is saying, is that there elements within the marketplace that feel very uncomfortable with respect to what is going on generally, and its not an accident that you're finding that central banks are going in to buy gold and one of the reasons is gold is historically one of the rare media of exchange that doesn't require any collateral or backing, counter signatures, gold is universally acceptable as a means of payment."
GREENSPAN ON THE GOLD STANDARD:
"I'm not saying we can or should go back on the gold standard, that would be extremely difficult, and it would require such cast changes that this society has made no indication that it wants to do that, but I do think to get a sense of the stability of the system, watching the price of gold is not too bad."
GREENSPAN ON OIL PRICE:
"When we talk about the price that will hit us, keep an eye on brent and not on WTI, that has got technical problems."
GREENSPAN ON FORECLOSURES:
"I am assuming, and this is an assumption, that the foreclosures will begin to slow down, they are beginning to slow down, but the problem that we've had is such a large proportion of sales are distressed sales, and clearly if you have a significant proportion in that category, the overall price level is going down."
GREENSPAN ON HOME PRICES:
"Ultimately what is the determinate, as far as I'm concerned, is basically whether or not the price, excluding distressed sales, is falling, because the other is a statistical problem, I'm not saying its not real, it is real, but it gives you a false signal, so I'm watching the less distressed sales, now I must admit those prices have edged down recently somewhat to my surprise. But not enough to create where I think the problem is."
GREENSPAN ON MORTGAGES:
"When subprime went underwater, they were very rapidly going into foreclosure because they couldn't basically live with it, but the vast majority of conventional conforming mortgages, even those which were underwater, are none the less capable of being financed by the people who live in the homes the proportion of conventional conforming homes that will be defaulted, is really very small."
GREENSPAN ON THE FED:
"At this point the Fed is in the position where it can contract its balance sheet very significantly and the issue is will they be able to do it in proper timing? They think they can."
GREENSPAN ON BERNANKE:
"These are judgments that you have to make, I know Bernanke very well, we worked together, Ben and I went over a number of crisises together, I know how he functions, I have considerable trust in his judgment."
GREENSPAN ON THE FUTURE:
"You're dealing with very difficult problems. The one thing we all pretend we can do but we can't, is forecast, the future out there isn't very bright."
GREENSPAN ON DODD/FRANK:
"I look at whole series of mandates in Dodd/Frank and I think some of them are internally contradictory, and we're going to find out if that is indeed the case when the regulators start to implement."
GREENSPAN ON CONSEQUENCES:
"What we're going to find is that the unexpected consequences of much of the new regulation that's going to come as a result of Dodd/Frank is going to have to reversed, and that's going to create very high degrees of uncertainty."
GREENSPAN ON TOO BIG TO FAIL:
"The purpose of a financial system is to move the scarce savings of a society into physically productive assets, we in the United States have been very affective in doing that, poor savings but very high rates of return. You start moving some of that scarce savings to propping up companies, it does not go into effective uses, and the result is output per hour slows down and standards of living slow down. So too big to fail is critically an issue with respect to standards of living, you have to have failures, JOE (HAVE WE SOLVED IT?) no we have not."
GREENSPAN ON SAUDI OIL:
"Saudi Arabia is, look- its got three and a half million barrels of standby crude capacity, nobody else has standby capacity, so Saudi is a whole game."
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At what point does a billionaire step in, buy 10,000 contracts at COMEX, deposit the fucking $1.75B up front, and stand for delivery? That's not a lot of money; David Einhorn would be my choice. He'd have a movie made about him.
Or 10,000 little guys each buying one contract.
Someone should start a whip-round and a facebook page. Group discount?
contract sz: 5,000
current price: $36.40
contract cost: $182,000
And that's not counting actual cost of delivery (van rental, etc). I doubt that's within reach of the average "small investor".
Lets pool it in 10s. so we need 100k people. Someone call Charlie Sheen and tell him to hook up with Max Kesier. Thats a winning formula.
LOL. But, beyond the humor, Sheen has, what, 2M facebook/twitter friends? I think he might be very up for this idea--he's got a very big ax to grind . . .
Anybody know how to get in touch with his buddy Alex Jones??
Hmmm, I bet Kaiser does.
Im sure he would. He could also be the anchor order to get things kick started.
Sounds like a plan. Anbody who can get the ball rolling?? My surboard is short on mercury . . .
The only problem with that is IF the comex did default ,well we loose big time , all that money gone
It's 8:25 am. Do YOU know what Blythe is up to?
the 'average investor' is driving demand from the dealers and private mints. the private mints are buying in the futures market.
well, equity momo, i thought the greenspan one-liners were fantabulous!!! plus, since i don't hafta look at the pathetic little monkey, i can imagine him wielding a Geo. Burns Panatella and just shrugging off the launches...
rosie and the earl of morningwood want to have a little chat this morning, then, i believe i shall breakfast alone, on lucky charms & whipping cream. again.
The most sensible argument I have heard against this is that it would kill the goose that's laying the silver eggs.
The 'Buyers of Size' wish to acquire as much physical silver as they can at these artificially low prices; a COMEX default would put a stop to that.
As long as our governments (via their proxies, JPM et al) are willing to keep prices low by naked shorting, made possible by diluting our money via limitless creation of fiat currency, it's in no one's interest to bring the music to a stop until all the physical stockpiles has been acquired.
Then the COMEX will default, and we'll see true price discovery commence. Along with the crushing of the USD, $250 oil, etc, etc.
It'll be exciting, yes, but very dangerous for those of us living in urbes. As a parent I'm not looking forward to it, to be honest.
real size buyers do not procure physical commodities from futures exchanges.
Those are intended primarily to be cash settlement mechanisms.
Thanks for making me think about this more deeply.
If rumours are true, and it is hard to acquire large quantities of physical silver at its current price, then my understanding is that the BoS can decide to take delivery from futures exchanges (and SLV), where the supply is supposedly much greater - much greater because the quantity has been inflated by naked shorting.
As long as the amount demanded for delivery when the contracts expire is less than the quantity the sellers physically can deliver, the fact that the price has been manipulated downward is largely irrelevant. But if more silver is demanded, there will be a default, and the buyers will be rewarded with a cash settlement considerable in excess of the contract's face value. This of course will push up the demand, and the price, of long contracts on the exchange, meaning that any longs that stand for delivery in the future will be paying a lot more for their silver.
My argument is that it makes sense for them not to do this, if they value acquiring physical silver (at its current price) more than they value their fiat.
Comments, please.
If the desire was for true price discovery, there would be no unbacked contracts. No naked shorted paper silver, buyers and sellers would both be on a delivery mandate. A contract could not be settled in cash.
The contract might change hands many times between it being opened for delivery X many months into the future, but when settlement time comes around, it settles and someone takes deliver of 5000 oz, and someone is relieved of 5000 oz.
If the desire was for true price discovery, there would be no unbacked contracts. No naked shorted paper silver, buyers and sellers would both be on a delivery mandate. A contract could not be settled in cash.
That's my point - there is no such desire, at least, not by i) central banks, and ii) anyone who wants to acquire a lot more physical at its current price.
The contract might change hands many times between it being opened for delivery X many months into the future, but when settlement time comes around, it settles and someone takes deliver of 5000 oz, and someone is relieved of 5000 oz.
Not always. If the seller floods the market with naked shorts just before close date, they will force the price down, and acquire the long positions at a cheaper price, thus i) not have to deliver, and ii) make a profit.
You keep saying that, but it isn't true.
Sure, maybe 99% of transactions settle in cash, but any short that can't or won't cover must deliver real commodities to any long who stands for delivery.
If these were intended to be cash settlement only, they would be called ETNs, not futures contracts. Further, speculation in such products would have NO IMPACT on the price of the actual commodity, since no actual supply is withheld from the market by speculators.
Stop repeating this disinformation.
We are so fucked.
Yes, what cost $1 in 1913 now costs $20. But so what? Money neutrality states that if you were earning $1 per hour in 1913, you are now earning $20 per hour (and even more, if labor productivity is higher).
So there you go, the Fed is responsible for increasing your nominal wage by a factor of 20. How do all you workers out there like them apples? Ron Paul wants to rob you of these wage increases!
(David Andolfatto, Chief Economist Federal Reserve Bank Of St. Louis)
http://wallstreetpit.com/64990-ron-pauls-money-illusion
Problem is not even so much the wage increases set in motion by inflation, it is the take up the ass penalty watching your savings decrease in value.
What an asshole the man is. So, if the dollar has declined by a factor of 20, and a hundred years later, wages have increased by a factor of 20, everything is fine? What about the enormous increases in productivity over the last century? What happened to all that increased wealth?
Essentially, inflation has enabled the parasitic financial elites to siphon off all the productivity gains made in the last 100 years that would otherwise have accrued to the common man.
Thanks, Woodrow.
Well, at least he knew what he did was wrong.
"I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the civilized world. No longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and duress of a small group of dominant men."
"Since I entered politics, I have chiefly had men's views confided to me privately. Some of the biggest men in the United States, in the field of commerce and manufacture, are afraid of somebody, are afraid of something. They know that there is a power somewhere so organized, so subtle, so watchful, so interlocked, so complete, so pervasive, that they had better not speak above their breath when they speak in condemnation of it." -- Woodrow Wilson, The New Freedom- Woodrow Wilson, after signing the Federal Reserve into existence.
... and thats the president speaking!
land of the free bitchez.
WW had his eminence grise, the so-called "Colonel" House.
Above from foreword by William Norman Grigg, pp. ii from "Philip Dru: Administrator" e.g.:
http://www.abebooks.com/servlet/SearchResults?sts=t&tn=%22Philip+dru%22&...
Then House "helped" FDR to extend the Great Depression, .. er .. New Deal.
- Ned
+1040 EZ
What's cheering about the article is that the vast majority of the commenters see right through his sophomoric monetary sophisms and call him out for the shill he clearly is.
This guy is such an obvious liar that it is laughable - or it would be, if the matter at hand wasn't so serious.
First, let's assume that $20 now is equal to $1 in 1913. His conclusion that $20 of wages = $1 of 1913 wages is dead wrong - and he knows it. Why?
1) Taxes are far higher now, even on someone who is lower-middle to middle class like someone who pulls in $40K right now. Social Security didn't even exist then. Income tax then was only for the "rich" (those making over $20,000 THEN - equivalent to $400,000 now) and had a top rate of 7% when you got over $500,000 of income ($10 million now). http://www.taxfoundation.org/publications/show/151.html
2) The relative cost of housing and schooling is far higher now, as is the relative cost of health care. That all comes from wages.
3) As you pointed out, what about productivity gains? Do we just forget about them?
4) I'll bet that transportation costs a lot more now than in 1913 - where does the money come from to pay for that?
5) What didn't we have then that is considered a necessity now - telephones, electricity, various electrical appliances including TV, electricity to run all of that, cellphones, etc. Again, where does the money come from to pay for all of those things?
Inflation is the most manipulated figure, followed closely by unemployment statistics. You want a guide to inflation? A silver quarter from 1964 is now worth $$6.57 - call it $6.50, which is 26 times face value in only 47 years. Yet, according to the official CPI, $0.25 in 1964 would buy $1.78 of goods. http://146.142.4.24/cgi-bin/cpicalc.pl I'd say that it is understated by quite a bit. Yes, I know, silver is only one commodity, and not a terribly important one in most people's lives in terms of a percentage of their expenditures (well, except for ZH'ers, but we're not exactly typical), but that is only one example. Cars, for example, cost on the order of 10x what they cost in the mid-'60s. Granted, cars have more standard equipment (much of it EPA-mandated) and arguable have better handling and crashworthiness, but this is normal technological development brought about by competition - IOW, the price per unit of performance (however you measure it) should be going DOWN, due to competition. I'm sure that all of you can come up with others.
This guy isn't serious, he's a stooge and a very bad liar. However the CNBS people and other financial reporters won't even challenge him or his figures, and the average person has not a clue that this moron is advising the Fed.
Furthermore, we get taxed on any putative interest we earn on our savings, irrespective of the level of inflation.
AND - on creation, the new money does not get doled out equally to everyone. The first recipients get the advantage of being able to spend it before price levels have risen commensurately. The money trickles through the economy raising prices, and it's the poorest, those on fixed incomes, and savers who lose purchasing power.
You underestimate Sir Alan. He mixes truth with lies quite cleverly. Some of his current "truth" is newly (re)discovered, and designed to salvage his reputation. It is now up to some future historian to cherry pick Sir Alan's comments and actions and buff up his image. The chapter in your grandchildren's history book will be entitled "Sir Alan and Sir Ben: The Men Who Saved the World".
He would get a pair of concrete Nike's...
That action would be considered terrorism...
>>Barnes Tells CNBC Sees Silver Prices Extremely High Over 3-5 Yrs
And thus begins John Q public's move into the metals. $36.70 ... criminy this is ridiculous.
If all we did is sell 5 min before the NY open and buy the NY close.. we could get rich in our sleep..
China can do it and China is doing it.
Guys. Pssst. I just heard a rumor that JP Morgan is short wampum.
The Indians used up most of it 400 years ago, so there is a shortage. If we buy all the physical Wampum, JP Morgan will default and we will ruin Blythe and the Evil banksters.
Buy Wampum and bankrupt JP Morgan. If we all take delivery of the useless wampum, COMEX and JP Morgan will default!!!!
Hows that stock pick doing?? GEN is sucking it up again today...
Math Man is RNR. He's a Soros paid troll.
Math girl, you do not know how to troll. Wait until PMs are down and the market is up, then twist the knife. If you do not understand what I am telling you, ask the guy in the cubicle next to you.
Of course the world is going to end up with a gold backed reserve currency. Nothing else works. There are no barriers to it. It is as easy to go to a gold exchange standard as it is to come off one. The US alone has done it repeatedly. You don't need any extra infrastructure.
The problem is once gold becomes money again the governments will do everything to control and regulate it
"The problem is once gold becomes money again the governments will do everything to control and regulate it"
good enough, but I got silver so it's all good.
I'll worry when the regulate silver american dimes othewise it's all good.
problem also, is when a recession hits, all the gold disappears and theres no money to stimulate growth. sure these guys fucked up keynes ideas. but in essence fiat wqorks better than gold.
as long as you dont have corrupt assholes bleeding the system.
oh and you cant fight modern war on gold , everyones broke too quickly.
not that thats a bad thing.,just saying TPTB need fiat to run wars way past broke, if they want to win .
in essence gold holds value, fiat loses value as soon as you print it and pay the guy his wages. as soon as joe sixpack gets his pay, its losing value. pay him in gold it keeps its value.
if you where emperor what system would you want to keep the minions poor and productive?
The first line of your post is so full of bad assumptions and nutbag economics that it boggles the mind.
Growth comes from savings. People save money or gold in banks when the banks are solvent. The banks lend the money and create growth. People don't save money in banks when the banks are not safe. They do not save money in banks when they get no return. When the money that is saved is depreciated, savers become poor. If a saver's money is depreciated, they cannot save enough money to start their own business. If they borrow money to start a business, the business is saddled with an effective tax from the bank in the form of loan interest that may kill it. If money is depreciated, a bank will not have enough purchasing power to make a loan that will do anything anyway.
If you don't have sound money, you don't have anything. Increasing the money supply does not help the economy over the long term. It kills it.
people dont save to earn interest on a gold standard. how does it actually earn interest? prob with gold is growth will eventually outgrow the money supply. especially if you are paying every schmuch with money in the bank intererst.
lol, that's as silly as saying you can't eat gold.
Look, for the infinityeth time, fiat control of money (i.e. legal tender law) is bad for economics, period. Doesn't matter if it's paper backed by nothing, or solid gold coins. If there's no freedom to use whatever currency one wishes, the people who control the money are always going to be abusing the system for their gain and everyone else's loss.
So if the world somehow "runs out" of gold (ha ha), people just start using silver, or copper, or whatever else works.
Can we not afford the DHS too?
I think you're right. Rickards says all the Fed has to do is announce they are buyers of gold on the open market. Gold would skyrocket and come to market discovery prices, $5-10K. With the (supposed) gold reserves, this would create a de facto USD gold-backed currency.
TPTB just don't want to get their cold bony fingers off of the fiat.
<<< "These are judgments that you have to make, I know Bernanke very well, we worked together, Ben and I went over a number of crisises together, I know how he functions, I have considerable trust in his judgment." >>>
Amazing how Bernake so grossly underestimated the subprime crisis... and how Bernanke was under the delusion that home prices would not drop on a year-over-year basis.
Gee, I feel better already...
50 year mortgages are the answer. Let's do it! Oh wait, not too many people are finding 30 years of steady income let a lone 50. Scrap that idea.
I'm at around the age I should be thinking of buying a starter house, but 1, they are still too expensive, 2, these 30 year contract things sound fucken retarded, and 3, I still have student loan debt.
A whole generation not buying houses, at a time with unprecedented empty houses.
LOL
I'll just stick to paying my 225$ rent.
Me doing the same, screw the system!
Save up a few $$$ buy a cheap house and rent it out or farm land. You are still giving out your frn's to someone else who is profiting off of you. Do what many before you have done to step ahead of the pack. Food, shelter and clothing. The basic necessities are once again coming in vogue.
I hear you AN. I work with a guy that was renting, paying $1200 a month though for a condo. He is buying a house right now, I tried to talk himout of it, but no dice. He's looking at a $2000 a month mortgage, awesome huh? I feel bad. Nobody listens. I tell them how I was buying 10 oz. silver bars for $320 3 weeks ago and this morning they're going for $378 with only 3 available where I buy. Glad I bought last night at $370. I think Gold will keep moving but Silver is where you'll see "parabolic" movement. Yes, I said the P word. It really is amazing how it's far it's moving daily.
Absent minded - This is the parablic run... 70+% and counting since September. You're supposed to be selling here, not buying.
You said the same thing when gold was at $1100 Bravo. So keep up the good work!
Because the future looks so much brighter now than it did in September.
Your rent is not going to stay at 225 for very long at this rate. The ONE advantage to the mortgage is it is non negotiable interest rate debt over 30 years. Your rent is adjustable with each lease period.
Based on the performance of the dollar and future trends? That could very well be 10-50 ounces of silver for that house in the future based on the fiat price.
If I was a non-homeowner at this point I'd get a plot of dirt cheap land, a very cheap mobile home and use the savings to load up on PM's. Being house poor in this economy is going to get very VERY painful soon.
We're looking at $107 WTI right now! This is very worrisome to those that believe the economy is "recovering" and that everything will return to normal in a few months. The EU can not expect to hold it together with this sort of pricing pressure. The UK cannot hold it together. The US can not hold it together. Bankster's ponzi scheme is blowing up in their disgusting faces.
I wonder whether JPM will be able to access any of that $30 billion Fed backstop to cover the losses on those Bear Stearns silver short positions? It wouldn't surprise me....
$30 billion.........interesting number. Isn't that the amount we just confiscated from Ka-Daffy?
There are no coincidences.
slow roast: never happen, that bet is on the comex ability to pay off..comex would go bk, and you would be stuck with non collectible IOU. the big money is buying physical.
Wynter Benton is playing for cash premium and does not want to BK the comex..just slowly bleed them..that makes sense.
That is something I never understand when everyone talks about the Comex going broke. Are they not just the facilitator of the contract? The onus is upon the contract seller, not Comex, to deliver on the contract. Yes, the seller could go bust but the Comex would go on.
Anyway, if someone did buy 10,000 contracts and announce their intention to stand for delivery they would put Comex on the spot. It would cause major panic, the truth would likely be revealed(whatever that happens to be), and we'd have a market finally searching for equilibrium in hyperdrive. Oh yeah, and JPM would likely fucking die.
Comex has 8,000 contracts worth in the warehouse; if there was a default on 2,000 of the 10,000 contracts it wouldn't even matter because that's only a 20% default rate; do you not believe that emptying the entire Comex registered inventory would push silver 20% higher? Shit, we might be up 20% today!
Amazing that we have such generious anonymous billionaires buying trillions in treasuries, but for some reason they just don't think physical gold is worth investing in. Right Ben!
LOL THIS WHOLE ECONOMY IS A FRAUD.
If Bill Gates and Buffet wanted to do the world a favour the'd buy 5B worth of silver each, we'd have a New World Order overnight (pun intended)
At least that's the theory
The plan from Jan was to PUSh the sellers of contracts and they did- before 1st delivery date there were 4000 contracts, and mysteriously by friday there were only 1800 left but less that some 400 delivery notices had been stopped...where did the open interest go?...they took the paper/cash settlement for X% over, only problem is that they now have more paper to recycle and buy more contract for the next month...lather risne repeat, just like last fall.
You are correct, all futures markets simply match buyers and sellers so Comex cannot go broke. However once a truly vertical move starts, the net shorts would be desperately trying to cover long from a declining pool of sellers. At this point I suspect Comex goes limit up, declares a disorderly market and trading stops. They may (I am guessing) then close out all positions based on the limit up price, since this is covered by the margin requirements.
So in the paper markets losses and gains will be forcibly capped. Having forced all positions to be closed out, Comex reopens the contract for business at some greatly increased price and the game continues. Only physical holders will make the big gain
<<< Fed's Lockhart says cautious about extending bond purchases after June but new risk call for flexibility Mon, 14:00, 07-03-2011 >>>
Is this posturing for QE3?
THERE IS NO INFLATION!
I REPEAT!
THERE IS NO INFLATION!
yes... oil 200$ will only happen because of evil speculators...
The amount of bullshit statements is accelerating. If that's not inflation, then what is?
true...
here in Europe I've heard already 3 statements that all of this is happening because of speculators.
None of them realises why it really happens. I sometimes feel like a alien :)
This week weekend my father joined us when we went to the store to buy food for the week. The total was just nuts!
368 euro for a cart! And we didn't buy anything abnormal!
Normally we pay about 250/280 euro a week.
For about 6 months I have been keeping my bills to compaire and whe I've put the new next to a "old" one of 6 months, there where increases of +40%!!
My father finally started to realize I haven't been talking BS for these last few months.
But acting and buying protection like silver and gold isn't what he wants to do.
All he says is: SPEND IT NOW WHEN IT STILL HAS VALUE!
He's 74, so for him he's right :)
But still, he's a very fit man, and personally I think he'll live to be 110 years old.
Was that the kiss of death?
Maestro distancing himself by kissing each fuzzy cheek.
"Growing concerns that surging oil prices will lead to further inflation and snuff out the already tentative global recovery..."
You idiot. It is NOT surging oil prices that will lead to further inflation. Surging oil prices are a consequence of monetary inflation. There is no recovery. It is a Minsky Melt-Up or Crack-Up Boom.
Like all mainstream media, he mis-identifies cause and effect. Just like "civil unrest is causing rising oil prices". NO! Civil unrest is a consequence of monetary inflation causing commodity price increases.
It's not rocket surgery.
Zillow now has my home priced less than March 2009. New dip bitchez.
i'm guessing you live in a trendy manhattan neighborhood because most homes are back to their 2003 levels.
you know what they say :)
SELL LOW BUY HIGH!
Seen your avatar a hundred times, still have to laugh every time I see it.
maybe I should concentrate a bid more at my work instead of surfing the web all day :)
NEAHHH...
ANY doubts amongst the populus regarding "futures manipulation", have been removed on this morning's actions. One glance at ES is all it takes to say, "WTF!"
Isn't it about time to start enforcing Greshams Law?
greshams law is on ABC right after Law and order right?
Lets give Greenspan his own TV station so we can listen to him 24/7.
Hey...I like it William!!
We can call it...The Fox Former Fed Fuktard Financial Forum. Or F6 Network for short.
Probably not that feasible, WB7. Gramps Greenspan would begin to nod off about ten minutes into the show. Now, if Andrea were signed as co-host, she could knock Alan's shins with her Jimmy Choo's under the table, and keep the eyelids open. The show must go on.
Yeah PeaBird that was my thought.
GSpan's statement about TheBernank, provides a similar visual as to when in "The Godfather" movie series, Al Pacino's character gives the kiss of death to one of his family members, I think a cousin or brother, before he has him killed.
This is going to be an interesting week in the markets. Much groundwork is being laid this week:
* They have Brezinski on MSNBC bright and early saying someone needs to get involved but it would be wrong for the U.S. solely to get involved. (He essentially said once we have partners in crime to deflect blame we then should)
* John Kerry saying no military intervention. Only a no flyzone
*McCain & McConnel requesting no fly zone
* MSNBC among other bobble asking who will stop this mad man from massacring his own people.
*Lockerbie 103 resurgence 20 years past event
We had 3 rumors in the past week meant to deflect oil lower (Price fixing attempts), margin raise on oil and nonsense about opening strategic reserves. The recovery failure was blamed on snow last month and this month it will be Libya. The Fed & Administration cannot allow for oil to stay in this level. We have seen what appears to be two direct PPT/PD interventions in the last 7 trading days. The market has had minor selloffs but Silver & Gold have not followed suit which is concerning the Fed.
The only reason they allow dips is to tame the metals but this time the metals have barely budged. Interesting week for rumors coming up and we are that made days closer to the end of QE.
well we heard nonstop "Saddam WMD" based upon an Iran war and the Kurd attack. Maybe they will bring up the Barbary pirates and start dropping the shock&awe
Isn't Mika Brezinski on MSNBC Brezinski's daughter?
Partners in slime?
Yes. Papa Bear says she's good in the sack, too. It's a Bilderberg thing.
When the S&P GSCI Commodities Index gets "rebalanced" by GS, that'll mean it's time to short commodities.
Until then, long and strong.
Isn't it about time that despicable old fart shut the fuck up?
Ya just put that skeleton back in it's closet already
I kind of liked the remarks about the "faulty currencys"; too bad he couldn't remember these things when he was in charge of the big brass money valve.
for silver longs: just went to APMEX and looked at us silver coins...they are out of most bags of coins..dimes, halfs on and on ..WTF?
I always just buy random. It is a lot cheaper, and you are a lot more likely to get a few numismatic ones. It's family fun night when one of those big bags come in and we sort them by date and check mint marks. We have found a few that are worth quite a bit more than their silver price.
I've gotten both dimes and quarters that way, which is all I really wanted anyways.
Tmosley, you could avoid letting cats out of bags..mums the word..OK?
I have filled 3/4's of a mercury dime book that way, even seen a few barber dimes. Damn now I have to go buy another book.
delete
What source did you use to "value" your coins? Did you grade the circulated coins correctly? Here's a source for you:
http://www.ngccoin.com/poplookup/NGCCoinPriceGuide.asp
Good Morning,
Since this is my first post here, I would like to say hello, and congratulate Tyler and the ZH team for the fantastic blog.
Further, I would like to add a SPX chart in terms of gold, in which it is apparent that US equities have topped out in late February, but I do now know how to do it, but I guess you can look it up
The rest is obfuscation of reality.
One final word of concern for the lower classes in the US - imo monetary debasement at this speed is a crime against the poor and the middle class.
Enjoy your Carnaval.
Welcome to the club.
This is also my first day here at zerohedge, although my second post.
I am also a reuglar commenter on the Daily Telegraph, especially Ambrose Evans-Pritchard's blog.
I'm fighting on the European front of this war of the upper class against the lower and middle class.
On the daily telegraph, me and my dear friend Chelyabinsk are fighting the forces of evil, i.e.
1. The false spin on MSM on economic matters by complicit editors an so-called well-respected journalists
2. The false spin of fake commenter intheir blogs, so-called astroturfing
financed by the Koch brothers from Wichita, Kansas, i.e. groups like "Americans for Prosperity" and "FreedomWorks"
3. The attack on our currency, the Euro, by anglo-american hedgefunds, especially George Soros et al.
Our ultimate goal is to destroy the culture of recklessness in the City of London, and if we can, that on Wallstreet
Since I'm German, NYSE is now in our hands, and we will try to influence Reto Francioni, head of Deutsche Börse, to eliminate the fraud on Wallstreet
In order to achieve that, it is necessary to work closely together with attorney generals in the state of New York, especially Preet Bharara, and to hand him NYSE's order books.
I constantly refer readers on The Daily Telegraph to Zerohedge, to remove the wool from their eyes, so they can get access to real financial news and not the lies they are being told on corporate MSM.
Auf Wiedersehen
geshtinselfuk. asswipe.
Please answer in full and proper English sentences.
Please don't use insulting language.
Thanks.
"Please don't use insulting language."
franken me boyo, New to fight club?
the stink of insulting our intellence is what you should be trying to avoid.
Joe, he is not a National Socialist.
Words cannot describe the irony of a fucking German using an avatar of the Armenian Jewish man who literally destroyed your country.
Please put those toys back into the pram, will you ?
By the way:
Jossif Vissarionovich Dhugashvili was Georgian, and persecution of Jews under Stalin was widespread.
Why should he persecute people of his own creed, if he actually was Jewish as YOU claim.
I don't think that Stalin was a Jew.
Can you prove your claim ?
Regards
KOOK KOOK!
KOOK KOOK ! ? oh yes, that's Flemish for TOOT TOOT !, I believe. Maybe you would feel less Alien if you had a new photo taken ? One that showed you in a more favorable light ? Just a suggestion.
Welcome. Yes, ZH is penicillin for the statist MSM bullshit.
Georag Soros is indeed a James Bond villain bent on world domination.
Fortunately, he's getting way too old to play the part --- depart ain't just a role in a movie.
Wow. Another Crazy wacked out nut job.
At least now they've got a place congregate.
Thank god for Zerohedge.
News flash to MathMan: "You're not running the asylum either!"
Agreed. I would add groups like Media Matters and Center For American Progress to the ranks of the astro turfers. Or are you one sided on your views of media and public manipulation?
Welcome. Equities in nominal terms have not done well vs gold.
Yes, it is stealing from everybody, especially those who think their bank accounts are safe.
It will create a shock when people wake up, and make Egypt come to mainstreet.
As planned, it will create unhappy people who will call for an IMF global currency
The lower classes don't bother with this sort of thing. It's the middle class who have a dog in the fight -- and losing.
Welcome to ZH.
Unless I'm reading this wrong, this sounds like a joke:
GREENSPAN ON MOMENTUM:
"There is no question at this stage that the momentum of this economy, leaving out the oil price issue, leaving out the Euro problems that have emerged, and very specifically leaving out the budget problems, this economy is really beginning to pick up momentum."
This can't be a real quote, can it? Because if it is, he basically said if you exclude every major problem, the economy looks great.
yep.... he said it... I seen the video... he's still sippin the kool aid
Unfortunately it's a real quote.
Remember, these are the same people that decided that food and fuel should be excluded from the consumer price index...
They stick their heads in the sand and they no longer see a problem...
"Except for the rotting corpses, the necronomy is fine." -- Alan Greenspan.
I believe it's a "special kind of real"; the Real he lives in. Not the Real anyone else lives in. He's pretty strange alright; often seems like some kind of an Alien; and I don't mean from a foreign country, either.
That reminds me of a scene from The Jerk:
http://www.youtube.com/watch?v=Ag6DtzRUF5U
Listened to Ben Davies on a King World News podcast last nite and he said he sees silver pulling back to low 30's high 20's range.
Anybody else see this happening? Cause i'm getting itchy w/ my trigger finger to add to my silver collection.
If the Wynter Benton story and the 80% payout is to be beleived we had a shortlived market price of 60.00, no.
"If the Wynter Benton story and the 80% payout is to be beleived we had a shortlived market price of 60.00, no."
don't forget WB said they would use strategic shorts from time to time,,,BTFD.
Get yer thumb outta yer ass and push the frickin Buy button! What the hell are ya waiting for? BTFD was 3 weeks ago, now it's time to play catch up. As I said in an earlier post the quicker you pull the trigger the more you get for your ponzi paper.
I heard that too and scratched my head. A pullback perhaps but to low 30's or high 20's? Perhaps, but with the dollar continuing to slide? I'm good, I'm holding.
The red batphone is blinking on and off in Blythe Masters office right now. It's The Bernank with the message "SELL BITCH!!!"
she'll tell that weasel-faced 2-bit heeby jeeby bankster to kiss her fuking ass. she's responded to slewie's unbridled lust for her playa-bility and has been buying dips like mad since the last contago in paris... this BiCH may be half lizard, but it's not her better half...hon, you just shop till you drop. slewie will be here for you...
trust me.
We hit 8:30, and again with the drop in silver and gold. It's almost like it is a rigged game...every day. BTFD!
At least the North American timezone got a dip today at the usual bat time and bat channel.
Look at the Sydney & Hong Kong sessions in the preceding 8 hours of today, wasn't much of a dip to be had, looks more like step rises than dips. Please be thankful there is a dip during your physical purchasing hours...
WINNING!
Gold dipped, but not Silver. I think they're losing control, keep buying! Bankrupt JPM! Stand for delivery and drain the supply!
Sir Alan must be feeling Mr. Grim Reaper close and hand and is purging in preparation for meeting his Maker.
I'm starting to think this is the start of the collapse we've all been looking for but hoping would never come.
BTW, "-66 minus 34 =" leads to answer that is, indeed, larger than 3-characters.
evidently you fit the "sufficiently determined" criterion!
+1 ... lol ... Tyler occasionally throws in a bs quiz to see who is paying attention... variety is the spice of life...
Heh! Yeah. Funny - after telling me I can't do basic math it then gives me the ability to post without having to go through the CAPTCHA hurdle. So there you have it.
doc-that's 'cuz u b IN now!
I like to read the comments of the true PM bugs. Actual physical materialism always made more sense than paper worship of a paper dollar. None of these idolatries, however, can measure up to the pursuit of China's greatest export, which is Mardi Gras throws.
I took the family to the combined parade of Bacchus and Endymion last night. The crowd was amazing in both size and variety, all competing for the Chinese surfeit of petro-beads and doubloons. There were hundreds of thousands worth of beads just hanging in the oak trees along St. Charles Avenue. I did catch a particularly nice pair from Kelly Ripa, who was riding with Mark Consuelos and Anderson Cooper. Also alcohol, which was rented and then deposited in the THOUSANDS of porta-potties staged by true entrepreneurs and groups along the route. Some were charging 2 FRNs just to pee in their units. The excess was excessive. The marching bands and dance squads were ON FIRE! A good time was had by all. Catholics will pay for all of these inflationary policies on Wednesday, when we are blessed with penitential ashes (Ash Wednesday) and pretend to swear off all of the materialist sins that we just enjoyed so much.
beau tox~~~~/;<) i'm somehow certain you'll have enuf grapefruit and pineal extract to get thru fat tues with the lizard tail and flipperZ! is it just slewie and youie or is kelly ripa everybody's dream transsexual?
Slewie;
Though I cannot bring myself to watch her on that stupid TV show, I must admit that she made a beautiful bead-thrower on Endymion's Marshals float. The drunken college girls all around us were, like, positively creaming themselves in all of the reflected divinity.
Another comment re: inflation. Did we realize that Mardi Gras doubloons are perfect simulacra of 1 oz. bullion coins? They are exactly the same diameter as an Eagle or as a Maple Leaf, though they are composed of anodized aluminum. In fact, some of my paltry holdings are commemorative .999 krewe issues from before the PMs became real money Ag $4.50?). The elites that rode floats would give them as special treats to their connected friends at the ball or the krewe royalty would save them as mementos. The cheapo aluminums are thrown out in the millions to the serfs along the parade route. This is such a cynical inside joke of the activities of Central Banks around the world. Debased money distributed to the masses while the Kings and Queens, Maids, Captains, Lieutenants and other krewe 'members' keep the real thing as their own medium of transaction.
I wonder if the continued electronic debasement will one day come back to haunt them, when the melt value of aluminum doubloons actually exceeds the paper value of the Silver Dollars which doubloons were created to spoof?
The allegory of the Mardi Gras parade. What a fitting couplet with the Allegory of the Cave. A literary and visual feast for the book of future tales.
Rocky;
Here's a secret. The internet (EBay reserve, CraigsList, etc.) premiums on .999 silver 1 oz. doubloons are lower than for comparable bullion coins. Stock Up! before the doubloon collectors realize that spot has exploded upwards overnight.
I'm not a doubloon collector and there are plenty. I've not chased them since the weights are not usually noted in the sales descriptions. Got a source for the silver content of them? (Sterling or .999, weight, etc.).
Thanks for the heads-up.
This one didn't look very cheap:
12 Mardi Gras .999 Silver Rounds/Doubloons 11.74 ozt Item number: 320626404946 Item condition: -- Ended: Dec 06, 201011:41:55 PHT Bid history: 1 bid Sold for: US $385.00
Rocky;
Just Examples
http://cgi.ebay.com/2007-KREWE-SATYRICON-999-SILVER-MARDI-GRAS-DOUBLOON-...
Well this is interesting...silver hooooorahhhh!
http://www.marketoracle.co.uk/Article26741.html
http://www.youtube.com/watch?v=o07G2M0UZXM
Premiums for physical silver have been creeping up. Looks like the paper/phsical struggle has begun. Silver paper at $30 or less with a $20 premium on physical looks to be coming up soon.
Completely fraudulent; it's just internet bullshit. "Flying saucers landed on my lawn today, blah, blah." Never happened.
where the fuck is my %80