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"We're Living Within A Money Bubble Of Epic Proportions"
Submitted by Adam Taggart via Peak Prosperity,
James Turk believes the time we live in now will be studied by future historians for generations to come. Just as we today marvel at the collective madness that resulted in the South Sea and Dutch tulip manias, our age will be known as the era when society lost sight of what money really is.
And as result, the wrong kinds of wealth -- today, that's mostly financial assets -- are valued and pursued. And just like those bubbles from centuries ago, when the current asset boom goes bust, the value of paper wealth will vaporize.
In contrast, those holding tangible productive assets or real money will fare much better on a relative basis.
James and co-author John Rubino (of DollarCollapse.com) have recently published a new book covering the details of this prediction called The Money Bubble: What To Do Before It Pops. Within it, they delve into the reasons for why the world is destined for what Ludwig von Mises termed a "crack up boom":
Wealth comes in two forms. It comes in financial assets, bonds, and T-Bills, and things of that nature, and it also comes in tangible assets: real estate, oil wells, timberland, farmland, houses and things that are tangible. And when you’re in a financial bust – and we’ve been in a financial bust since the dot-com bubble collapsed back in 2000 – what you want to do is you want to be involved with tangible assets and you want to avoid, as much as possible, your involvement in any financial assets. So, consequently, what people should still be focusing on, even though we’re 14 years into this bust, is continuing the accumulation of tangible assets.
Because when this bust is over, promises are going to be broken left and right. And that means financial assets where you have counterparty risk where you own an asset, the value of which is based on someone’s promise – a lot of those financial assets are going to be diminished in value. Now, there’s a special kind of financial asset called a stock in a company. It’s almost like a tangible asset in the sense that if you own stock in EXXON, you’re basically owning a tangible asset, because it’s involved in oil and it owns tangible assets all over the world.
But then, there are financial stocks, credit-card companies and banks, that are financial wealth rather than tangible wealth. So, you don’t want to own stocks in those companies. So, basically, own tangible assets or stocks in companies that are involved with tangible assets – those stocks, I call near-tangible – I think that’s the thing that everybody should be focusing on.
And when it comes to money and liquidity, the money, of course, would be physical gold or physical silver or a combination thereof because they will re-emerge in the historical and traditional role as money.
Keep in mind, gold’s been money for 5,000 years. It was made money by the market. Money comes from the market. It doesn’t come from the government. Over the past century, government’s certainly usurped that authority to control money. And over the last 40 years, they’ve gone even further afield by completely divorcing fiat currency from the gold that used to back money. And because of the time element that’s involved, we’ve lost sight of what money really is, and that’s what’s created the money bubble, Chris.
And it’s this money bubble where people have to come back to reality as to what money really is. It’s liquid, tangible assets being used in the economy in exchange for real goods and services. And it’s ultimately where we’re going. And I think it’s going to be very, very disruptive because if you look at an individual country like Weimer, Germany or Zimbabwe more recently, or what Venezuela or Argentina are going through now. You can see the disruption to the economy when the money is no good.
We’re talking here about fiat currencies throughout the world because nobody’s tied to gold anymore. No country’s currency is tied to gold anymore. So this is going to be the bubble, I think, that generations from now, hundreds of years from now people are going to be talking about just like we talk today about the South Sea Bubble or the Mississippi Bubble, from those episodes in history a couple hundred years ago.
Click the play button below to listen to Chris' interview with James Turk (35m:26s):
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No shit.
http://www.forbes.com/sites/gordonchang/2014/01/26/china-halts-bank-cash...
China just closed all bank transfers. Good luck on Monday everyone.
Ho Li Fuk!
We are not in Cyprus anymore...
Op Sheet Kreek.
If you want your bank transfer . . .
you solly out of luck!
In the UK we have to pay our tax bills next week.
Perhaps we will be unable to with a seized banking system....?
Perhaps the chinks think they have enough gold now....and on the 2nd
Announce a floating gold backed currency??
May bee they have pledged all their T bonds to Africa in exchange for resources?
Perhaps they are simply ready..?
Or just fucked.
Good luck to all next week and beyond.
"chinks", what a lovely expression.
Dennis Leary gave Political Correctness a well deserved middle finger of common sense.
Rescue Me - Sensitivity Training
https://www.youtube.com/watch?v=egAMgNY84do
PC hack - "the word chink, is what I like to call a problem word"
Sean Garrity - "if I were a chink, I think I would rather be called a chink, instead of gook"
Apparently you're of the belief that calling someone a "chink" falls under the domain of political correctness? I'd consider it belongs more in the realm stupidity, or perhaps at best a lack of class/decency, but perhaps that just me. Let me ask you: how do you feel about someone calling you dumbass?
gee... I don't know, why don't you tell me how you've handled it in the past
Why is it that when Whites think up a one syllable word to refer to other races that new word is always considered an insult?
"Chink" is merely descriptive. It has no negative connotation. It is a one syllable word that is more convenient than "Chinese"
The worst person to lie to is yourself.
How about slope head that ok who cares
Of course chinks don´t like being called gooks, since that refers to koreans. Chinks don´t like gooks.
dunno... but maybe someone will tell round eye go home?
News Headline Summary
PBoC has ordered commercial banks to halt cash transfers
Says:
- There will be a three-day suspension of domestic renminbi transfers. There will also be a suspension, spanning nine calendar days, of conversions of renminbi to foreign currency.
Full article: http://www.forbes.com/sites/gordonchang/2014/01/26/china-halts-bank-cash...
*So many COINCIDENCES lately.
I brame imperialist yankee yellow dog...
oh wait.
Same as always, fault lies in US 'american' citizenism blobbing-up the bubble-making means while offuscating the scraping of the Chinese goat, manifestering the eternal consumptionalizing 'american' parangong nature.
Make me laugh.
We are good, we have Obama and Yellen, nothing to worry about over here in the USA.
woof...
Sum Ting Wong!
THIS IS SERIOUS NEWS !!!!!!!!!!!! WOW !!
Katie, bar the door.
Hell's Bells. This time she did.
Uncle Billy...He's your man!!!
Holiday...
It just another Banking Holiday
We're out of cash so now you just go away
And enjoy your Holiday.
That notice is rather ominous. Systematic maintenance is halting FX conversions for 9 days. Something doesn't smell right.
If u peeps havent got ur pm's yet best do it quick
They know there is going to be a rather large default on Jan 31 and are trying to stop systemic contagion and bank runs.
Well, they got everyone's attention;)
It pains me to turn on the cable television, but let me see if any of the news outlets are reporting anything.
CNN: "Who should pay to keep brain-dead mom alive?"
FOX: Obama says "it's our generation's task to reignite the american productivity" or something like that. It actually sounded reasonable, but coming from his mouth, complete horsefeathers.
ABC: Gas prices are rising.
Okay. Business as usual.
Runs in China will be epic!
Those lines at the train station during New Year's Migration....Childs play.
I want to see it.
Why is that, more tainted Kitten McNuggets?
Alas, alas, 1.3 billion times alas, just have to run to the nearest roadside and bare with it.
I'll have a Big Mutt, a 9 Piece Kitten McNugget, a Double Quarter Horse with Cheese and a Diet Coke, please!
Actually, OT, but funny story about me and McDonalds from when I was a teenager. I was on my way to do a side job to earn a little extra money with a buddy of mine one fine day, and was hungry. Being a teenager, I was not as put out about McDonalds as I am now, so I stopped at one and ordered a double quarter pounder. Well, it tasted nasty, and I was only able to scarf down about 1/4 of it before I decided that I couldn't eat anymore of it. It so happened that I was on the on ramp for the interstate, and I'm a firm believer in merging going the same speed as traffic, so I was already going 50-55mph. With a simple flick of the wrist, I tossed the thing out the window into that little triangle patch of land that was bounded by the street, the on ramp and the interstate. Well, a couple of kids that were probably around 13 or 14 just happened to be traversing the patch of land at the wrong time. Motherfucking MCSMACK! Right in one kid's face at 50-55mph. I kind of felt bad for the kid, but that did not stop me from laughing my ass off. That faux berger drilled the poor kid, catsup and faux beef sprayed everywhere, his hands immediately went to his face and he dropped to his knees. It had to have felt like getting drilled by a boxer, but holy shit! Can you imagine explaining that black eye to your parents and friends?
That story was hilarious but I still had to down vote you...for littering.
It reminded me of another on-ramp story, OT as well. About twenty years ago I was cruising along with friend in his car on the freeway. He was driving. Out of nowhere he looks at me and says "Are you driving?" I said "What?" He said "I'm serious, I took three hits of acid and I can't tell if you are driving or I am driving!" Immediately I told him to pull off the next exit and stop the car, after I called him all sorts of names. So instead of pulling off the off ramp he drives under the overpass and turns up the on-ramp. So, I'm yelling at him while he is dodging traffic when sirons and cop lights come on behind us. After we were stopped, the cop comes up to the driver window and says "Son, didn't you see the arrows? Dave yells, "Arrows?! I DIDN'T EVEN SEE THE INDIANS!!"
Dave went to jail that night. Drive sober kids.
PS The look on the cops face was precious.
Wok don't run!
poor little pussies and pups.
Small splattering things.
The Peoples Revolution Indoctrinary Corp (the PRIC's) have already issued a call to arms!
The Great Leap Forward to the nearest roadside!
Because, after all, a turd in the dunghand is worth two in the bushes.
Capital controls coming in
4,3,2...
The runs you get in China are always epic
The runs you get in China are always epic
No. The runs I had in Greece were the worst. Wound up in a hospital in Brindisi, Italy!
Well, that was worth saying twice! ;-)
Miffed;-)
Mum's the word to quell panic.
Bloomberg headquarters live from Hong Kong does not have the story either.
Busily bribing every Chinese official on their roll-a-dex/contacts list no doubt.
But....all this time they have been telling me gold, silver and bitcoin have been the tulip bulbs
no, no, no. they've been telling investment manias don't exist. you can have all the tulip bulbs you want.
and gold.
and silver.
and bitcoin.
"just keep buying Beeks."
Closed for maintenance. I guess they will blaming Obama's NSA?
Monday is certainly going to be interesting.
Let me guess, CGI built the back end programs.
From January 30th to February 2nd. Hmmm.....
CPL - I followed your link - thank you. Great find!
However, as the Forbes article points out, CBOC is only doing this because of the need for "system maintenance". They said so themselves. Nothing to see. Move along.
crony capitalst-hybrid communist system maintenance.
these people dont fib
Probably to give folks time to cool off after the Cash = Gold or Debt = Gold (I forgot the exact name) fund fails. I don't think that strategy has ever worked...
"due to system maintenance". A claim like that means that the PBoC has no ability to backup it's computer systems while maintenance is done on parts of it? That is a dubious excuse for 9 days of no foreign currency conversions! Has something in the China shadow banking system blown up and cascaded into financial instruments backed by nothing but promises and promise of future earnings? We all know that one blow up in the right place would dislocate many financial engineering frauds. This may or may not be big news, if it is, then tomorrow will be a harrowing day on the street. As for the cover story, I do not believe that excuse for a moment, that is fake, what it covers up we can not yet know. Were I in the markets, I would, this very night, be seeking to exit all I could.
> http://www.forbes.com/sites/gordonchang/2014/01/26/china-halts-bank-cash...
Ugh. Words. Lots and lots of words.
I'll wait until Tyler posts a cartoon version, thanks.
gung hay fat choy!
Anyone else getting an error message when trying to access the Forbes article? Is this the ministry of truth at work or irrefutable evidence of my computer illiteracy?
"promises are going to be broken left and right."
Sounds familiar.
Edit: CPL, That escalated quickly.
"Maintenance" = Fill those tanks, stock those pantries, fill the desiccant boxes and grab some popcorn.
Pat Travers - Boom Boom (Out Go The Lights) Studio Version
http://www.youtube.com/watch?v=oBf1e6WWWA0 (2:46)
Good Evening James if you are reading this. It is a pleasure to see you on ZH. Your viewpoints are particularly well timed today, as we see money lock-ins at 3 British banking groups at the moment: HSBC, Lloyds Group and Bank of Scotland.
Your attempts to educate the financial public in recent years will prove to be prescient, in my opinion. Best wishes to you, GATA and the goldmoney team in Jersey.
Interesting that the ZHer 'CPL' just posted a link to the closing of bank transfers in China. HSBC contagion or vice versa?
Good evening Simon....
hmmmm
"....and you want to avoid, as much as possible, your involvement in any financial assets."
Sounds good in theory, but these are the exact "assets" that taxpayers were forced to back, bail-out, and suffer zero interest rates for 5 years in a row, in order to save. Perhaps he is missing the point that these "assets" come with a systemic/societal guarantee behind them? What is that worth? Hate to spoil a good article, as I respect what this man has to say.
Well, in theory anyway, shares of a well run company represent an ownership interest. And if a well run factory or company is not tangible, nothing is.
I think I'd rather have part of a bricks and mortar than part of my grandfather's farm. Farming sounds like work, and it's not as liquid if you don't want it, or you have to leave in a hurry.
Problems always arise of course if a bricks and mortar goes belly-up, but farms do also.
As for heavy metal, I can't see myself with a wheeled cart hauling bullion down the road when things turn bad. I remember stories of people crossing the border into Suisse from the north trying to trade silverware and gold for food and safe passage. In this culture you wouldn't get to the town line with both your life and your gold.
The point isn't that shares of Walmart or Apple are any better at that time; the point is nothing is going to be as valuable as your resourcefulness and mental preparation. And having to stand guard over a stash is just going to tie me down.
The author of the article referenced earlier by CPL is a Mr Chang who also wrote recently: 'Mega Default In China Scheduled For January 31'. You can see this article listed to the right on the page linked by CPL.
More financial repression occurring so soon after Davos. Who'd a thunk it?! Predictable, don't you think. Insolvent international banks desperate to save their own skins - with other people's money.
At near zero interest rates, only keep bill paying cash in banks. Activate the autopay system, so the bank is lumbered with paying out, not you in the event of more technical 'glitches' or bank holidays.
That is exactly why I sold all my stock and bonds, liquidated all my IRAs and my 401k ... and put it all into Bitcoins.
IC WAT U DID THAR!
Right !! You're kidding, I hope!
lol...as fonestar would say, its virtually tangible!
And I feel virtually safe too!
The Bitcoin network is very safe, has never had any troubles except for a small fork that was resolved in hours.
I have a nagging suspicion that I am going to get forked in the end, too.
But...but..but,..It is a virtual fork.
They're the worst Tom. You get no reach around.
Miffed;-)
Please, go into detail about bitcoin's safety.
Why would you need to transfer money among banks?
It's more efficient to let the central planners piss in all directions.
Meanwhile at a bastion of 'progressive' thought they mock the consideration of 'free markets'.
These poor things. Good people I suppose but the fundemental retardation astonishes...........
"Good people?" No, evil people either by sloth or theft.
G'luck with that, akak. I really hope it works out for you. It's not for me, but any way to get out of the current mismanaged money system is better than staying in it, imo.
LOL
So you did not catch the satire?
Stacy Summary: Many were oh so concerned about the Chinese who owned some bitcoin. LOL.
China Halts Bank Cash Transfers
Read more at http://www.maxkeiser.com/#GpOTIrOSeOVf7eII.99
The promises will be kept - but they will be kept by devaluing currency. It is the 'modern' way. The US will simply print $17 trillion in paper money and pay off the debt. Of course, an acre of land, a gold coin, and a barrel of oil will skyrocket when this happens - but the paper 'debt' will be paid - and the economy will eventually re-set. You will be fine as long as you own a 'real' asset or have a skill that will be needed after the re-set. If you are relying on the gubmint, get ready for lots of 2% increases in your gubmint check will prices climb 20%.
Wow, is it a coincidence that it's on Stuper Bowl Sunday and Grammy night......
As long as those food stamp cards are operating, things should continue as they are........dumbed down.
What are the chances of another "unexpected" blackout during the SuperBowl?
Is tonight Super Bowl night? I have been watching the Kiev super bowl being played out between riot troops and freedom fighters, So far it is freedom fighters 45 and cops 0 in the first quarter. The EU promises support for the freedom fighters which could make this a run-away victory for an EU Ukraine. Or so it looks at the moment, yet other players are warming up and they have a heavily stocked bench, the score may shift once they are sent out onto the field.
I doubt that this will bring the system down, but I am always left wondering how many nails this coffin of a world economy can take.
Dear China, May I suggest JP Morgan and Goldman Sachs. They will shou you how to use your citizens money to build a prison for all of your citizens Then you will be able to take everything they have and kill them-- a system just like the United States and Europe have
"use your citizens money to build a prison "
You're not just blowing smoke.
Top Shareholders of US Prison factories CCA and GEO" at: http://prisondivestment.wordpress.com/private-prison-industry-industria-de-prisiones-privadas/top-shareholders-in-cca-geo/
"The financial services industry now makes up a third of the US economy, and its members collectively own over two-thirds of CCA and GEO Group."
I have access to 200 Maples for 5k. It is a verbal deal done today. I'm hooped.
The suggestion that "future historians" shall even contemplate and spin these times is pretty questionable.
Just sayin'.
Shit. Holy fuck. Gold and Silver Bitchezz.
Meanwhile in Amerika, Sheeples getting ready for Grammy and SuperBowel. Yeah much more important
http://www.youtube.com/watch?v=MjkMh0tKCZo
still not Grammy material?
well...okay then.
StupidBowl and Lardassians ^
Your comment makes me feel so very WalMartian.
"Lardassian" -New one... But I like it!
" Up...up and away... In my beautiful, beautiful balloon."
If gold closes above the 10/20 and 50 day averages during the Asian session, that's really good. It might test the 100 day avg.@ 1279. It's nice to see good ole shiney XAU above the trend line. :-D
Already 1272.3 on Kitco site.
1275.10 now. Hang on. It's going to be a bumpy ride up, again. No place for weak hands.
Short squeeze is on.
Hey Winston. I laugh when I see those retards on 'Discovery Channel' pulling gold out of the ocean in Alaska... ;-D
Hard to disagree with James Turk. Like other commenters, I thank him for his tireless work against the soul crushing central bankers.
Does this PBOC inter bank freeze have anything to do with the Default of the Trust.... My Sister + Pussy = A1 Double + Good = Paper GLD + Leverage = Happy Fortune Cookie Trust?
http://dontpkethebear.com/25-funny-auto-correct-fails/
Shaved? or furry?
Thanks for that. I laughed so hard I started crying.
Me too
Yes, 'MakeMineADouble'. See earlier link provided by 'CPL', and look right to see the author's article about the massive default due Jan. 31. Yet another paper gold scam, taking down unwary buyers. Get physical...preferably not with your sister, as I understand that's immoral or outlawed or somefink....;-)
This article points to the real metric of how much total gold is there vs how much total global fiat currency.
2009 : www.youtube.com/watch?v=eZA0qNsf4m0
same/same
When the bubble pops, the rich will protect themselves... they created, own and operate the monetary system. What are they doing? Hoarding... hoarding assets, cash, etc., defalation will hit like a storm and those with the liquidity will cash in BIG... those with the most liquidity on hand will buy/sell those with the least liquidity and most bills that is... when those with the least cash are hit with the "margin call" they will cry and sell at fire sale prices. Cash will be king.
fiat is, precisely, a way to steal wealth from productive labor and transfer it to those who have the power to issue or create more of that fiat.
And that's all it is.
Tangible assets...
And frangible assets.
Don't ventilate ...
Masticate.
Nothing is really changed, money, fait,was always an illusion. So borrow money and buy things that will hold value. I prefer gold, but that is personal. You will make money on your new assets which you can sell and repay the fiat. Christ, banking is not difficult. Say it all again.
This is the biggest bubble (starting in 1945) that the world has ever seen. The USA has blown the mother of all fiat and debt bubbles. We were lucky, such an exorbitant privilege to own the reserve currency as Charles De Gaul said.
We pumped it to the max and traded pieces of paper for real goods and services from the rest of the world.
We will be very lucky if we only japanify. Even at best the mojo is gone as we and the third world converge through labor and capital arbiteage. That is the optimistic scenario. A Brazilian standard of living in 20 years isn't too bad assuming Brazil comes up a lot and we go down only a bit more from here.
/.
Real wealth isn't measured the way James Turk claims: " It comes in financial assets, bonds, and T-Bills, and things of that nature, and it also comes in tangible assets: real estate, oil wells, timberland, farmland, houses and things that are tangible."
Real wealth is family, friends, and freedom. That freedom means liberty, clean air and water, and the ability to pick your own friends and neighbors. It also means the absence of fear that comes with a government that is out of control. If you don't believe that this is real wealth then try doing without.
Tyler should correct the article title to
They're Living Within A Money Bubble Of Epic ProportionsBecause 99% do not get even a tiny fraction of the money
Great Article!! Combined with the comments of "Stuck on Zero" below it's as good as it gets! Congratulations!