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FOR THE RECORD: GATA, Ted Truman And Gold … Another Stunning Revelation

lemetropole's picture




 

 On May 10, 2000 a GATA delegation consisting of Reg Howe, Frank Veneroso, Chris Powell and Bill Murphy met with Denny Hastert, The Speaker of the House in the United States Congress; Spencer Bachus, the Chairman of the House Subcommittee on Domestic and International Monetary Policy; and Dr. John Silvia, the Chief Economist of the Senate Banking Committee. We presented each of them our 100 page "Gold Derivative Banking Crisis" document and personally delivered it to the staff of every House and Senate Banking Committee member. It actually made the news on ABC television in Australia.

From www.LeMetropoleCafe.com six days later:

May 16, 2000 - Spot Gold $275.30 down 20 cents - Spot Silver $5.11 up 9 cents

Midas Special

Dinner plans are with former Justice/Treasury Department attorney and Gold Anti-Trust Action Committee member, Ethan Stroud, this evening, so this MIDAS will be a shorter than planned…

GATA put out a press release this morning about the Roll Call open letter and our trip to Washington, noting that we met with Congressman Spencer Backus of Alabama. Congressman Backus is Chairman of the House Banking Sub Committee on Domestic and International Monetary Policy. This committee has oversight of the gold and silver markets and is the right place to go about our gold market concerns…

Allow me to let you in on some of the inside scoop going on here. Over the past year, the name Ted Truman has popped up in our circles as a CIA snoop. That is also the word around certain politicos in Washington. Rumor mind you, but smoke all over the place on this one. He used to work for the Federal Reserve, but he had a falling out with Alan Greenspan. Al Gore picked him to go work at the Treasury which is where he is employed at the moment. After one of our meetings in Washington, we met with one of GATA's support contacts and told him the names of who we met with. Immediately, he told us to be careful with one of them because he has a direct line to Ted Truman.

That sets the scene.

Yesterday, I almost fell off my chair when GATA Treasurer/Secretary Chris Powell faxed me of a copy of a letter he just received from none other than Ted Truman! It was dated May 10, the day of our meetings in Washington. We did not get out of our meeting that day until
3 o'clock. Chris Powell had written letters to the Treasury many months ago as had others in his behalf. I just looked in our files and found the following correspondence:

A letter that was sent to Senator McConnell of Kentucky from Jeffrey Rush Jr., Inspector General of The Treasury.

A letter to Dale Schnitzler and Congressman Sherrod Brown of Ohio from Marti Thomas, Acting Assistant Secretary of The Treasury.

A letter to Congressman Charles T. Canady from Linda L. Robertson, Assistant Secretary of the Treasury.

A letter to Senator Christopher Dodd (with "concerning questions from Mr. Chris Powell." written in the letter) from Michelle A. Smith, Deputy Assistant Secretary of the Treasury.

Two letters to Treasury Secretary Lawrence Summers from Senator Joe Lieberman of Connecticut.

A letter to Senator Lieberman from Alan Greenspan in response to GATA's Roll Call questions.

All this, but no letter from Secretary Summers to anyone, not even to Senator Lieberman. Secretary Summers had everyone else put their name down. But, NOT HIS.

At the same time, there was plenty of correspondence to Chris Powell over these past many months by other Treasury officials in response to his request for answers to the questions that GATA posed in the Roll Call open letter.

It is very odd then that this supposed CIA snoop (with the proper name of Edward M. Truman) with the Treasury writes to Chris Powell

after obviously being immediately informed about we said at one of our presentations in Washington. The letter itself was a form one that

most others received except for one difference. It started out, "Secretary Summers has asked me to respond on his behalf." I cannot help but think that Secretary Summers is the ringleader of the US gold trading operation, having taken over from former Treasury Secretary Rubin. The evidence is starting to mount. If that is the case, and Congress finds this out, it could open up a can of worms and who knows what else Congress will find?

The Gold Anti-Trust Action Committee and our supporters in the GATA delegation could be the Democrats worst nightmare, maybe Tony Blair's too.

-END-

As for Tony Blair, he was Prime Minister of the United Kingdom when the Bank of England announced a very controversial decision to sell

400 tonnes of gold at around $275 an ounce, which was close to the bottom of the market. Nearly a month ago Ned Naylor-Leyland, investment director of Cheviot Asset Management in London, interviewed by Max Keiser on yesterday's edition of "The Keiser Report" on the Russia Today television network, revealed that the British Broadcasting Corp.'s investigative journalism TV program, "Panorama," killed a report exposing silver market manipulation even after doing substantial interviews that provided evidence of manipulation by JP Morgan, etc.

GATA knew all about the Panorama TV program due to GATA’s Adrian Douglas being involved. Word was that it was a call from Tony Blair which killed the airing of the show. It begs the question to ask why and reveals just how big a deal the precious metal market manipulation story really is. The story won’t die there. (And it didn’t with this discovery)…

From the Daily Mail:

PUBLISHED: 12:51 EST, 16 September 2012

Tony Blair has taken a £4.2million loan secured against his family home from the US bank he advises, it emerged yesterday.

The former Prime Minister received the seven-figure mortgage from JP Morgan, which pays him £2.5million a year for his advice…

http://www.dailymail.co.uk/news/article-2204154/Tony-Blair-takes-4-2m-lo...
-London-des-res-U-S-bank-advises.html

-END-

A decade later, Mr. Truman surfaced again…

ft.com

October 12, 2010 2:01 pm

America should open its vaults and sell gold

By Edwin Truman

Gold is back in the news. Its price is soaring in what some analysts say is a reflection of a weak economy and a lack of confidence in government policies. Naturally, investors are looking at a new sure thing in the expectation that prices will continue upward. My advice to the US government, however, is that this may be the best time – to sell. Doing so would help President Barack Obama and Congress reduce indebtedness, at little cost…

http://www.ft.com/intl/cms/s/0/2bbd4dbe-d5fe-11df-94dc-0
0144feabdc0.html#axzz2GknfM8SL

-END-

Which has now led to this stunning revelation by R.M. and my colleague Chris Powell in this GATA missive…

Washington Agreement is another gold rig, former Fed and Treasury official admits

Submitted by cpowell on 09:01AM ET Tuesday, January 1, 2013. Section: Daily Dispatches

12:12p ET Tuesday, January 1, 2013
Dear Friend of GATA and Gold:

Coordination of European central bank gold sales under the Washington Agreement on Gold, an agreement made in 1999 and updated in 2004 and 2009, is "the modern counterpart" of the London Gold Pool of the 1960s, which controlled gold prices until it collapsed in March
1968, a former Federal Reserve and U.S. Treasury Department official told an international investment conference a month ago.

The former official, Edwin M. Truman, went on to describe an enduring system of daily communication among Western central banks in which they share "confidential information" that includes "the size, currency, and nature of their foreign exchange market operations."

Thirteen years ago as assistant treasury secretary for international affairs, Truman denied in a letter to GATA that the Treasury Department was involved in manipulation of the gold market. But he did not volunteer any awareness of gold market manipulation from other
sources.

Ironically, in his presentation to last month's investment conference, sponsored by the Bank for International Settlements and the World Bank and held in Washington –

http://www.bis.org/events/pic2012.pdf

Truman, now a senior fellow at the Peterson Institute for International Economics, urged greater transparency for central banks and sovereign wealth funds and seemed to argue that they should not resist devaluation of the U.S. dollar. Truman cited the work of two colleagues at the Peterson institute who last week published a report blaming the U.S. trade deficit on currency manipulation by foreign central banks and advocating dollar devaluation:

http://www.iie.com/publications/interstitial.cfm?ResearchID=2302

Of gold market rigging in the 1960s and today, Truman said: "Participants, a subset of the G-10 countries, cooperated in feeding gold into the London gold market to help keep the price close to $35 an ounce. The modern counterpart of the gold pool is the agreement among the central banks of some of these same countries to limit their market sales of gold. But that agreement, which currently runs through 2014, does not extend beyond a small group of countries."

A detailed description of the London Gold Pool is posted at Wikipedia here:

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

The European Central Bank's most recent statement about the coordination of central bank gold sales is posted here:

http://www.ecb.int/press/pr/date/2009/html/pr090807.en.html

Of secret coordination of Western central bank currency market interventions, Truman noted "the establishment at the BIS in 1962 of the Gold and Foreign Exchange Committee of the G-10 central banks," adding, "At regular monthly meetings, participants exchanged views on

conditions in gold and foreign exchange markets as well as their own operations. These discussions involved extensive sharing of confidential information. Later on these same central banks began regularly to participate in daily telephone calls in which they discussed, and exchanged information on, financial market developments including the size, currency, and nature of their foreign exchange market operations."

But Truman's presentation to the BIS-World Bank conference seems to have been mainly a lament that the United States is losing control of the world financial system as huge dollar foreign exchange reserves are held opaquely by foreign central banks and sovereign wealth funds and the U.S. government can't keep track of them and know where they may be used to strike next. He says more cooperation with international "public-sector investment policies" is needed and warns that "the alternative to increased cooperation on public-sector
investment policies is a currency war."

Of course given his biography --

http://www.piie.com/staff/author_bio.cfm?author_id=122

-- the greatest blow for transparency in the currency markets might be struck simply by strapping Truman himself onto a witness stand somewhere and putting him under oath. Wikipedia quotes New York Times columnist and Nobel Prize-winning economist Paul Krugman as having described Truman as "the George Smiley of international economics" --

http://en.wikipedia.org/wiki/Edwin_M._Truman

-- George Smiley being the British intelligence officer of the John LeCarre spy novels. Ever since Truman manifested himself during a GATA delegation's visit to U.S. House Speaker Dennis Hastert and other members of Congress in Washington in May 2000, GATA Chairman Bill Murphy has been describing Truman as a Central Intelligence Agency asset.

Truman's presentation to the BIS-World Bank conference, acknowledging that gold market rigging continues through the Washington Agreement on Gold, is posted at GATA's Internet site here:

http://www.gata.org/files/Truman-WorldBank-BIS-12-03-2012.pdf

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

* * *

The evidence is mounting about The Gold Cartel price suppression scheme almost every week now, in every way imaginable, including the way gold and silver have been trading. What is it going to take to get the mainstream gold world press to deal with the truth so that the gold price suppression scheme can be exposed and stopped?

Bill Murphy
Chairman
Gold Anti-Trust Action Comittee

 

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Wed, 01/02/2013 - 16:36 | 3116009 supermaxedout
supermaxedout's picture

Basel III the game changer for gold : Gold is by 1.1.2013 again money.

http://www.bdlive.co.za/business/financial/2012/12/19/south-africa-ready...

You can read there:

"The number of member jurisdictions that have published the final set of Basel III regulations effective from the start date of January 1, 2013 is 11. These includes  Australia, Canada, China, Hong Kong SAR, India, Japan, Mexico, Saudi Arabia, Singapore, South Africa and Switzerland," the committee said.

"Seven other jurisdictions — Argentina, Brazil, the European Union, Indonesia, Korea, Russia and the US — have issued draft regulations, and have indicated they are working towards issuing final versions as quickly as possible. Turkey will issue draft regulations early in 2013," it said.

Some major banks in Europe and the US have however said they would not be able to meet next month’s deadline (1.1.2013) for capital reforms but the Basel Committee has insisted this would not derail their implementation.

Stefan Ingves, chairman of the Basel Committee said last week: "While some jurisdictions have not been able to meet the planned start date, a large number will be ready to begin introducing the new capital requirements as planned on January 1 2013."

----------------------------

And this means already now gold is not anymore a commodity but M O N E Y. The Basel III rules (published by the BIS Bank of Intl. Settlement in Basel Switzerland)  which is setting the worldwide standard for the banking community have moved gold up in the value ladder by.1.1.2013. It does not matter that it is till now only effective in the first group of the jurisdictions.  The effect that gold is regarded in Australia, Canada, China, Hong Kong SAR, India, Japan, Mexico, Saudi Arabia, Singapore, South Africa and Switzerland as hard stable cash, which is the highest quality of capital, equal with US Dollars, Treasuries, German Bunds etc.  is breaking the damm.  Gold can now be purchased at will by the banks in these jurisdictions in order to diversify their capital holdings without the till 31.12.2012 obligatory 50% value discount to the market price.  The banks in these jurisdictions can now accumulate gold without their capital base being harmed.  The earlier they do it, the more their capital base can benefit from this move..

And these expected gains are absolute necessary to hold the balance sheets of the banks together, because at the same time the new Basel III rules say, that (dont laugh) Asset Backed Securities which were also regarded as first class capital (Tier I)  till 31.12.2012 have lost their status and can not anymore be regarded as capital at all.

Imagine at the same time Japanese Souvereign bonds would loose two notches  from AAA to AA- meaning the value of these bonds (under the present BIS capital rules) would automatically be reduced by 20% in the banks balance sheet. Its not unrealistic that this is going to happen within the next 12 months.  So the banks in Japan and all over the world need a lot of "gold windfall profit" to cover their ass from these losses. And  there is no other "safe haven asset" anymore which is having the potential to move upward. Dollars and treasuries are at best moving sidewards if not downwards.

So whats left.  not much. It seems to me that the time of the gold mania is "ante portas". Insofar I can understand the IndFinMin. If nothing happens then the new gold rush can destroy the  old fiat world within a matter of days.   But you know what, nothing can stop this thing in my opinion. Be it now or in the next 12 to 24 months. The financial world has to find a new equilibrium to function. Now everything is stuck and out of balance and in my opinion the things are going its way they have to go.

Wed, 01/02/2013 - 13:54 | 3115285 sgorem
sgorem's picture

Way back when you could get gasoline for around 20 cents a gallon, two mercury dimes, YOU CAN STILL GET A GALLON OF GAS FOR TWO MERCURY'S, AND GET CHANGE BACK! Hows that float your boat "Setarcos"?

Wed, 01/02/2013 - 13:19 | 3115144 Bansters-in-my-...
Bansters-in-my- feces's picture

Sounds like Edwin eats keynesian cock....

Fuck you eddy

Wed, 01/02/2013 - 12:55 | 3115062 Clesthenes
Clesthenes's picture

Most people and investment advisers don’t seem to have a clue as to the real potential for gold; mainly because they have yet to include a number of factors that will influence the gold price, such as 1) “cash positions” of companies on a worldwide basis; 2) government guarantees on bank deposits; 3) Mortgage Backed Securities (MBS); 4) US Treasuries held by foreign central banks (some $3.5 trillion); 5) gold stored at Fort Knox (if any); 6) the gold carry trade; 7) the federal debt; and probably a few other factors.

Then we have to include practical and constitutional considerations.

When all these factors are examined, it really becomes a wild ride; and, you will see the desperation that drives manipulation of precious metals.

Wed, 01/02/2013 - 12:55 | 3115059 Element
Element's picture

 

 

"the George Smiley of international economics"

What, you mean this guy?

http://www.yankeepotroast.org/image/guysmiley1.jpg

Wed, 01/02/2013 - 11:42 | 3114880 XtraBullish
XtraBullish's picture

Way to go, Murph! GATA is like a pit bull terrier teeth locked around the ankle...

Wed, 01/02/2013 - 12:22 | 3114984 drbill
drbill's picture

Unfortunately, nothing will come of this because if the "powers that be" did something about it, they'd cease to be "the powers that be."

I'm coming to the unfortunate conclusion that the system cannot be fixed since fixing it would destroy those in power and that's something that they will fight until the bitter end. A truly sad state of affairs...

Wed, 01/02/2013 - 12:50 | 3115033 Shell Game
Shell Game's picture

"I'm coming to the unfortunate conclusion that the system cannot be fixed"

Welcome to the red pill reality, the more people who finally come to this realization, the better.  Prepare. Alt-skill. Get out of cities.

Wed, 01/02/2013 - 12:38 | 3115007 Ignatius
Ignatius's picture

True.

Think about what a reserve currency is.  In effect it says "Save in our debts", a powerful position. Saving in gold without counter-party diminishes their power.  They have and will fight this to the end -- however, "those things which can't go on forever, don't".

Thu, 01/03/2013 - 01:07 | 3117757 fockewulf190
fockewulf190's picture

Even more confirmation on why the CFTC does nothing...and is saying nothing.  The jig may be up, but the rig sure isn´t.  I´m still stacking phyzz regatdless.

Wed, 01/02/2013 - 11:31 | 3114843 steve from virginia
steve from virginia's picture

 

 

 

Industrial economies are based on lies, the biggest lie being that industries are productive ... that is, they produce at a higher order than the sum of inputs.

 

This is false and -- in fact -- thermodynamically impossible. Industries produce waste and the lie about the waste.

 

Behind this great lie are all the other little lies ... about money, currencies, credit, convenience, wealth, value, worth, etc.

Wed, 01/02/2013 - 11:08 | 3114769 Neo1
Neo1's picture

Irrecusable obligation, which according to 'Bouvier's Law Dictionary' (1914 ed.), is "a term used to indicate a certain class of contractual obligations recognized by the law which are imposed upon a person without his consent and without regard to any act of his own." This is distinguished from a recusable obligation which, according to Bouvier, arises from a voluntary act by which one incurs the obligation imposed by the operation of law. The Income Tax succinctly described is an irrecusable obligation.

However, if anyone else accepts this private credit and uses it to purchase goods and services, the user voluntarily incurs the obligation requiring him to make a return of income whereby a portion of the income is collected by the IRS and delivered to the Federal Reserve banksters. Actually the federal income tax imparts two separate obligations: the obligation to file a return and the obligation to abide by the Internal Revenue Code. The obligation to make a return of income for using private credit is recognized in law as an irrecusable obligation. The voluntary use of private credit is the condition precedent which imposes the irrecusable obligation to file a tax return. If private credit is not used or rejected, then the operation of law which imposes the irrecusable obligation lies dormant and cannot apply.

A Banksters defeatism (realization of defeat) nightmare, Being forced to Return to Real Money=United States Note=Lawful Money, Use the Remedy within the Federal Reserve Act. Redeemed 12USC411, Refusal Penalty 12USC501a http://savingtosuitorsclub.net   Stop being a Slave!!!!!!! This is Tax Free Money!!!!!!!  www.stormthunder.com

Wed, 01/02/2013 - 13:17 | 3115136 RockyRacoon
RockyRacoon's picture

Operative words:  "...obligations recognized by the law..."

There ya have it.   You ARE obligated, all else be damned.

Wed, 01/02/2013 - 10:57 | 3114726 hawk nation
hawk nation's picture

Keep buying pms.

Supply will fix the price issues and its a way to kill the banksters slowly but painfully until the whole population figures out what they are doing to currency

 

 

 

 

 

 

 

 

 

Wed, 01/02/2013 - 09:20 | 3114478 Kina
Kina's picture

The main/bank-stream media are owned-controlled by the same interests that corrupt the gold and silver 'market'.

They will say nothing except support price supression until notified to do otherwise.

 

The banks have absolute power over all, therefore.... they corrupt absolutely.

They have thoroughly raped the US and most Americans, the last thing they want is US citizens all possesing gold as that would ruin their power.

 

Sell your homes, buy gold silver and go live in some other country. The banks intend to rape you and future generations some more before this is 'over'.

 

 

 

 

Wed, 01/02/2013 - 09:49 | 3114531 Badabing
Badabing's picture

Fucking Banks!!!

Wed, 01/02/2013 - 10:13 | 3114595 Vendetta
Vendetta's picture

bada boom!

Wed, 01/02/2013 - 08:49 | 3114431 new game
new game's picture

AHHHHH! this is a classic good vs evil scenario.

so we can look fwd to a gunfight at the ok coral.

or a nasty slice job in a dark opaque area?

this is getting ugly in a serious way...

my bet is good may prevail if we can rise to the nastiness needed...

could be fun?

hunt is the best part :)

Wed, 01/02/2013 - 08:47 | 3114428 johnnyarrowmaker
johnnyarrowmaker's picture

So, this sounds very much like TREASON - selling a country's gold for short term personal gain.  Certainly is in the UK.

Now, where are JPM doing their dirty work??  .... Oh, that would be London.

Come on Queenie, spruce the Tower of London up!

Wed, 01/02/2013 - 13:35 | 3115206 Quinvarius
Quinvarius's picture

The people in current government and banking are far more trustworthy and enlightened than all those who have come before them.  The failures, crime, and fraud that have been going on for centruries were ended a couple decades ago.  These things you say could never happen again.  No one is looting the possessions of the people or the state, using government positions, for their own benefit.  The world is different now.

Haha!

Just wait until these fukrs invite the Chinese and the UN in to keep you under control.

Wed, 01/02/2013 - 08:47 | 3114422 Disenchanted
Disenchanted's picture

 

 

 

I've said it before...The same entities that control fiat fractional reserve currencies control the precious metals(prices) as well.

 

??? ????LONIAN WOE - JRBooksOnline.com - JR's Rare Books ... 

A Study of the Origin of Certain Banking Practices, and of their effect on the events of Ancient History, written in the light of the Present Day(1974).

by David Astle

Wed, 01/02/2013 - 08:31 | 3114406 XitSam
XitSam's picture

First his name is Edward, then later it is Edwin. Is this the same guy?

Wed, 01/02/2013 - 08:13 | 3114374 Proofreder
Proofreder's picture

WTF ... first trading day of the year and the white metal is up almost a buck !!!  WTF

Wed, 01/02/2013 - 08:29 | 3114403 Proofreder
Proofreder's picture

We know now that the market is totally manipulated and can see so today well before the US open - the question is: by which group, and why?  Classic Stop Run or Short Squeeze ?  Hope it is the latter and the price can be forced to put the JP Morgue into serious financial difficulty.

Expect to see the mining stocks, HL, SLW, etc. moving out of the gate - unless Ag is trampled before 9:30.

Got Popcorn ?

Go GATA

(hope y'all bought the effin' dip)

 

Wed, 01/02/2013 - 09:12 | 3114471 Setarcos
Setarcos's picture

Maybe Max Keisers campaign to destroy JP Morgue by buying silver will work, but because JPM virtually is the Fed, I have to wonder.

Wed, 01/02/2013 - 11:26 | 3114826 caconhma
caconhma's picture

JPM and the Fed are parts of the same criminal banking cartel. THe stay together and they will fall together.

Wed, 01/02/2013 - 08:26 | 3114394 Middle_Finger_Market
Middle_Finger_Market's picture

Quite honestly the dishonesty and complete farce of the so called markets and supposed determinants of growth and success make me SICK. To think people actually take this bullshit day in day out, with enough people we could walk into bliars house...run a rope around a nearby tree and string him up until his feet fell limp. No jokes, this is possible. Be scared blair et al. We are coming, expect us in due time. 

Wed, 01/02/2013 - 07:12 | 3114341 BigDuke6
BigDuke6's picture

Tony Liar should never feel safe.

Even in the shitter of his country club.

So many people would want to put a cap in his ass.

I hope he gets more and more nervous, the slug.

Wed, 01/02/2013 - 08:10 | 3114371 Setarcos
Setarcos's picture

Please don't insult slugs.  They serve a useful purpose, even if not quite in accord with human purposes always; whereas the Bliar serves no purposes other than his own ... which are counter to everyone else, even those he has duped into paying him big fees.

Nothing in all the animal world should be used as a metaphor for this psychopath, e.g. vultures only feed on the already dead, but this piece of scum feeds on the living.

Sorry scum.

Scum usefully break down the contents of sceptic tanks, whereas the Bliar and his ilk ARE shit.

Sorry shit.

Shit fertilizes new growth, whilst the Bliar and his cohorts - Bush, Cheney and nearly all Western politicians (along with their bankster financiers) - seek nothing but destruction that they can profit from.

Rant off.

Wed, 01/02/2013 - 05:34 | 3114287 akak
akak's picture

Please indulge my posting of this quote one more time, because it just seems so perfectly appropriate here:

 

"Because gold is honest money, it is disliked my dishonest men."

 

-Ron Paul, The Case for Gold

Wed, 01/02/2013 - 12:50 | 3115043 Shell Game
Shell Game's picture

+1  Perfect timing makes perfect quotes.

Wed, 01/02/2013 - 09:04 | 3114456 Setarcos
Setarcos's picture

Snag.

Factually.

Gold is NOT money, unless minted as coinage and stamped with a exchange value as against silver, copper, every other commodity and services rendered.

Fact.

Gold will never be money-per-se until it circulates as coinage again.

Fact.

You cannot walk into a shop and buy anything with an ingot of gold.

Fact.

Even as coinage/money, gold has never been a common medium of exchange - which money of any kind is, such as silver and copper coins, tally-sticks and paper promisory notes ... repeat "medium of exchange" for goods, services, etc..

During the Victorian era gold coins were in circulation, but only amongst the very wealthy, because an average worker got paid maybe five silver shillings per week (if he was lucky) whilst a gold sovereign was at least four times that at face value.

So why would a common worker wait a month to get paid in gold, with a coin he could easily lose or get stolen?

Gold bugs have zero historical perspective, nor understanding of what practical money is as fundamentally just a means of exchange ... essentially as an abstraction of human labour that goes in to the production of both goods and services in demand, or not, as the case may be.

Wed, 01/02/2013 - 13:58 | 3115307 lasvegaspersona
lasvegaspersona's picture

Setarcos

I agree in essence.

Gold makes a lousy medium of exchange. Fiat for all its faults does nicely. Gold is a very good store of value. When the manipulation ends (as it must and has in the past as it is costing a lot to do said manipulation) gold will again fill this role....very nicely.

Wed, 01/02/2013 - 14:06 | 3115351 akak
akak's picture

 Allow me to point out that if our (weak, lazy, spineless) societies had insisted on maintaining an honest hard money system (i.e., physical gold and silver as money and as the ONLY means of exchange), virtually all of the innumerable financial and monetary crimes and shenanigans of the last century and a half, the benighted "Age of Fiat Currency", would have been essentially impossible.

Wed, 01/02/2013 - 15:01 | 3115569 lasvegaspersona
lasvegaspersona's picture

akak

do you have a way to change human nature/behavior/ Have you a solution to the weakness of men?

I didn't think so, I do not either. I therefore want gold to stay outside the monetary system, unpolluted by the whim of government. It should be a store of value only and never again a government approved currency.

Think about this...as soon as the government says what gold is worth (as they do now by market manipulation of the paper gold price) then gold looses much of it's use as a reliable store of value.

I have come to believe that when the dollar fails we will see a solutuion. Mankind needs a reliable SoV outside government control. Gold works, but not if we demand that the government controls its price.

Wed, 01/02/2013 - 13:36 | 3115204 Imminent Crucible
Imminent Crucible's picture

Setarco hits a couple of snags.

First, the fact that low-wage labor seldom got paid in gold does not negate the fact that gold is, and has been, money in higher venues. The U.S. mint struck One Dollar gold pieces from 1849 to 1854, more than twelve million of them, and a vastly greater quantity of Indian head and Liberty Half-Eagles ($5) that circulated constantly among businesses and banks. Gold settled international debts for centuries until Nixon defaulted in 1971. Some central banks still hold 100% of reservers in gold.

A bigger snag is that your rant disregards the crucial "store of value" function of money, which paper currencies utterly fail. If the Unluckiest Man In The World turned his paper dollar savings into gold at $850 on January 21, 1980, he's still up 100% in nominal terms. His 1980 dollars have lost fully two-thirds of their purchasing power by the govt's own CPI measure. They've lost a lot more than that if he needs to buy bread or gasoline or a car.

Paper currency fails the test for money as it cannot function as a store of value, aka a deferred claim on goods and services. It's only good for immediate conversion.

The only reason gold and silver are not considered money is because the government has ordered you to NOT think of them that way. Legal tender laws serve only to enforce a tremendous fraud and wealth transfer upon the working man and the saver.

Wed, 01/02/2013 - 14:24 | 3115441 lasvegaspersona
lasvegaspersona's picture

IC

So what if fiat looses 2% per year. Were you going to store your wealth in paper?

Fiat is a medium of exchange ...period....and a good one at that.

The great lie is that we are told it is also a store of value, that it is 'as good as gold'. We know it is not true and neither are any of the derivatives of the dollar. When the dollar fails, as all fiat currencies eventually do, due to a build up of unserviceable debt, we will then see what true, good stores of value are....won't we...

Until then use the ease of payment had with fiat and store your net production in something that will endure.

I suggest physical gold. I hold it, never expect to use it as a MoE, but do expect to convert it to fiat again someday. Whether that fiat is the dollar, the NEW IMPROVED DOLLAR, the Euro or some other fiat...who cares....my SoV will hold its value over time.

One more thing...once the government marks gold as a currency and declares what it is worth, then I have a problem don't I? In that situation my SoV is no longer floating in value with/against the fiat but is tied to it. I would no longer have a reliable SoV. So please, never encourage the government to tell us what gold is worth. It kills its use as a SoV and gives all the power that gold might have back to the government.

I'd like my gold unencumbered by any thing other than the free market's opinion as to its value.

Wed, 01/02/2013 - 22:20 | 3117337 Imminent Crucible
Imminent Crucible's picture

Lasvegaspersona, you're hinting at the Freegold concept, as you probably know. I would be accepting of a multiple-currency system to accommodate different time preferences, but with one big caveat, to wit: Allowing governments to emit credit of any type without limit, has a dual hazard: If even the transactional currency is issued at a rate that exceeds economic growth by much, it's going to lead to price inflation even as it encumbers the nation with debt. And the worse result is that enables war-mongering. Wars of hegemony or empire-building are among the most costly enterprises that governments attempt, and without the ability to expand money and debt at will, most governments would be forced to find less destructive strategems for pilfering.

Fiat does work well enough for a mere transactional medium, but when central banks target 2% inflation, what they really mean is 4%-5% inflation, because inflation metrics are deliberately jiggered to under-report inflation by half or more. Even that level is very destructive to the living standards of the working poor, who cannot afford to lose that much of their standard of living, year after year.

I recall that in 1970, CPI began at 37. As 1981 opened, it had risen to 87. Peruse these CPI figures to see how that itty-bitty inflation compounds on itself:

http://www.inflationdata.com/inflation/Consumer_Price_Index/HistoricalCP...

Wed, 01/02/2013 - 14:00 | 3115236 akak
akak's picture

+100 IC!

 

It is sad, so very sad, to see these brainwashed, Stockhold Syndrome-suffering advocates of fraud (fiat currency) so vigorously defending the very chains of their monetary and financial enslavement.

Wed, 01/02/2013 - 10:47 | 3114675 Ghordius
Ghordius's picture

money is whatever shows the attribute of "moneyness", which is more elegantly said in French: le numéraire. look it up on wiki: Numéraire

the gist: "the basic standard by which value is computed"

it does not matter if it's salt, sheeps, slaves, amphors of wine, whatever, what it matters is not it's circulation, what it matters is if people take it as mental standard

"moneyness" starts within your mind, for example I've got a friend who calculates everything in packets of cigarettes (he spent quite a lot of time in a Soviet prison)

the best example is fiat currency: 311 million Americans calculate in dollars - even though there is no such thing as a dollar, only written promises to deliver a "dollar"

see? money does not even need to exist, in order to function as money. though Tax Tokens have an edge, generally speaking, because eventually you need them for the taxman

another very important feature of "moneyness" is price stability. the numéraire has to be the most stable item in the market, regarding price, otherwise something else takes it's place

ergo "shake it baby, those metals have to bounce up and down!" (presumably what Blythe says in the morning while brushing her hair)

Wed, 01/02/2013 - 12:00 | 3114936 RockyRacoon
RockyRacoon's picture

True.   It's all in the mind.  When I buy lunch I think of how many junk silver dimes it equals.  When the wife brings home another piece of plastic shit from China, I think of what percentage of an American Silver Eagle it represents.  When I used to buy a vacation package (don't do that any more) I would think of a Gold Eagle equivalent.   It's all about where your awareness lies.

Wed, 01/02/2013 - 09:53 | 3114542 Widowmaker
Widowmaker's picture

Fact.

Your fraud-fiat is completely worthless.

Wed, 01/02/2013 - 10:59 | 3114737 Enslavethechild...
EnslavethechildrenforBen's picture

Exept for transfering wealth from the workers to the consumers.

Wed, 01/02/2013 - 07:44 | 3114349 Ghordius
Ghordius's picture

"Because gold is HARD money, it is disliked by WEAK men. Who notoriously dislike HARD decisions."
Ghordius

Wed, 01/02/2013 - 13:08 | 3115103 Imminent Crucible
Imminent Crucible's picture

"Because silver is BRIGHT money, it is despised by DULL people."

~Gluteus Maximus

"Because gold is COLD money, it attracts HOT BABES."

~His Imminence the Crucible

Wed, 01/02/2013 - 05:23 | 3114283 eddiebe
eddiebe's picture

It's all for our own good though, right? / Sarc

Wed, 01/02/2013 - 10:12 | 3114593 SWRichmond
SWRichmond's picture

The rabbit hole runs deep.

Wed, 01/02/2013 - 13:54 | 3115287 lasvegaspersona
lasvegaspersona's picture

tick tock tick tock tick tock

Wed, 01/02/2013 - 10:57 | 3114729 Enslavethechild...
EnslavethechildrenforBen's picture

No thinking allowed. You will be reported.

Go back to work slave bitchez.

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