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The Golden End Game – A Thought Experiment - Part One
The Golden End Game – A Thought Experiment
Part One of Two
By
Cognitive Dissonance
With limericks by The Limerick King
This is part one of a two part exploration (part two found here) into what the world might look like after a total or partial collapse of the currency/economic system from the perspective of holding Gold. As the title explains this is a thought experiment, not a dissertation filled with footnotes and references. Consider it one man’s flight of fancy, so take what you need and leave the rest. Anyone who claims they know what will actually happen is a fool greater than me.
As markets are starting to sink
The end could be here in a wink
So should I prepare?
Should I even care?
My PMs will save me!!! (I think......)
(The Limerick King)
When I first entered the business 20 plus years ago the firm I started with had a mentoring program that paired the fresh faced rookie with a veteran for the first 6 months. The idea was that for a piece of the action paid to the veteran from the rookie’s commissions, the veteran would offer hands-on review, insight and support. While some on both sides of the office divide groused over this arrangement, from management’s point of view it made all the sense in the world because now the office was raising the rookie, not just one or two managers.
I found the mentoring system to be beneficial simply because I was coming in quite a bit older than the younger shark chum fresh from the diploma mills. Most of them felt they had the world by the balls, thus as long as they showed up the (fiat) spice would flow. But I knew these financial chop shops had a tendency to chew up the rookies, and then spit them out once they’d been used and abused. Since I didn’t want any part of the rookie churn and burn I relished the chance to work with a veteran and develop good habits early rather than be left with trying to break many bad habits later.
Luckily I was paired with an old pro who quickly took a shine to me and showed me the ropes, spending far more time with me then he was ever compensated for. In fact the experience re-invigorated him and he went on to become the top producer of the office two years running. The more I learned the harder he pushed, reasoning that since I knew this, I damn well better know that. So he took most of his compensation in the form of my spilled blood and an inner satisfaction that he was making his mark. For me, the processes, morals and methods he taught me are still paying sweet dividends two decades later.
One of his demands was the weekly ritual of a portfolio review of each holding in every client account. When Friday came round he insisted I justify why this or that position was in a client’s account and quite frankly it drove me crazy. I would complain that we had done the same damn thing every week for months and not much had changed. So why was he still asking me the same questions again and again. And every time I complained he would respond with a question of his own, often dramatizing it by looking out the window or throwing the Wall Street Journal on his desk. Prove to him that the world was the same one that existed when we reviewed the accounts the last time.
And of course he was right; the world was not the same and often quite different from week to week. This trial by fire is something I still force myself to go through every Friday afternoon. Knowing the client and the world situation, if I can’t justify the position, why the hell is it still in the account? But of equal or greater value to me were my mentor’s questions each time I tried to add a new position to an account. I hated his probing and poking and often I took it personally. And that bastard knew where all my buttons were and delighted in pressing every single one until I finally wised up and stopped letting him goad me.
After we had discussed why I was adding the position, and well before I was allowed to call the client and make the pitch, he always had one final question for me. How was I going to dispose of it if things went wrong in a hurry? Or in his words, “What’s the end game on that?” At first I felt his question was downright stupid and my rote answer was always that I would cross that bridge when I got there. But he never let me get away with my intellectual laziness and he’d ask the same question 6 different ways until I saw all the possible pitfalls based upon the knowledge I had at the time.
I can still hear him today. “Don’t ever take on a new position until you have thoroughly considered how you will dispose of it under the worst of conditions.” It forced me to look beyond my nose and consider how circumstances change, and with those changes the ability to sell something that, while saleable today, might not be tomorrow. Liquidity and desirability can dry up quickly and always when it is least convenient to you and your client. This perspective broadening exercise was extremely useful beyond my business world because it can and should be applied at all (not just major) life decision points.
As this Keynesian game nears an end
And the Banksters can no longer lend
What will we all treasure?
Will gold be our measure?
Or the love of our family and friends?
(The Limerick King)
So……what’s the end game here folks? Regardless of whether we are USA centric or more globally focused, the fact is that we ‘own’ a political, economic and social portfolio that is the foundational basis not only of our wealth and investments, but of our very lives and those of our family, friends and neighbors. So have we done a fearless and thorough portfolio review or are we simply buying Gold and other precious metals, along with guns and various food stuffs, and hunkering down to wait out the storm?
I don’t pretend to have all the answers, let alone the proper questions. So don’t look to me for instructions when the T-1000 HFT bots crest the ridge and cream our asses. But a little proactive introspection is well warranted here considering we are now entering uncharted territory. And it is uncharted territory; at least for plebs such as you and me, even though there have been fiat currency collapses throughout history. This time really is different (as were all the other times for each generation caught in the middle) if for no other reason than the massive use of financial leverage combined with the humongous explosion in global population over the last 100 years.
Don’t get me wrong. I’m basically a hard asset guy at this point in the great unwind. But as I have said in the Zero Hedge comment section several times before, it’s one thing to grow and/or protect your assets and wealth in Precious Metals (PMs) (and other hard assets) and another thing entirely to move those assets to the next game board when this one is reset, replaced or recreated.
I see and hear a great deal of cognitive dissonance in many of the articles and comments discussing PMs as the best vehicle to use when moving to dry land……….that is, when dry land finally does rises from the ocean floor to form the new capitalist capital called Atlantis Redux. I find that many are kind of fuzzy on how the actual transition/transaction will go down and nearly all just sort of insert “and then a miracle occurs” at some point in the discussion when they recite the precious metals (PM) mantra.
Let’s just say for a moment that our Gold, Silver, Platinum and Gold-plated Tungsten have all quintupled in price (as measured in whatever fiat is the favorite at the end) and we are now all sitting pretty. Do we really honest-to-God no-fingers-crossed cherry-on-top believe that the powers-that-be will simply allow us to mosey up to the cashiers cage and redeem or convert it all for whatever monetary unit reigns supreme? Really? Because from my point of view it’s just crazy talk to assume that the enemy of the state (Gold and other PM’s) will be welcomed home with a warm welcoming embrace.
Now before you bite my head off (remember boys and girls, this is just a thought experiment) understand who this essay is directed towards. Or rather isn’t directed towards. If you are capable of purchasing several LBMA Gold bars and are able to store them overseas and you can easily relocate yourself to where your Gold is, then this rant really isn’t directed towards you. While you may not be a power-that-be, you are in a class above the middle class regardless of your protestations to the contrary. I’m not saying you don’t share many of the problems others are facing, only that you have a great deal more flexibility to deal with them.
In the same respect, if you own several Gold Eagles and a couple hundred ounces of Silver, then you are also not to whom I’m speaking. Most likely you will run under the radar because your small amount of Gold and Silver is being held in the form of the U.S Eagle coin which, while not exactly produced as a numismatic, is a US Mint produced Gold and Silver coin that is considered US legal tender. So from my point of view, if Gold and Silver Eagles are held in small quantities, they will not be considered an investment, but rather savings or collectibles.
The people I am talking to are those who are converting a substantial portion of their investable assets into physical Gold. Or who are selling other assets or breaking qualified retirement accounts (IRAs, 401(k)s etc) in order to purchase relatively large amounts of physical Gold and Silver, though the focus of this essay is Gold. Their intent is not only to grow their PM assets, but to carry the bulk of their wealth over to the Promised Land when the current Ponzi Empire crashes and burns.
You know who you are and unfortunately so do the government goons if you have ever bought any quantity of Gold from an established dealer with a check, a cashier’s check, wire, electronic funds transfer or other traceable method. And because of Check 21 everything is traceable nowadays (even cash within a few degrees of separation) if you used one of these instruments to gather the cash.
The End Game is here so I'm told
Will the last valued asset be gold?
If so, keep it tight
From the thieves in the night
For they know every ounce that you hold
(The Limerick King)
Where I have a problem with the logic used by some is this. There seems to be a general consensus that Gold is the arch enemy, the Kryptonite if you will, of the out of control fiat creation by central authorities in order to extend and pretend while looting the executive bathrooms of the Gold faucets and monogrammed bathrobes. This understanding, along with a host of others, is always proffered when explaining the reason behind PM manipulation and the entire PM paper racket. And I don’t necessarily disagree with this general supposition.
What I don’t get is the idea that if Gold has been considered ‘contrary’ or ‘dangerous’ to the unfettered debasement of fiat in the past and present, thus the reason for the manipulation, then why would this suppression and resistance to the ‘Golden enemy’ by the powers-that-be suddenly disappear precisely when the powers (or more accurately their agents and puppets) are desperate and have the most to lose? It is clear to me, and judging by the comments clear to many others here on Zero Hedge, that these guys and gals play for keeps, consistently pushing nearly all their chips to the center of the table in an endless game of bluff and intimidation.
More important to me, at least for the purposes of this essay, is that those lovable sociopaths would rather burn to the ground than play to lose or walk away. This, by the way, is precisely why they rarely lose. They play for keeps and they’ve been doing so for thousands of years. They not only have the power, but they know how to use the power they have. Meaning they are ruthless cutthroat bastards who see you and me as cattle to be consumed or beasts of burden to be used. And I’m being kind for the sake of the weak stomachs among us.
As best as I can tell the general assumption is that when the partial or total collapse comes (not if because we are talking worst case scenario here) the failed powers that be, perhaps inspired by some public hangings and decapitations, will pack up their lawn chairs and vacate the levers of power, allowing more responsible adults and even some advanced children to take over and save the day. Or at the very least, the expectation is that the new kids on the block will clean up the mess left behind by those traitorous bastards and that they will do so in a reasonably fair, open and egalitarian manner. Let me take a moment to collect my thoughts before rendering my opinion on this matter.
I DON’T THINK SO!
Why am I so confident of this? Well, from studying history of course. And by history I mean good old fashioned world history dictated and approved by the Empire for high school or college textbooks. You see, from the perspective of long term history, while we may have a new production company and support system for the global Ponzi screenplay, as well as fresh faces to fill the role of puppets, enablers and useful idiots, and even a (relatively) new political system to emotionally and culturally unify us all as we labor away in our hamster cages, the Ponzi is at its central core the oldest con in the books.
Essentially we are all experiencing plantation living at its highest and most efficient evolution to date, where the sole purpose of our existence is to serve our immediate masters who then serve their masters who then serve their masters in an ever narrowing pyramidal hierarchy. This goes on until it reaches the point where at the top we find several hundred to a thousand elite scattered across a number of blood-line families that share the power and spoils. And there is serious evidence available to be examined by the determined researcher that there might even be another level (or two) above that.
BTW for the most part, but with certain exceptions, you will not find these elite of the elite on any list of richest people in the world. I personally suspect that many of those who you do see listed are in fact the public caretakers of the wealth of others and who are paid handsomely to play the role and weather the slings and arrows of public scorn in exchange for growing the assets and guarding the anonymity of the real owners of Mother Ship Earth.
The Powers That Be are concealed
Their identities won't be revealed
They will hide from the light
And continue their fight
Until all of our fates have been sealed
(The Limerick King)
History is full of examples of crumbling empires and nearly all of them seem to share several characteristics. First and foremost in my mind is that regardless of how dire things may seem to be, the collapse progresses much slower than expected. It always seems like today’s bad news signals the end of the world as we know it….until tomorrow’s even worse news hits the ticker.
Grab Mr. Peabody and fire up the WABAC (pronounced ‘wayback’) machine to travel a few years into the past, say to 2007, and consider some of the headlines we saw and the reactions they provoked. What were considered Earth shaking events back then are nearly routine today, no big deal really. This is a severely misunderstood and underappreciated, and thus under weighted, counter balancing force to the general insanity level. The (normalcy bias) force is strong in you young Skywalker.
I suspect this isn’t so much because the powers that be are holding it all up, but rather it is the common folk living on the ground floor of this insanity that are doing the heavy lifting. Never underestimate the desperate desire of those who are chained to the plantation to preserve that plantation even when it would be easier and saner just to walk away. This Stockholm syndrome conditioned mind is of course exploited by the masters to rape and pillage long past the normal or even expected expiration date of the Empire.
Also, collapse (partial or total) is a relative term. For the financial elite, politically powerful and top tier business people, collapse is just another word for a really severe business cycle downturn. When conditions become harsh, the script is always the same. Shed useless eaters, strip all usable assets and sell the estate to the last of the greater fools, then move on to a more favorable business location. So by the time the barbarians are at the gate, the rich and powerful are long gone and have stripped most of the wealth from the kingdom.
In the modern era this means that the rape and pillage of the middle class is the purpose and eventual outcome of any severe recession/depression. So of course it is the purpose of the ongoing collapse. See ‘The Great Depression’ of the 1930’s for the Cliff Notes on the coming fun and games…exponentially escalated by $708 Trillion (notional value) in derivatives. But always remember that the explosive firepower released back in the 1930’s is nothing compared to the massive potential energy that is about to be released. The real purpose of can kicking is to try to slowly release that energy rather than to allow it to go BOOM all at once. Consider it a form of extended game play for the elite.
When the global reset is complete
And the Kleptos are in full retreat
Secure family and friends
For their game never ends
And they'll never accept their defeat
(The Limerick King)
The true powers that be have a long history of backing all sides in nearly every conflict or collapse. So it is not a stretch to assume they are supporting the very barbarians who are beating the door down while also relocating their kin from the collapsing empire. If you spend any time studying the blood lines of the rich and powerful, despite our general indifference to this seemingly inconsequential subject matter, to Earth’s owners the blood lines are carefully massaged, managed and manipulated in order to maintain a balance of power and influence among the bickering kings and queens. Do not underestimate the utmost importance of blue blood hierarchies or of the interconnected web between supposedly bitter enemies and plantations/countries. If it is important to them, then it should be considered life and death to us.
Inside the sprawling plantation the conditioning of the slaves is ongoing and ever changing and relies heavily upon the older, more experienced slaves to indoctrinate and condition the new ‘volunteers’, thus cementing the bond that is often expressed as nation or community…..or more properly ‘misery loves company’. For several thousand years religion was the center of the indoctrination process and controlled by the blue bloods, all of whom had no aversion to donning priest’s robes to spout the all important rites and rituals. A close inspection of history shows that while the vehicles of power shifted and morphed, the methods used and the personalities involved always remained the same.
Closer to the modern era, there was a shift to the sharing of power between religious centers and blue blood families who presided over kingdoms. Again, there really wasn’t a divide, only the public appearance of division. Mom usually decided which son became King and which became a Cardinal or Pope, thus assuring her it all remained in the family.
Over the last several hundred years the center shifted once again to the façade of central governments organized under ideological memes such as democracy, communism, socialism and of course the more traditional blue blood families aka Kings, Queens and royal families, sometimes along with a quasi democratically elected congress designed to create a false sense of self control for the naïve native slaves.
Regardless of the method or ideology used today, they are all simply more sophisticated methods to organize and exploit the plantation and nothing more. In much of the so called ‘free’ world today, giving the slaves the illusion of freedom of (limited) choice has been found to dramatically increase productivity. An intelligent plantation manager will allow any work rules as long as they still maintain order while increasing efficiency because strip mining the human and mineral resources of Earth is the one and only goal of the ruling elite.
Preserving your wealth can be fun
The first thing you'll need is a gun
Trust no one you meet
Each night soak your feet
Just in case it is prudent to run
(The Limerick King)
Regardless of whether the financial elite remain in place or move on during or after the collapse, there will still be some type of procedure set up to exchange the old slave script for the new slave script. Without a doubt there will be different tiers or exchange rates depending upon which social and/or economic class you reside in. And rest assured the transition will not be fair and it will be used to extract whatever remaining wealth the middle class still holds. This is a given, but it will not be readily obvious or even visible since most of the dirty work will occur behind closed doors and well in advance of the general scrum.
There is also no doubt, once again predicated by a careful reading of history, that regardless of the leadership actually holding office, when the gates are busted down (or as is more likely the case pulled down from within, often via false flag attacks), in order to placate the increasingly restless slave population, fresh faces will magically appear from the cloning rooms to offer stirring speeches and heartwarming platitudes about how all the slaves must engage in mutual sacrifice and work even harder to ensure that the elite make a clean getaway before the cleansing fires are set and the system is finally rebooted. I can’t wait for the games to begin because I still have more cognitive room left over for that hope and change thingy.
Every crumbling Empire always reaches into the same bag of tricks when the heat is on and the slave nation becomes restless. After all, the elite must maintain order so that the fleecing can be completed. ‘Order’, especially near the end of the End Game, is usually maintained by a heavy handed police and/or military presence via outright martial law or the stealth version implemented by (executive) decree. Let the head bashing begin. Desperate puppet leaders will most certainly do desperate things, first to maintain their own illusion of power, then just to save their asses. Count on it.
Two tricks of the deception trade that often work hand in hand are scapegoat harvesting combined with war mongering, which usually leads to out-right-war in order to deflect attention and blame those evil elites over there and their supporting band of vicious baby eating enablers, indentured servants and wage slaves. And while it might be an old trick, even the oldest, it still works every single time it is used because we slaves would rather support the devil we know then to take a chance and actually live free. Spend enough time in a locked cage under dehumanizing conditions and the jailer no longer needs to lock the door anymore. We slaves will keep ourselves just fine, thank you very much.
While I could extend this list of common denominators for several more pages, let me cut to the chase and list the one commonality that is near and dear to my heart and the core function of every central government that administers the (crumbling) Empire……..to be a blood sucking parasite. The bottom line is that governments, Kings and religious orders do not ‘produce’ anything nearly equal to their consumption no matter how you measure it, unless you have been drinking their Kool-Aid. These entities will consume from all sources using one or more of the following strategies; regulation, taxation and ultimately confiscation.
In Chapter Two we will examine the third method as the end game worst case scenario draws ever near.
11-20-2011
Cognitive Dissonance
Special thanks to The Limerick King for his wonderfully apropos limericks. It is an insult to describe the process of condensing complex subjects into 5 lines of prose as ‘writing’. The term ‘stupid good talent’ just begins to scratch the surface of what The Limerick King has to offer. Thank you TLK.
I also wish to thank Dagny Taggart for the ongoing and wonderfully diverse conversation that always leads to further inspiration. Thank you Dagny.
PS: For those who just can’t get enough of The Limerick King, below please find some more of his work that just couldn’t be fit in. Momma always told me never to waste a single mouthfull of The Limerick King.
To those who think gold is the cure
For everything fake and impure
You may get your wish
If gold catches fish
By making an outstanding lure
As the great global reset draws near
Consider the things you hold dear
Will others agree
With the value you see?
If so you have nothing to fear
My wealth is so precious to me
Without it I just couldn't see
Life would be dour
I'd lose all my power
I'm spawn of The Powers That Be...
- advertisements -
Lester:
Well... I kinda do live across the street from some very sweet mines here in British Columbia.
I have not a clue about this 'Jim Willy' guy you listened to last night but I do know a Jim Willie, aka the GoldenJackass, as we have shared a few beers over the years in Vancouver.
When my eyes get all red and watery at the end of the day from reading a computer screen too much, I lay back and listen to the people on the SGTreport...
http://www.youtube.com/user/SGTbull07
There is a good chance you will find Willie interviewed there along with some other great gloom and doom gold bugs.
bringin' out the celebs in this thread I see
all in a quest for shiny
if the $$$$ hits the fan
and my tint ain't a tan
it's clean water I'll need, my pretty.
I don't seem to be able to MARK YOUR POST UP ENOUGH!!!! What is wrong with the up arrow! ;-)
Another reminder of what makes this forum so great. A lot of us have argued about this and that - but none of us really knows what the future may hold. I hope to see you all on the other side.
When we get there, remember the first rule of Fight Club....
Thanks CD, ZH, Limerick King.
Thank you from all of us.
My goal is always to spark alternative debate instead of treading common ground. As always, the real value of Zero Hedge can be found in the comment section. I often feel I learn so much more from the comments than I pass on in the article. And from what I can tell that is how it is supposed to work.
Thank you for adding your voice to the collected ZH community.
The debate goes on...
... the debate continues...as to whether you should own physical metal or the mining shares. First off I will state that mathematically, fundamentally and practically, Gold must be priced on average year after year in more Federal Reserve notes. I take this premise as a given for all of the reasons we have gone over time after time.
The Gartman's, Nadler's and Christian's of the world either have fundamental and mathematical blinders on or are disingenuous, period, end of story.
ALL investors need some amount of physical metal in hand in case (I now believe it is a matter of when) the entire unbacked monetary system implodes and actually shuts down. You must have physical metal in this instance to guard against having no access to capital were the system to "barter" which I believe it will for a time. Shares in this instance will not be usable to buy beans and rice (unless you don't want your change back in return). The shares can however be used to purchase cars, houses, estates etc. by simply signing them over to the seller even if the markets are closed.
We are truly at an unprecedented fork in the road.
Mathematically the fiat system MUST be rearranged through a revaluation. Gold and Silver, even though they have pulled back from their highs are at levels that very few would have believed even 5 years ago while the shares themselves ARE at levels where they were 5 years ago. I have spent my entire career being a "value investor" which is what led to Gold in the first place, it is also why I believe the shares are right now the best possible investment class on the planet. If you agree that mathematically Gold and Silver must trade at ever higher levels to current currencies then you should go that one step further.
This "one step further" is to look at the valuation levels of the supply chain of the product. In many cases the shares are trading at or even below the "giveaway" prices of late 2008 (in both relative AND absolute terms). This is of course in part because of the naked shorting that has been done but it really doesn't matter "why", it only matters that this is where we are. The shares have historically shown 3 to 1 leverage to the price of their product, not so since 2008. But wait, the producer's earnings HAVE shown very significant leverage to metals prices and have in fact nearly quintupled since 2007. Yes, there are more risks in owning the shares such as mine collapses, regulatory, nationalization issues etc. but this is why you diversify by geography and type of mine.
We are now being offered for the 3rd time in 10 years what investors in industrial stocks get maybe twice in their lifetimes! The shares are at GIVEAWAY levels! You can actually go out and purchase junior mining companies that are not in production yet for less than $10 per proven ounce of Gold in the ground! Yes, physical Silver is cheap...but not even close to this cheap. You are being offered as many shares as you can fit in your "truck" as you can buy for maybe a 90-95% discount to their real values! Yes you can argue "what is truly real value?" but just like pornography, maybe you can't define it 100% but you know it when you see it. The mining sector as a whole is GROSSLY undervalued.
When, not if Gold goes to higher levels in current fiat terms, do you believe that proven Gold in the ground will still sell for less than $10 per ounce? At $2,500 Gold, do you think maybe proven in ground Gold might be valued at $250 per ounce? Will this take a couple of years? Will these companies be sitting on their hands during this time or will they be exploring and "proving up more ounces" on their properties? When you look at it like this, these are dumb questions!
Please keep in mind that the big producers MUST continually add to their reserves as they are being depleted every year, day and minute that they are in production. THIS is what tells me that the current ridiculous pricing will not stand. Proven Gold in the ground IS the CHEAPEST way for the producers to ensure access to future production...period. They cannot go out into the field (even if the long lead time did not matter) and discover Gold and Silver for anything even resembling what the market values some of these very real juniors at. My guess is that the big boys (again, forget about the long time factor) would spend 5 times the outlay of the average junior price to locate and verify precious metal. THIS is what makes the junior sector so attractive, they have (and are) done the leg work and proven up metal which is being valued at pennies on the Dollar!
I truly do not want to nor intend to insult anyone by what I am about to write but it needs to be said. Going 100% physical metal is dumb!
Of course it is to each his own and whether you can sleep at night or not, but the fact is, right now, mining shares are at a huge discount relative to Gold and Silver going back for years and years. Right now you are being offered a gift as far as I am concerned, going "all in" whether it is physical metal or the shares is a mistake in my opinion. They both have their pro's and con's and neither is "the tonic" for everything. In fact, right now is an opportunity to shed some physical metal in favor of spreading it around in the shares.
If you are now "top heavy" with metal, you are being offered the chance to rearrange your portfolio on very favorable terms. As I said, this was not meant to offend anyone. I call it as I see it and I just can't see being 100% metal nor 100% shares. Everyone has their own comfort levels but the current situation clearly begs the true value investor towards the mining shares in a fashion rarely ever seen before.
www.lemetropolecafe.com
Your input is appreciated but there are two things you are overlooking- 1. A bird in the hand is worth two in the bush; and 2. I have come close to brokering some gold / silver mines and gold in the ground is highly speculative at best. Not only is its' existence questionable with the best methods of study, but production is difficult, dangerous and highly toxic. Nuff said.
All you say is true... but hey...maybe the world is not coming to an end just yet, even if the rot of the ameriKlan mafia empire is in it's last days.
There are other countries in the world with somewhat honest economic and political systems where people can go hunting in the bush for that second bird with a reasonable chance of success.
"...will consume from all sources using one or more of the following strategies; [mock-] regulation, [mock-]taxation and ultimately [mock-]confiscation. ..."
[mock-] ...because any of these 3 activities are, in fact, done in inconsistent/deceitful/unpredictable ways to disable any threatening counterattack. [Pushback/protest that is not actually threatening is often tolerated, if not used to further disable the opposing forces.]
The inconsistent/deceitful/unpredictable aspects were demonstrated long ago, by the great Russian physiologist/veterinarian Pavlov, to produce insanity , at somewhat controllable rates and stages [increments].
Reference the famous pain-reward series, wherein animals were trained to choose between 2 different symbols/targets to get fed. One target produced pain/shock; the other food. As the targets were progressively made similar and the animal unable to discern the one producing food and and avoiding pain, the animal went progressively beserk until characteristics of insanity prevailed. QED
I gave it a fiver for the reference to Peabodys WABAC machine...lol.
"Really? Because from my point of view it’s just crazy talk to assume that the enemy of the state (Gold and other PM’s) will be welcomed home with a warm welcoming embrace."
Outside the box...it would have to be a "one world government" to prevent the commoner from cashing in...with all that entails. In that case (for me) there wouldn't be much point in living in it, I don't do serfdom well. If not the case, there would always be someone to exchange with...for land or power or influence or bread & water or whatever.
Gold and silver will always have value, its portable and can change form. It isn't going away like fiat notes down through the ages. Neither are diamonds & rubies as another example of wealth preservation.
This is why I think individual nation-state sovereignty is so very important...its in the commoners best interest, in this context.
Besides, if they are going to treat you (here) as a criminal or terrorist or whatever, they have already made the allegiance decision for you. I like things cut & dried like that ;-)
"I gave it a fiver for the reference to Peabodys WABAC machine...lol."
I like throwing in the old fart memories now and then to smoke out "the others" among the readers. Nice to see you stinking up the thread nmewn. :>)
I knew it was for us...and I appreciated it ;-)
Some past the point of old-age threshold incorrectly identify me with Rock the Flying Squirrel. Poor souls.
Would you prefer if we associated you with Penelope Pitstop :))
http://www.youtube.com/watch?v=ymlGyVMNZUI
Great to see ya Rocky!
lol...I know how it is, many thought I must be asian.
Funny how the mind works when not given all the information to come to the proper conclusion.
"His rival it seems, had broken his dreams, by stealing the girl of his fancy" is one of the best lines of all time.
And many think I'm an American of African descent. Must be the Oaktown/Memphis/South Main Street deal.....
That broun soun sure do get aroun - Larry Underwood
http://www.youtube.com/watch?v=6WO8UrwJSe8
While those that know me know the real deal ....
http://www.youtube.com/watch?v=uf5rIuJPTt0
Hey bud, let's party! LOOOOL
Good effort Cog. Keep the chilli pot simmerin
The simple truths are hard to come by -- Some people think we're strange, and a little bit crazy because we can see tomorrows, yesterday - Gary P Nunn
http://www.youtube.com/watch?v=drk4LZIT4Wc
:D
Cheers
Spicoli...lol.
Theres one in every crowd, you might recognize this guy before he made it big...
http://www.youtube.com/watch?v=fY3Q6SlXmZY&feature=related
But hey, its Christmas...
http://www.youtube.com/watch?v=2Qdb6wC0Iz4&feature=related
Merry Christmas my brutha! ;-)
I love me some Alabama and she had a way of running into rough gems too!
Everyone knows not to fly commercial these days. Besides, Greyhound now provides better service than the airlines without the bend and spread/squat and cough aspects of getting processed into prison.
A very happy new year to you and yours brutha! ;)
I believe I made that mistake two years ago. The good news is that I'm now older, wiser and more senile......so it will never happen again. :)
Never fear. Even a one-world-government must have officers to do its bidding, and those officers will have an incentive to work with the commoner to line his own pockets. The more power to the central authority, and the larger it gets, the more it needs its army to assert control. The army is made up of individuals, who will engage in trade on the black market - its always that way.
There will be opportunities to "cash in" on a small scale, a transaction at a time, and remain under the radar. People with entreprenuerial minds quite often profit in such hard times by knowing when/where/with who to conduct business. Gold passed hands within some of the most tightly-controlled regimes, and it will pass hands here. Serfdom doesn't have to be accepted entirely by everyone. Some people slip through cracks and evade complete control. Its figuring out how to be one of them that is the challenge....
That is my thought as well. Contrary to this fear of "big US government" it is still run by individuals and always will be.
Human action ;-)
Somewhere below I noticed a comment from someone whose family has been there and done that from a Eastern European country when that whole thing went to_____.
That perspective is what makes ZH special.
Yes, I noticed that comment as well nmewn, and I know a few people who lived through that under Soviet era. The stories are chilling, but I think the thing to focus on is the degree to which the human being is hard-wired to survive, under any type of totalitarianism. Yet, it is sad how savage-like people can become in the midst of it. The best and the worst of human nature is demonstrated under the worst of times.
I admire anyone who has survived through those events. I admire especially the ones who faced death in order to stand up for their families and friends, and for the principles they believed in.
In the best of times 1/4 bottle of wiskey got us 3 hams, 4 cases of c-rations and something else... Norway 1979.
What I know about Just In Time inventory is not the actual practice, but the theory of managing production, raw material inventory, estimating demand, and enabling the wholesalers or vendors to buy with delivery assured to meet their customers.
Grocers and other consumable commodity dealers are entirely committed to JIT and the If You Got It, A Truck Brought It chain of supply.
The vast majority of self-sufficiency gear and supplies are not in demand, historically, not enough to have deep inventory at the ready to ship status. Grocery items, even canning jars, bulk grains and basics are in the JIT supplyline, but their availability is not such to allow satisfaction of a sudden 25% surge in demand. Not many are buying these regularly so supplies are thin...
128,000 FBI background checks were done on Black Friday. Previous record was 87,000 in one day. Perhaps the demand for firearms is met, but more likely demand is so high that if you covet gear that is in high demand, you'd best buy it when and where you can.
Got Food? Figure it is going to be more available and at lower prices? Not what I'm expecting...
Anything necessary or desireable that serves to aid self-sufficiency will or has already seen big pickup in demand.
If 5% of the population suddenly decides to make-ready, then the supplies of these items will be impacted greatly.
Just In Time doesn't work for products that take time to build or assemble, when there is a sudden jump in demand. JIT has coerced suppliers and mfrs into not maintaining inventory depth or facilities & employees to enable a large-scale increase in finished product, We haven't even considered the impact on delivery scheduling that imported parts have and how much leadtime is required to meet demand by those producers...
Modernlife hangs by a thread, a horseshoe nail if you will. Taking self and family out of the loop and into self-sufficiency takes tools, supplies, gear, and time; not to mention commitment. There is no "buy your way into" being self-sufficient.
Money, even gold/silver, will fail soon. If you have plenty money now, this is the time to deploy it and use it to creat a life for self and family. Your heirs, if you will have any, are depending upon you to make some difficult decisions. Decisions are always difficult if the matter isn't obvious. More are seeing the obvious every day. Soon your options and opportunities for how to deploy your money to create wealth will be impacted. Only so much in the pipeline and once demand picks up there will be much less. Many firms can't deal effectively with increases of subtantial percentages and many suppliers just don't have the goods to enable it.
Excellent post. Always try to buy two of whatever items you deem to be critical in a time of need........more if you can afford it. Generators. firearms, bulk foods, storable fuels...........none of it is getting cheaper and some of it may prove to be the investment of a lifetime........
Good post. I will revise a plan or two of my own. Thanks.
Great read, CD. Much appreciated
Dont worry about gold confiscation. Its already here and its called "cash for gold."
in order to procure well gurarded small amounts of gold over a vast geographical area you need only flood the area with commericals and a print $ to pay for the industry to operate. its consolodation of wealth and its free to those who have the power to print $.
If there was no gold in Fort Knox, what a way to replace it!
A corrollary would be to suddenly raise the price very high [3,000/oz?], then declaring further accumulation illegal.
Only relatively few would have any significant amounts and it would easy to inhibit further/mass distributon...too late for the masses of commoners to have an effective counter.
CD,
Conspiracies of bloodlines and elite
are concepts I find quite effete
I do like your writing
The prose is inviting
And your intentions are terribly sweet
once was a trader called ned
stuck in a rut always in red
did not buy gold was to bold we are told
silver a fractional unit at best
this he did not buy as a test
so he dd what he was told
the trolls are buying a taco with jest
with an oz of gold never bought at best
so because of the unknown they kept their chunk
of assets in a mountain of bunk
the gold was never to be seen
an asset never so keen
the silver was brought to the fore
a dime was produced for a taco you see
while the traders who lived in the real
found time to cut to the chase
gold was exchanged for property and such
the gold was not eaten the 20 dollar bill was stuffed in the mouth
an industry was born trading real for real
while the trolls were busy finding a spot
beside the dumpsters to rot
Wonderfully written, I do not know the future just as you, however to not see the collapse at our doorstep today is to be blind; or in a state of cognitive dissonance.
CD, gold (silver/platinum) will only be redeemable for anything if it's legal tender -- second, the biggest short of all time is stamped on every coin.
You will receive $50 for your oz. Everyone else gets melt (or less) for bullion or other coin. Both will be credited solely as electrons, nothing tangible whatsoever.
What is all this talk about that gold has to be traded to only TPTB? I will trade paper for your gold today, and tomorrow. Do you think I'm alone? My price is much better than that $50 of which you speak.
I will trade lamb, wool socks or potatoes for your gold today and tomorrow. My bean farmer friend and gas distributor friend will as well.
That is why you might want to hold canadians philharmonics, or krugs.
Congress has the power to regulate money. I dont see why they couldnt force you to exchange your gold eagles for fifty bucks or SDR's or fifty whatever.
That would not be gold confiscation.
Once again it is my pleasure to read your written word
Merry Christmas CD
Bah Humbug!
Thank you for your kind praise. Please excuse my grouchy "other" half and his lousy Christmas mood. I think he has some mistletoe stuck up his as........ :>)
There is still time Cog. I believe that prize turkey is still hanging in the window for you to send to Bob Cratchit's by Christmas. Not sure about the metal content in that shilling...
To my surprise and delight I have recently been re-introduced to the Christmas tradition of love and care for loved ones without all the rampant materialism I have come to detest. Very nice.
It just goes to show that precisely when I think I have it all figured out, someone slips a joker or two into my deck of cards. I guess there is still hope for this old fool after all. :)
Merry Christmas Dagny and thanks for your help with this article.
@CD
Excellent essay & genial limericks from "The Limerick King"
Is there also a Hank Reardon Blog somewhere ?
BTW, I guess The Limerick King is familiar with The Grumbling Hive:
or, Knaves Turn'd Honest
By Bernard Mandeville ( 1703 )
http://www.maartensz.org/philosophy/mandeville/fable_of_bees.html
I remember reading this 40 years ago ; the Limerick King reminds me very much of Mandeville.
IIRC, v.Hayek was also inspired by Mandeville.
FWIW
Snippet :
The MORAL.
THEN leave Complaints: Fools only strive
To make a Great an honest Hive. [410]
T'enjoy the World's Conveniencies,
Be famed in War, yet live in Ease
Without great Vices, is a vain
Eutopia seated in the Brain.
Fraud, Luxury, and Pride must live; [415]
We [illeg.] we the Benefits receive.
...
...
Nice dynamic duo. The great irony of all this is that they will suffer the same fate they are trying to inflict on us.
And yes Virginia, there is a Santa Claus.
I say, that is the quality of life - reading fine poetry in ZH...
Markets can drift here and there, but we are New Olympians :)
And gosh... This is my first post... Be kind
"And gosh... This is my first post... Be kind"
Welcome my virginal friend to the Zero Hedge hoard. May your postings always be full of whit, whimsy and snark. :>)
Hello Cog, thanks for your words.
I am still shock and awe, but i hope will be bitcheez-fit to add some more entropy here and some good fun as this is our daily bread...
Thx!
Kaaarl
Welcome to the Mad House; enjoy your stay.
Great stuff CD. Everything that is held as "wealth" can only be considered such because of the value someone else (the potential counter-party to the trade there of) put on it. This goes for everything. Again, Every Thing.
We assume, because we've only know "civil" society, that tomorrow, the next day or after the collapse, that some sort of basic rules will still apply. This I believe is just another one of our biases. If you believe that the excrement will hit the oscillator at some point, you have to recognize that it will not discriminate upon where it lands, regardless of how "prepared" you believe you are. In the end, just like throughout history, it'll be a numbers game but it wont be about fiat currencies or ounces of gold, it'll be about the number of bodies that can be thrown into the fight for any particular side.
The wealth we have all come to covet has only been possible because of the "system" that "they" have created. Your only defense is to remove yourself from their game. This, of course, as an absolute is not possible as the board we roam (known as the USA) is still theirs (they still have the bigger gang at this point) but you can at least sit it out and let them fight amongst themselves. Use their game pieces as little needed to sustain you and yours.
The only real wealth each of us have is our ability to turn food into energy and then intelligently use that energy. Stop trading your wealth for more of their game pieces than you absolutely need, because there will come a time when they come along and take them all away, regardless of the form it is currently in.
"Everything that is held as "wealth" can only be considered such because of the value someone else (the potential counter-party to the trade there of) put on it."
I'd rather have 50lbs of 223 ammo than 50 lbs of gold if things get really bad.
or 50 lbs. of painkillers/antibiotics