Gold: 1980 vs Today

Tyler Durden's picture




 

When gold was undergoing its latest (and certainly not greatest) near-parabolic move last year, there were those pundits consistently calling for comparisons to 1980, and the subsequent gold crash. Yet even a simplistic analysis indicates that while in the 1980s gold was a hedge to runaway inflation, in the current deflationary regime, it is a hedge to central planner stupidity that will result as a response to runaway deflation. In other words, it is a hedge to what happens when the trillions in central bank reserves (at last check approaching 30% of world GDP). There is much more, and we have explained the nuances extensively previously, but for those who are only now contemplating the topic of gold for the first time, the following brief summary from futuremoneytrends.com captures the salient points. Far more importantly, it also focuses on a topic that so far has not seen much media focus: the quiet and pervasive expansion in bilateral currency agreements which are nothing short of a precursor to dropping the dollar entirely once enough backup linkages are in place: a situation which will likely crescendo soon courtesy of upcoming developments in Iran, discussed here previously

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Fri, 02/17/2012 - 22:15 | 2172122 fonzannoon
fonzannoon's picture

From the Telegraph.

Congratulations to Iceland.

Fitch has upgraded the country to investment grade BBB – with stable outlook, expecting government debt to peak at 100pc of GDP.The OECD's latest forecast said growth will be 2.4pc this year, after 2.9pc in 2011.Unemployment will fall from 7pc last year to 6.1pc this year and then 5.3pc in 2013.The current account deficit was 11.2pc in 2010. It will shrink to 3.4pc this year, and will be almost disappear next year.

Fri, 02/17/2012 - 22:17 | 2172128 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Ther terrists

Fri, 02/17/2012 - 23:22 | 2172238 Thomas
Thomas's picture

Gold was competing against 8% real returns on treasuries. That ain't so this time. The opportunity costs of owing gold are zero. When real rates go positive, I pay attention. I should add that interest rates and gold both maxed out within months of each other in 1980; anybody who thinks gold tops the second treasuries start falling (rates rising) doesn't know their history.

Sat, 02/18/2012 - 03:31 | 2172473 Max Fischer
Max Fischer's picture

 

 

I would strongly urge readers NOT to sign up for the "Future Money Trends" newsletter, which is what this video is selling.  This is a website run by the same pump-n-dump NIA guys that Peter Schiff has repeatedly warned his followers about.  While I regard ZeroHedge as one of my favorite places on the internet, i think that promoting known scam artists subtracts from the overall quality of this site, even if they offer the same flavor of doom/gloom that ZH readers are looking for.  I know that ZeroHedge is free, so I really don't have any right to complain, but I would hope that we would be warned of guys like this, rather than be led to them.   

After several lawsuits, the guys at NIA/FMT were forced to warn their subscribers with hilariously blunt warnings.  At the beginning of their disclaimer, it reads:  "...never make an investment decision off of anything we say."  *LOL*  And they conclude their disclaimer with the same thing: "never base any decision off their website or emails."  It also reads, "our activities involve actual conflicts of interest."  

This is probably my favorite part of the disclaimer: "we receive monetary or securities compensation in the very securities we are promoting and shortly after...... we sell the securities during our promotional activities or thereafter."   

*LOL* Basically, the lawsuits forced them to admit to being a pump-n-dump operation.  

These guys are bad news.  And, yes, that's a double entendre.

I hope this comment isn't taken the wrong way.  As I said, I thoroughly enjoy ZH.  I just don't like to see pump-n-dump scammers being promoted.   

Max Fischer, Civis Mundi



Sat, 02/18/2012 - 03:55 | 2172518 cnsteph
cnsteph's picture

Didn't Daniel leave NIA a while back?  I know there was some thing with Shiff calling out NIA.

Sat, 02/18/2012 - 10:36 | 2172646 GetZeeGold
GetZeeGold's picture

 

 

 

It's all over.....send all your golds to us.....vee will dispose of it in a safe and environmentally conscience manner.

 

 

 

 

Sat, 02/18/2012 - 18:47 | 2173753 clymer
Sat, 02/18/2012 - 08:23 | 2172647 GetZeeGold
GetZeeGold's picture

 double post.....grrr.

 

Newsletters are for pussies. Never spent the money. They have this little thing called the internet. Info for nothing and your chicks for free.

 

 

Sat, 02/18/2012 - 08:46 | 2172671 Pringsh Peensh
Pringsh Peensh's picture

Speaking of creepy dual intentioned web sites, what's the deal with "ABC Media, LLC" on the bottom of the ZeroHedge web pages (in the copyright footer). Ummmmmn, please don't tell us that the MSM got a hold of this last bastion of hope. This isn't the ABC I fear it is, it is????

Sat, 02/18/2012 - 10:26 | 2172748 AldousHuxley
AldousHuxley's picture

Office 3, bl.51,
Jerusalem Str., j.k."Mladost 1"
Sofia, BULGARIA
Phone: (+359 2) 9743974
Fax: (+359 2) 8753599
E-mail: contact@strogosekretno.com

 

Administrative Contact:
Georgiev, Georgi tyler@zerohedge.com
Office 3, bl. 51, Jerusalem Str., j.k. "Mladost 1"
Sofia, Sofia 1000
BG

 

Father Krassimir Ivandjiiski, is a writer and editor at Bulgaria Confidential

http://strogosekretno.com/index.php?p=contactus

 

 

http://nymag.com/guides/money/2009/59457/

 

best insider info abotu wall st. comes from ex-wall st. banned for insider trading for they were the small fish fried while the big fish like Robert Rubin gets away.

Sat, 02/18/2012 - 11:49 | 2172819 clymer
clymer's picture

I'm sure Dan, co. are all thrilled that an administrative office in Bulgaria is now a SPAM target

Sat, 02/18/2012 - 10:17 | 2172737 nodhannum
nodhannum's picture

Chicks for free is an oxymoron. The three most expensive things in the world are home cooking, home loving and free laundry!

Sat, 02/18/2012 - 11:06 | 2172776 Lost Wages
Lost Wages's picture

What makes me LOL is the people who pay $150/year to read Bix Weir's private posts.

Sat, 02/18/2012 - 04:05 | 2172528 StychoKiller
StychoKiller's picture

I can think of at least $16+Trillion reasons why I don't need a newsletter to tell me the future of the Dollar...

Sat, 02/18/2012 - 04:39 | 2172539 Bay of Pigs
Bay of Pigs's picture

Hey Max, you're a fuckan asshole.

Sat, 02/18/2012 - 08:26 | 2172655 Popo
Popo's picture

fuckan?  

Sat, 02/18/2012 - 12:04 | 2172842 bbq on whitehou...
bbq on whitehouse lawn's picture

Its because he's from " Neuw Yourk " the people who invented the phrase " you fuckan assshole". :)

Sat, 02/18/2012 - 08:16 | 2172645 doggings
doggings's picture

I knew I recognised the voice on the video.

but wrt to the videos they basically steal Schiff's commentary and put it to video, so the videos are usually good, just the sign-up-to-our-offers are dodgy.

Sat, 02/18/2012 - 09:21 | 2172698 Mr. Lucky
Mr. Lucky's picture

Crede sed proba.

Sat, 02/18/2012 - 00:53 | 2172362 TheFourthStooge-ing
TheFourthStooge-ing's picture

Mr Lennon Hendrix noted:

Ther terrists

Yep, and them's the worst kind, terrists from Sackistan, on account of 'em having big brass balls.

 

Sat, 02/18/2012 - 10:50 | 2172768 GetZeeGold
GetZeeGold's picture

 

 

Actually those balls are gold......just like Janet Napolitano's.

 

 

 

Fri, 02/17/2012 - 22:21 | 2172139 fonzannoon
fonzannoon's picture

well played.

Fri, 02/17/2012 - 22:38 | 2172170 withnmeans
withnmeans's picture

What is your take on this Tyler? From Kathimerini, are they trying to cover their ass.

http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_17/02/2012_428589

Sat, 02/18/2012 - 02:04 | 2172424 danielvisionvic...
danielvisionvictory@yahoo.com's picture

thanks

Sat, 02/18/2012 - 02:04 | 2172425 danielvisionvic...
danielvisionvictory@yahoo.com's picture

thanks

Sat, 02/18/2012 - 02:04 | 2172426 danielvisionvic...
danielvisionvictory@yahoo.com's picture

thanks

Sat, 02/18/2012 - 13:28 | 2172997 General Decline
General Decline's picture

Rare triple post. Nice.

Sat, 02/18/2012 - 04:21 | 2172531 groundedkiwi
groundedkiwi's picture

Iceland is winning! Not according to this and the advent of vulture banksters. http://www.globalresearch.ca/index.php?context=va&aid=27673

Sat, 02/18/2012 - 04:22 | 2172532 groundedkiwi
groundedkiwi's picture

Iceland and its new elephant in the room 

http://www.globalresearch.ca/index.php?context=va&aid=27673

Sat, 02/18/2012 - 10:31 | 2172752 Coke and Hookers
Coke and Hookers's picture

A good find. When the Icelandic banks were resurrected, the government handed the new ones over to creditors of the old ones. Outstanding debt became shares in the new banks. In the meantime, vulture funds had bought all the old debt for pennies on the dollar (6 cents a dollar on average apparently) and now own the new Icelandic banks. The new banks basically own everything in Iceland because private and corporate equity was wiped out during the crash - so now Iceland belongs to 20 vulture funds or so. The identity of these funds is apparently a state secret but among them are the follwing according to some credible inside info:

York Capital
TGP Investments LLC
Anchorage Capital Partners
Arrowgrass
Cyrus Capital Partners
Centerbridge
Davidson Kempner
Fortelus
Tiger Management
Verition Group LLC

The neoliberal Icelandic government is negotiating an EU entry and this makes it vulnerable for outside pressure from the international financial elite, particularly the IMF, which now dictates economic policy in Iceland. As usual, IMF has ordered the Icelandic government to 1) defend the new banks at all cost and 2) privatize everything in sight. The privatization plans haven't gone over well in Iceland and the government periodically tests the waters to see what it can get away with. Examples:

- The government is trying to seize fishing quotas owned by fishing companies (worth 1-5 billion dollars depending on how it's calculated)
- The government is testing the waters regarding the sale of the national power company (Landsvirkjun)
- The government has from time to time 'discussed' changing roads built for public funds into toll roads
- The government has gone to extreme lenghts to use taxpayer money to pay for the Icesave debt (which belongs to Landsbanki bank) - despite the fact that its posessions are sufficient to pay the debt (which means that vulture funds wouldn't get anything) :-(

Despite massive cuts in public spending and massive tax increases, the current public deficit it 10% of GNP - meaning that there is no actual growth or recovery. Every single extra penny earned in foreign currencies is used to pay foreign public debt which "magically" went up to 90% of GDP from nothing (it may be far more though because the public figures are very inconsistent - i.e. state secret like the identity of the vulture funds).

So, to summarize, the Icelandic people have been stripped of most assets and are now slaves to the international financial system. Their government works for said system and acts as a debt collector. Could be better but it could have been worse too. It could have been an EU member like Greece in which case it would be crushed under the German/Brussels boot, it would still have grossly overvalued currency and it could have taken on the Icesave debt. In that case Iceland would be in the same exact position as Greece - basically in ruins.

Sat, 02/18/2012 - 11:55 | 2172828 trav7777
trav7777's picture

the larger powers would have used military options against them had they refused.

Sat, 02/18/2012 - 15:12 | 2173224 trav7777
trav7777's picture

Fuck Abe Foxman and fuck the ADL

Sat, 02/18/2012 - 05:52 | 2172573 disabledvet
disabledvet's picture

In other news "Brazil was upgraded for the first time in 27 years last year after sticking it to the man in 1985." Like i said: "we have Hyman Minsky banks now." Good luck financing your country!

Sat, 02/18/2012 - 10:43 | 2172757 Coke and Hookers
Coke and Hookers's picture

"Fitch has upgraded the country to investment grade BBB – with stable outlook, expecting government debt to peak at 100pc of GDP."

 

This means nothing. The rating agencies reward or punish Iceland based on how closely they follow IMF instructions. Examples:

1) "You are not accepting the Icesave debt (which would crush your country)? We better downgrade you."

2) "You are spending (wasting) your foreign currency reserves to pay to carry trade gamblers locked in because of capital controls. Good boys! Here's an upgrade!"

The second example is the reason for the Fitch upgrade btw.

Fri, 02/17/2012 - 22:16 | 2172126 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Gold, bitchez

Fri, 02/17/2012 - 22:29 | 2172151 JW n FL
JW n FL's picture

Silver, fuckerz

Fri, 02/17/2012 - 22:35 | 2172160 Conrad Murray
Conrad Murray's picture

LSD and Cheesy Biscuits!

Fri, 02/17/2012 - 22:47 | 2172182 Cheesy Bastard
Cheesy Bastard's picture

bastardz

Fri, 02/17/2012 - 23:18 | 2172232 Hulk
Hulk's picture

retardz

Sat, 02/18/2012 - 08:25 | 2172654 GetZeeGold
GetZeeGold's picture

 

 

Fargin Bastagez.

 

 

Sat, 02/18/2012 - 13:10 | 2172952 Benjamin Simon
Benjamin Simon's picture

Shotguns and canned food. Friendz.

Sat, 02/18/2012 - 00:59 | 2172369 TheFourthStooge-ing
TheFourthStooge-ing's picture

. LSD and Cheesy Biscuits!

Microdots and Microwaveable!

 

Fri, 02/17/2012 - 22:53 | 2172187 Long-John-Silver
Long-John-Silver's picture

I'm diversified, I have Gold AND Silver.

Fri, 02/17/2012 - 23:29 | 2172257 Boston
Boston's picture

AND Platinum.

Sat, 02/18/2012 - 00:12 | 2172314 DaveyJones
DaveyJones's picture

and fertile land

Sat, 02/18/2012 - 00:24 | 2172327 Hulk
Hulk's picture

mycorrhizae bitchez !!!

Sat, 02/18/2012 - 02:21 | 2172440 tekhneek
tekhneek's picture

bokashi, trickz!

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