‘Gold For Bonds’ in Japan as Bond Buyers Get Gold Coins - May Enhance Returns 5.9 Times

Tyler Durden's picture

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jcaz's picture

Ah, the golden toaster plan- brilliant!

Nothing says your paper is shit better than gold.....

Harlequin001's picture

So let me get this straight, I lose $129,000 on the worthless paper (that can't be sold without a gold tag to tempt me) but gain half an ounce of gold in the process? The BOJ can take then a fraction of this new money raise and use it to short the same gold they're tempting me with OR alternatively if I can spend my $129,000 on gold bullion, shove the price through the roof and lose nothing... Nah, pure idiocy that one...

Sounds like a bond traders bargain. Sign me up...


Long-John-Silver's picture

$129,000 in $1 bills contain 1.650 million BTU. If you are freezing to death Gold can't keep you warm.

Harlequin001's picture

Damn, wish I'd thought of that before buying all this gold...

How will I ever afford the oil, or the coal?

When you think about it though, if I'm going to pick up some poor fools Aston for a song when he pukes it, it should have a decent heater in it eh...

sqz's picture

Looks like Kyle Bass was on to something with Japan sovereign debt issues. The timing of this smacks of desperation.

zaphod's picture

The Japanese can not affort real interest rates due to their high debt load.

So this means that they plan to service the interest on said debt by selling off their gold holdings.

Yes I'd call that desperate....

Oh regional Indian's picture

Dumb plan. And dumber still the people who buy into it.

Three years from now, all promises will be dust. Imagiine how much gold and silver you can get for 129,000 dollars today.



LawsofPhysics's picture

Even better, imagine being paid for your services from these sheeple tomorrow.  Hhmm, maybe the plan isn't so dumb.

bernorange's picture

Edit: whoops - I misread the deal.  Never mind...

TorchFire's picture

such a callous misuse of the tradition of desire for a silly relic

spankfish's picture

Can I be the first to say "Gold Bitchez"?

I think I need to buy a gun's picture

will ben do that for treasuries in my money market?

cowdiddly's picture

You have'nt heard about the new .002 gram tungsten commemoratives from the U. S. Mint that witll be issued with evey 100K purchase of 30 year T bonds? Awesome looking coin with Guantanamo on the front and Dick Cheney shooting quail on the obverse.

Help Is Not Coming's picture

The absolutely crazy thing is that the US mint can mint a platinum coin with any dollar amount on the coin of their choosing. During the debt ceiling debate it was proposed that the US Mint mint several "trillion dollar" platinum coins and then give them to the Federal Reserve as collateral for the FRN. Since it would be a coin minted by the US Treasury it would be lawful money and the US gov't could spend that amount without going over the debt ceiling since they wouldn't have to borrow that money. Strange days indeed.

Robslob's picture



But but but...Gold ISN"T MONEY?


Retarded governments worlwide leading people to the slaughter for centuries....

bingo was his name's picture

Welcome back to the gold standard

MachoMan's picture

Exactly.  Inherent in the proposition is the notion that gold is money, has value, and should be valued by bond purchasers...  The problem, of course, is that the proposition is inherently self-defeating in that if the government recognizes gold for what it is, then there is no reason for anyone to purchase the bonds in lieu of gold.  Awkward.

Azannoth's picture

So if I am interpreting this correctly the Government of Japan sees Gold at $260,000 per oz. in 3 years time?

MsCreant's picture

No, they figure they will be dead so they won't have to pay back anything at all.

Edit: True story, had a father in law run up a credit card he never had before a month before he died. 

Harlequin001's picture

yeah but these gold coins will glow at night for around 120 million years I think...

Azannoth's picture

Depleted Uranium is the new Tungsten in Japan :) Gold in Japan even more Shiny than anywhere else in the world get it while it's 'hot'!

papaswamp's picture

$129,000 for 1/2 oz?.....just buy the gold outright and skip the loss.

AngryGerman's picture

Japanese gold coin has dragon on one side and samurai on other - mighty gold coin!

MsCreant's picture

Better than the one with the dragon on the front and the queen on the back. What a buzz kill.

AngryGerman's picture

don't say that! I often fanatsize about the queen. I keep on imagining:

Her - "I am so amused, I am so amused, I am sooooooo amused!"

Me - "For you and England! Yeah biatch!"

mick_richfield's picture

Lie back and think of the Illuminati.

Kobe Beef's picture

Dear MSCreant,

Try Luk Fook Jewelry or other dealers in Hong Kong. They have stunning dragon designs on rounds sold by the gram. Singapore often mints fine dragon designs as well. I too am tired of Queen Elizabeth's ugly mug on all my gold coins. Off with her head! hahaha




flattrader's picture

Luk Fook's website sucks.  It's all fooked-up.

Any idea where the rounds might be?

They do have a presence in San Fran...but, I'd rather not make the trip.

paratrooper325's picture

The whole debt buying thing is, and always will be, a very stupid endeavor. For instance, lets say my neighbor comes to me and opts to sell me his credit card debt with the promise that he will pay me more back by the time he has payed it off. Sound like a good buy? NOPE. Do what papa said, just buy the gold.

bullionbaron's picture

Interesting to see some similarities building between the last Gold bull market and this one. Potential for Iran & and an energy crisis to once again drive Gold to magnificent highs?


edmondantes's picture

recommendations from Deutsche Bank and Bank of America are a major negative... always best to do the opposite of what is proposed by this gang of lying thieves

ThisIsBob's picture

Stole the concept from the Cracker Jack company.

fonzanoon's picture

The thought process with money printing seems to be the world ends up awash in paper money and becomes worthless. How does that mesh with the fact that the middle class is getting poorer by the day and the lower class is growing substantially as well? There may be a lot of money in circulation but it seems the lower middle class is desperate for some of it? How does that end up being hyperinflationary?

MsCreant's picture

Hyperinflation is poorly named. It is a lack of faith in the currency. It becomes less and less trusted until finally there is a race to get out of it and into something that is trusted. In that race spiral it becomes worth less and less as more of it floods the market. Also, the currency will come flooding back home where it has been stashed in foreign destinations, where it is dumped rapidly, going into the system trying to buy something, anything, of value. Domestic dollars compete with those dollars and it takes even more and more of them to get stuff. 

Inflation happens because of printing. Hyperinflation is a loss of faith in the currency once folks think the currency is shit.

fonzanoon's picture

I do believe that to be true, but if you use the U.S as a test case for that. It is pretty clear that 99% of the population do not end up seeing any of this money. So when it comes flooding back it will go to a tiny percentage of the population. The 99% will still be on food stamps begging for that next dollar. On a related note if every country seems to be in a financial mess who are the owners of the massive amounts of dollars right now that will eventually send them back here when they lose faith?


MachoMan's picture

I'll quote spitzer and say that the amount of printing necessary to cause hyperinflation has already occurred...  Think gonzalo lira - failed auction...

The Proletariat's picture

The value of $1 is worth less and less and less and so on......

fonzanoon's picture

"The value of $1 is worth less and less and less and so on......"

Agree completely. It just seems that the masses in this case would not lose faith in the dollar, they would be desperate for more of them.

HamyWanger's picture

Only libertarians say that inflation is catastrophic. 

Actually, it isn't. It is just a redistribution of wealth, namely a transfer from the higher-middle-class and the improvident rich into the pockets of the government, and the poor by ricochet.

Given that most Americans don't have liquid savings (their holdings are composed of real estate, debt and Social security/retirement income wich is and will be adjusted for inflation), they won't see anything. 

Only the extreme minority of savers will see their holdings melt, but as an even more extreme minority has a clue what inflation is, and as the banks will offer everyone falsely CPI-adjusted contracts, there won't be any public uproar. If you go out of the microcosm and table jerk of Zerohedge and Bloomberg, nobody gives a fuck about Bernanke or QE2. 

Inflation has been the solution chosen by all European rulers across the XXth, XIXth and XVIIIth century when facing economic difficulties for a reason. It is much more popular to the public than upright defaults and liquidations of big and well-known companies. Also, inflation never menaces national security, as it tends to reinforce the State and the military at the expense of the people. Even hyperinflationary vicious circles are not a danger for States: the ruler may be toppled in a coup, but goverment services always remain intact. Contrary to default which would dramatically reduce its size and power.

Henry Chinaski's picture

Hamy, you are right to a certain degree.  The slow simmer of inflation was a nice racket for a while.  Unfortunately TPTB got greedy, arrogant and out of control.  The frenzied fraudulent pillaging of the middle class has gone too far.  Nobody even tries to hide it anymore.  The system is both unsustainable and unstable.  A phase shift seems unavoidable, not because of inflation, but because of people's apostacy from natural law.

When my children were born, they received gifts of savings bonds from grandparents and other friends from the greatest generation.  A few years ago, I woke up to the inflation racket.  I exchanged their series E bonds for the equivalent (several tubes) in silver Maple leafs at $15/oz.  My children are old enough to understand basic economics and the inflation racket.  I will pass along to them a healthy stack of real money some day and no person or goverment will know about it.

JamesBond's picture

so the claim is that the debt matures at .05% and gold over 5% and the BOJ wants you to purchase the debt.

drunk japanese business men are a hoot at midnight don't ya know! 

Matt's picture

You don't get it. They don't want us to buy the bonds. They only want Japanese nationals to buy the bonds. They specifically want them to be unattractive to foreigners while simultaneously rewarding their citizens for patriotically buying more bonds. That way their gold sales only go to their own citizens, and it all stays in Japan.

orca's picture

According to rumours, the gold used for the comme...cumminge... special coin was recently transferred from the special Tepco storage facility at Fukushima. A Finance Ministry spokesman declined to comment on reports that the coin is that special it even glows in the dark.

thorgodofthunder's picture

Just shows how gold is latest fad- in 1999 you would have been given a share of pets.com, in 2005 a free month interest on your sub prime mortgage, in 1955 a free toaster when you opened a bank account.

Technology is the new gold. The rocks themselves have no further use.

MsCreant's picture

How do you store the value the tech embodies?

mick_richfield's picture

Actually, I think silver is the new gold.

youngman's picture

Well with the Cesium in the baby food now....Japan won´t be around to much longer as all the kids will be dying....

ziggy59's picture

Should get the toilet paper aka bonds for free after spend 129000 on pms!