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Guest Post: A Golden Opportunity

Tyler Durden's picture


Submitted by Patrick Barron via the Ludwig von Mises Institute,

The euro debt crisis in Europe has presented Germany with a unique opportunity to lead the world away from monetary destruction and its consequences of economic chaos, social unrest, and unfathomable human suffering. The cause of the euro debt crisis is the misconstruction of the euro that allows all members of the European Monetary Union (EMU), currently 17 sovereign nations, to print euros and force them on all other members. Dr. Philipp Bagus of King Juan Carlos University in Madrid has diagnosed this situation as a tragedy of the commons in his aptly named book The Tragedy of the Euro. Germany is on the verge of seeing its capital base plundered from the inevitable dynamics of this tragedy of the commons. It should leave the EMU, reinstate the deutsche mark (DM), and anchor it to gold.

The Structure of the European Monetary Union

The European System of Central Banks (ESCB) consists of one central bank, the European Central Bank (ECB), and the national central banks of the EMU, all of which are still extant within their own sovereign nations. Although the ECB is prohibited by treaty from monetizing the debt of its sovereign members via outright purchases of their debt, it has interpreted this limitation on its power not to include lending euros to the national central banks taking the very same sovereign debt as collateral. Of course this is simply a backdoor method to circumvent the very limitation that was insisted on when the more responsible members such as Germany joined the European Monetary Union.

Corruption of the European Central Bank into an Engine of Inflation

When the ECB was first formed around the turn of the new millennium, the bond markets assumed that it would be operated along the lines of the German central bank, the Bundesbank, which ran probably the least inflationary monetary system in the developed world. However, they also assumed that the EMU would not allow one of its members to default on its sovereign debt. Therefore, the interest rate for many members of the EMU fell to German levels. Unfortunately, many nations in the EMU did not use this lower interest rate as an opportunity to reduce their budgets; rather, many simply borrowed more. Thus was born the euro debt crisis, when it became clear to the bond market that debt repayment by many members of the EMU was questionable. Interest rates for these nations soared.

Over the past few years the European Union itself has established several bailout funds, but the situation has not been resolved. In fact, things are even worse, for it now appears that even larger members of the EMU succumbed to the debt orgy and may need a bailout to avoid default. Thus we have arrived at the point predicted by Dr. Bagus in which the euro has been plundered by multiple parties and the pot is empty. The ECB and many sovereign members of the EMU want unlimited bond buying of sovereign debt by the ECB. Only Germany opposes this plan, but it is the lone voice against this new bout of monetary inflation.

The Historical Context of German Antipathy to Monetary Inflation

In 1923 Germany experienced one of the world's worst cases of hyperinflation and the worst ever for an industrialized nation. The reichsmark was destroyed by its own central bank, plunging the German people into misery and desperation. Now, after only a dozen years of relative monetary discipline, the euro faces the same fate as country after country demands to be bailed out of its mounting debts by unlimited printing of money by the ECB. Because Germany is part of the EMU, it must accept these newly printed euros. This threatened monetary inflation of unlimited amounts has shaken German bankers to the core. It is the nightmare scenario that they feared when, against their better judgment, the German politicians agreed to give up their beloved deutsche mark and place the economic fate of the nation in the hands of a committee of foreigners not as concerned about monetary inflation. But Germany can put a stop to this destruction and save the world while it saves itself. It can leave the EMU, reinstate the deutsche mark, and tie it to gold.

A Golden Deutsche Mark Is Possible and Desirable

Despite the haughty pronouncements of EU officials, there is nothing that can stop a sovereign country from leaving the EMU and adopting a different monetary system. The most likely scenario would be a one-for-one redenomination of German banks' euro-denominated accounts for deutsche marks. Thereafter, the DM would float freely in currency markets in the same way as British pounds and American dollars. The Bundesbank would be responsible for monetary policy just as it was before Germany joined the EMU. By leaving the EMU Germany would insulate itself from the consequences of the euro as a tragedy of the commons; i.e., monetary inflation by third parties would end, Germany would not experience higher prices due to the actions of third parties, and the capital-destroying transfers of wealth would end.

Yet Germany should go one step further. It should anchor the DM to gold. Germany is the world's fourth-largest economy, behind only the United States, China, and Japan. Furthermore, Germany owns more of the world's gold than any other entity except the United States, more than either China or Japan and more than any other European country. A prerequisite to market acceptance of any gold money would be confidence in the integrity of the sponsoring institution. Not only is the Bundesbank known for its integrity and reverence for stable money; Germany itself has a worldwide reputation for the rule of law, advanced financial architecture, and a stable political system. For these reasons, Germany would prove to the world that a gold-backed money is not only possible but desirable. Expect a cascade of similar pronouncements once Germany's trading partners realize the importance of settling international financial transactions in the best money available — which initially at least would be a golden DM.

Germany Should Seize the Moment!

Of course the beneficial consequences of tying money to gold go beyond ending price inflation and capital-destroying wealth transfers. We can expect all the beneficial consequences of a return to limited government, for government could no longer fund itself through the unholy alliance with an inflationary central bank that creates fiat money in order to monetize government's profligate spending. The people would no longer be so subservient to government, pleading and begging for special interests at the expense of the rest of society, for government would be forced to go to the people for approval to increase its budget. The list of benefits goes on and on. Suffice it to say that it all begins with truly sound money, money anchored in gold. Germany can lead the way and earn the just respect of a grateful world. It is in the right place at the right moment in history. It should seize the moment!


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Fri, 10/26/2012 - 19:34 | 2922966 goldenboy
goldenboy's picture

Ahh,ok...that's enough to convince me that der Buba still has its name on any more than that 150 Tons it's bringing back over 3 years for a 'thorough examination'. Link the DM to paper gold claims on never-to-exist gold... The Oil states are gonna rush to that as payment for their Oil...

Fri, 10/26/2012 - 19:38 | 2922980 knukles
knukles's picture

Strong currency, anyone?

Fri, 10/26/2012 - 20:00 | 2923027 gmrpeabody
gmrpeabody's picture

Ackward, but Germany doesn't know if they actually have any gold to anchor to...

Fri, 10/26/2012 - 20:18 | 2923071 knukles
knukles's picture

If this goes on much longer it'll go from "Gold? What gold?" to "Vaults?  What vaults?  We never had any vaults.  Whadddhu talkin' about?"

Fri, 10/26/2012 - 20:33 | 2923094 Dr. Sandi
Dr. Sandi's picture

I want to see how the official audit of German gold turns out.

Will it truly be a transparent, actual audit process that would mean something, or will it be some sort of standard accounting practice audit where each IOU is compared to each UOMe and declared equally high stacks of paper?

If the real gold actually gets back home to Deutschland, it would seriously change the game. And it would make it possible for Germany to actually have gold backed fiat. 

Of course, the honesty of even a gold-backed system still relies on the honesty of the thieves in charge.

Fri, 10/26/2012 - 20:37 | 2923110 knukles
knukles's picture

Hah ha ha ha ha ha ha

Fri, 10/26/2012 - 21:57 | 2923275 strannick
strannick's picture

The people would no longer be so subservient to government, pleading and begging for special interests at the expense of the rest of society, for government would be forced to go to the people for approval to increase its budget.


Fri, 10/26/2012 - 22:24 | 2923308 flacon
flacon's picture

The problem is that world wars are fought over land and gold. THE UNITED STATES OF AMERICA® (the bastard, kniving beast that she is) deserves some respect for being able to pillage the entire world of it's gold under their drunken noses. For the US Dollar is the substance which makes kings and rules drunk with the the wine of their fornications. 

Fri, 10/26/2012 - 23:09 | 2923358 fourchan
fourchan's picture

if our 10000+ tons isnt in our vaults, we should kill every government worker and start over.

Sat, 10/27/2012 - 02:29 | 2923505 Enslavethechild...
EnslavethechildrenforBen's picture

Usury is unpayable, neither in Gold nor in Fiat. Printing money is exactly the same as robbing money. People close to the top of the pyramid are starting to wake up to this fact. Monetary easing is the art of easing hundred dollar bills out of your pocket while you are being distracted with an endless array of bullshit. No government on earth wants to go back to a Gold Standard because that would end their ability to steal at will. They will print until hyperinflation is a household word. The only solution is to realize that there are 300 Billion of us and only 300 of them, that being a ratio of a Billione to 1, we outnumber them to the point where it should be no problem to simply put them all in jail and start over.

Sat, 10/27/2012 - 09:57 | 2923701 Bansters-in-my-...
Bansters-in-my- feces's picture

I know it seems like "300 billion of us"but I am pretty sure it's like 7 billion ish. So your estimate seems a wee bit high.

But......I still agree put them in jail and hang them there.

Sat, 10/27/2012 - 04:30 | 2923553 jeff montanye
jeff montanye's picture

never seen a list of reserves with 10,000 tons of gold or higher for the u.s., usually around 8,100 (though cnbc has an 8,900 figure).  my guess is the truth is lower rather than higher and that government workers below the tippy top got none of it.  the revolving door to the bullion banks, tbtf etc. rewarded a few, probably at a fraction of a cent on the dollar.

Fri, 10/26/2012 - 22:03 | 2923284 cynicalskeptic
cynicalskeptic's picture

A tungsten backed currency isn't quite the same thing - and that may be the result if London and NY still have any German 'gold' bars on premises.  You'd expect the bankers to at least preserve the illusion of gold holdings for their favorite central bank metal lenders via gold coated tungstern even if they sold off all the real stuff years ago.

Same reason you'll never see a real audit and (with assays) of US holdings.

Sat, 10/27/2012 - 09:39 | 2923686 Eugend66
Eugend66's picture

You`re, of course right. But the currency Will be the EUR.

Sat, 10/27/2012 - 04:18 | 2923548 Snidley Whipsnae
Snidley Whipsnae's picture

"Yet Germany should go one step further. It should anchor the DM to gold. Germany is the world's fourth-largest economy, behind only the United States, China, and Japan. Furthermore, Germany owns more of the world's gold than any other entity except the United States, more than either China or Japan and more than any other European country."

Possession is 9/10s of the law... It's going to take Germany 3 years to repatriate 150 tons of gold from the US... Why 3 years? BTW, the PBoC certainly believes that physical PM ownreship MATTERS. Indians, who own ~ 15,000 tons believe that it MATTERS. Only the talking heads and paper pushers on MSM believe that it doesn't MATTER. All of SE Asia and the Mid Easterners believe that physical ownership MATTERS. Who ya gonna believe?

"CNBC MOPE: Actual Existence of Gold Reserves is Irrelevant, It’s the Bookkeeping That Matters!"

"In reality, it does not matter one bit whether the Federal Reserve Bank of New York actually has the German central bank’s gold or whether the gold is pure. As long as the Fed says it is there, it is as good as there for all practical purposes to which it might be put. It can be sold, leased out, used as collateral, employed to extinguish liabilities and counted as bank capital just the same whether it exists or not."


Sat, 10/27/2012 - 04:36 | 2923556 jeff montanye
jeff montanye's picture

it doesn't matter until it does (see: no clothes, emperor with,; oz, wizard of; republic, weimar)

Fri, 10/26/2012 - 21:58 | 2923276 EatYourCornTake...
EatYourCornTakeyourPill's picture

I think the author misses the elephant in the room.  Germany sells the majority of it's shit to Europe. Just ask Krugman, kill the consumer, kill the world. Seriously though, if Germany drops Europe. Germany gets screwed just as much. Catch 22 anyone? China's on the line.

Fri, 10/26/2012 - 22:30 | 2923317 masterinchancery
masterinchancery's picture

I don't agree. The golden rule is that gold rules.  If Germany were to back the DM with gold, it would rule the world. Ultimately, unbacked currencies would have to fall in line.

Sat, 10/27/2012 - 00:34 | 2923435 Bindar Dundat
Bindar Dundat's picture

You are right Master I,


There has never been a strong country that did not have a strong currency -- ever.

Sat, 10/27/2012 - 10:33 | 2923725 xray vision
xray vision's picture

Why would unbacked curriences have to fall in line?

They could sell their goods cheaper than Germany and Germany's economy, largely based on exports would dry up.  People with money would buy DM just to hold and drive it's cost up up up.  Just like Switzerland had to debase their currency.  In the global race to the bottom a strong currency is death. 

Sat, 10/27/2012 - 10:59 | 2923751 Bay of Pigs
Bay of Pigs's picture

Like Greece?

You forgot your <sarc> tag.

Sat, 10/27/2012 - 10:33 | 2923726 xray vision
xray vision's picture

Why would unbacked curriences have to fall in line?

They could sell their goods cheaper than Germany and Germany's economy, largely based on exports would dry up.  People with money would buy DM just to hold and drive it's cost up up up.  Just like Switzerland had to debase their currency.  In the global race to the bottom a strong currency is death. 

Sat, 10/27/2012 - 14:34 | 2924082 OneTinSoldier66
OneTinSoldier66's picture

This is like trying to say that Gold has no value.

Fri, 10/26/2012 - 23:18 | 2923364 Gutterballs
Gutterballs's picture

Kill the Keynesian bullshit. Oh, and I think you meant "its". The possessive form of "it" is "its", to distinguish it from the contraction "it's = it is".

And go ask Krugman how often he polishes his Nobel medal.

Sat, 10/27/2012 - 03:20 | 2923526 fockewulf190
fockewulf190's picture

Let me tell you all that there is almost ZERO support amongst all the mainline political parties over here to ditch the Euro. All you hear is "wir brauchen mehr Europa!" (we need more Europe). These chumps in power will drive this bitch straight into the ground on full afterburner. I shit you not! They may be stalling here and there, but in the end they are going to throw billions out the window if the screaming gets loud enough...and I'm talking about the banks, not the people. The people here are always considered sheep.

Sat, 10/27/2012 - 03:35 | 2923533 Cast Iron Skillet
Cast Iron Skillet's picture

that's what I hear, too. it might be technically possible for Germany to leave the Euro, but it is politically impossible.

Sat, 10/27/2012 - 04:57 | 2923557 jeff montanye
jeff montanye's picture

"These chumps in power will drive this bitch straight into the ground on full afterburner."

that's my reading of the european political elite as well.  christine lagarde may not read her organization's publications but she knows a hot leather item when she sees it.  oh and then there's this:

Sat, 10/27/2012 - 12:31 | 2923856 nofluer
nofluer's picture

I fail to see ANY benefit to keeping customers who cannot pay value for value.

Go for it, Germany! Once the rest of Europe realizes that momma has slammed the lid on the cookie jar, maybe they'll finally eat their broccoli?

Fri, 10/26/2012 - 22:20 | 2923305 Silver Bug
Silver Bug's picture

Germany really should leave the Euro for their own good.

Sat, 10/27/2012 - 19:02 | 2924524 bilejones
bilejones's picture

Here is the central issue:


"the bond markets assumed that it would be operated along the lines of the German central bank, the Bundesbank, which ran probably the least inflationary monetary system in the developed world. However, they also assumed that the EMU would not allow one of its members to default on its sovereign debt."


Who are the "Bond Markets"  ? 

The Banks.

The convergance trade (that all euro rates would move toward those of Germany) was second only to the yen carry trade in the past couple of decades.

Hundreds of billions of dollars were made.

This is a bank fuck-up and when banks fuck up guess what, they're bankrupt.

Fri, 10/26/2012 - 19:35 | 2922969 Hulk
Hulk's picture

Keep stakin Bitchez !!!

Fri, 10/26/2012 - 19:48 | 2923007 TrillionDollarBoner
TrillionDollarBoner's picture

Vampires maybe, bitchez no.

I draw the line there. 

I have never and will never stake any bitchez, period. 

Fri, 10/26/2012 - 21:18 | 2923199 Hulk
Hulk's picture

I see what you did there !!!

Sat, 10/27/2012 - 02:56 | 2923516 Likstane
Likstane's picture

No matter how many times I stake wood in them, they never seem to expire; sometimes they moan a lot, but never expire.  Maybe I'm doing it wrong. 

Fri, 10/26/2012 - 19:42 | 2922970 Yen Cross
Yen Cross's picture

Germany re-unified the East in the early "90s'". I think Germany is ready to take the "blue pill", and move fore-ward! (I'm not yiddish)

  Germany makes Japan look "pathetic"!

Fri, 10/26/2012 - 19:41 | 2922987 bank guy in Brussels
bank guy in Brussels's picture

A differing perspective today from one European commenter, writing to John Ward's excellent 'The Slog' ...

« ... Whatever we do is not going to make one blind bit of difference to the real Eurozone problems and the huge Euro catastrophe heading straight towards all of us. »

Fri, 10/26/2012 - 19:45 | 2923001 Yen Cross
Yen Cross's picture

 You always pop in at the most "un-invited times". That's why you are a, "Bank Wananbe in Belgium"!

Sat, 10/27/2012 - 01:18 | 2923467 Treason Season
Treason Season's picture

Frontrunning for zionists and pedophlles.

Fri, 10/26/2012 - 19:57 | 2923019 Burticus
Burticus's picture

Anchor it to gold?!  Ahahahaha!

Everyone knows the Limeys, 'Murkins and Frawgs done stole the Krauts' gold, gave it to their central bank masters where Rubin swapped it for plated tungsten and "leased" it for eternity to their beloved bullion bank shareholders who "sold" it the Rothschilds and just enough into the market to disguise the collapse of their central bankers' fiat electrons.

For a currency to be redeemable, they will need a lot of real gold that ain't there.

Fri, 10/26/2012 - 20:02 | 2923032 newworldorder
newworldorder's picture

Correct. If GATA has it right the German physical gold is not there. If it is, it has been swapped,  leased, loaned and sold numerous times. Would the German people take the dare of finding out the truth? Stay tuned to GATA and ZH for the exciting details, but dont be suprised if you grow old wainting for the final results.

Fri, 10/26/2012 - 20:17 | 2923059 yabyum
yabyum's picture

Gold! What Gold? Better think about the Tungsten inside those shiny bars. Better think of the empty look on their faces.

Fri, 10/26/2012 - 20:25 | 2923079 Thisson
Thisson's picture

Gata doesn't have it right, though.  And Germany adopting a gold-"anchored" currency isn't going to solve anything as long as they continue letting their banks engage in fractional reserve lending.  It's also unclear that they wouldn't suffer from inflation, unless they prohibit the use of euros and other fiat currencies as well, otherwise Gresham's law will result in the DMs being hoarded as imported euros continue to act as an inflation engine.

Fri, 10/26/2012 - 20:53 | 2923155 CitizenPete
CitizenPete's picture

Serious hypothetical question: Say that they do back all base money (reserve money) with gold assayed and allocated in the CB vault.  Then buy bonds and allow banks to expand the money supply via fractional reserve lending.  Of it ends up being a 9 to 1 ratio for this "twice loaned money" then is 9 to 1 really a problem. Why does it need to be 1 to one.  How could it function that way?  The banks go and mine gold.? 

Sat, 10/27/2012 - 06:06 | 2923578 _underscore
_underscore's picture

Which doesn't really matter at all. German strength stems from its formidable industrial base & post-WW2 reputation for financial probity & currency stability. Imagine, if you will, the situation where Germany says it will re-adopt a DM standard & buy gold withose DM & will also pursue its gold reserves held overseas. It may well have difficulty in getting its gold back - but so what! It has the claims, those cliams can be converted (if all else fails) into other resource claims/debts owed. By hook or by crook it will get some (maybe not quite all though) value back for its gold. Meanwhile, it buys gold on the open market (or from Russia) with its ever-so-desirable new DM, starts trading oil for DM, bilaterally trades in DM/Yuan with China, sells machine tools to India for gold, buys palm oil from Brazil for DM etc, etc.

Utlimately, gold is unproductive, except where it can do its 'work' - and even though intial possession is important, if you don't have much productive capacity you'll sell to buy product. Gold will flow into Germany like it did into the Assyrian, Roman, Spanish, British & American empires. Gold flows now into the Chinese empire at the same rate as it flows out of the American empire - not because China has $ reserves, but because it made stuff to get $ reserves.

As many here point out, paper games, book-keeping entries on govt. bonds & fiat currency magicking-into-existence alchemy don't produce one single nut or bolt of production - when the time is right, all that ephemera will be swept aside, banker produced debt obligations will mean nought.


Sat, 10/27/2012 - 09:32 | 2923678 Shibumi2
Shibumi2's picture

I think underscore has it right. The paper, backed by gold or not, is merely a representation of value and exchange to facilitate trade. Since gold has been a universal storage medium of value, it provides a convenient yeardstick and known entity as a backstop.

Ultimately, the paper is worth what one can obtain for it. Post WW!, the national socialists were cut off from international financing but did quite well bartering well made german products for equal value of needed imports. Ultimately, if one group needs something another group makes, the trade will or not.

The decline of american prosperity is a factor of the loss of industrial output rather than the banking industry fraud, per se. In other words, the bank fraud was undertaken to liberate value from those who produced it. The industrial muscle of past times created the value looted. 

Sun, 10/28/2012 - 06:33 | 2924973 Ghordius
Ghordius's picture

"paper games ... don't produce one single nut or bolt of production" exactly

and this is the reason why we are all engaged in a race-to-the-bottom with currencies:

from a national-industrial point of view: in order to keep the existing industrial resources home instead of letting the globalized economy rationale ship them to cheaper labour shores.

from a national-labour point of view: same as the above, with an even higher incentive because it's job that won't return, ever

going golden or with a super hard currency now would go exactly in the other direction. the last thing that Germany and others want. hence the EUR and it's function

Mon, 10/29/2012 - 06:52 | 2927170 _underscore
_underscore's picture

That's the 'classical' explanation (of the desire for a cheap curency) of course Ghordius. Tell me this: does Germany  have lower labour costs than China now? Then, how (given your explanation) can Germany compete, even now?

I fail to understand (and this may very well be my failing, I concede) how having  efficient production sector that produces sought-after goods can damage itself by mere success. This is a trick played upon workers to lower their wages & increase profits for the rentier class - that class being mostly represented in the City & Wall St. The mistake, as I see it, is in the assumption that a hard DM would mean a less competitive Germany, as the floating exchange would 'over-value' the DM. This assumes no corollary advantage of lower energy/commodity & import prices, which would allow a pricing level (in DM) to stay competitive - this is not the same as an internal devaluation by the way. A mature labour union movement (as is the case in Germany) would negotiate pay levels that reflect the purchasing power of that pay - a strong currency negates the need for inflationary pay compensation, so only genuine increases in production are negotiable items in pay compensation. Production costs (say for BMW) would decrease as a result of cheaper raw material / energy costs, so their prices will refelct that. The worker' pay component is stable, except (as above) in the case of greater productivity, which again is factory-gate price neutral.

The situation now (i.e. the Euro) is a hindrance to those southern european economies that need to de-value  & a millstone to Germany, going forward. The rabiit-caught-in-the-headlights response of the EU sees only a political problem - so seeks a political solution, not an economic one.


Sat, 10/27/2012 - 00:02 | 2923402 Eally Ucked
Eally Ucked's picture

Why they need so much gold? If they have 1T its ok too, just find proper ratio of paper to gold 1g AG to 150t of paper and that's it.

Why are you so attached to 31g of gold to 1700$? Depending on weight and nominal value of bills now ratio is 1:1, 1g of Ag to 1g of paper. HaHa! 

Fri, 10/26/2012 - 19:58 | 2923022 AUD
AUD's picture

It should seize the moment!

It won't.

Fri, 10/26/2012 - 21:10 | 2923188 Urban Redneck
Urban Redneck's picture

the Germans would have to actually balance their budget to do so...

Fri, 10/26/2012 - 20:01 | 2923030 A Lunatic
A Lunatic's picture

All of the arguments for a gold backed currency are the reasons it will never happen. If wishes were horses........... bitchez

Fri, 10/26/2012 - 20:08 | 2923044 Big Ben
Big Ben's picture

If Angela Merkel were Ron Paul..........

Fri, 10/26/2012 - 20:24 | 2923077 knukles
knukles's picture

Angela is not Ron Paul, she's a sex kitten

Fri, 10/26/2012 - 21:40 | 2923241 Yen Cross
Yen Cross's picture

knukles     You are the consumate (thespian).          Merkel' yuk.   She is CORRECT about the [€ though]

  Bring back the " Deutche mark'!

Fri, 10/26/2012 - 20:28 | 2923083 Dr. Sandi
Dr. Sandi's picture


If Angela Merkel were Ron Paul..........


...she'd be cuter.

Fri, 10/26/2012 - 20:36 | 2923105 knukles
knukles's picture

Holy shit, it's true!

Fri, 10/26/2012 - 21:27 | 2923214 Vincent Vega
Vincent Vega's picture

If Angela were Ron Paul she'd have testicles. 

Fri, 10/26/2012 - 21:34 | 2923227 A Lunatic
A Lunatic's picture

If Angela had testicles she would be Janet Napolitano..........

Sat, 10/27/2012 - 06:21 | 2923583 falak pema
falak pema's picture

this is getting so close to the ridiculous that you could sell it to Goldman Sachs for a profit. 

Fri, 10/26/2012 - 20:11 | 2923050 Neethgie
Neethgie's picture

I sorta realised the problem with QE and how its gonna die, ok so atm 25-30% of the debt is held by the fed yea, well what happens when people start realising the govt can print whatever?

So some guy says, hey pay me 40k, it doesnt matter you can print it.. 

later down the line the guys doing gov contracts like defence say, hey pay us an extra 30% it doesnt matter you can print it...

pretty soon we see people are gonna get deals then be outdone by the next deal, so they are going to want tangible rewards not paper.. trouble ahead..

Fri, 10/26/2012 - 20:28 | 2923086 Thisson
Thisson's picture

What the hell do you think they're doing now?  They're already printing.  The fed is "buying" the treasuries with printed fiats.  We're in the outright monetization phase.

Fri, 10/26/2012 - 20:35 | 2923102 knukles
knukles's picture

Oh, leave him alone.  (LOL)
He's either new or a bit slow.

Fri, 10/26/2012 - 20:37 | 2923106 Dr. Sandi
Dr. Sandi's picture

I hear the fed has secretly perfected replicator technology and is now turning out tons of real gold.

The only drawback so far has been that the replicators run on the blood of virgins. It's been a bitch finding those in DC.

Fri, 10/26/2012 - 20:42 | 2923129 TrillionDollarBoner
TrillionDollarBoner's picture

They should try buying treasuries with printed farts.

That would at least be something, if not solid, then tangible, in an olfactory kind of sense. 

The death of fiat. The rise of fart. 

It's the way ahead. 

Sat, 10/27/2012 - 00:18 | 2923421 Yen Cross
Yen Cross's picture

Come on?  "QUADRILLION BONER", is where it's at!

Fri, 10/26/2012 - 22:07 | 2923289 Neethgie
Neethgie's picture

I was posing the situation when the man on the street realised it you moron..

Fri, 10/26/2012 - 20:29 | 2923088 Seal
Seal's picture

EXCEPT Germany won't be able to get its gold back from the US or London!!!! Mark my words. 

Fri, 10/26/2012 - 20:35 | 2923101 Dr. Sandi
Dr. Sandi's picture

I'll even deutsche mark your words!

Fri, 10/26/2012 - 21:08 | 2923183 lakecity55
lakecity55's picture

Haha. Maybe because it's not in London or N Yawk.

Fri, 10/26/2012 - 20:36 | 2923103 Jim in MN
Jim in MN's picture

Yes but....where could the German aristocracy possibly find the guts to let their banks' holdings get gutted ONLY in order to save the greater good down the line?

Same question worldwide...same answer.

Our society is simply doomed because of gutless greed.

Fri, 10/26/2012 - 20:38 | 2923112 Dr. Sandi
Dr. Sandi's picture

I dunno. I've seen a lot of greedy people with a pretty good gut on them.

Fri, 10/26/2012 - 20:37 | 2923109 cjbosk
cjbosk's picture

Brilliant! Then their currency goes to the moon and they export what to whom again?

Thought so. If it were so easy it would have been done long ago.

Sat, 10/27/2012 - 15:16 | 2924113 OneTinSoldier66
OneTinSoldier66's picture

"Then their currency goes to the moon and they export what to whom again?"


I don't know. Apparently neither do you.


But am I thinking that they wouldn't have any exports and that Germany would suddenly cease to exist? No. Is that what you're thinking?



Posted below by 'hawk nation':


"If germany went to a gold standard there would be so much capital that is now sitting on the sidelines that would go to germany looking for opportunities that the rest of the world would realize they needed to folow germany's lead"

Fri, 10/26/2012 - 20:43 | 2923131 fijisailor
fijisailor's picture

The fix is in.  No one's gonna fix any currency to gold because that currency will evaporate in a hurry.  No, all these fiats are going to sink in the cesspool together.

Fri, 10/26/2012 - 20:55 | 2923157 Pseudo Anonym
Pseudo Anonym's picture

pfft.  germany; the control freak would surrender power to people?  dream on.

Fri, 10/26/2012 - 21:02 | 2923168 swissaustrian
swissaustrian's picture

Germany sees the Euro as an opportunity to conquer the rest of the Eurozone through economic control. They're carefully keeping the crisis going, offering only the amount of "compromise" necessary to keep the other states in. This way others can claim victory over Merkel and Schäuble at the various EU summits when in fact Germany got one step closer to it's goal of economic dominance over Europe. Max Keiser has realized this 2 years ago.

But the roots of this idea go back much further:

The common currency project was first imagined by none other than I.G. Farben in 1940:

Bernard Connolly has described the German intentions behind the Euro project in his excellent book "the rotten heart of Europe" written in 1995.

This book is now traded for $700 and more:

Fri, 10/26/2012 - 21:02 | 2923171 fijisailor
fijisailor's picture

OK here's the scenario.  We get worldwide hyperinflation and a loaf of bread is a trillion bucks so all the banks print trillion dallar bills.  Now all the fiat debts are wiped clean and the central banks tell you to change your trillion dollar bills for a new $1 bill.  Moral of the story:  If we're headed for hyperinflation get in debt up to your ears now so that it gets wiped clean with all the other debt and your real estate assets become a freebee.  It happened just like that to my wife's family in Bolivia a few years ago.

Fri, 10/26/2012 - 21:58 | 2923281 DoChenRollingBearing
DoChenRollingBearing's picture

Some debts and taxes ARE indexed to inflation.  Best avoid debt whenever possible.  Especially since DEFLATION could hit, then debtors have a big problem.

Fri, 10/26/2012 - 21:06 | 2923178 lakecity55
lakecity55's picture


It's what's for money.


I branced out into Palladium, but the huge stack of montana coins I had fell off the back of the pickup in del Rio.


Fri, 10/26/2012 - 22:00 | 2923283 DoChenRollingBearing
DoChenRollingBearing's picture

Crossing the border at Del Rio is notoriously dangerous.  Next time take another route.  Damn!  Water and PMs do not mix...

Sat, 10/27/2012 - 07:48 | 2923620 lakecity55
lakecity55's picture

Yes. Right to the bottom they went. The leafy green vegetable material wrapped in paper and saran wrap floated away, too. A sad sight. I did score a bargain at the F&F Gunstore nearby. See the owner, Eric. He always has a deal.

Fri, 10/26/2012 - 21:41 | 2923244 tony bonn
tony bonn's picture

".... But Germany can put a stop to this destruction and save the world while it saves itself. It can leave the EMU, reinstate the deutsche mark, and tie it to gold...."


what a fucktard.....germany has gold? bbwbwaahahahahahhhhahahaaahhahahahahahha

and for anyone else who is not a complete and total fucktard, you can use gold and silver among yourselves....u do not need the corrupt and worthless usd.....

Fri, 10/26/2012 - 21:41 | 2923245 ebworthen
ebworthen's picture

Now that would be a move toward reality and common sense.

Not sure if enough in Germany have the balls to do it, Merkel doesn't.

Too many fiat debt floated equity market worshipers in the U.S. to get it done, go Deutschland!

Fri, 10/26/2012 - 21:55 | 2923272 nevket240
nevket240's picture

The USSA is with holding what physical they have to handover to their idealogical masters when that new Chinese warship enters NY harbour, ala French. The Chinese do not want to lose face holding arse paper, they have a long affinity with Gold and, like the Frogs, will want physical money in exchange for arse paper.

Anybody interested in setting up a new ETF. The SubMerging Markets ETF, featuring the PIIGS, The UK, The USSA and numerous other failures..



Fri, 10/26/2012 - 21:58 | 2923278 BigDuke6
BigDuke6's picture

Poor Germany
They are a parody of what they were.
I almost feel sorry for them

Sat, 10/27/2012 - 04:25 | 2923550 falak pema
falak pema's picture

Poor first World...

Fri, 10/26/2012 - 22:06 | 2923288 hawk nation
hawk nation's picture

If germany went to a gold standard there would be so much capital that is now sitting on the sidelines that would go togermany looking for opportunities that the rest of the world would realize they needed to folow germany's lead


Fri, 10/26/2012 - 22:38 | 2923323 sitenine
sitenine's picture

Hypothetically, what if Germany comes up short on their gold audit?

Sat, 10/27/2012 - 03:26 | 2923530 Dr. Sandi
Dr. Sandi's picture

WE won't hear about it. But there will be a lot of quiet, high level ass kicking behind the scenes, I suspect.

Fri, 10/26/2012 - 23:04 | 2923352 KingTut
KingTut's picture

Nifty Idea, too bad they don't have any gold!

James Turk: The Entire German Gold Hoard is Gone

Fri, 10/26/2012 - 23:47 | 2923394 q99x2
q99x2's picture

A more practical system would be to pay for the development of bitcoin to take over world financial markets and thereby remove the parasitic financial terrorists from the system. If they can't get out from under the control of the banksters what would they accomplish by moving to a gold standard?

Sat, 10/27/2012 - 00:08 | 2923405 Non Passaran
Non Passaran's picture

If you are on a gold standard it does not matter what circulates , gold or shells, as money.

Sat, 10/27/2012 - 00:21 | 2923413 Yen Cross
Yen Cross's picture

q99x2    Bitcoin is finite, Fiat printing is infinite. 

Sat, 10/27/2012 - 00:47 | 2923442 Piranhanoia
Piranhanoia's picture

Germany did seize the moment, and all the gold from their citizens.  During the 30's and 40's.  Before and after they killed them.  They hid it in Switzerland in private accounts known only to them and the Swissies.

But maybe it got stolen from them?

Sat, 10/27/2012 - 01:42 | 2923483 SoundMoney45
SoundMoney45's picture

The Euro is dead, the question is what will replace it.  Perhaps the BIS will offer a world currency.

Sat, 10/27/2012 - 02:03 | 2923497 Savvy
Sat, 10/27/2012 - 04:27 | 2923552 Snidley Whipsnae
Snidley Whipsnae's picture

More MSM talking heads trying to kick sand on the truth... Like the neo cons 'we create reality, and while you are studying what we created we create a new reality.'... paraphrased

Sat, 10/27/2012 - 05:43 | 2923568 Freegold
Freegold's picture

News flash for mr Barron: All attempts to tie ones currenzy to gold has failed in the past! What we all need and will have is a free floating physical only gold market. So when a country consumes more than they produce gold will flow from that zone. In a surplus country gold will accumulate. The price signal from gold, rising or falling in your currency will balance things much better than today.

Gold will do that and restore confidence in the financial system. At a MUCH higher price. It will happen bc it´s the only solution to this crisis of exponential debt. Get your gold while it´s still on firesale :)



Sat, 10/27/2012 - 13:14 | 2923908 Marco
Marco's picture

Maybe, but any country which wants to run a trade balance could very easily do that without gold ... what advantage would there be to first acquire piles of gold at significant cost instead of just using something like trade certificates to ensure a balanced trade?

Hell, not trying to build that pile of gold would be a significant competetive advantage.

Sat, 10/27/2012 - 15:13 | 2924151 OneTinSoldier66
OneTinSoldier66's picture

..."instead of just using something like trade certificates..."


And these trade certificates would be made up of what material? PAPER?

Sat, 10/27/2012 - 16:03 | 2924231 Freegold
Freegold's picture

Gold is payment in full. Everything written on paper is by definition debt! Debt is where we are now :)

Sat, 10/27/2012 - 05:54 | 2923571 poldark
poldark's picture

It has been written in history many times - you cannot trust governments with a fiat currency.

Sat, 10/27/2012 - 09:19 | 2923671 falak pema
falak pema's picture

you can never trust a man with other people's wives...expecially if he says he is a priest and annointed by moral beliefs; just like a banker and his ethical code.

There is only one way out of this conundrum, regulate to prevent, monitor via whistle blowers while work in process, then punish those who break the law. Only one big obstacle : never allow the interested parties to control the whistle blowers and judges; ensure separation of powers and no circular governance. 

Other than that, never marry! Aka, never use fiat and... stick to goats.

Sat, 10/27/2012 - 06:38 | 2923590 TerraHertz
TerraHertz's picture

The German gold is long gone. But it's impossible for the current political structure in Germany to pursue this matter effectively (as opposed to merely pretending to), since... their gold was stolen by international bankers. And international bankers are predominantly (entirely?) Jews. And we know what happens when modern day Germans go anywhere near to being even the mildest bit critical of Jews.

So, that status quo will continue, despite becoming ridiculously untenable and absurd in every way.

Add another 'this can't go on' point to the long list of current impossible things. It's going to be interesting when they all break down at once.


Incidentally, you'd think the Germans would have jotted down the serial numbers of their gold bars before shipping them off to the USA for 'safe' (hollow laughter) keeping. Being such meticulous, organized people.  But no, apparently. So, there's no tracking? No lists of which bars went where? This was some kind of golden precursor to cloud computing?

Add me to the list of people who want to see a lot of bankers shot.

Sat, 10/27/2012 - 08:59 | 2923659 toomanyfakecons...
toomanyfakeconservatives's picture

That's a very long list. Millions of patriots in and around the U.S. military are on it. Treason is easy to spot. Collaborators are easy to spot. The U.S. Marshalls called out LIBOR. The threat from within is the only one America (or Germany for that matter) need be concerned about.

Sat, 10/27/2012 - 11:40 | 2923804 markar
markar's picture

I keep reading about these alleged Federal Marshalls riding to the rescue. When are they going to do something about it?

Sat, 10/27/2012 - 07:09 | 2923599 schatzi
schatzi's picture

two words: wishful thinking.

Sat, 10/27/2012 - 07:25 | 2923609 JamesBond
JamesBond's picture

spot on analysis

Sat, 10/27/2012 - 07:43 | 2923618 Reptil
Reptil's picture

Look what Prof monetairy economics Sylvester Eijffinger of the Tilburg University Netherlands is proposing:
- according to him the gold reserves of EU countries are pooled in the ECB

- according to him the ECB can decide over souverign gold reserves

- the guy's proposing the gold of Spain and Portugal is to be sold to cover for bonds.

original link:

my thoughts:

The prof is clearly nuts, stoned on neokeynesian dope, or aspires a chair in Bejing's university. It's not 1998 anymore professor.
It was ALWAYS about the gold. If Spain and Portugal do this, they'll cut the last way out: to revert to their original currency.
Aaah economists they never seem to get the concept "reality" quite right.

In other NEWS:
Westerwelle (german minister of Foreign affairs) wants a free trade zone with the USA. This is supposed to solve the economic crisis.
It'll be the end of small and medium business in Europe. And a clear vote for globalism, while the currency war is heating up.

Sat, 10/27/2012 - 08:17 | 2923638 falak pema
falak pema's picture

All in the same boat, we sink or swim, as the Oligarchy wills. It would make sense if in the same instance they turned off the ponzi banksta jaccuzi that sucks the true wealth of nations into the private scam whirlpool and reigned in the useless government spending programs, in defense or in gold plated bureaucratic nonsense. 

For France alone the government spending on useless nonfunctional projects can be cut back by 100 billion Euros a year. For the US its nearer one trillion USD. If on top of that they increased the taxes on corporates who have never made so much money outsourcing their production to slave economies, we would see less debt and less deficits in first world. 

But that needs achieving the impossible which is taking power away from the corrupted and the damned. 

Eijffinger to hhim as well! 


Sat, 10/27/2012 - 08:10 | 2923635 rufusbird
rufusbird's picture

Germany, don't let them take you down.

Sat, 10/27/2012 - 09:09 | 2923665 toomanyfakecons...
toomanyfakeconservatives's picture

I agree. Their empire was stolen, then they have to take crap over WWII. A proud nation and people who would be better off with Constitutional gold currency.

Sat, 10/27/2012 - 08:39 | 2923648 Diesel Seven
Diesel Seven's picture

Not sure there is ANY political body that is farsighted enough to pull it off. Long-term, a super-strong DM would allow Germany to better utilize its comparative advantage. Unfortunately, most German companies would be terrified of the short-term negative effects from currency translation losses. (I doubt they would tolerate a bad quarter just to achieve a stable and sustainable monetary system. )

Sat, 10/27/2012 - 09:11 | 2923663 Radical Marijuana
Radical Marijuana's picture

I would say that this is just another ridiculously superficial article rehashing the nostalgic fantasies about the world being able to resolve problems by going backwards.

Gold backed money is just another fraudulent system from the start, and not just for the many problems already raised in many of the previous comments.

The basic problem is this:


Asking for honest and sound money is the same as asking for an honest and sound murder system. THAT is exactly the nature of the problem! Any idea that money is going to become miraculously honest and sound because it is based on some commodities is a goofy ideology!

Commodity backed money is a first approximation to the laws of nature, i.e., the TRUTH found in the conservation of matter. However, that "TRUTH" has been EXPLODED by the fact that matter is a form of energy, as proven by atomic bombs going BOOM!!!

Money manifests through the same energy laws and general systems as does everything else! Money evolved along with militarism. Militarism is the supreme ideology, because the death controls are the central controls. The death controls are crucial to everything else, whether we like that or not! The debt controls depend on the death controls ... BECAUSE MONEY DEPENDS ON MURDER.

Political economy was ALWAYS inside of human ecology, and the problems we have are primarily those kinds of problems, which can not be resolved by silly notions about money becoming honest and sound after it is based on commodities which cannot be created out of nothing.

Honest, sound, money SHOULD be based on our best understanding of energy laws, and general systems theory. However, WHEN we do that, we plunge through the infinite tunnel of deceits, which is the central feature of the actual history of militarism.  The history of money was always related to the history of war and kings. That history made War King, then that morphed to make Fraud King.

The real systems will ALWAYS be fraud, backed by force. Muddling through that madness "better" is our best hope. An arms race between different systems of organized lies, operating organized robbery, IS what is happening, and only doing that better, to evolve a dynamic equilibrium, is theoretically possible.

HOWEVER, at the same time, we ARE pumping everything up with science and technologies that are orders of magnitude bigger, and may transcend human beings, to then require that computer/machine entities evolve their own industrial ecology, (within which may survive some human ecology, and some natural ecology.) The next wave of problems are those regarding industrial ecology, which are perhaps going off the scale of all previous human problems, and maybe even off the scale of all previous biological evolution!

When the mainstream morons start talking about the REALITY that money is based on murder, and start asking and answering the questions about what the murder system should be, and what the death controls should be, THEN, AND ONLY THEN, will there be theoretically some progress towards a better money system. ... As long as this goofball retreat or regression to gold, or other commodity based money, is the popular reactionary revolution, then we are still going backwards, and are still being drowned by the same old deluge of bullshit!

Sat, 10/27/2012 - 11:13 | 2923771 Husk-Erzulie
Husk-Erzulie's picture

I plussed you, just so you might break even. LOL.

You have here the seeds of some really interesting analysis, especially this part:

Honest, sound, money SHOULD be based on our best understanding of energy laws, and general systems theory. However, WHEN we do that, we plunge through the infinite tunnel of deceits, which is the central feature of the actual history of militarism.  The history of money was always related to the history of war and kings. That history made War King, then that morphed to make Fraud King.

You should clearly define your terms and then expand your ideas.  I, for one, would be really interested to see/read the result.  Good on ya.  :-)

Sat, 10/27/2012 - 13:30 | 2923955 WmMcK
WmMcK's picture

+2 even though I don't totally concur with OP mostly because I remember silver also being used as (barter) money and it was a better system than what we have now.

Something about the tax rate being much higher then or something?  /sarc

Sat, 10/27/2012 - 15:17 | 2924155 Radical Marijuana
Radical Marijuana's picture

... define your terms and then expand your ideas ...

I collect my thoughts on these topics here:

Some Monetary System articles.

Sorry, but that is very rambling and redundant, but it does work through those things you suggested ... Actually, it beats them to death, because I tend to do this mostly for my own amusement, since there is nothing realistic that one can do within the political processes to change anything ...

I have tried doing that for several decades. I have had a few court cases against the government of Canada, about the issues that I cared about, which were especially the funding of the political processes, and I even won one court case, while fighting my other court cases to a stalement.

I maintain a fringe political party in Canada, because it is the only thing that I can do, rather than totally give up and do nothing. My main focus has been the political contribution tax credit, which is created by the Canadian income tax law, and election law.  I found a ten billion dollar per year loophole there, and proved it was legal, and then the government changed the election law, to try to plug that loophole, but I figured out a new way to add one more step and still make it work. Of course, what I am saying about that political tax credit is directly no good to anybody except Canadian taxpayers, but nevertheless, the links to my current work upon that topic are here:

As that article beats to death, the PROBLEM is that 99% of Canadians NEVER make a financial contribution to any political party. 1% of the people paid for 100% of the politics, while everybody else paid for nothing. Moreover, even being able to make an after-tax profit from participating does NOT make any difference. The overwhelming vast majority of Canadians ARE Zombie Sheeple, and they want to stay that way!

Of course, the situation in the USA is very similar to that in Canada, except the USA is several orders of magnitude worse! There is no reasonable grounds for being motivated to learn about the monetary system, and communicate that to the public, because there is no feasible way to actually change things to make them become any better.  Thus, I continue to be interested in learning about the monetary system, but I have no motivation to bother to do a better job communicating what I have learned, other than as a record for myself, of my research and thoughts.

After working of the problem of the money system, and the funding of the political processes, for a few decades, and after talking to thousands and thousands of people from all walks of life about these topics (including literally a few hundred lawyers, and a couple dozen judges) I have been forced to come to the conclusions which I wrote about above: the real world is controlled by huge lies, backed by lots of violence, and therefore, evidence and logical arguments are practically useless. The real systems are frauds, backed up by force, and those systems are now runaways.

Anyway, I thought I would reply to your comment to say that I have spent a long time attempting to better define my terms, and expand my ideas, BUT, the bottom line conclusion is that can NOT make any real difference to the established fundamentally fraudulent financial accounting system. Therefore, I do not have sufficient motivation to do a better job of communicating my ideas, since, after doing my best to try to do that for a few decades, I have finally concluded that that is a waste of time, other than for my own amusement, and intellectual curiousity. ... About the only reason to bother, is for the sake of some possible potential feedback, that could assist in developing better ideas ???

However, I continue to see no practical means that better ideas about the monetary systems could change the already established, overwhelming triumphant FRAUDS backed by force, that deliberately maintain huge lies about themselves, because that is what works best for them! To overcome the advantages that the established systems have in the ways that they fund politics, and already own the mass media, etc., is NOT POSSIBLE!!! Therefore, developing better ideas about the money system are like doing art for its own sake.

Sat, 10/27/2012 - 16:58 | 2924322 Husk-Erzulie
Husk-Erzulie's picture

Thanks for linkies, good to know about.

edit... Quick read, looks like great resources.

Sat, 10/27/2012 - 09:53 | 2923697 monopoly
monopoly's picture

No, this would be a start moving ahead, not backward. But the politics of the world would not allow it. Germany will follow the rest of us down a road that leads to monetary disaster. 

Let it be written, let it be done. So sad.

Sat, 10/27/2012 - 11:02 | 2923757 saveandsound
saveandsound's picture

It's not a trivial task for Germany to abandon the Euro and use a new German Mark. And it is not clear at all if Germany's economy would be better off with a new German Mark.

However, it is complete retard to believe one could establish a new Gold-Backed currency (in Germany).

If you like, Gold is not an asset but real money. Same applies to Silver. And maybe in 20 years we all use Gold and Silver not only as a store of value, but also as an every day meaning for payment. But there will still be Fiatmoney - either as paper oder as plastic.

In case you would like to build a house and take a credit for that: is the lending bank supposed to take a spade and dig the credit somewhere in Africa out of the ground?

Author is selling his book - that's all.

Sat, 10/27/2012 - 11:30 | 2923784 americanspirit
americanspirit's picture

IMO it is highly likely that the Fed has secretly transferred all the gold in their hands - both US gold, German gold, and everybody else's gold to China long ago. Well, maybe 4-5 years ago, in return for China agreeing to keep buying patently worthless US paper. The Chinese are smart people - why else would they keep buying the worthless paper of a bankrupt nation unless they KNEW that at some point in the future it wouldn't matter that they were left holding worthless paper because they would have all the gold in the world - or almost all.

And the Chinese motivation, other than economic dominance, which is so much easier than military dominance? Please familiarize yourselves with the history of China and the West - especially Great Britain, France and the US - from roughly 1800 - 1920. When you do you'll realize that the grandparents of the older generation of today were alive at the tail end of over 100 years of systematic, sustained western atrocities, exploitation and humiliation in China ( more or less ending c. 1917), so the brutality and evil that the West visited upon the Chinese is held in living memory. So the notion that Chinese planning is and always has been driven by revenge against the West is not a quaint idea - it is at the core of Chinese national consciousness. Never forget, and never forgive - this is the reality of how the Chinese view the West, and the time of reckoning is drawing close. As it should.

Sat, 10/27/2012 - 11:47 | 2923808 markar
markar's picture

I don't think a return to the D Mark would hurt exports as much as many think. The cost of recapitalizing their banks will be enormous. Not to speak of their massive unfunded liabilities to an aging population. They will have to print as fast as everyone else.

Sun, 10/28/2012 - 05:42 | 2924965 saveandsound
saveandsound's picture


Sat, 10/27/2012 - 14:15 | 2924056 OneTinSoldier66
OneTinSoldier66's picture

"The cause of the euro debt crisis is the misconstruction of the euro that allows all members of the European Monetary Union (EMU), currently 17 sovereign nations, to print euros and force them on all other members."


The Big Political Banks in America try to get the Government to print dollars, bail them out, and force all the American people to pay for what should have been their(the bankers) losses.


Is there an analogy there?

Sat, 10/27/2012 - 15:58 | 2924216 cardis
cardis's picture

Tks T(s) D(s)


More und mais. Subito.

Sat, 10/27/2012 - 17:12 | 2924358 ciscokid
ciscokid's picture

Germany has no more gold.When they lost the war the gold was split by the allies.

Germany is still under the orders of the U.S.A.

Sat, 10/27/2012 - 17:24 | 2924378 Tingles
Tingles's picture

If Germany created a sound DM backed by gold the value of the DM compared to the Euro would increase quickly. Germany's exports would be more expensive to the world and would decrease. This would not be in Germany's interest.

Sat, 10/27/2012 - 17:39 | 2924408 orangegeek
orangegeek's picture

The Euro is fine - it's just going to be worth a lot less globally.  Germany will leverage one country after another under there version of fiscal control.


This won't take as long as many think since these countries are literally out of cash.  France will be the last to drop under fiscal control.


This happened in the US some 200 years ago.  Good of Europe to finally catch up.

Sat, 10/27/2012 - 18:11 | 2924466 DutchMadness
DutchMadness's picture

German totall worth of Gold in USDollars is only 180 Billion. That is peanuts in perspective to their economy. So, dream on, but the fiat-banksters have us all in their alien power. ( till it explodes)

Mon, 10/29/2012 - 12:43 | 2928170 saveandsound
saveandsound's picture

At the moment Germany's gold is worth only 180 Billion US-$.

In case countries start to use gold as an anchor for their currencies, an ounce of gold would have a much higher price then now. However, when one creates a gold-back currency, one looses control over the money supply. You would have a fixed money supply - in a world of growing assests this would mean deflation. Alternativly you might observe an increased velocity of money. 

I don't think (a little bit) deflation ist necessarely a bad thing - but at this moment of time most economists and financial leaders think different about this topic. I don't expect to see gold-backed currencies in the next 5 to 10 years.

Sat, 10/27/2012 - 20:23 | 2924621 honestann
honestann's picture

What countries should do and what they will do is never the same.  Why?  Because every country on earth is now controlled by predator-puppets who are in turn controlled by predators-behind-the-curtain (mostly owner/controllers of central banks).

Don't expect any country to do the right thing or the smart thing.

Mon, 10/29/2012 - 20:55 | 2929769 Radical Marijuana
Radical Marijuana's picture

YES! That is the way I see it too.

Sun, 10/28/2012 - 02:33 | 2924891 are we there yet
are we there yet's picture

Germany's gold is mostly out of their country in US, France, and England, and publicly they are not allowed to see, touch, repatriate their gold. Germany could not creat a gold based system with phantom gold in unaudited foreign countries.

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