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War Of The R'n'R Pundits: The Rogers-Roubini Conflict Escalates; Will Gold Hit $2,000?

Tyler Durden's picture




 

Earlier today Jim Rogers took a stab at Roubini saying that the NYU professor is wrong "about the threat of bubbles in gold and
emerging-market stocks." In addition to claiming that commodities are still down and the equity markets are firing on all cylinders, Rogers added that the price of gold will double to $2,000 an ounce in the next decade. As a reminder, lately Roubini has been warning about the threats of the biggest every carry trade being established: that of shorting the dollar. Rogers seems to disagree: “What bubble?” Rogers said, w,hen asked if he agreed with
Roubini’s view. “It’s clear Mr. Roubini hasn’t done his
homework, yet again.”

Never one to back down from a public confrontation Roubini retorted promptly at today's Inside Commodities Conference in New York. Roubini claimed Rogers' $2,000/ounce forecast is "utter nonsense." As Bloomberg reports:

There is no inflation or “near-depression” to drive gold
prices that high, Roubini said today at the Inside Commodities
Conference in New York. If a severe depression came to pass,
with investors buying canned goods and hiding out in log cabins,
“maybe you want some gold in that scenario,” Roubini said.

“Maybe it will reach $1,100 or so but $1,500 or $2,000 is
nonsense,” Roubini said. Gold rose to a record $1,096.20 today
on the New York Mercantile Exchange’s Comex division on
speculation that central banks and investors will purchase the
metal to hedge against a declining dollar.

Roubini shared some additional insights into what he believes are bubble markets:

In his New York speech, Roubini repeated his assertion that
asset prices have risen “too much, too soon, too fast.” He’s a
New York University professor and chairman of New York research
and advisory firm Roubini Global Economics.

 

“It is very hard to justify oil going from $30 to above
$80 based only on the fundamentals of supply and demand,”
Roubini said. Prices are “in part” a bubble, he said.

Position limits on oil trading, if they helped reduce
volatility, may be “beneficial” because the swings in oil
prices have been “destructive” to the global economy, Roubini
said.

Ah, the good old days, when pundits only quarreled about whether or not subprime was contained (with the consistent chiming in of the Soothsayers of the Fed that not only had they not created a housing or credit bubble, but that everything is under control - just consider the following absolutely moronic quote from the fossil that destroyed capitalism: "Indeed, recent research within the Federal Reserve suggests that many homeowners might have saved tens of thousands of dollars had they held adjustable-rate mortgages rather than fixed-rate mortgages during the past decade, though this would not have been the case, of course, had interest rates trended sharply upward.... American consumers might benefit if lenders provided greater mortgage product alternatives to the traditional fixed-rate mortgage. To the degree that households are driven by fears of payment shocks but are willing to manage their own interest rate risks, the traditional fixed-rate mortgage may be an expensive method of financing a home." - Alan Greenspan, 2004). Now that the goldbug camp has such vocal and publicity eager (pr)opponents as Roubini, Rogers and Rosie, expect speculation on gold speculation to reach unprecedented levels.

 

 

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Wed, 11/04/2009 - 12:46 | 119703 ghostfaceinvestah
ghostfaceinvestah's picture

How much money does Roubini manage?

Wed, 11/04/2009 - 13:46 | 119811 Gordon_Gekko
Gordon_Gekko's picture

Umm...ZERO dollars?

Wed, 11/04/2009 - 14:38 | 119925 Careless Whisper
Wed, 11/04/2009 - 14:29 | 119904 Anonymous
Anonymous's picture

Roubini also said at one point that unemployment would peak at 9%. He's good, but he's not THAT good.

Wed, 11/04/2009 - 12:49 | 119711 kaiserwongze
kaiserwongze's picture

Academia vs. A proven successful investor.  What a joke.  Is it even a real matchup?

Wed, 11/04/2009 - 14:07 | 119860 Anonymous
Anonymous's picture

So you're saying that investors are always right? Hmmm. You're a smart guy, must be an investor. Ex-Lehman engineer maybe?

Roubini is right about gold.

Wed, 11/04/2009 - 19:28 | 120356 Anonymous
Anonymous's picture

Roubini went to the same Keynesian Schools as Bernanke and the other Wall Street Bozo's.

Sir John Maynard said "In the end we are all dead" We are approaching this period in time.

Got gold?

Wed, 11/04/2009 - 14:12 | 119869 perfectlyGoodWh...
perfectlyGoodWhiteBoy's picture

http://en.wikipedia.org/wiki/Survivorship_bias

 

Of course, that could easily apply to both of them.

Wed, 11/04/2009 - 12:50 | 119713 callistenes
Wed, 11/04/2009 - 18:53 | 120303 snorkeler
snorkeler's picture

Think for yourself

Question authority

Wed, 11/04/2009 - 12:50 | 119715 SWRichmond
SWRichmond's picture

gold will double to $2,000 an ounce in the next decade

More than that, in less than that.  JMVHO.  Short term?  Who knows.

Wed, 11/04/2009 - 13:12 | 119743 ghostfaceinvestah
ghostfaceinvestah's picture

I figure gold to 2000 an ounce by April, after Zimbabwe Ben announces his continued and unending support of Fannie/Freddie MBS.

Wed, 11/04/2009 - 13:47 | 119816 Gordon_Gekko
Gordon_Gekko's picture

Actually, it will reach $2k next year.

Wed, 11/04/2009 - 14:06 | 119853 chumbawamba
chumbawamba's picture

Easily.  On its way to $10,000.

I am Chumbawamba.

Fri, 11/06/2009 - 01:51 | 121887 Anonymous
Anonymous's picture

Hey you're right!! I had a prophetic dream that gold went to $8,000 and the gov't offered to buy it from investors by sweetening the pot by paying $9.000. The trick is that they will be paying with "new money" or a new currency which is still largely fiat money (but backed by a small percentage of gold - 2-3 %). Anyway, this all happens shortly after (within a month) of Obama's oath of office anniversary (Jan 20th, 2010). The US will have a three year depression followed by growth. This was brought on by bad, toxic, bank debt gone south and a really bad mortgage real estate crash. Look back at the Dow gold ratio historic charts. Gold spiked in the 70's or 80's and it will happen again. If dollar crashes, there's no telling how high gold could go!! Hey, don't laugh about the dream. Two weeks before 9/11 I dreampt that a jet hit a skyscraper & then the dream repeated. How weird is that? About 3 weeks ago, I told an aquaintance not to let her grandson go 4 wheeling. A week & 1/2 ago, he was killed when the 4 wheeler flipped crushing his head. I could go on, but you get the point. If not convinced, wait till gold hits 2,000 then get in for all your worth. The spike won't take long. It's going to be the ride of a lifetime. If you get in now, you'll end up making almost 900 percent!!

Fri, 11/06/2009 - 21:23 | 123125 Unscarred
Unscarred's picture

Great trade idea, Anon:

Short reality, go long dreams...  Wait.  That trade is already on, and getting quite crowded, too.

Mon, 11/30/2009 - 17:04 | 146684 Anonymous
Anonymous's picture

Just don't agree to having a particular number put on your hand or your forehead, in order to buy or sell.

Wed, 11/04/2009 - 12:54 | 119720 BobPaulson
BobPaulson's picture

One of the toughest things for an academic to digest is that things don't always operate according to models or smooth functions. Like many posters here, I think the big new bit of data is the potential for demand of physical metal over futures and paper gold. I tend to listen very closely to Roubini because I think he's very smart, but there is a potential black swan if delivery of physical gold is clogged up because some organizations actually have less gold than they say.

Thu, 11/05/2009 - 01:03 | 120612 Anonymous
Anonymous's picture

"One of the toughest things for an academic to digest is that things don't always operate according to models or smooth functions."

This is true however according to my model $2000 Gold is attainable before June 2010 as we are setting up the parabolic move that has occurred every 2 years since 2001. Though $1600 is more fitting. However, One of the toughest things for a Goldbug to digest is that things don't always operate according to the speculations, rumors and half truths put forth by the Gold Conspiracy Set. I know from being a hardcore goldbug since the late 90's as I watched so many "sure thing" scenarios disintegrate before my eyes.

At some point the true hyperinflation will occur and take gold to the stratosphere. I just don't think this is that time. We are in a deflation while the Fed is throwing everything at it they are getting very little traction. As we endure another period of asset mark down all assets will be sold to raise cash to clear debt. All of this will bare fruit in 2 years when we make the next parabolic move but this with years of Fed stimulus searching for a home and an Inflationary environment in which to truly Flourish.

Thu, 11/05/2009 - 10:16 | 120736 Anonymous
Anonymous's picture

We may have a small rise in the dollar in the near term, but gold is for real this time.

It is becomingly increasingly clear that the life supporting 'wealth' of the planet has peaked. Slowly realizing this, humans are starting to move their wealth from the abstract back to the real. Time to batten down the hatches. It won't matter whether there's inflation or not.

Wed, 11/04/2009 - 13:03 | 119729 A Man without Q...
A Man without Qualities's picture

Economists gamble with their reputation, speculators gamble with their money.

 

 

Wed, 11/04/2009 - 13:15 | 119749 cougar_w
cougar_w's picture

You can always recover your money at a later date.

Wed, 11/04/2009 - 13:30 | 119775 BorisTheBlade
BorisTheBlade's picture

While the reputation is like virginity - gone once and forever.

Wed, 11/04/2009 - 13:53 | 119825 Anonymous
Anonymous's picture

But a lot more useful.

Wed, 11/04/2009 - 18:50 | 120293 Unscarred
Unscarred's picture

Actually, reputations AND virginities can be sold for a handsome sum by their respective owners.  Just look at Natalie Dylan...

http://www.cnn.com/2009/LIVING/01/22/virginity.value/index.html

...OR, RNC Chairman Michael Steele, for that matter.

http://blog.reidreport.com/uploaded_images/steele-shock-j-746504.jpg

Wed, 11/04/2009 - 19:00 | 120313 snorkeler
snorkeler's picture

Funny.

One takes advantage of desperation. The other is desperation.

Wed, 11/04/2009 - 17:52 | 120232 Miles Kendig
Miles Kendig's picture

That is IF you subscribe to the notion of a window dressing world.  Humans, by our very nature fuck up.  It is in how we deal with both success and failure that makes or breaks a reputation in my book

Wed, 11/04/2009 - 18:16 | 120254 BorisTheBlade
BorisTheBlade's picture

You're right. I wasn't serious though, just forgot to put some nasty smile in the end.

Wed, 11/04/2009 - 13:04 | 119731 lsbumblebee
lsbumblebee's picture

Roubini's a gatekeeper. If he truly lived up to his MSM moniker "Dr Doom" he wouldn't be allowed on teevee. At least not on the General Electric Channel.

Wed, 11/04/2009 - 13:58 | 119831 cougar_w
cougar_w's picture

Don't know about that. Seems like they bring him on so they can point at the geeky professor and say "explain to us again how you missed teh Rally!" and laugh behind their hands. It's class warfare, except that he's right and he's just trying to save the financial world for future generations, and they're just trying to make monthly ratings.

They'll be the first against the wall when the revolution comes.

cougar

Thu, 11/05/2009 - 04:49 | 120662 Anonymous
Anonymous's picture

My copy of the reservation list calls for (1)David Rockefeller Sr.(2)Henry Kissinger etc.

I don't have the CNBC talking heads on my copy of the official list until sometime after we have all members of the Bilderburg Group and the CFR taken care of.

But, we could bump them up, if we have the time.

Wed, 11/04/2009 - 13:06 | 119737 BorisTheBlade
BorisTheBlade's picture

“It is very hard to justify oil going from $30 to above $80 based only on the fundamentals of supply and demand,” Roubini said. Prices are “in part” a bubble, he said.

Ok, but then it should be almost impossible to justify why it went down from $147 to $30 a bbl in less than a year (just by looking at fundamentals of supply and demand). One of the two: either it is not about the fundamentals, or the fundamentals that professor is looking at are not the same as those affecting the oil market.

Wed, 11/04/2009 - 14:16 | 119879 Green Sharts
Green Sharts's picture

The price of oil dropped from $147 to $30 during a period when the global economy collapsed and oil supplies went from very tight to a glut.  The increase from $30 to $80 has occurred with global economies remaining weak and without any tightening of oil supplies.

Of course, oil didn't trade very long at either of those extremes, which were almost certainly a result of momentum and leverage.

If the major oil companies thought $80 oil was justified by the fundamentals they would be ramping up their exploration and production budgets, which they're not doing.

 

Wed, 11/04/2009 - 15:51 | 120048 BorisTheBlade
BorisTheBlade's picture

Ok, fair enough. Oil producers are not increasing their budgets and expecting that price of oil price is not going to sustain current level and will have to go down.

However, what if the opposite is true and they do not expand oil production because current price of $80 is lower than what is perceived as a justified level? Why would you increase output at a level of $80 a bbl if you can do so at a level, say $100? If price of oil went up from $30 to more than $75 before any economic recovery, then how much higher it can go if there is a recovery. And remember - recession is over, Roubini said so.

Wed, 11/04/2009 - 13:13 | 119740 brandy night rocks
brandy night rocks's picture

Anyone think there's a possibility the Administration has been working on the Fed and Treasury to let the dollar sag to crisis levels, only to be miraculously firmed up in early 2010?  It would certainly boost the credibility of the Obama/Reid/Pelosi hydra if, after Labor Day and heading into the final mid-term election sprint, that three-headed monstrosity could croak out self-congratulatory fluff about having "pulled the dollar back from the brink."

And if something like that were to happen, where do commodities go?

 

All speculation, I know.  But you know this crowd is going to do something to pump the financial picture going into the fall - I've just been trying to figure out what it is.

 

 

Wed, 11/04/2009 - 14:46 | 119945 Edna R. Rider
Edna R. Rider's picture

Oil at $100 will warrant a response.  So would gold over $1200.  But it will be a tepid "planned" response and likely serve to just stall the dollar.  My view is the administration, especially Timmy's crowd, are all like computer network engineers, tweaking things every day to keep things going at about the same (lousy) level, when in fact throwing away a bunch of machines and starting over is the smarter approach.  There is no throwing away in this administration.

Wed, 11/04/2009 - 13:11 | 119741 Anonymous
Anonymous's picture

Roubini's $1100 'perhaps' number is near breached already. Maybe he was misquoted and meant to say $1200. Hopefully he has put his money where his mouth is and has bought gll all the way up!

Wed, 11/04/2009 - 13:12 | 119744 Anonymous
Anonymous's picture

That is such a great quote by Big Alan Greenspan during what turned out to be the hight of the housing bubble.

And here is another...
“I guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've said”

Wed, 11/04/2009 - 14:31 | 119908 Anonymous
Anonymous's picture

"That's part of the normal manner of a chairman, to appear to be saying something while you're saying nothing at all," commented the Nobel laureate economist Robert Solow.

"Alan is the passed master of this. It's what central bankers do. They're like squid, they emit a cloud of ink and move away."

Wed, 11/04/2009 - 19:05 | 120324 snorkeler
snorkeler's picture

From what I have read, he purposely created large sections of his "fedspeak" statements to sound complicated but mean absolutely nothing. And he thinks it was funny.

Its easy to be funny when you know exactly when the house is going to collapse.

Wed, 11/04/2009 - 13:13 | 119747 Hondo
Hondo's picture

Rogers is an idiot on this one. His implication that there is no bubble because a commodity like oil hasn't risen to the previous high of 145 is utter nonsense and shows economic stupidity.  Maybe, just maybe the previous high was a bubble also....what an idiot.

Wed, 11/04/2009 - 13:44 | 119809 Anonymous
Anonymous's picture

I think there's a legitimate case to be made that the 2008 price spike was not primarily a bubble phenomenon. Here is an excerpt from an article by Steven R. Kopits I originally saw in Energy Current. It is no longer there, but is reproduced at ASPO:

Peak oil, not speculation
http://www.aspousa.org/index.php/2009/05/peak-oil-not-speculation/

"...After many years of solid growth, oil production plateaued in October 2004. Regardless of the price level, the oil supply simply stopped responding, and from then on, the world had to make do with broadly flat supplies. Ordinarily, the expansion of the world’s economy would be accompanied by increased energy consumption and an inelastic oil supply might have been expected to hinder economic development. It didn’t. In the four years to mid-2008, the world economy expanded by 18%. The global economy boomed, even without new oil.

However, this came at a price. In the absence of oil supply growth, demand accommodation was required. This was achieved by secular prices rises averaging 25% per annum from 2003 to the end of 2007. In other words, the price of oil went up, and this constrained consumption by causing the marginal consumer to drop out of the market. This proved a workable solution for a time, but the global economy could not sustain 25% annual price increases indefinitely, and by second half 2007, the situation was becoming critical. Consumption was being maintained by continuing draws on inventories averaging 1.4 million b/d, and virtually every producer, with the possible exception of the Saudis, was running flat out. By early 2008, even the Saudis were throwing the kitchen sink at the market - all to no avail. On paper, it looked like a peak oil nightmare.

Of course, consumers were responding. From 2005, the EU and Japan began to shed consumption and, from late 2007, US consumption also began to decline as the US consumer sought to escape high oil prices. Notwithstanding, developed economy consumers were not abandoning the market as fast as Chinese consumers were entering it, and prices continued to rise. In early 2008, prices took off and some argue that speculation took over. Still, as inventories continued to fall until May 2008 and all the oil producers were running at full output, the case for market manipulation at that time is hard to make. Indeed, the market was in backwardation most of this time. In backwardation, futures prices are lower than spot prices, the equivalent of the market saying, “Well, prices are high now, but they’ll be lower later.” The market - those very speculators - believed that oil was over-priced but was continually surprised as demand kept pushing up prices.

Prices did ultimately fall, but not because the supply situation eased, nor because speculators fled the market, and not because inventories were released. Prices fell because the global economy collapsed. ..."

Wed, 11/04/2009 - 13:48 | 119818 cougar_w
cougar_w's picture

There are a few people who comment here who I can tell understand complex systems and emergent properties. It's not a subject gamblers would find interesting, and most day-traders are gamblers. Not trying to pick a fight, just making a useful generalization.

I promise you, Roubini absolutely gets it. Rogers I suspect doesn't get it. It doesn't matter, it won't change anything in the end, it ain't a beauty contest. It's just a good idea to know who's looking at it from which angle.

Things are not as they appear; we are no longer the masters ,assuming we ever were. I get the feeling that the financial system as now wired up is set to kill us. It wouldn't have done that before, this is a new thing, something we created ourselves. It's like some animal made entirely out of blades that nobody can manage now and we created Her and there is no escape, She is on her way. Those "financial weapons of mass destruction" are only part of the problem. The dollar carry trade is becoming another. The flight to risky assets with borrowed money, yet another. Paying debt with debt, even worse. Monetary policy see-saws and exit strategy dithering will become the blunt tools that cut the chains and liberate the beast. And when the bitch finds herself free everything within a very large radius is going to be turned instantly into sausage.

Good luck trading around that one, sirs.

cougar

Wed, 11/04/2009 - 13:53 | 119826 Anonymous
Anonymous's picture

This doesn't really make things a lot clearer, Cougar.

Not sure you get it either. (I certainly don't).

Wed, 11/04/2009 - 14:02 | 119840 Stevm30
Stevm30's picture

Thank god that you're here to clarify things for us Cougar...

Wed, 11/04/2009 - 14:07 | 119861 cougar_w
cougar_w's picture

Wasn't meant for you. The lecture you need to attend is a little later.

Wed, 11/04/2009 - 14:16 | 119877 Anonymous
Anonymous's picture

I wish this site had more cougar's instead of all the dumb-dumb movie characters.

Wed, 11/04/2009 - 19:33 | 120364 snorkeler
snorkeler's picture

I think this is very well put. Things are certainly not as they appear at all.

When the whole thing obliterates there will be many saying: "what just happened???"

Wed, 11/04/2009 - 13:55 | 119827 Anonymous
Anonymous's picture

Maybe Rogers is just another variation of Jim Cramer? A pumper for gold? Never give a sucker an even break.

Wed, 11/04/2009 - 14:09 | 119864 chumbawamba
chumbawamba's picture

I agree, Rogers is not all that much smarter than Roubini.  A good trader, perhaps, and lucky for the most part, but he doesn't seem to see the macro picture very clearly sometimes.

I am Chumbawamba.

Wed, 11/04/2009 - 14:10 | 119865 chumbawamba
chumbawamba's picture

And I don't trust guys who wear bowties.

I am Chumbawamba.

Wed, 11/04/2009 - 14:11 | 119866 Gordon_Gekko
Gordon_Gekko's picture

The US Dollar is the bubble.

Thu, 11/05/2009 - 00:55 | 120608 slick
slick's picture

Your on the mark Gordon!

Wed, 11/04/2009 - 13:16 | 119748 Pizza Delivery Man
Pizza Delivery Man's picture

Pillow fight! Yayyyy. I just love pillow fights

-Michael Jackson

I don't know about you but I love it when economists and money managers disagree. One of these days someone is going to get hurt.

Wed, 11/04/2009 - 14:58 | 119967 Gordon_Gekko
Gordon_Gekko's picture

"Economists" today are nothing but charlatans. Turds literally.

Wed, 11/04/2009 - 19:40 | 120372 Sqworl
Sqworl's picture

I agree, I find it pathetic that his facebook has died and filled with his geezer parties.

Six months ago, he would post something and the discussion was brilliant, but sadly today, same ho's wish  him a safe flight and kisses.

Really sad...

Wed, 11/04/2009 - 13:16 | 119751 tradertim
tradertim's picture

“Maybe it will reach $1,100 or so but $1,500 or $2,000 is nonsense,” Roubini said.

for gold to rise to $1500 from $1100, it has to go up about 36%. from its low in january of this year, gold rose 36% to its present price. why does roubini think that a rise of another 36% to $1500 is "nonsense" given the fact our nation is bankrupt? at least jim rogers is giving a decade to reach $2000. (maybe roubini has a subscription to 'the elliott wave' theory)

Thu, 11/05/2009 - 06:06 | 120670 hayesy316
hayesy316's picture

"why does roubini think that a rise of another 36% to $1500 is "nonsense" given the fact our nation is bankrupt?"

Why do you think one thing has to do with the other? Like Denninger says, if US debt truly defaults, you're better off buying lead than gold.

Wed, 11/04/2009 - 13:20 | 119757 curbyourrisk
curbyourrisk's picture

Rogers talking his book!

 

Another "pundit" I can't wait to watch fail.

Wed, 11/04/2009 - 14:46 | 119944 Careless Whisper
Careless Whisper's picture

Dewd, Rogers is NOT a pundit. He's a professional trader and a professor at Columbia University. If you don't agree with him that's fine but do you have anything to back up your position?

Wed, 11/04/2009 - 13:29 | 119770 hank_rearden
hank_rearden's picture

regarding gold...to quote kevorn zaxor, ambassador to new planet testing:

"space cash is only worth what you as a planet decided it was worth."

Wed, 11/04/2009 - 13:40 | 119801 Argonaught
Argonaught's picture

+1 for the sweet South Park reference.

Wed, 11/04/2009 - 13:31 | 119777 HEHEHE
HEHEHE's picture

I'll have to agree with Roubini on this one.  Rogers sure changed his tune in a week. 

Wed, 11/04/2009 - 13:35 | 119788 Anonymous
Anonymous's picture

Yes, what does that rogers guy know about commodities anyway, hmmm. Not like he made billions with Soros while at Quantum, trading commodities and currencies. Why would he know anything about global macro?

Roubini should stick to talking about economic fundamentals, and refrain from making market calls. He's no good at it. Rogers has left himself ten years to see gold at 2000, while roubini says anything beyond 1100 is nonsense. With gold now at 1090, who's more likely to be wrong?

Rogers never said anything about oil prices not being high, hondo. I saw the interview. What he said was that cotton, sugar and a few other cmdtys were hardly in a bubble from a long term pov. He also said he thought the dollar would have a bounce before heading lower. He is expressing himself in probabilities, and not point estimates. Which is what differentiates a trader/investor from an academic (and coincidentally, is the reason why Rogers is very rich).

Wed, 11/04/2009 - 15:00 | 119976 Anonymous
Anonymous's picture

Statistical noise alone could prove Roubini wrong, while an avg 10% increase per year in the next ten years would prove Rogers right (prove is nonsensical in this context since they are both guessing, but bear with me). The odds that Roubini will be proved wrong are greater. In any case then, rogers may look smart for ten years before he is wrong too.

Thu, 11/05/2009 - 21:42 | 121663 Anonymous
Anonymous's picture

Roubini could be right with his "maybe 1100" ad Rogers could end up looking silly for a full ten years.

In December of 1989, with the Nikkei at 38,915.87, having risen 20-40% per year for years, and with almost every pundit and trader alike calling for 40,000 the first week of 1990, one trader, interviewed by Todd Benjamin of (then) CNN's "Moneyline", said the Nikkei would be at least 25 years waiting for 40K and would see below 10K first.

Sometimes it brightest just before the abyss.

Wed, 11/04/2009 - 13:36 | 119792 Fish Gone Bad
Fish Gone Bad's picture

If the future were easy to predict, everyone would do it.  Eventually time will tell and then everyone can point fingers at the "loser", call him names, and perhaps make him cry.

Wed, 11/04/2009 - 14:04 | 119849 cougar_w
cougar_w's picture

Actually certain kinds of things are really easy to predict, within defined bounds of uncertainty. The problem is that people don't believe it in part because if they did then they would have to behave differently.

Cuts into profits, that sort of thing, don't you know.

cougar

Wed, 11/04/2009 - 13:40 | 119800 Anonymous
Anonymous's picture

Gold is going to $2000/Oz Before the calender turns over to 2011. I'll take ALL bets (small and large) for those that want to wager. (Of course, I'm going to insist that the terms of the bet are settled in Oz Au)

Thu, 11/05/2009 - 06:08 | 120671 hayesy316
hayesy316's picture

"I'll take ALL bets (small and large) for those that want to wager."

That's why you're posting as Anonymous.

Wed, 11/04/2009 - 13:45 | 119810 Anonymous
Anonymous's picture

This is a classic case of two people who may not even fundamentally disagree playing a very silly, very public game of "mine's bigger than yours."

Nouriel: There is a global carry trade in the dollar that is driving asset prices to untenable levels. It will unwind. Asset prices will fall.

Rogers: Gold prices are going to $2,000!

So far, there's nothing to suggest that these two positions are in conflict. But Nouriel goes onto make the mistake of buying into Rogers' game - commenting on price levels that are fundamentally unknowable, especially given the role monetary policy is playing in all of this - and contradicts himself.

Nouriel: There's no reason for gold to go to $2,000, no inflation or a depression blah blah blah.

We have now officially exited the realm of coherent debate. All you'll get from here on out is an echo-chamber of swinging-dickisms - someone will be right and someone will be wrong, neither because they were good but because they were lucky. If Nouriel is right about the dollar carry, then who is to say how far the damned thing runs before it expires? Gold could pull the greatest head-fake of all time and go to $3,000 (seems unlikely, but WTF knows?). All we do know, if he's right, is that prices will run, and then they will unwind. We don't know how much. We don't know the timeframe.

And we can argue semantics about the definition of inflation until the cows come home, but the simple fact of the matter is that the rate of money creation is far outpacing the rate of goods / services production / provision. That is the very definition of inflation. Nouriel may not see inflation because output continues to fall, but that's the marvel of inflation - it's latent...until it isn't (akin to the problem of getting the ketchup out of the bottle: nothing after two shakes, then suddenly it's all over the plate).

The most relevant question in this entire discussion is whether Nouriel's contention - that there is a global dollar carry-trade that is driving asset prices wildly out of whack with fundamentals - is in fact true(?). If you can determine the veracity of that position, then you have a framework within which you can work.

Wed, 11/04/2009 - 15:41 | 120025 chumbawamba
chumbawamba's picture

I pretty much agree with what you're saying, but the exception is your thoughts on gold.  Gold is going to and will surpass $3,000/ozt for reasons that are lost upon those who've spent their entire careers on Wall Street.  That sort of mindset only knows consistent and fairly predictable markets, predictable within a certain range of "normal", that "normal" no longer existing.  Wall Street dinosaurs will go extinct unless they adapt.

I am Chumbawamba.

Thu, 11/05/2009 - 04:05 | 120658 Anonymous
Anonymous's picture

I should clarify - I don't doubt that gold will eventually see $3,000. The question is: will it get there before or after the unwinding of the dollar carry-trade? This really is fundamentally unknowable. We can bet one way or the other, but that's exactly what we'd be doing: betting.

Another example: what if the carry unwinds, but dollar-rich profiteers immediately swap a substantial portion of their dollars for gold? Again, it's impossible to know what the impact magnitude would be on either the value of the dollar or on the price of gold (and what we care about ultimately is probability x impact).

- tetsuotrees

Thu, 11/05/2009 - 09:30 | 120711 Anonymous
Anonymous's picture

Anyone caught holding gold on margin or in derivatives is gonna get ploughed, physical will become unattainable. The markets continue to be rigged and the banking cabal is still in control. Yes, much is not as it appears. India, along with others, must soon sell their "gold" for food.

Wed, 11/04/2009 - 13:46 | 119812 Anonymous
Anonymous's picture

By the time Roubini figured out there was a bubble in real estate, Suzy Pole the realtor and Lefty Pimp the mortgage broker had already gone back to their old jobs.

Wed, 11/04/2009 - 13:47 | 119815 Anonymous
Anonymous's picture

This is a classic case of two people who may not even fundamentally disagree playing a very silly, very public game of "mine's bigger than yours."

Nouriel: There is a global carry trade in the dollar that is driving asset prices to untenable levels. It will unwind. Asset prices will fall.

Rogers: Gold prices are going to $2,000!

So far, there's nothing to suggest that these two positions are in conflict. But Nouriel goes onto make the mistake of buying into Rogers' game - commenting on price levels that are fundamentally unknowable, especially given the role monetary policy is playing in all of this - and contradicts himself.

Nouriel: There's no reason for gold to go to $2,000, no inflation or a depression blah blah blah.

We have now officially exited the realm of coherent debate. All you'll get from here on out is an echo-chamber of swinging-dickisms - someone will be right and someone will be wrong, neither because they were good but because they were lucky. If Nouriel is right about the dollar carry, then who is to say how far the damned thing runs before it expires? Gold could pull the greatest head-fake of all time and go to $3,000 (seems unlikely, but WTF knows?). All we do know, if he's right, is that prices will run, and then they will unwind. We don't know how much. We don't know the timeframe.

And we can argue semantics about the definition of inflation until the cows come home, but the simple fact of the matter is that the rate of money creation is far outpacing the rate of goods / services production / provision. That is the very definition of inflation. Nouriel may not see inflation because output continues to fall, but that's the marvel of inflation - it's latent...until it isn't (akin to the problem of getting the ketchup out of the bottle: nothing after two shakes, then suddenly it's all over the plate).

The most relevant question in this entire discussion is whether Nouriel's contention - that there is a global dollar carry-trade that is driving asset prices wildly out of whack with fundamentals - is in fact true(?). If you can determine the veracity of that position, then you have a framework within which you can work.

Wed, 11/04/2009 - 13:49 | 119820 TraderMark
TraderMark's picture

Weird comments by Rogers

Sort of the opposite of what he has said in the past, i.e. Dow could go to 40,000 if US wants to print its way to "Prosperity"

It's ok to call it a bubble and still profit from it.  Unfortunately its destroying the real economy ... but hey the country is run for the speculator class and debtors.

Wed, 11/04/2009 - 14:06 | 119855 Gilgamesh
Gilgamesh's picture

I read the entire BBG article w/ Rogers, and I don't see anywhere that he contradicts what he has been saying.

I think people here talking garbage about Rogers in this thread either: 1) didn't read the link and what assets he is referring to, or 2) haven't listened to what he has been saying previously

Wed, 11/04/2009 - 14:00 | 119836 Anonymous
Anonymous's picture

This argument is silly. Neither Rogers or Roubini know when the dreaded bond market vigilantes will arrive on the scene.

If they don't, we'll see inflation and rising gold prices.

If the bond market gets hit (which eventually it must) we'll see gold collapse overnight.

Thu, 11/05/2009 - 00:58 | 120609 slick
slick's picture

Read your history of the last GREAT Gold Bull Market

Wed, 11/04/2009 - 14:03 | 119842 chumbawamba
chumbawamba's picture

Well, Roubini finally and inequivocally established himself as a complete moron.  His status as a go-to economic guy was an apparent fluke.  The guy is as clueless as Bernanke.

I am Chumbawamba.

Wed, 11/04/2009 - 14:05 | 119851 jimmyjames
jimmyjames's picture

Cougar said

There are a few people who comment here who I can tell understand complex systems and emergent properties. It's not a subject gamblers would find interesting, and most day-traders are gamblers. Not trying to pick a fight, just making a useful generalization.

"I promise you, Roubini absolutely gets it"

Roubini called this thing--then--

He completly lost sight of it--

If you think like he does,that we've avoided a depression--

Then can you explain,what you see as an economic driver,that will pull us out of this?

 

Wed, 11/04/2009 - 14:05 | 119852 Gordon_Gekko
Gordon_Gekko's picture

"It is very hard to justify oil going from $30 to above $80 based only on the fundamentals of supply and demand"

Well, actually Mr. Roubini the opposite is the case -  it is (was) very hard to justify oil dropping from $80 to $30 considering the fundamentals. The WTIC contract was rigged by Wall Street in cahoots with the US Govt - which is why the Saudis are now rejecting the bloody thing. Good riddance.

"Maybe it will reach $1,100 or so but $1,500 or $2,000 is nonsense"

Mr. Roubini is completely 100% WRONG on Gold. He is the one spouting utter nonsense. Looks like somebody missed the Gold train and/or was short Gold.

If a severe depression came to pass, with investors buying canned goods and hiding out in log cabins, “maybe you want some gold in that scenario,” Roubini said.

Well, I guess John Paulson, Paul Tudor Jones, Andrew Hall, George Soros - not to mention Jim Rogers - are all "hiding in log cabins". This guy is funny - and also a total and complete IDIOT.

"Position limits on oil trading, if they helped reduce volatility, may be “beneficial”

Well, it's clear that this guy is nothing but a SCHILL for the establishment. Let's see - position limits on oil would be "beneficial" (so investors can't protect themselves from pillaging by the  Fed by buying oil and we all know how important cheap oil is to the US Govt. so it can keep running it's Ponzi Schemes). And how about extending this "benefit" of position limits to the precious metals market? But of course we know it will NEVER be extended to THAT market where the bullion banks are short so much metal that they don't have a prayer of delivering - EVER.

Mr. Roubini is a total and complete DISGRACE.

Wed, 11/04/2009 - 14:16 | 119876 Humble Gentleman
Humble Gentleman's picture

"Mr. Roubini is a total and complete DISGRACE."

That may be a little harsh, because he is successful at what he does. But I'm with you on him being wrong.

Wed, 11/04/2009 - 14:16 | 119878 Anonymous
Anonymous's picture

What a childish, immature comment. You don't offer any justification for your beliefs, rather, you simply rip on Roubini.

Regarding oil, the fundamentals are that in a contracting economy we are using less. This has yet to play out. Obviously, oil will rise in the long term, but in the short term the fundamentals support a price in the $30s, not $80s. And that's even with a weaker dollar.

Regarding Gold, you're looking for a double or more. Okay, why? Weaker dollar? Again, I agree long term, but short term there are deflationary pressures, and if you haven't figured out that all currencies trade relative to others, you will. The bottom line is that there are a lot of people around the globe who have an interest in supporting the greenback, regardless of how badly Ben wants to destroy it. It's not as obvious an outcome as you seem to believe.

Your comment was childish and immature. Deal with the fact that others disagree with you. Open your mind. You'll do better. You are way to emotionally attached to certain outcomes. You're gonna get creamed.

Wed, 11/04/2009 - 17:03 | 120169 Anonymous
Anonymous's picture

While you are right that deflationary pressures are stronger now, the point is that they may not be in the futre. Gold is now rising in every currency - look it up. So relative currency weakness is not really the point.

The point is that gold is rising relative to ALL paper money, right now. I have no idea how high gold will go, btw. I don't believe in the destruction of the USD, but I do believe for a time, gold will trade strongly relative to paper, and escpecially the USD. The trend is your friend.

Wed, 11/04/2009 - 20:31 | 120423 Notorious
Notorious's picture

In Aussie dollars too?

Thu, 11/05/2009 - 01:41 | 120444 Renfield
Renfield's picture

Over one year, relatively flat result, from about $1100/oz to about $1200/oz.

http://goldprice.org/charts/history/gold_1_year_o_aud.png

But also very volatile progress: spikes to about $1250, $1450, $1550 in early 2009. Looks to be on a slow gradual flat-to-uptrend, depending on how responsible the RBA is with rates and how well the Aus economy actually DOES. (I am very skeptical on this last point considering how heavily Aus relies on a continuing Chinese 'boom' and that we have the highest level of private debt in the world.) Since the recent 'economy has recovered' propaganda, gold in AUD is flat to slow-rising.

Over 5 years, rose to $1200 from about $590/oz.

http://goldprice.org/charts/history/gold_5_year_o_aud.png

Over 10 years, rose to $1200 from about $490/oz.

http://goldprice.org/charts/history/gold_10_year_o_aud.png

Long term, gently rising trend in AUD. This year, a lot of volatility, and I would call this recent flat pattern very much a wait-and-see period, regarding how well (or badly) the economy does.

From here on the ground, I don't hold out much hope for the economy continuing well.

Wed, 11/04/2009 - 14:27 | 119895 Hondo
Hondo's picture

Oil went from about $60-70 p/bb in late '06 early'07 to $145 p/bb over corrected in '08 to $41 p/bb and is not about where it was in the summer of '07.  The ramp from June '07 to June '08 was a bubble pure and simple.

Wed, 11/04/2009 - 15:04 | 119980 Gordon_Gekko
Gordon_Gekko's picture

The crash from $147 to $30 was the real bubble (an inverse bubble, if you will).

Wed, 11/04/2009 - 14:28 | 119900 HEHEHE
HEHEHE's picture

Why do you get so upset all the time gold lover?  How much of that stuff are you holding?  I understand your investment thesis.  

What you don't understand is that all of that money that's been printed by the Fed is not being lent out but being used by the banks to bid up the markets and other assets such as gold?  There's no acceleration of money currently occurring so there is no inflation much less hyper-inflation.

The banks essentially were given a bunch of moeny to go out and buy up cheap assets and claim profitability when those assets rose.  Now it will all fall back down again.

Believe me if anyone is a shill its Rogers.  One week ago he was saying on Bloomberg expect the anti-dollar trade to end and a bubble in treasuries.  A week later he's saying gold will hit $2000 and there's no bubbles in equities.  A more reasonable explanation is Rogers is blowing smoke and dumping positions into the bubble. 

Wed, 11/04/2009 - 14:39 | 119927 lookma
lookma's picture

Its great when people talk about the banks not lending meaning there can be no inflation and/or hyperinflation because then you can be confident they have no idea what they are talking about and are just ranting out of fear against that which they do not understand.

Wed, 11/04/2009 - 15:45 | 120033 chumbawamba
chumbawamba's picture

If the banks are buying up assets with TARP funds then the money is getting out into circulation, hence inflation, soon to be followed by hyperinflation.  Or, we may just skip the inflation entirely and proceed directly to hyperinflation, a crisis of confidence in a condemned currency.

I am Chumbawamba.

Wed, 11/04/2009 - 19:49 | 120380 snorkeler
snorkeler's picture

I disagree. I do Agree with HEHEHE.  The banks are not lending this huge chunk of liquidity (TARP, FED loans etc.) out. They are using it to build up their balance sheets which if accounted for properly, would show severe insolvency.

If all of this excess liquidity began to be lent out quickly, hyperinflation would be the most likely outcome. Ask around. Banks are not lending.

lookma, please tell us what we are fearful of and do not understand.

Wed, 11/04/2009 - 22:45 | 120529 Papasmurf
Papasmurf's picture

Banks are not lending yet because the need to shore up their balance sheets for further unknown deterioration from failed loans.  If and when conditions improve with rising real estate prices (the goal of QE) and improvement in default rates, the cash on the balance sheets will come roaring back into the market.  Just like last time, banks will compete to be first to "put cash to work", so this capital will return fast and furiously.  MBS or other asset bundles have not been made illegal and requirements to retain risk in house (skin in the game) hasn't happened.  So leverage will be applied again by bundling up packages of joy.  They may not be mortgages in the bundles next time, but the result will be the same.

The fed has a poor track recored for recognizing these turns, so they will be late to act again. 

When we reach this tipping point, cheap cash will flood the market with the usual inflationary effects on asset prices.  The next bubble likely will form somewhere else instead of revisiting real estate.  It's hard to say where, but gold is money, so gold will go along for the ride.

Thu, 11/05/2009 - 06:12 | 120672 hayesy316
hayesy316's picture

"Mr. Roubini is completely 100% WRONG on Gold."

You can only be 100% wrong about something in retrospect. Deflate the ego a bit and quit confusing your opinion with facts.

Wed, 11/04/2009 - 14:09 | 119863 Anonymous
Anonymous's picture

Roubini + Rogers = Irrelevant. Nice to know that so many people are so passionate about two windbags pissing on each other. No wonder people get on the wrong side of the trade.

Wed, 11/04/2009 - 15:46 | 120035 chumbawamba
chumbawamba's picture

:)

I am Chumbawamba.

Wed, 11/04/2009 - 14:12 | 119870 Humble Gentleman
Humble Gentleman's picture

Mr. Rogers is a successful investor, and Mr. Roubini is a successful academic. Hm, I think I'll be pragmatic and give a lot more credence to what Mr. Rogers has to say when putting my own money to work.

Wed, 11/04/2009 - 14:17 | 119880 Anonymous
Anonymous's picture

DUHHHHHHHHH to all that are so uninformed!!! Roubini is the ONLYone that called the MARKET CRASH!!!!!

Wed, 11/04/2009 - 15:47 | 120041 chumbawamba
chumbawamba's picture

TOTALLY!!! That dude is like an utter total genious or somesuch shit.  I would suckle his cock if only he would tell me more great secrets of the financial universe.

I am Chumbawamba.

Wed, 11/04/2009 - 20:59 | 120448 geopol
geopol's picture

I don't know about suckling  his cock, somewhat extreme even on a sure bet, but I was calling this shit hole back in 2005 walking around Harmony Florida asking the builders if they where nuts? and I don't remember him..

 

Rubini the academic,,, all the white shoe boys from the ivy league that storm trouped us into this shit should all be in Cuba shucking sugar..

Sat, 11/07/2009 - 00:50 | 123250 Anonymous
Anonymous's picture

Wrong- Robert Prechter called it again. tOPS AND BOTTOMS. lOOK IT UP AT eLLIOTTWAve.COM. And he has called it for very soon, now too.

Wed, 11/04/2009 - 14:21 | 119884 Burnbright
Burnbright's picture

If any of you think Gold is in a bubble you're an idiot. Let's look at the facts shall we?

1) Double of the money supply in late 2008

2) The US needs to reduce its debt by at least half by 2014 (another 50% drop in purchasing power needs to occur through the printing press)

3) Where are all the people telling you to buy gold? Most people I talk to don't even understand what the value of something is or how to determine it. Hell, in another post some idiot said Gold had no intrinsic value, if that isn't any indication of just how stupid people are I don't know what else is.

Gold is not in a bubble, the dollar is just being devalued and demand is picking up. Until you hear everyone tell you to go out and buy gold because it is a good investment (i.e. not hedge or store of wealth) then you know.

I am sorry but things do not look good for the dollar. Unless Ben or Timmy increase interest rates to 20% like Paul Volker did Gold will just keep going up. Having said that, because of the financial situation we are in, raising interest rates won't happen. Gold is going to be higher than 2000 an ounce a decade from now. You will be lucky if you can even purchase gold with dollars a decade from now.

Wed, 11/04/2009 - 14:28 | 119899 Anonymous
Anonymous's picture

It is worth noting that there is a confluence at play for a while now. Many CBs are looking into swapping their cash into real assets - vide India, China, while the current owners of hard assets are in a desperate need for cash to "ameliorate the international imbalances". Yes, boys and girls, a bubble is forming. The base for AU was ~$800, bubble extension is typically greater than 3x, so this will take us well past $2400.

Wed, 11/04/2009 - 14:32 | 119912 Hondo
Hondo's picture

Hey, news for you.....the $$ has been declining since the 1950's.  After WWII the US was great...why...because we blew apart most of the worlds productive capabilities.  As countries have invested capital to produce goods and services the US has naturally lost the unreal competative advantage it had immediately after the war.  As long as the pie as a whole continues to grow everyone is happy but when the pie shrinks we have problems.

Wed, 11/04/2009 - 15:36 | 120018 Anonymous
Anonymous's picture

Almost all the correspondents here have dollar-centric economic world-view. Gold has not appreciated priced in Euro or AUD, NZD, CAD and NOK. Why must we necessarily evaluate Gold in Dollar terms? Please wake up, rest of the world is passing the US by.

Most of the correspondents here are also either partisans of inflation or of deflation. But what about stagflation nobody is talking about, which perhaps would be the most likely outcome if the dollar continues its downward slide as a result of Fed pumping in more and more money in the economy. Assets -stocks, bonds, commodities, real estate - will go up as priced in Dollars (inflation), but real economy - employment, manufacturing - may not be going upany time soon (deflation).

US has dug itself in a very deep hole of debt, whish is becoming deeper by the day. It seems unlikely that it can earn its way out of it at any distant time-horizon one can visualise. The only course left for the TPTB is to pump in more and more money and deflate these debts. Dollar will tank and all Dollar priced assets will soar. Foreign holders of US debt are panicking and fleeing Dollar and hoarding alternative assets like gold and non-Dollar currencies

TPTB may be able to revive the economy eventually by QE, but it seems a very tall order that they will be able to salvage the Dollar world hegemony.

Wed, 11/04/2009 - 15:52 | 120052 chumbawamba
chumbawamba's picture

Why must we necessarily evaluate Gold in Dollar terms?

Because that's the currency in which most commodities trade.

But certainly, feel free to valuate it in any currency or commodity you prefer.  We'll try to follow along.

I am Chumbawamba.

Wed, 11/04/2009 - 21:02 | 120450 geopol
geopol's picture

I have gold, and I'm walking bare ass through tall cotton...

Wed, 11/04/2009 - 21:07 | 120459 geopol
geopol's picture

Rubini was one of us until he became noteworthy, and then they got to him, and now he's one of THEM NWO Bilderberg Group, Council on Foreign Relations MUHAHAHAHAHAH... Puppet post...

Wed, 11/04/2009 - 16:16 | 120095 PeterB
PeterB's picture

Looks like we're only minutes away from gold trading at $1100usd even gold in AUD is creeping up to recent highs.

Wed, 11/04/2009 - 16:22 | 120102 Anonymous
Anonymous's picture

I'll bet Roubini 1 ounce of 999 gold that it reaches US$1500 by January 14 2011. Tell that nincumpoop to put his money where his mouth is. Walkdontrun.

Wed, 11/04/2009 - 16:55 | 120158 Anonymous
Anonymous's picture

It's international buying that is driving the price of gold...not Goldman, JP and the related cronies.

Wed, 11/04/2009 - 17:00 | 120161 Anonymous
Anonymous's picture

PS. Don't forget it is more likely than not the 2008 oil price spike to $147 was simply Merrill and GS robbing Semgroup.

Wed, 11/04/2009 - 17:50 | 120231 Anonymous
Anonymous's picture

Gold has the green light it appears if you believe Liesman and G-men he spoke to. If they don't see domestic inflation, and no panic selling ( controlled decline is fine by them) they won't act to prop USD. This is what I wanted to know. What they thinking. Now that confirms it for me, slow painful death of USD.

They figure most Americans don't go anywhere and they don't look at exchange rates and will not notice. The

http://www.cnbc.com/id/33621641

Wed, 11/04/2009 - 17:55 | 120234 Miles Kendig
Miles Kendig's picture

Did Rogers drive up in a Lamborghini double clutch tractor?

Wed, 11/04/2009 - 20:43 | 120434 geopol
geopol's picture

It was Yellow

Wed, 11/04/2009 - 17:59 | 120239 Anonymous
Anonymous's picture

You guys got it all wrong gold is going to $5,000 by next week if not sooner. Its the all those Chinese and Indians.
And a can of tomato soup will be going for $25 by next week too. Do not forget to buy some bullets this week.

Wed, 11/04/2009 - 20:50 | 120439 geopol
geopol's picture

Your attempt at provoking trouble, is LIMP.. Next destination for you, Huffington Post,, now move along.

Wed, 11/04/2009 - 18:10 | 120248 Phillycheesesteak
Phillycheesesteak's picture

Oil was a bubble at $147.  Even OPEC was screaming that the world was "Awash in oil" and the price didn't make any sense.  The Fed and speculators have the markets so screwed up that noone knows what anything is worth.  Want to get a fair price on oil?  Shut down the hyperinflation speculators and make anyone who buys oil futures take physical delivery.

 

And Roubini has been much more accurate than Rogers the last few years.  Rogers called a bottom to the Chinese stock market at 3400 before it collapsed to 1600.  All markets are being inflated right now.  Will it last?  How determined is Bernanke to turn the dollar to dust?  Noone knows but him.

Thu, 11/05/2009 - 19:10 | 121495 Anonymous
Anonymous's picture

Shutdown the hyperinflation speculators?

Sure after the deflation speculators are shutdown in the precious metals market.

Why not?

Wed, 11/04/2009 - 18:38 | 120278 Invisible Hand
Invisible Hand's picture

I hate to be a nag, but...trading gold may make you some money (maybe even a lot of money).  I make a bunch in PM's a few years back myself.  However, it is not a long term store of wealth for the simple reason that if (when?) things get bad our masters are going to confiscate the gold (and pay you a small fraction of what it is worth internationally).  They did it 75 years ago and they will do it again.  You may be able to "save" it by hiding it somewhere but you will not be able to buy things for your family with it (which is my definition of what money is).  What we should be arguing about is how to perserve the Republic and the rule of law, not the price of gold. Just MVHO.

Wed, 11/04/2009 - 20:41 | 120433 Humble Gentleman
Humble Gentleman's picture

I'm not so sure about your remark vis-a-vis confiscating gold, because the circumstances are much different now. People are fed up with our 'representatives', so the reps are in a tenuous position. Insurrection would occur overnight if they announced such an absurd change of course. Eh?

Wed, 11/04/2009 - 21:03 | 120451 Renfield
Renfield's picture

Howard Katz has an interesting article arguing that gold confiscation is unnecessary by governments and therefore won't be done (unless/until there is a return to a gold standard for currency).

http://marketoracle.co.uk/Article14699.html

Wed, 11/04/2009 - 19:06 | 120325 Anonymous
Anonymous's picture

What? No mention of the extremely large call volume in UUP?

Wed, 11/04/2009 - 19:19 | 120345 Anonymous
Anonymous's picture

Does any of this make sense? Who's
getting paid off?

Wed, 11/04/2009 - 19:26 | 120355 Sqworl
Sqworl's picture
Nouriel Roubini is off tonite to London and Dublin for buzzzzinessss...back to NYC on Friday night...let me know what is cooking Friday night back home for fun... his facebook post....He will soon be the pitch man for Viagra/Cialis...along with old fart Soros...to be followed by Summers pitching narcolepsy drugs.
Wed, 11/04/2009 - 19:41 | 120374 Anonymous
Anonymous's picture

i wish you would make these math ?s easier.
fear and uncertainty will make the price of gold. the one international currency everytime.
bill buckner in his newsletter about 6 months or so ago foretold the events presently unfolding from the housing situation, gold, deflation to the serious funding deficits felt by every level of government in the us and europe. his track record is kind of spooky.
i signed up for his newsletter,'the privateer', because i liked his sense of aussie humor. he hasn't been so funny lately. it doesn't look like good times ahead any time soon. GLTA, breezer1

Wed, 11/04/2009 - 20:19 | 120409 Anonymous
Anonymous's picture

I don't care about Rogers or Roubini - I have plenty of useful real-world information available for making my investment decisions without turning to the forecasts of cult figures. For the benefit of those younger than 40, and particularly those who see recent asset price moves as proof of specific theories about the future market direction for oil and/or gold (especially as a function of the dollar) - after the Arab Oil Embargo in the 1970's everything went crazy; the price of oil went up and up and up, the price of gold went up and up and up, banks were recycling petrodollars into junk Latin American loans like there was no tomorrow, etc, etc. There were analysts, traders, and pundits all explaining exactly why this was all based on fundamentals ("peak oil" is not a new term) and would go to yet greater extremes; Volcker raised rates, Saudi Arabia opened the spigots, and it all suddenly crashed - including a thousand banks; the same analysts, traders, and pundits now explained why the fundamentals made the instant drop in oil and gold prices predictable and obvious. Meanwhile, the dollar continued to depreciate from before the oil/gold bubble to the twenty-first century.

Caveat Emptor

Wed, 11/04/2009 - 20:32 | 120424 Anonymous
Anonymous's picture

track who wins the Roubini/Rogers showdown.. at www.etfdesk.com http://www.etfdesk.com/headline.aspx?hId=1470

Wed, 11/04/2009 - 21:29 | 120480 time123
time123's picture

It all depends on the value of the dollar. If it falls further, gold prices will rise. But when it becomes clear that the US economy is growing strong, the US dollar will rise, and gold prices will be capped.

 

time123

admin: http://invetrics.com

Wed, 11/04/2009 - 22:05 | 120505 Anonymous
Anonymous's picture

The debate here sems to be whether my gold investment would make me another 30% or whether I would lose my shirt when it plunges, too emotional. It's not about Roubini vs Rogers. To those who own gold, Roubini sucks. To those who sold out recently, Rogers is nuts. Take a look at the big picture people. Nothing goes up forever, and the system being broke compelling you to buy gold, will itself be destroyed sooner than you think. Banksters are like the mafia - they are not in control as much as you think. When they flee, the leverage system collapse, and with it all bubbles. When there is no more leverage or carry trade, wither gold? I would rather buy a wheat farm than buy gold now.

Anyway, Rogers lives in Asia, sends his daughter to school to learn mandarin, and did not sell a single chinese stock throughout the plunge from 6000 points to 1500 on the SSE. You folks have nothing in common with Rogers, he is talking up his book; and yes, besides Chinese stocks, he also said the pound would be worth zilt in April. Where is the sterling today?

Wed, 11/04/2009 - 22:55 | 120534 Grand Supercycle
Grand Supercycle's picture

 

USD bullish divergence continues . . .

What happens to Gold when the USD rallies ?

Daily charts in key equity indices are still giving bearish warnings.

MORE:
http://www.zerohedge.com/forum/market-outlook-0

 

Wed, 11/04/2009 - 23:48 | 120573 Anonymous
Anonymous's picture

Things are easy: current situation will end in inflation and a weaker dollar (strong gold, strong commodities), or in a lot higher long term interest rates (all asetts prices down). Any of these options is bad for USA, but the first one is less bad for everybody, including USA.

Clearly, I bet for investing abroad...

Thu, 11/05/2009 - 01:19 | 120627 Anonymous
Anonymous's picture

Double in the next decade? Like, by 2019? Wow, 7% growth - nice call.

Talk about hedging your bets - it's like losing 100 pounds - you gain 5, then lose 10, then gain 15, then lose 8, ... a decade later you've lost 100 pounds and your heavier then ever.

Gold is not always an inflation proxy - I bet on FX volatility, if it shoots to $2000 in 6 months - it's going to be a wild ride - India has some serious firepower now.

Thu, 11/05/2009 - 06:43 | 120680 Anonymous
Anonymous's picture

Gold, Silver, Copper, Food, Water, Commodities, Guns, Ammo, Energy, etc. are essentially stores of value and/or consumables and may be exchanged for other items or even for paper money. Paper money such as the US dollar has no value, intrinsic or otherwise, except that placed on it by people who have faith in it -- it really is not true money, but exchange currency that represents real money and promotes daily commerce. Such faith is based upon historic usage which over time changes for good or bad, based upon collective experience of the populace or even nowadays upon the world, since we have vastly allowed the "buck" to be distributed everywhere by virtue of reserve currency status, etc.

As more and more "bucks" are circulated either by printing or digitizing or whatever means available, the total expanded circulation diminishes or devalues the individual shrinking units via inflation. Inflation is thus a hidden tax on all who hold the underlying paper to the extent that such manipulation has caused present and future loss of purchasing power. People erroneously think that the value of gold, silver, etc. changes according to daily reportable statistics, but this is only in relation to paper money which can be manipulated according to the dictates of politicians, bankers, etc., when the only thing that changes is the reflection of manipulation itself. The value of the item remains the same whether it be an ounce or gallon or bushel or whatever, unless it is in some way perishable.

Bottom-Line: Hope and pray that our financial system as it has now evolved can now hang on longer so that people have time to adjust to the inevitable results of gradual monetary devaluation which must ensue to accommodate payment for economic stimulus, ongoing and accumulated deficit spending, etc. Also hope and pray that the same powers who precipitated the present confounded status have the intestinal fortitude to bail out "main street" as well as "wall street", because without "main street" there is no need for the other.

Unfortunately, we find ourselves mired in numerous detractive smokescreens which trick people into focusing on topics that are perhaps important but not critical. If people become unemployed for long durations, what importance is expensive, unaffordable health insurance to them unless they happen to be independently wealthy? Until elected officials wake up and realize that their actions are actually detrimental and destructive to the very system that they supposedly represent, the masses will increasingly lose faith in them, the broken or diseased system, and the devalued paper currencies here and everywhere.

If one is fortunate enough to have saved any money through all of this, they may ultimately search for a way to preserve such. This will likely be accomplished by acquiring real things that have value in their lives or that can be exchanged for same, like gold, silver, food, etc. Until people begin to see a return of wisdom or at least a desire by the powers that be to try to begin to truly fix or restore the broken system rather than delay the inevitable, or worse continue to make it worse, or continue to attempt to transform the system to some sort of unconstitutional socialistic utopia, they will likely gravitate toward a lack of faith and trust, which will collectively exacerbate the devaluation of the paper currency representatives of real value.

On a side note, whether one agrees in a central banking system or not, it is what we have and for the most part they have been carefully walking a tightrope through the economic maze. Even though some mistakes have been made, their attempt to reflate the system is better than the alternative, but they can only do so much. Without proper administration of the political system and at least some semblance of integrity, the Fed's extensive best efforts may be all for naught, even though some of the most prosperous periods in our nation's history have been during periods of controlled and calculated currency inflation. This may be the last chance at actually fixing our system and all I see is a majority of elected representatives who appear to be living their indifferent collective utopic lives as though they were from some other planet, not realizing that sooner or later one has to "pay the piper" or suffer the consequences of their actions. Why should people sit back and allow their livelihoods and that of future generations be frittered away and gambled as though they were meaningless?

Short of reverting to a hard currency approach, the only way to really accomplish a lasting fix is to simultaneously mandate "iron clad" fiscal responsibility along with manageable inflation, while comprehensively vastly increasing productivity. Implementing such a diverse plan would at the least entail establishing every possible way to activate and achieve a meaningful national full work force via such measures as tax incentives and targeted industrial and technological stimulus as well as containment of factors which inhibit or hinder the growth of free enterprise.

Nearly free energy via "cold fusion" is a worthy goal. The technology exists but has not even been placed in a pilot plan status, even though such implementation would eventually take an estimated 30 plus years in order to effect some 60,000 operational processes. What are we waiting for? If we are holding back because of greed or some other ill-thought reasoning, it could be costing us the survival of the planet. This energy process alone would put many millions back to work. If properly undertaken it could conceivably be THE answer to numerous of the world's problems including pollution, food shortage, waste of finite resources, perhaps even prevention of wars. The time for talk is over -- now is the time for action!

Thu, 11/05/2009 - 06:48 | 120681 Anonymous
Anonymous's picture

Gold, Silver, Copper, Food, Water, Commodities, Guns, Ammo, Energy, etc. are essentially stores of value and/or consumables and may be exchanged for other items or even for paper money. Paper money such as the US dollar has no value, intrinsic or otherwise, except that placed on it by people who have faith in it -- it really is not true money, but exchange currency that represents real money and promotes daily commerce. Such faith is based upon historic usage which over time changes for good or bad, based upon collective experience of the populace or even nowadays upon the world, since we have vastly allowed the "buck" to be distributed everywhere by virtue of reserve currency status, etc.

As more and more "bucks" are circulated either by printing or digitizing or whatever means available, the total expanded circulation diminishes or devalues the individual shrinking units via inflation. Inflation is thus a hidden tax on all who hold the underlying paper to the extent that such manipulation has caused present and future loss of purchasing power. People erroneously think that the value of gold, silver, etc. changes according to daily reportable statistics, but this is only in relation to paper money which can be manipulated according to the dictates of politicians, bankers, etc., when the only thing that changes is the reflection of manipulation itself. The value of the item remains the same whether it be an ounce or gallon or bushel or whatever, unless it is in some way perishable.

Bottom-Line: Hope and pray that our financial system as it has now evolved can now hang on longer so that people have time to adjust to the inevitable results of gradual monetary devaluation which must ensue to accommodate payment for economic stimulus, ongoing and accumulated deficit spending, etc. Also hope and pray that the same powers who precipitated the present confounded status have the intestinal fortitude to bail out "main street" as well as "wall street", because without "main street" there is no need for the other.

Unfortunately, we find ourselves mired in numerous detractive smokescreens which trick people into focusing on topics that are perhaps important but not critical. If people become unemployed for long durations, what importance is expensive, unaffordable health insurance to them unless they happen to be independently wealthy? Until elected officials wake up and realize that their actions are actually detrimental and destructive to the very system that they supposedly represent, the masses will increasingly lose faith in them, the broken or diseased system, and the devalued paper currencies here and everywhere.

If one is fortunate enough to have saved any money through all of this, they may ultimately search for a way to preserve such. This will likely be accomplished by acquiring real things that have value in their lives or that can be exchanged for same, like gold, silver, food, etc. Until people begin to see a return of wisdom or at least a desire by the powers that be to try to begin to truly fix or restore the broken system rather than delay the inevitable, or worse continue to make it worse, or continue to attempt to transform the system to some sort of unconstitutional socialistic utopia, they will likely gravitate toward a lack of faith and trust, which will collectively exacerbate the devaluation of the paper currency representatives of real value.

On a side note, whether one agrees in a central banking system or not, it is what we have and for the most part they have been carefully walking a tightrope through the economic maze. Even though some mistakes have been made, their attempt to reflate the system is better than the alternative, but they can only do so much. Without proper administration of the political system and at least some semblance of integrity, the Fed's extensive best efforts may be all for naught, even though some of the most prosperous periods in our nation's history have been during periods of controlled and calculated currency inflation. This may be the last chance at actually fixing our system and all I see is a majority of elected representatives who appear to be living their indifferent collective utopic lives as though they were from some other planet, not realizing that sooner or later one has to "pay the piper" or suffer the consequences of their actions. Why should people sit back and allow their livelihoods and that of future generations be frittered away and gambled as though they were meaningless?

Short of reverting to a hard currency approach, the only way to really accomplish a lasting fix is to simultaneously mandate "iron clad" fiscal responsibility along with manageable inflation, while comprehensively vastly increasing productivity. Implementing such a diverse plan would at the least entail establishing every possible way to activate and achieve a meaningful national full work force via such measures as tax incentives and targeted industrial and technological stimulus as well as containment of factors which inhibit or hinder the growth of free enterprise.

Nearly free energy via "cold fusion" is a worthy goal. The technology exists but has not even been placed in a pilot plan status, even though such implementation would eventually take an estimated 30 plus years in order to effect some 60,000 operational processes. What are we waiting for? If we are holding back because of greed or some other ill-thought reasoning, it could be costing us the survival of the planet. This energy process alone would put many millions back to work. If properly undertaken it could conceivably be THE answer to numerous of the world's problems including pollution, food shortage, waste of finite resources, perhaps even prevention of wars. The time for talk is over -- now is the time for action!

AdamSmith37

Thu, 11/05/2009 - 06:55 | 120683 Anonymous
Anonymous's picture

Gold, Silver, Copper, Food, Water, Commodities, Guns, Ammo, Energy, etc. are essentially stores of value and/or consumables and may be exchanged for other items or even for paper money. Paper money such as the US dollar has no value, intrinsic or otherwise, except that placed on it by people who have faith in it -- it really is not true money, but exchange currency that represents real money and promotes daily commerce. Such faith is based upon historic usage which over time changes for good or bad, based upon collective experience of the populace or even nowadays upon the world, since we have vastly allowed the "buck" to be distributed everywhere by virtue of reserve currency status, etc.

As more and more "bucks" are circulated either by printing or digitizing or whatever means available, the total expanded circulation diminishes or devalues the individual shrinking units via inflation. Inflation is thus a hidden tax on all who hold the underlying paper to the extent that such manipulation has caused present and future loss of purchasing power. People erroneously think that the value of gold, silver, etc. changes according to daily reportable statistics, but this is only in relation to paper money which can be manipulated according to the dictates of politicians, bankers, etc., when the only thing that changes is the reflection of manipulation itself. The value of the item remains the same whether it be an ounce or gallon or bushel or whatever, unless it is in some way perishable.

Bottom-Line: Hope and pray that our financial system as it has now evolved can now hang on longer so that people have time to adjust to the inevitable results of gradual monetary devaluation which must ensue to accommodate payment for economic stimulus, ongoing and accumulated deficit spending, etc. Also hope and pray that the same powers who precipitated the present confounded status have the intestinal fortitude to bail out "main street" as well as "wall street", because without "main street" there is no need for the other.

Unfortunately, we find ourselves mired in numerous detractive smokescreens which trick people into focusing on topics that are perhaps important but not critical. If people become unemployed for long durations, what importance is expensive, unaffordable health insurance to them unless they happen to be independently wealthy? Until elected officials wake up and realize that their actions are actually detrimental and destructive to the very system that they supposedly represent, the masses will increasingly lose faith in them, the broken or diseased system, and the devalued paper currencies here and everywhere.

If one is fortunate enough to have saved any money through all of this, they may ultimately search for a way to preserve such. This will likely be accomplished by acquiring real things that have value in their lives or that can be exchanged for same, like gold, silver, food, etc. Until people begin to see a return of wisdom or at least a desire by the powers that be to try to begin to truly fix or restore the broken system rather than delay the inevitable, or worse continue to make it worse, or continue to attempt to transform the system to some sort of unconstitutional socialistic utopia, they will likely gravitate toward a lack of faith and trust, which will collectively exacerbate the devaluation of the paper currency representatives of real value.

On a side note, whether one agrees in a central banking system or not, it is what we have and for the most part they have been carefully walking a tightrope through the economic maze. Even though some mistakes have been made, their attempt to reflate the system is better than the alternative, but they can only do so much. Without proper administration of the political system and at least some semblance of integrity, the Fed's extensive best efforts may be all for naught, even though some of the most prosperous periods in our nation's history have been during periods of controlled and calculated currency inflation. This may be the last chance at actually fixing our system and all I see is a majority of elected representatives who appear to be living their indifferent collective utopic lives as though they were from some other planet, not realizing that sooner or later one has to "pay the piper" or suffer the consequences of their actions. Why should people sit back and allow their livelihoods and that of future generations be frittered away and gambled as though they were meaningless?

Short of reverting to a hard currency approach, the only way to really accomplish a lasting fix is to simultaneously mandate "iron clad" fiscal responsibility along with manageable inflation, while comprehensively vastly increasing productivity. Implementing such a diverse plan would at the least entail establishing every possible way to activate and achieve a meaningful national full work force via such measures as tax incentives and targeted industrial and technological stimulus as well as containment of factors which inhibit or hinder the growth of free enterprise.

Nearly free energy via "cold fusion" is a worthy goal. The technology exists but has not even been placed in a pilot plan status, even though such implementation would eventually take an estimated 30 plus years in order to effect some 60,000 operational processes. What are we waiting for? If we are holding back because of greed or some other ill-thought reasoning, it could be costing us the survival of the planet. This energy process alone would put many millions back to work. If properly undertaken it could conceivably be THE answer to numerous of the world's problems including pollution, food shortage, waste of finite resources, perhaps even prevention of wars. The time for talk is over -- now is the time for action!

AdamSmith37

Thu, 11/05/2009 - 10:54 | 120760 Jim B
Jim B's picture

Roubini is a pretty smart man, but I don't see the spending/deficit situation having a happy ending for the dollar.  He seems to be ignoring this.........

Thu, 11/05/2009 - 12:23 | 120839 Anonymous
Anonymous's picture

Both Roubini and Rogers are pretty smart guys. Ah, there's the rub. Man cannot resist proving himself the smartest kid on the block.

In the early 70s, I asked my economics professor why we could not have an inflationary recession. His answer: Impossible to have through economic theory. Of course, a few years later, it happened when OPEC did their thing.

I am not smart enough to predict markets, therefore I shy away from those who do. Instead, I make my investment decisions based on trends. If gold is trending up, I have gold holdings. If gold is trending down, I either don't hold gold positions, or if the trend is strong enough, I short gold positions. I place my risk management positions into place if I am wrong.

One thing that I have learned is filter the noise. This is why John Templeton moved away from Wall St. (oh, yeah, taxes were in his decision to move as well).

In other words, do not blindly follow a Roubini nor a Rogers. Do your own research.

Sat, 11/07/2009 - 01:09 | 123263 Anonymous
Anonymous's picture

Gold and silver are the means that the elite use to preserve their wealth and trade with each other. Rothchild has 500 trillion dollars (half of earths wealth), and vaults of gold to hold it. Saw it on youtube. Rogers does not try to outsmart anyone, just to take as big a bite as he can,without high risk. He sees food shortages, water shortages, maybe famine, and economic devastatio for the US. Currencies are nots gloablly, so there is nowhere to hide but in gold and silver for the lo9ng haul. In short run, agriculture, food, ater and probably weapons, ammo. You can't eat gold, but eventually you can use it after the terrible stuff is over to buy land and businesses that are left. They paid pennies for whole farms in the depression. Think if you had gold then, you could have bought up as much as JP Morgan, Rothchild,,Rockefeller, ETC. Half gold, half dollars. Everyone seems to forget the derivatives that are outstanding. They are in dollars, so the loosers must pay them off in dollars, which will rocket up. Wrap your mind around the $225 quadrillion dollars in outstanding derivatives globally. Dollar rally? and gold will not be far behind-

Mon, 11/09/2009 - 00:10 | 124283 Anonymous
Anonymous's picture

If we actually get to the point where we need physical gold to purchase things, then the only one's who will have gold are the one's who also have guns.

Mon, 11/09/2009 - 17:16 | 125092 Anonymous
Anonymous's picture

I will sell my gold when fiscal sanity returns to the U.S. government.

Obviously, I will be holding my gold for a long, long time.

Wed, 11/11/2009 - 14:50 | 127268 Anonymous
Anonymous's picture

All you young c/s'should note: In Sept 1978 (Peanut Carter was POTUSA) one could buy gold @ $278 per OZ & silver about $5 per OZ. Jimmy,s malaised $ policy while restricting Paul Volker Chair S/T by late 1979 early 1980 pushed gold up to $800 per oz and the HUNT BROS of Texas attemptin to corner the silver mkt pushed silver to $40 per oz. C/Ds were paying 17% and loans to business were 22% + prime of approx 2%. The only thing that COULD push gold to $2000 - $3000 per oz is primarily INFLATION. For Mr. Rogers, late last year, he was saying Buy Cotton. Robert Prechter has been a "bear" since the late 1970s. If gold reaches $2000 let alone $3000 you will be riding bicycles and pushing wheelbarrows(sp). The Ga., LIGHTEREDKNOT>

Wed, 11/11/2009 - 14:50 | 127269 Anonymous
Anonymous's picture

All you young c/s'should note: In Sept 1978 (Peanut Carter was POTUSA) one could buy gold @ $278 per OZ & silver about $5 per OZ. Jimmy,s malaised $ policy while restricting Paul Volker Chair S/T by late 1979 early 1980 pushed gold up to $800 per oz and the HUNT BROS of Texas attemptin to corner the silver mkt pushed silver to $40 per oz. C/Ds were paying 17% and loans to business were 22% + prime of approx 2%. The only thing that COULD push gold to $2000 - $3000 per oz is primarily INFLATION. For Mr. Rogers, late last year, he was saying Buy Cotton. Robert Prechter has been a "bear" since the late 1970s. If gold reaches $2000 let alone $3000 you will be riding bicycles and pushing wheelbarrows(sp). The Ga., LIGHTEREDKNOT>

Thu, 11/12/2009 - 04:25 | 128203 Anonymous
Anonymous's picture

They've both been utterly wrong more times than I can count.

Roubini hasn't done his homework, it's true, as he seems to know nothing about speculative manias. I'd ask him if the tech bubble wasn't "nonsense" based on fundamentals, or last year's oil spike. Anyone thinking markets move mainly, or exclusively, on fundamentals is a n00b or a cretin.

As for Rogers, he loads up and talks his book. Typical Wall St. front-running pump & dumping, thus he can never admit openly that it's all about hype bubbles.

Mon, 11/30/2009 - 19:22 | 146891 FreddyInBangkok
FreddyInBangkok's picture

who would you think is the better investor, Jimmy or the other one? never trust an intellectual ... or anyone who worked for Soros for that matter.

 

by Bob Chapman http://www.globalresearch.ca/index.php?context=va&aid=16313 Global Research, November 28, 2009 The International Forecaster

The following information may be the most important we have ever published. One of our Intel sources, highly placed in banking circles, tells us that on 1/1/10 all banks that have received TARP funds have been informed by the Federal Reserve that they must further restrict any commercial lending. Loans have to be 75% collateralized, 50% of which has to be in cash, which is a compensating balance. The Fed has to do one of two things: They either have to pull $1.5 trillion out of the system by June, which would collapse the economy, or face hyperinflation. This is why the Fed has instructed banks to inform them when and how much of the TARP funds they can return. At best they can expect $300 to $400 billion plus the $200 billion the Fed already has in hand. We believe the Fed will opt for letting the system run into hyperinflation. All signs tell us they cannot risk allowing the undertow of deflation to take over the economy. The system cannot stand such a withdrawal of funds. They also must depend on assistance from Congress in supplying a second stimulus plan. That would probably be $400 to $800 billion. A lack of such funding would send the economy and the stock market into a tailspin. Even with such funding the economy cannot expect any growth to speak of and at best a sideways movement for perhaps a year. We have been told that the FDIC not only is $8.2 billion in the hole, but they have secretly borrowed an additional $80 billion from the Treasury. We have also been told that the FDIC is lying about the banks in trouble.

The number in eminent danger are not 552, but a massive 2,035. The cost of bailing these banks out would be $800 billion to $1 trillion. That means 2,500 could be closed in 2010. Now get this, the FDIC is going to be collapsed before the end of 2010, which means no more deposit insurance. This follows the 9/18/09 end of government guarantees on money market funds. Both will force deposits into US government bonds and agency bonds in an attempt to save the system. This will strip small and medium-sized banks and force them into shutting down or being absorbed. This means you have to get your money out of banks, especially CDs. We repeat get your cash values out of life insurance policies and annuities. They are invested 80% in stocks and 20% in bonds. Keep only enough money in banks for three months of operating expenses, six months for businesses. Major and semi-major banks are being told to obtain secure storage for new currency-dollars. They expect official devaluation by the end of the year. We do not know what the exchange rate will be, but as we have stated previously we expect three old dollars to be traded for one new dollar.

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