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Will We Never Learn? 1840's Gold Rush Edition

Tyler Durden's picture




 

1840's Gold Rush or 2014 Dot-Com 2.0?

Despite the amazingly high cost of living and the extraordinary opportunities for frittering away money, everyone in early San Francisco was supremely confident that he would soon be able to return home with an incalculable amount of [wealth].

 

Everything was conceived on a vast scale, and there was always plenty of cash available for any scheme that might be proposed, no matter how impossible or bizarre it seemed. No one hesitated to borrow money...

 

-The Barbary Coast (describing the gold rush)

 

 

Source: @signejb

 

 

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Tue, 02/25/2014 - 19:27 | 4477920 NoDebt
NoDebt's picture

Bah!  It's different this time.  You'll see.

Tue, 02/25/2014 - 19:37 | 4477965 cynicalskeptic
cynicalskeptic's picture

Was out west this summer and picked up a few books on the Comstock Lode.  

Very few of the mine owners and miners made any real money.  The serious riches went to the bankers and stock brokers in San Francisco  More money was made on mine stock manipulation than ever came directly from the mine production.

Tue, 02/25/2014 - 20:11 | 4478092 CClarity
CClarity's picture

And some other fortunes were made too, like Levi Strauss, for supplying the rugged denin pants that held up better for physical labor, Studebaker, who made wheelbarrows before he made autos, and many other merchants, along with the bankers.

Wed, 02/26/2014 - 00:47 | 4479028 Unpopular Truth
Unpopular Truth's picture

picks, shovels, ...

Wed, 02/26/2014 - 10:31 | 4479810 NEOSERF
NEOSERF's picture

Same exact thing will happen with the marijuana mania...it will be the grow light providers, electric companies and banks that make all the money..  Retail dispensaries will lose their margins as they fight with eachother over potheads...

Wed, 02/26/2014 - 13:20 | 4480394 monad
monad's picture

Big Pharma and the Order paid the Washington cockroaches big money for their respective monopoly franchises. They are going to make sure Gansta Holder goes Pinkerton on those interlopers. Just like Kalifornia pig roast.

 

Tue, 02/25/2014 - 20:52 | 4478254 monad
monad's picture

Roughing It by Mark Twain could have been written today about the dotcom boom and virtual crypto poker. Makes contemporary msm carpetbaggers and scalawags look like the bottom feeders they are. 

Tue, 02/25/2014 - 22:52 | 4478632 Stuck on Zero
Stuck on Zero's picture

The smart money has learned its lesson from gold rush San Francisco.  Now they invest in fracking!

 

Wed, 02/26/2014 - 05:15 | 4479324 Villageidiot777
Villageidiot777's picture

Fracking is completely safe and good for everyone, unless you have a site near EXXON CEO's backyard...

Tue, 02/25/2014 - 19:37 | 4477966 fonestar
fonestar's picture

Today we have Bitcoin!  The superior system!

Tue, 02/25/2014 - 19:40 | 4477978 Winston Churchill
Winston Churchill's picture

Shame Mt. Gox proved it could be fractionally reserved,

So is it different again ?

You said this was unpossible.

Tue, 02/25/2014 - 19:42 | 4477988 Skateboarder
Skateboarder's picture

fonestar is very much like Gollum. He will gladly follow his precious bitcoin into the very fires of Mount Doom.

Tue, 02/25/2014 - 20:09 | 4478087 RafterManFMJ
RafterManFMJ's picture

Sensors indicate your one down arrow is from one Fonestar. His name was Fomestat. Gollum gollum.

Tue, 02/25/2014 - 20:44 | 4478214 tenpanhandle
tenpanhandle's picture

he should have paid real money for that 100 down arrow program.

Tue, 02/25/2014 - 20:27 | 4478143 unrulian
unrulian's picture

 funny, but you missed an opportunity to say... into the very fires of Mount Gox

Tue, 02/25/2014 - 19:55 | 4478046 seek
seek's picture

It was always known you could simulate fractional reserve with bitcoin, inside your own accounting system, but that a run would kill the bank, just like with fractionally reserved gold banking in the 30s.

In the 30s, if you held physical in your position, or in 2014, if you make sure your BTC is in the blockchain, none of the failures affected you.

The lesson here isn't about bitcoin, it's about possession and control. If you don't have verifiable possession/control of any asset, it's not really yours. AU, BTC, Fiat cash v. numbers on a bank computer, etc.

Tue, 02/25/2014 - 20:32 | 4478163 Jendrzejczyk
Jendrzejczyk's picture

Thank you Seek,

"Posession and Control" of your assets is exactly the most important thing you can do for yourself and your family.

This goes for those of you who have partners in business ventures too.

Tue, 02/25/2014 - 22:59 | 4478655 Urban Redneck
Urban Redneck's picture

Speaking of "Possession and Control" - to all the stackers:

Never forget the lesson of the LOST DUTCHMAN

Tue, 02/25/2014 - 19:39 | 4477974 HyBrasilian
HyBrasilian's picture

Everyone wanted GOLD... Everyone wanted TULIPS... Everyone wanted PET ROCKS... Everyone wanted CABBAGE PATCH DOLLS... Everybody wanted BEANIE BABIES...

~~~

My FUCKING GOD! ~ What could 'POPSSIBLY' come next?

Tue, 02/25/2014 - 19:49 | 4478016 Crash Overide
Crash Overide's picture

Bitcoins?

Tue, 02/25/2014 - 20:23 | 4478130 aVileRat
aVileRat's picture

Anything that lets a person with declining purchasing power feel smug and validated that their lives mean something.

That thing can come in the form of a shiny "gold" iphone5s, or a tax/social trend endorsed by celeb_A.

 

On another note, it does suck to be Gross today. Build largest bond fund, best friend you hire back TWICE, calls you a dick in the Wall St. Journal. Trade desk does not get to buy junk bond? so they leak shit to the press on positions and trade desk drama during a 200 bp bond world implosion.

Then 9 of your former trusted Lt's who you pulled out of bond-trading hell during the 1980's dogpile in during the day WSJ breaks the story on your fallout, making it seem like your AUM + GIPS was just a "who you knew" scam.

Yeah, the money makes the good times more fun, but at the end of the day it still sucks to get thrown under the bus by everyone you made a career for. Your employees & board know all the dirty laundry now and the investors/pensions definitly will be asking questions on the Mind & Management of PIMCO next month. It's not called Redemption March for nothing. All this on the eve of Tapering starting down another 10B & being one of the largest holders of global USD bonds.

Maybe someone should make a bill gross meme.

 

Tue, 02/25/2014 - 20:25 | 4478139 StacksOnStacks
StacksOnStacks's picture

Fast food?

/sarc

Tue, 02/25/2014 - 19:47 | 4478004 Real Estate Geek
Real Estate Geek's picture

Here's a lesson to learn:  don't forget where you buried your 1,400 $20 gold pieces.  Here's another lesson.  If you see something, dig it up!!! 

http://www.sfgate.com/bayarea/article/Gold-Country-couple-discovers-mill...

Tue, 02/25/2014 - 19:53 | 4478035 Crash Overide
Crash Overide's picture

Nice collection of pre-internet coins.

Tue, 02/25/2014 - 21:02 | 4478292 darteaus
darteaus's picture

Some poor buy buried them there and bought BitCoins.

Tue, 02/25/2014 - 22:00 | 4478465 0b1knob
0b1knob's picture

I hate to be debbie downer on this, but it seems very suspicious to me.   The technology exists to make perfect casts of rare coins and then reverse engineer the dies to stamp out new ones.   All you need is a cute story of how you magically found the stash.   A few thousand dollars worth of gold becomes $10 million dollars worth of rare coins.

Why are so many of the coins mint state?   I imagine few circulating coins in California from that time were in such good shape.   And no identification of the owner?   And they are going to be sold on Amazon bypassing the usual rare coin dealers?

Caveat emptor..

Tue, 02/25/2014 - 20:54 | 4478262 Renewable Life
Renewable Life's picture

I just spent the evening out in SF on Saturday and I hadn't been there "partying" in years, and i must say, its worse then the media is making it out to be in SF with these techy bullshit millenials! I lived in SF thru the height of the dotcom 1.0 and the City was still awesome!  

But these Apple/Facebook/Google/App Startup fucks are a new breed of BS that really was unreal to see from the outside looking in!! Its hard to describe to the "average person" unfamiliar with the West Coast, but geeezus was i ready to kick their skinny little asses by midnight! (im sure the cocktails only made shit worse)  

I really do hope the USD collapses in a heep of burning shit, for no other reason to watch this crowd of idiots wake up one morning and find ALL their fucking imaginary money gone!!!  Tesla payments and ALL! (note: i like the Tesla s-model, its fucking awesome, ive driven it, but i hate MOST the MFers driving them after Saturday night) 

Tue, 02/25/2014 - 21:01 | 4478288 darteaus
darteaus's picture

Tech hipsters.

Tue, 02/25/2014 - 22:44 | 4478600 christiangustafson
christiangustafson's picture

The Barbary Coast is such a great book, written by the same author who wrote Gangs of New York.  I picked up a very nice first edition recently.  It's still in print; I recommend it highly.

Asbury describes the sheer lawlessness of SF in the 19th Century, especially as outsiders, from Australia, from Mexico, from NYC, descended in waves upon the place to plunder it. 

Several times, appalled by the uncontrollable crime, the citizens would form an ad hoc Vigilance Committee, whereupon they would then promptly lynch a few examples until things calmed down.  The mayors were terrified of these efforts, which were threatened again and again when things got out of hand.

It took the 1906 quake really to clean up the city.

Tue, 02/25/2014 - 19:29 | 4477926 lordbyroniv
lordbyroniv's picture

Back than...wasnt it much easier to borrow and disappear?  I imagine moving to a different state would'a really thown the banksters for a loop.  Man,...I was born in the wrong century.  :(

Tue, 02/25/2014 - 19:55 | 4478043 The Wisp
The Wisp's picture

then again there wasn't a lot of people to hide among, everybody knew everybody and if you said Who came in on the last stage coach, 50 people could give you an answer

Tue, 02/25/2014 - 20:11 | 4478096 RafterManFMJ
RafterManFMJ's picture

A plague on you. A plague on the whole stinking lot of ya, without morals or laws. And all you whores got no laws. You got no honor. It's no wonder you all emigrated to America, because they wouldn't have you in England. You're a lot of savages, that's what you all are. A bunch of bloody savages. A plague on you. I'll be back.

Tue, 02/25/2014 - 20:44 | 4478210 Jendrzejczyk
Jendrzejczyk's picture

FAFS  (funny as fucking shit.)

Leaning on a cane and frothing spittle through gapped black toofs.

Tue, 02/25/2014 - 19:29 | 4477928 NOTaREALmerican
NOTaREALmerican's picture

Human are pathological optimists.    And the sociopaths use it against them every chance they get.

Tue, 02/25/2014 - 20:48 | 4478236 Clycntct
Clycntct's picture

Fk man why didn't you tell me that 40years ago?

Tue, 02/25/2014 - 19:30 | 4477934 AldoHux_IV
AldoHux_IV's picture

the best part is the roundtrip in this whole concept: "buy gold bitchez"

 

Tue, 02/25/2014 - 19:33 | 4477947 Jackfish
Jackfish's picture

Which one of them forgot where they buried their gold though?

 

http://gma.yahoo.com/blogs/abc-blogs/california-couple-finds-10m-buried-...

Tue, 02/25/2014 - 19:36 | 4477960 Winston Churchill
Winston Churchill's picture

Never go full retard ,and forget where you buried it.

Or someone killed the owner thinking it was in a bank box.

Tue, 02/25/2014 - 19:41 | 4477986 Jackfish
Jackfish's picture

Whenever I hear of a Viking hoard finding in the UK, I think the same thing. 

Someone killed before being able to retrieve.

Tue, 02/25/2014 - 20:28 | 4478148 SoilMyselfRotten
SoilMyselfRotten's picture

If someone as really thinking, they'd invest in some scuba gear and take advantage of all the lost fortunes at the bottom of Lake Xxxxxxx

Tue, 02/25/2014 - 20:51 | 4478249 tenpanhandle
tenpanhandle's picture

lotta broken canoes.

Tue, 02/25/2014 - 19:36 | 4477958 booboo
booboo's picture

Well shit, look at Amway, what amount of revenue is generated by "a greater fool" and they own a fucking NBA team that sucks.

Tue, 02/25/2014 - 20:16 | 4478107 Lumberjack
Lumberjack's picture

Ahhh...

Meet the Boss: Former Amway executive opens faith-based nonprofit and restaurant

http://www.freep.com/article/20131208/BUSINESS06/312080031/Craig-Witcher...

 

You just got my up vote. Saw this happen in the energy sector...Faith based. (my ass).

Tue, 02/25/2014 - 19:38 | 4477961 AUD
AUD's picture

Despite the amazingly high cost of living

I'll wager that this cost was actually denominated in the "plenty of cash available", derived from "no one hesitated to borrow money". That is, it was denominated in bank credit, not physical gold.

Tue, 02/25/2014 - 19:41 | 4477985 LetsGetPhysical
LetsGetPhysical's picture

20 yr old kids making $200k a year for working 2 hrs a day and driving around government subsidized Teslas.... What could go wrong?  Ahhh...California...gotta love it. 

Tue, 02/25/2014 - 20:44 | 4478216 pitz
pitz's picture

Where's that?  I can assure you, there are very few 20-year-olds working in the Silicon Valley these days. 

Tue, 02/25/2014 - 20:05 | 4478075 The Wisp
The Wisp's picture

How soon we Forget,  ( Link is to the San Fran Quake pictures )

Tue, 02/25/2014 - 20:44 | 4478219 Que Sara Sara
Que Sara Sara's picture

Is anyone else having the issue I am having, I am getting "web pae canot be displaed" frequently on ZH, Is some one trying to take dow ZH?

Tue, 02/25/2014 - 20:45 | 4478224 Que Sara Sara
Que Sara Sara's picture

ory meat "take Down "

Tue, 02/25/2014 - 20:45 | 4478225 Que Sara Sara
Que Sara Sara's picture

ory meat "take Down "

Tue, 02/25/2014 - 20:46 | 4478228 Que Sara Sara
Que Sara Sara's picture

Sorry could be my laptop acting up!

Tue, 02/25/2014 - 20:53 | 4478256 Clycntct
Clycntct's picture

"ory meat "take Down " I think it's working OK Just post where your stashing your gold and we'll get back with you.

Tue, 02/25/2014 - 20:54 | 4478259 22winmag
22winmag's picture

"We are looking for motivated people in your area to learn how to flip houses with no money down using other people's money!"

 

Step right up folks!

Tue, 02/25/2014 - 22:34 | 4478565 Blano
Blano's picture

There's yet another one coming thru Dallas/Fort Worth.  That makes 5 now in the past few months.

Tue, 02/25/2014 - 21:00 | 4478284 darteaus
darteaus's picture

SFO has always been boom & bust: ...PC boom / Defense spending bust / Internet Boom / Dot Bomb.

Now we have the VC incubator and Apps boom and drought bust.

Tue, 02/25/2014 - 21:40 | 4478408 Axenolith
Axenolith's picture

WOOT!  These folks made the score!  Should have kept it under wraps and filtered them out after grading over time and unpublicized...

 

http://www.sfgate.com/bayarea/article/Gold-Country-couple-discovers-mill...

Tue, 02/25/2014 - 23:38 | 4478787 toadold
toadold's picture

I cleaned out a bunch of free E-books to make more room for my porn mindlessdrivel  genre science fiction and mystery's and I inadvertently removed the biography of General W. T. Sherman. In between US Army service he was a bank director in California during the Gold Rush period.  Pretty much confirms the quotes from the "Barbarry Coast" book but also talked about how a lot of bankers went under. One  reason was they wouldn't charge enough interest on loans and let their cash on hand get to low to cover even a small run based on a rumour.  He quit the bank because he couldn't convince the board of directors of how risky Califronia was and that the interest rate banks in the East were charging were higher than what the banks in California were charging despite the lower risks in the East. Same old, same old, "It is different out here, we have much more wealth comming in than the do in the East."

Wed, 02/26/2014 - 01:42 | 4479128 pupdog1
pupdog1's picture

Studebaker made a real, physical, superior quality thing that others had to have.

Something all the Goldman squid and nail gun bankster fucking psychopaths couldn't do if their lives depended on it.

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