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On The Price Of Gold

Tyler Durden's picture


On a day where gold surged generously on the same thesis with which it managed a five-fold increase in the last decade or so - that of paper money debasement - we thought it appropriate to get some context as to the yellow metal's history, current implications, and potential future. In a mere 111 seconds, we are treated to a history of sound money (from Croesus to The Bank of England to The Great Depression), the growing division between some of the world's most-famous smartest investors with regards to Gold's price (Buffett vs Paulson/Bass), Governments and Central Banks Spending and Printing 'experiments', and a discussion of the endgame of "Where Will All The Money Go?" - all with the help of a magical cartoon hand. As it seems the profligate control of the electronic press is now all that matters to an increasingly correlated and blind-leading-the-ignorant markets, perhaps it pays to consider how markets have changed reactions to the threat promise of the extreme easing upon which the equity market's heart beats so strongly. Once anxious of bond vigilantes (taken care of via LTRO reacharounds and direct Fed monetization), FX markets remain intervention-prone (just ask Azumi how many times he looks at JGBs or JPY risk-reversals every day), and finally to the stock (and vol) markets as 'Bernanke's trailing-strike Put' ensures 'the wealth effect' buoys us all the chosen few to greater and greater spending disconnects between value and price and potentially larger and larger mal-allocations of capital. With Corporate cash stockpiles so huge - the "Where Is John Galt?" line can't help but appear in many minds as reinvestment in a dilapidated, aging, increasingly less cash flow generating asset base remains to be seen.

UPDATE: Added link to Matthew Bishop's ebook 'In Gold We Trust'


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Mon, 03/26/2012 - 23:48 | 2293365 Triple A
Triple A's picture

it's so perrrty, now if it wasn't so manipulated.

Tue, 03/27/2012 - 00:10 | 2293410 ClipperBASIC
ClipperBASIC's picture

Agreed! It is a very attractive metal.  As to the manipulation; pure politics.

Tue, 03/27/2012 - 00:59 | 2293467 Pinto Currency
Pinto Currency's picture


Clever video but disinforms:

1) In 1913 the Fed started with their "elastic money", financed WWI and blew a bubble in the 20s that collapsed the economy in 1929.

2) The most recent bubble came when rigging of interest rates and gold accelerated in 1993 and juicing of the money supply accelerated in 1995 followed by the NASDAQ bubble, then the 2000s housing bubble and the derivatives bubble, and then the recent horrific government deficits of Obama Administration all because of the US economy collapsing starting in 2007/2008. 

At the root of these two bubbles and crashes of the US economy is the Federal Reserve and the removal of strict gold money both starting in 1913.

Tue, 03/27/2012 - 02:55 | 2293586 Michael
Michael's picture

If I were typical people, I would be stuffing my mattress with as many $20ies as I could get my hands on.

Tue, 03/27/2012 - 03:07 | 2293593 Vic Vinegar
Vic Vinegar's picture


Tue, 03/27/2012 - 03:34 | 2293617 StychoKiller
StychoKiller's picture

Because the Ignorati believe that "" is a good deal -- need I explain further?

Tue, 03/27/2012 - 03:40 | 2293620 Michael
Michael's picture

It's only a temporary fix in the beginning of the collapse, might help you make it a little further.

My next prediction is $20ies will become in short supply.

Tue, 03/27/2012 - 04:05 | 2293630 LuKOsro
LuKOsro's picture

Why, will toilet paper be in short supply ?

Tue, 03/27/2012 - 04:11 | 2293633 Michael
Michael's picture

I want Dr Ron to be my next President.

Have you seen him in tonight's appearance on Piers Morgan? It was epic and you can see it on Youtube;




Tue, 03/27/2012 - 05:51 | 2293683 economics9698
economics9698's picture

The motivation for going off gold and onto fiat is simple.  Governments can finance whatever project s they want, usually war machines.  Corporations can borrow and pay back in “soft” chap devalued money.  Corporations can raise prices faster than wages increase.

Inflation cause by fiat is nothing more than the elites ripping off the rest of society.

Tue, 03/27/2012 - 06:20 | 2293702 Watauga
Watauga's picture

9698--You are right that fiat allows govt to finance anything it wants, but war is a drop in the bucket when compared with the ever-expanding welfare state that secures power more effectively than any war ever did.  Those in power spend fiat to secure their power, period.  And the best way to do that is to buy off the voters with handouts, to buy off big money with even bigger handouts, and to get in bed with the corporate money paid to the political whores who run the carnival.

Tue, 03/27/2012 - 06:26 | 2293704 GetZeeGold
GetZeeGold's picture



Long tungsten and gold spray paint.


Pretend and extend to infinity.


Tue, 03/27/2012 - 08:46 | 2293848 Pinto Currency
Pinto Currency's picture


Fiat currency also provides a tool to keep society in repeated cycles of chaos as the medium of exchange is disrupted and savings are wiped out.

You don't want the sheep lining up on the gridiron with cigars hanging out of their mouths with an evil look in their eyes.

Tue, 03/27/2012 - 10:37 | 2294185 SubjectivObject
SubjectivObject's picture

I agree, because for a useful, transient duration, paper money may be more valuable than, metered, electronic money; more of that old wives tale about bank asses maturing, and such.  Certainly, there will be a time to unload the Jacksons (may bliss be upon his soul) hanoverfist (cue the music .... STEARRRRRRNS ....).

Tue, 03/27/2012 - 16:46 | 2295587 MiddletonRobert3
MiddletonRobert3's picture

my roomate's sister makes $85 hourly on the computer. She has been fired from work for 6 months but last month her paycheck was $16158 just working on the computer for a few hours. Read more here .....

Tue, 03/27/2012 - 01:16 | 2293498 ACP
ACP's picture

He forgot to say, "And now for something completely different!"

Tue, 03/27/2012 - 01:46 | 2293529 vast-dom
vast-dom's picture

yeah and Asia is fucking soaring on Bernank hot hopium bs! i'd laugh if it weren't so deadly serious (and this after article on 40% yen correction as noted by some sinkhole china report).....

Tue, 03/27/2012 - 03:16 | 2293601 Al Gorerhythm
Al Gorerhythm's picture

it's so perrrty, now if it wasn't so manipulated.

Gold bides its time.

Tue, 03/27/2012 - 06:28 | 2293675 Chaffinch
Chaffinch's picture

Off topic (but only slightly!)
Yesterday BBC Radio 4 broadcast an excellent programme called "Analysis" in which they explore the conjuring trick by which the Bank of England calls money into existence by the 'magic' of QE - comparisons to Weimar Republic etc. - AT LAST the mainstream media are starting to wake up!

I hope this link works - there is about a minute of junk at the start - sorry!

Tyler you might want to flag this up - there is a great bit where someone says the money is created by elves (well, it might as well be...!)

Tue, 03/27/2012 - 07:58 | 2293776 _underscore
_underscore's picture

I can't tihnk who would want to down arrow your post here (perhaps one of those with the MTV/goldfish level of focus - hey, it was nearly 30 mins long after all..) - anyway, yes, a good (for MSM anyway) walk-through broadcast. What strikes me, as always, is the almost naieve and/or incredulous tone of the (obviously) intelligent journalist making the piece - almost idiot/savant level in fact. It reminds me of the Cash4gold sellers & their mid-set: do they not think there's a reason all those shops want their gold for kock-down prices? Don't they ever just wonder (even slightly) why some fool is willing to pay 'sky high prices!!!' for their gold. Well, no it seems not - not with them, nor most of their brighter compatriots either.

 In my daily life the same lack of connection seems to be made with the people I meet (and even I have some fiarly intelligent friends/acquaintances etc.) & talk to. People invariably just see the 'oh more rising prices..oh heck.. terribly expensive these days..' side & not the more fundamental 'why is money debasing?'  aspect. Apart from genuine shortage, of either/both raw materlal & productive output, there's no real reason for rising prices - other than a transfer of wealth from The primary productive units (the common man/woman) to the parasite manipulators & dealers in fiat currency -William Cobbett's 'stock jobbers & tax eaters' of the Great Wen.

  To borrow a phrase from Labour's Peter Mandelson (when referring to big finance/business & obscene profit making from money manipulation) - I'm intensely relaxed about the value & (current fiat) price of gold & know my exposure to the fiat manipulators & their machinations are now very limited.


Tue, 03/27/2012 - 15:44 | 2295268 Chaffinch
Chaffinch's picture

Thanks for the support Underscore! I too was wondering who would junk me for putting this link on ZH - maybe a troll trying to undermine...

Glad you enjoyed it too - I agree with your comments about the intelligent reporter 'dumbing down' - (all that silliness about getting 5 ten pound notes then queuing to change them for a fifty) - but maybe her naive style enabled her to get away with some confrontational stuff (e.g. Confronting the BoE governor about the 'lie' of promising to pay the bearer on the face of the notes - and flagging up the BoE's failure to uphold the value of the note - since QE is deliberately doing the opposite.)

I loved the comparison to Peter Pan - clap your hands if you believe in fairies - paper money works so long as we all believe in it but once we all stop...?

Tue, 03/27/2012 - 08:01 | 2293781 Grimbert
Grimbert's picture

I heard this last night too, expecting the usual drivel/lies about how the BoE keeps inflation down etc. but it was quite excellent.

It didn't tell me much I didn't already know from being on this site for the last 2 years, but I was amazed it was broadcast, being so honest about the nature of QE and the fundamental value of gold. 

Tue, 03/27/2012 - 15:49 | 2295299 Chaffinch
Chaffinch's picture

Yes Grimbert - it was remarkably honest - linking all the right stuff together - QE / inflation / faith in fiat currency / gold / the clearly political role of the BoE - obviously a little bit of MSM bias (e.g. slagged off gold for being so volatile without questioning why that might be happening!) but nothing like as bad as normal.

I was also slightly annoyed at the suggestion that if we went back to a gold standard we would all have to carry really heavy bags of metal around with us ; then at the gold machine she was disappointed at how small the one gram piece of gold looked - and that was what she had been thinking of buying with her £50 note!!

Mon, 03/26/2012 - 23:49 | 2293368 Thomas Jefferson
Thomas Jefferson's picture

Its mobile and can easily be lost if need be.

Mon, 03/26/2012 - 23:54 | 2293376 mess nonster
mess nonster's picture

Losing one's gold would have to be the smartest, er, most depressing thing that could ever happen to someone. I HOPE I never lose my gold!

Tue, 03/27/2012 - 10:25 | 2294151 Badabing
Badabing's picture

My physical gold just vaporized!!!!!!

Tue, 03/27/2012 - 00:21 | 2293425 Catfish
Catfish's picture

Really stupid of me to take all my gold with me white-water rafting and damn if the thing didn't tip over!

What a loss....

Tue, 03/27/2012 - 02:11 | 2293552 Deo vindice
Deo vindice's picture

I am convinced that gold/silver bugs are some of the dumbest folk around.

Almost everyone I talk to took their valuable purchases on fishing trips and against all odds, 100% of them had some sort of boating accident or other mishap.

One would think by now that they would have learned the lesson.

If you want to have a safe and successful fishing trip, leave your gold/silver at home.

Tue, 03/27/2012 - 03:40 | 2293621 Deo vindice
Deo vindice's picture

Red arrow?

Anyone who doesn't understand sarcasm without it being labelled 'sarc' shouldn't be allowed to click a mouse without supervision.

Tue, 03/27/2012 - 04:13 | 2293635 Acet
Acet's picture

Have you considered that those giving you the red arrows are being sarcastic too ....

Tue, 03/27/2012 - 06:51 | 2293725 GetZeeGold
GetZeeGold's picture



Damn your sarcasm to hell and beyond.


You do know I'm just kidding about that......right?


Tue, 03/27/2012 - 05:36 | 2293676 tabasco71
tabasco71's picture

Wow, I never thought about this.  Of course the water stains the gold and makes it look ugly - yuck!

I have a protest march coming up next month.  We will not be near water.  Can I take my gold along?

Thanks for your help.

Mon, 03/26/2012 - 23:53 | 2293374 monopoly
monopoly's picture

That was well done. Simple and to the point. Good for the sheeples that think gold is a barbaric relic. Might enlighten a few.

Mon, 03/26/2012 - 23:54 | 2293377 experimentals
experimentals's picture

weak! for zerohedge standards

Tue, 03/27/2012 - 01:08 | 2293481 Dan The Man
Dan The Man's picture

...strongly agree.  calling this an overview would be an insult to overviews.

Tue, 03/27/2012 - 07:11 | 2293506 Al Gorerhythm
Al Gorerhythm's picture

Here's abetter explanation of money.


In essence, gold measures the value of what people use as money. Gold can be money and when it is used as such it values items but when its not, it values what is used as money. It is one of the numeraires that individuals use to measure value. Right now I use gold to measure paper money because I judge that the political creation of money outmeasures the capicity of workers to create enough wealth that it measures. Its being over-produced in comparison to goods.

I hold the bulk of my savings in precious metals. The politicians can't create them for expiditious purposes (to conveniently hide their spending as they can by printing) and as long as there is a independent Fed, free to create credit, I'll continue to use it. One day there will come a time to use another measure but for me, not right now.

Tue, 03/27/2012 - 00:06 | 2293380 DavidPierre
DavidPierre's picture



The world is a complicated and dangerous place and it seems that more than precious metals will be needed to survive intact in the years ahead. Mental preparedness will also be needed.

1.  In the event of a world wide inflationary or deflationary collapse, this event could be used as the reason for the creation of a new world wide currency, partially ... 40% ?... based on gold.

2.  To insure that there is sufficient gold, its value have to exceed $10,000. Government will want gradually higher prices from here on.

3.  This new gold backed currency would be only used as payment between countries.

4.  Personal gold ownership would be banned.

5.  Purchase and sale of gold between individuals would be banned, in all countries. There would be a problem in countries like India.

6.  Those who do not sell their gold to the government during the initial call-in, would later have to use criminal channels to sell their gold for fiat currencies that will still be used, along with ration cards, for daily transactions.  In war time Germany, without a ration card or a home garden, a person could have starved, even with a pocket full of money.

7.  The sale of call-in gold to the government will have gold owners with their backs to the wall, with confiscation windfall taxes imposed ... 80-90%?... and with the final settlement made in a fiat currency. The former gold owner would be lucky if he is paid in cash.  If he is unlucky he will be paid in treasury bonds that will mature in a few years.  By then, with hyper inflation a good possibility, the former gold owner could be destitute.

8.  Under the conditions given above, silver will become the precious metal of choice. Because silver is indispensable in industry, silver could not be confiscated in the same way as gold.

9.  Under the chaotic conditions of an inflationary collapse, a new currency ... black market curency... will emerge, most probably based on U.S. 90% constitutional currency... junk silver coins.  This is another reason why it may be that silver will be the precious metal of choice, when push-comes-to-shove.

10.  There will be a transitional period when a person who has all his assets in the two precious metals will try to convert their value to other hard assets such as arable land, and rental property.

11.  An Orwell type of society. With the loss of monetary freedom, personal freedom is also lost.

12.  This will not be the end of the world, but many will think it is, especially those who are caught financially unprepared. Believe in mental preparedness.  Looking at the worst possible scenario, and accepting its possibility, is one of the first steps an individual should make in preparing for a world wide financial disaster. The events of the coming years have the potential for shaking western society, whose values and institutions are now world wide, to its roots.

13.  Good luck! We will need all we can muster.

Tue, 03/27/2012 - 00:22 | 2293427 Ima anal sphincter
Ima anal sphincter's picture

All good points, DP.

My solution......#1 Rid ourselves of the bankers and puppets. #2 Uh.....#1 takes care of it all.

Tue, 03/27/2012 - 04:09 | 2293632 francis_sawyer
francis_sawyer's picture

Nickles bitchez!

Tue, 03/27/2012 - 06:30 | 2293707 GetZeeGold
GetZeeGold's picture



Because life isn't complicated enough......that's what platinum is for.


Tue, 03/27/2012 - 01:15 | 2293496 CaptainTripps
CaptainTripps's picture

they try banning gold again its game over IMO

they will be admitting it really IS all a scam...yet again like FDR did



Tue, 03/27/2012 - 02:35 | 2293574 oldman
oldman's picture

David Pierre,

Dear sir,

The world is neither complicated or dangerous to the species at the top of the food chain provided that species does not destroy the bottom of the food chain by depletion of its balance and/or contamination of said chain.

The world is complicated and dangerous only in the human mind; it is a trick each of us plays on ourself. It is how I made a living selling socks and bombs without any interest in money, just trying to put food on the table.

Not complicated at all in the US where there are only two opposing reasons for taking action: greed and fear. The story you tell, my clients used to tell me, and I listened so as to ascertain what they really wanted to act on; greed or fear. !984 and Brave New World and Ayn Rand were their favorite reads to such an extent that these were probably the only books they had ever read. Not complicated, but more confused from reading so much of greed and fear

It certainly was not dangerous for any of these people---they lived in untouchable areas where the police escorted any 'suspicious types' of various colors and cultures out of the area in the backseat of the patrol car; all of this in Los Angeles, of all places, right? How dangerous was that?

Sorry to be so boorish, but ---the world a complicated and dangerous place? I don't think so, it seems a wonderful and generous place to me when I just live my life naturally without letting my mind run amok on constant doses of greed and fear.

Have a pleasant evening, sir                      om

Tue, 03/27/2012 - 08:24 | 2293805 tarsubil
tarsubil's picture

I totally agree. All you have to do is jump through the hoops, which may or may not be set on fire, and love your privileges and you will get your daily ration. Can life get any better? I mean, it has lasted, like, 60 years or something. That is a really really long time!

Tue, 03/27/2012 - 03:37 | 2293596 Renfield
Renfield's picture

M'sieur Pierre

I've thought often about the "nightmare" scenario you describe. I agree that when the chips are down, the criminal counterfeiters in charge of our central banks will make a grab for whatever real money they can steal from those of us who hold it. But I keep coming to the same points in my own mind:

"Personal gold ownership would be banned."
"Purchase and sale of gold between individuals would be banned, in all countries. There would be a problem in countries like India."

1) This isn't the 1930s anymore, when the trusting sheeple lined up to hand over their money to their betters in gov. The sheep have been fleeced of their real wealth for a long time now, and have never got it back. Those of us who do hold real gold in storage tend to be a canny, distrustful lot. We have gone thru a lot to make sure that we are not left with a worthless pile of government scrip, and it will take a lot more than gov passing some unenforceable law to make us dig it up from where it is hid and hand it on over to them.

"Those who do not sell their gold to the government during the initial call-in, would later have to use criminal channels to sell their gold for fiat currencies that will still be used, along with ration cards, for daily transactions.  In war time Germany, without a ration card or a home garden, a person could have starved, even with a pocket full of money."
"The sale of call-in gold to the government will have gold owners with their backs to the wall, with confiscation windfall taxes imposed ... 80-90%?... and with the final settlement made in a fiat currency. The former gold owner would be lucky if he is paid in cash.  If he is unlucky he will be paid in treasury bonds that will mature in a few years.  By then, with hyper inflation a good possibility, the former gold owner could be destitute."

2) If gold is used as money by gov anywhere, then it will be seen as money everywhere. I don't think trying to manage two separate currency systems (one for gov, one for sheep) will work for long, if it ever works at all. There is no way people are going to believe gold isn't money, if the gov is using it to make payments to international creditors. Fiat works, first of all, only if people BELIEVE in it. The gov may try to legislate such confidence but when it comes to that, they've already lost that confidence and all the laws in the world won't make it come back. At the point where fiat and gold meet, where one is measured in terms of the other (even if it's only to mediate between the gov and the serfs), at that point is where the relative value of each is plain to all.

3) Who holds gold today? The Rothschilds, Rockefellers, et al. - who are not going to hand it over to some dying government. In fact, gov will be lucky if those families allow sovereigns and central banks to hold much of it themselves. Who else? A few mistrustful citizens, most of whom would choose flight or "bankruptcy" over lining up to be fleeced. Who else? Other central banks. There are a few "weak hands" (e.g., Greece, Canada) who can be tricked/coerced/promised/persuaded into handing over what they do have, but for the most part this process is well underway, and soon the "small fry" govs will be purged of their wealth. That will leave: i) major gold-holding sovereigns/central banks, ii) wealthy aristocrats, iii) a handful of serfs who are probably not worth the trouble of chasing down.

In other words, it will be the same as it ever was. (I don't believe a "strong middle class" is a part of most of human history. Maybe this era is a sort of "reversion to mean", in social terms.) What I think we're mourning here is the loss of our middle class, the engine of productivity that made the 20th century the unique time that it was, and the socially-mobile dream that went with it. As for us gold holders, yes I think we have a few tough years ahead of us. That's nothing new and I don't see it lasting long. "Consent of the governed" isn't an ideal; but is the reason why gov fiat works or doesn't.

That said, I have every expectation that gov will attempt what you are talking about. They will inevitably fail. I also agree with you re: the monetary value of silver. In the same way, silver, the "poor man's gold", has always been currency and for the reasons you describe, I believe it will take its usual place. Bottom line: gov will attempt what you suggest, and all us gold holders have to do is wait for awhile until it inevitably fails, which won't be long. We will need to have enough supplies stocked up to last thru that time, of course. I hope that's part of the plan of every gold holder who reads here.

Tue, 03/27/2012 - 04:00 | 2293629 The Navigator
The Navigator's picture

I favor silver for the reasons you mention, although for 'grab and run' purposes, gold is a better bet - 1-2 pelican boxes @ 50lbs each will get you a long way from here.

I have both, but mainly silver - I don't recall any gov't action to confiscate silver in recent history. Whatever your holdings, diverify with some collector coins, bars, junk coins, etc so you have some argument to keep some of your PMs and not get Corzined of all your physicals, IMHO.

Tue, 03/27/2012 - 05:15 | 2293668 e-nergy
e-nergy's picture

"...not get Corzined ..."



Tue, 03/27/2012 - 08:11 | 2293792 GetZeeGold
GetZeeGold's picture



"...not get Corzined ..."


Ummm.....I think it's a little late for that. All we can do now is pray for some clawbacks.


Tue, 03/27/2012 - 10:41 | 2294208 SubjectivObject
SubjectivObject's picture

Yeah but the meaning of Corzined sticks [it to them].

Tue, 03/27/2012 - 07:46 | 2293754 graspAU
graspAU's picture

Silver was confiscated from private hands after gold. FDR used extremely high seniorage charges to take the metal for years. I think it started here:

EO 6814......
August 9, 1934
By virtue of the authority vested in me by the Silver Purchase Act of 1934 and of all other authority vested in me, I, Franklin D. Roosevelt, President of the United States of America, do hereby require the delivery of all silver situated in the continental United States on the effective date hereof, by any and all persons owning, possessing, or controlling any such silver...

Tue, 03/27/2012 - 05:42 | 2293677 PMakoi
PMakoi's picture

re: #10 land and rental properties...

Plan for higher property taxes.  Consider carefully, if you're doing this as "investment".  If you're doing it as personal escape, pick a no property tax State (doesn't mean that won't change). 

Taxation will be the greatest threat to one's wealth and property.

Mon, 03/26/2012 - 23:55 | 2293381 loveyajimbo
loveyajimbo's picture

Well, if you think the US debt is payable, short to intermediate, that Japan and Europe are financially sound, that the Middle East will suddenly declare peace for the next 50 years, that the dollar will remain the reserve currency, that the US economy will boom with no industrial base, that rates will never rise, that China is our friend, and that no additional money will ever be created out of thin air by central banks... then... er... buy gold anyway, it will reward you well by the time you are discharged from the lunatic asylum.

Tue, 03/27/2012 - 02:42 | 2293578 oldman
oldman's picture


I'm sorry, but " that the Middle East will suddenly declare peace for the next 50 years" causes me to ask:

when did the Middle East declare war? I have been in nearly constant touch with the world news these past two years and never heard a word about the declaration of war by the nations of the Middle East.

Gold is nice, it is pretty--i like gold---I think buying gold is a good idea.

Thank you            om

Tue, 03/27/2012 - 06:51 | 2293724 smiler03
smiler03's picture

Iraq declaring war against Iran.

Iraq invading Kuwait.


Tue, 03/27/2012 - 12:33 | 2294683 oldman
oldman's picture


Thanks, dude,

I had no idea that Iraq invaded Iran or that Iraq had invaded Kuwait in the past two years!

I suppose that some will say that the US 'pull-out' was to blame, but wait---

We still have a nominal presence there, right? I mean we did build a pretty swank embassy, or so I read.

Those Iraquis certainly love to to go to war----and I never heard a thing about this even though I've had my finger on the pulse of the planet.

just an old fool               om

Tue, 03/27/2012 - 03:23 | 2293606 AnAnonymous
AnAnonymous's picture

Well, if you think the US debt is payable, short to intermediate,


Well, the goal is not to pay back the debt but to consume as much as more possible using debt.

And noone consume more than using debt that wont be repaid. Anytime you pay on your debt, that is a share of consumption you wont make.


that the dollar will remain the reserve currency, that the US economy will boom with no industrial base


The USD is on the blocks to remain the world reserve currency as long as a reserve currency serves its purpose, that is allowing free ride, getting something against nothing.

The current stop is when the scheme breaks because well, there will be less resources to acquire throughout the world.

Having a reserve currency is enough to boom.

Tue, 03/27/2012 - 03:27 | 2293611 Vic Vinegar
Vic Vinegar's picture

U be my fave.

Baby I got your money.

Buy physical. 

Mon, 03/26/2012 - 23:55 | 2293382 mess nonster
mess nonster's picture

Gold is a barbaric relic. but what's wrong with that? I'm a barbaric relic, and it doesn't bother me at all.

Tue, 03/27/2012 - 02:13 | 2293554 Deo vindice
Deo vindice's picture

+1 for anyone that can combine humility with humour.

Mon, 03/26/2012 - 23:56 | 2293384 Campagnolo
Campagnolo's picture

by 2015-16 the US will collapse, that's when gold would be around $5,000-$10, rush at all, manipulate all you want/need bankers, gold will prevail!

Mon, 03/26/2012 - 23:56 | 2293385 UP4Liberty
UP4Liberty's picture

Sit tight - and be right!  You'll be swell - if you never sell!

The sheeple will realize all too late how their "paper bills of credit" - aka FRN's - aren't worth the paper they're printed on.

Tue, 03/27/2012 - 00:01 | 2293394 mess nonster
mess nonster's picture

Are you the Dr. Bronners of gold-buggery?

Tue, 03/27/2012 - 00:34 | 2293434 Manthong
Manthong's picture

Speaking of buggery..

OT, but interesting:

“Strauss-Kahn charged in alleged prostitution ring”

Somebody must be REALLY PO’d at this guy.


Tue, 03/27/2012 - 02:16 | 2293557 cranky-old-geezer
cranky-old-geezer's picture



The sheeple will realize all too late how their "paper bills of credit" - aka FRN's - aren't worth the paper they're printed on.

Obama's Iran sanctions might indirectly cause a dollar collapse and loss of WRC status.

Responding to Obama's Iran sanctions, locking Iran out of the inter-bank SWIFT settlement system, the entire east asian bloc is developing a new system of inter-bank trade payment settlement between nations that doesn't need the US dollar.

Iranian oil is the motivation now, but once the new system is operational it can be used for any type of trade between nations, and more nations wanting to get away from dollar hegemony will join in.

This new east asian inter-bank system is the biggest threat to the dollar's world reserve currency status.

Obama's Iran sanctions are the motivation for this new system being developed. 

Obama might cause the collapse of the US dollar far sooner than Bernanke's printing press will.

Tue, 03/27/2012 - 03:31 | 2293615 AnAnonymous
AnAnonymous's picture

Responding to Obama's Iran sanctions, locking Iran out of the inter-bank SWIFT settlement system, the entire east asian bloc is developing a new system of inter-bank trade payment settlement between nations that doesn't need the US dollar.

Iranian oil is the motivation now, but once the new system is operational it can be used for any type of trade between nations, and more nations wanting to get away from dollar hegemony will join in.

This new east asian inter-bank system is the biggest threat to the dollar's world reserve currency status.

Obama's Iran sanctions are the motivation for this new system being developed.

How? The strength of the USD (and the reason why there wont be hyperinflation) is because it captures and extorts from commodity rich countries.

No country or society can sustain itself without an access to commodities.

Shunting the USD? that is isolating from the world commodities market.

All that for Iranian oil which is a small fraction of the global oil market?

Obama's administration moves shows that US citizens know where the USD strength lies.

That is all. It wont endanger the USD reserve currency status.

BRIC and the rest could offer much better deals to trapped rich commodity countries, advancing their best interests through trade, negotiation and diplomacy.

But US citizens wont let that happen. US citizens are ready to unstabilize large areas of the world in order to justify military deployment, making the escape move impossible and making certain that the USD reserve status is maintained.

You do not run away from an extortion scheme by knocking on the door of the extorter, and waving goodbye.

Tue, 03/27/2012 - 05:49 | 2293681 PMakoi
PMakoi's picture

Righteous!  Maybe we can quit electing Presidents and start a system of Dons?

Tue, 03/27/2012 - 12:28 | 2294657 XitSam
XitSam's picture

No, it is worth the paper it is printed on. It is good quality paper.

Mon, 03/26/2012 - 23:58 | 2293389 MagicHandPuppet
MagicHandPuppet's picture

But you can't eat it

Tue, 03/27/2012 - 00:00 | 2293391 knukles
knukles's picture

But you can fellate, fondle and fuck it.

Tue, 03/27/2012 - 00:05 | 2293406 MagicHandPuppet
MagicHandPuppet's picture

Ok!! In that case I'm going all in bitchez!

Tue, 03/27/2012 - 04:54 | 2293656 ohhhhhbaaaaahhh...
ohhhhhbaaaaahhhhhhhhhmaaaaaahhhhh's picture

Oh yes you can eat it. Gold is a natural colourent. Its the E175.

It was used in cooking in the Middle Ages.

Mon, 03/26/2012 - 23:59 | 2293390 lasvegaspersona
lasvegaspersona's picture

Which is more likely to cause the price of gold to rise: less than 1% of the population buying paper instruments that can be minted fresh daily? OR the central banks (and their big friends) suddenly deciding NOT to sell?

Tue, 03/27/2012 - 00:04 | 2293403 mess nonster
mess nonster's picture

Yah. Something tells me that the Rothchilds are a few moves ahead of us on this whole gold thing. I don't know why, just a feeling I get...

Tue, 03/27/2012 - 00:53 | 2293455 Vic Vinegar
Vic Vinegar's picture

Not a bad take, mess.  However

buying gold is one of the more honest things you can do, as it's a vote for real money and it gives you something at the end of the day that people want.  Buy physical.

Tue, 03/27/2012 - 00:03 | 2293396 LongSoupLine
LongSoupLine's picture

Bring back the cartoon bears!

Tue, 03/27/2012 - 00:03 | 2293398 TheSilverJournal
TheSilverJournal's picture

One failed worldwide fiat ponzi coming right up!

Tue, 03/27/2012 - 00:03 | 2293399 swamp
swamp's picture

Get gold, as little Timmy didn't dispute 50 trillion last week.

Benjamin Fulford:


Posted by benjamin

March 26, 2012

The new financial system is online now and abundant financing is either already or soon to be made available, according to dragon family representatives. The final take down of the criminal cabal has also begun in earnest with over 200 senior bankers arrested and 450 resigned last week alone, these sources say. Japan is also now doing the final paperwork needed to set up an international economic planning agency with an initial funding facility of $10 trillion or about 200 times what the World Bank lends every year, according to Japanese government sources. There will be some sort of announcement about this and other things on Tuesday evening, March 27th, 2012 Japan Standard Time according to illuminati and White Dragon Society sources. The arrest of some very high profile individuals is imminent.

The general structure of the financial cabal and its top leaders has also now been mapped to some extent. For example, the Rothschild family dynasty leaders have been identified. The Swiss branch of the family is run by David de Rothschild in Geneva, the French branch by Guy de Rothschild, the German branch by Rothschild family member and Hitler daughter Angelina Merkel and the British branch by Evelyn de Rothschild.

In the US, JP Morgan is a Rothschild front.

The Rockefeller family syndicate uses Goldman Sachs and Citibank as its major financial fronts. Bank of America is a front for the Italian black nobility behind the Vatican and the mafia, run in part by Peter Hans Kolvenbach, the former black pope. Pope malevolent the 16th is also a senior member of this satanic group.

The Nazi faction is run by Fuhrer George Bush Senior with Ben Bernanke acting as Deputy Fuhrer. Their chemical and pharmaceutical mass murder division is run by the Du Pont family.

The Bill and Melinda Gates foundation is now in Africa forcing families at gunpoint to accept the sterilization by vaccine of their daughters. In North America, Japan and elsewhere the mass sterilization by vaccine is taking place under the guise of protecting girls against cervical cancer. Message to Bill Gates: your company and foundation are going to be confiscated and you are going to spend the rest of your life making restitution.

The United States government has been so compromised by these and other cabal families and their foundation fronts that the upcoming US Presidential “election,” is nothing more than a power struggle between the Chicago mob and their front man Mitt Romney versus the Bush Texas illegal drug mafia and their guy Jeb Bush.

Hopefully the new financial system, once it is fully implemented, will pull the plug on the entire farcical show and Americans will be able to choose their own leaders based on true information provided by free media. For now though, electronically rigged elections and corporate propaganda provide sham democracy for dumbed down and drugged up Americans.

However, a look at the pentagon budget for this upcoming year shows they have dedicated plenty of resources to financing reserve troop units inside the United States. This does not mean they are preparing to put average Americans into FEMA camps as feared by many. To the contrary, they are preparing for a mass round up of cabal agents and proxies, according to pentagon and CIA sources.

There was a clear indication of change on March 20th, when instead of having the cabal scheduled earthquake hit Tokyo, a magnitude 7.4 earthquake hit Oaxaca, Mexico exactly when President Obama’s daughter was vacationing there. Furthermore, this earthquake was advertised in advance through pamphlets distributed locally. This is a clear sign the bad guys no longer play the HAARP.

Another sign of change was the public rebuke of Obama, Clinton and cabal controlled media outlets when the official Chinese government news site, Xinhua stated that North Korea was not on the agenda of the 50 nation nuclear security summit taking place in Soeul, Korea this week. The cabal propaganda media has been carrying a fake story about nuclear danger from North Korea even though that country has already announced it will cease nuclear weapons development.

The secret agenda behind this 50 nation summit is an attempt to steal 200 tons of gold that is in South Korean warehouses. That theft is not going to be allowed to go ahead so the cabalists will leave the summit empty handed.

There was also plenty of speculation about a coup d’etat in China last week. All that happened was that a Maoist cabal agent Bo Xilai was removed from power after one of his henchmen was discovered taking instructions from the US consulate in Chongqing, according to MI6 sources. China is still on course for a stable and harmonious regime change-over later this year, according to White Dragon Society sources. The talk of a Maoist coup d’etat was wishful cabalist thinking fanned by cabalist media outlets.

Speaking about fake stories, the “White Hats” group on the internet, consisting of Bush agent Mike Cotrell and Hawaii resident Danny Gammage, has been spewing out laughable libel (such as this writer is a clone).

More damagingly, they managed to fool Lord Blackheath of the UK Upper House of Parliament with a fake story about $15 trillion that he raised in Parliamentary session. The House of Lords is now going to summon a White Dragon Society ally to testify about what is really going on in the financial wars.

The London financial district is headed for further purges and the talk is that Lord Sassoon is headed for a big fall. The investigation may even extend to the UK Royal family, European CIA sources say.

In Japan, meanwhile, the status quo is expected to remain on hold until the March 31st end of the fiscal year because of overwhelming workloads in the bureaucracy and the parliament. After March 31st, there will be concrete negotiations taking place involving the Finance Ministry, Bank of Japan, Prime Minister’s office and Royal Household Agency aimed at setting up a new international economic planning agency.

The Japanese self-defense forces and bureaucracy are also planning a major purge of cabalist puppets in the Japanese Parliament, banks, corporations and media.

Overall, things are looking very good. However, unless we see these senior cabalists on world TV confessing to their crimes, we must not be complacent. Until this financial war is over, keep your powder dry and

Tue, 03/27/2012 - 00:09 | 2293409 MagicHandPuppet
MagicHandPuppet's picture

What an imagination that attention seeker has. How can one person produce so many lies? He could have been a politician if he just kept the stories within the realm of possibility.

Tue, 03/27/2012 - 00:26 | 2293417 DavidPierre
DavidPierre's picture



Once you know what you are looking for, you can do some digging and find all the most significant articles published online about this strange story when it first broke in June, 2009.


Original Bloomberg article on the scandal:  

Daily Kos summary of links describing what may have happened:,Italy,and-US,-134-Billion-in-US-Bonds-Smuggling-Case  

Asia Times article on the issue, which has a lot more detail:  

In these two articles, “The Underground Investor” analyzed the evidence and clearly established how strange this whole story really was:


CONFIRMED: TheTrillion Dollar lawsuit that could end financial tyranny




Tue, 03/27/2012 - 01:10 | 2293476 putaipan
putaipan's picture

like i said in the japanese thread - "gullible, but some of the people whispering in his ear know some deeeeep shit"

thank you swamp, was just asking for this.

Tue, 03/27/2012 - 01:04 | 2293477 Mary Wilbur
Mary Wilbur's picture

What crap

Tue, 03/27/2012 - 01:35 | 2293514 nathan1234
nathan1234's picture

While a lot of it may be crap- The fact is that the financial system is in real nasty smelly shit led by the Fed in cahooots with Obama and cronies.


Americans are responsible for all the shit around the world without any doubt.


It's time Americans took action on their own to set right the system before they are consumed by it.


Tue, 03/27/2012 - 02:51 | 2293581 oldman
oldman's picture


Right on!

The truth will set you free

You are free!                          om

Tue, 03/27/2012 - 00:12 | 2293413 Hangfire
Hangfire's picture

How many In-N-Out double double burgers (w/ grilled onions) can I buy with a double eagle?   I'm pretty much set for everything else, I'm just not sure if I can survive without In-N-Out, then again they run such a sound business they would probably be the last ones standing!

Tue, 03/27/2012 - 01:13 | 2293491 putaipan
putaipan's picture

mmmmmm... in n''s been 26 freaking years and i can still taste it.  crap! why d'ya have to go and do that?

Tue, 03/27/2012 - 01:25 | 2293508 Troll Magnet
Troll Magnet's picture

if you keep eating that pink slime shit, you won't be around long enough to enjoy the fruits of your double eagles!

Tue, 03/27/2012 - 01:32 | 2293512 Elmer Fudd
Elmer Fudd's picture

Hangfire, you need pre65 USA quarters, Pretty sure there's enough silver in that coin to get you a double double with fries and maybe even a milkshake

Tue, 03/27/2012 - 00:46 | 2293444 Tom Green Swedish
Tom Green Swedish's picture

Who gives a shit?

Tue, 03/27/2012 - 00:50 | 2293452 dark pools of soros
dark pools of soros's picture

No mention of tradition??

Tue, 03/27/2012 - 06:56 | 2293727 GetZeeGold
GetZeeGold's picture



I've got your tradition right here amigo......where do you want me to put it?


Tue, 03/27/2012 - 00:55 | 2293456 xtop23
xtop23's picture

Pretty light video but good information for new ZH readers perhaps. 

I think, more than likely, anyone who frequents this site probably has more than a passing interest and amount of research invested in why it is smart to own PM's and is well aware of the reasons given and pertinent history.

Personally, Id like to hear more about the countries that are currently in negotiations for return of their holdings from abroad, by who and by what amount is production being handled directly from miners to buyers without utilization of the comex et al, and whether or not a microphone was actively recording when Bernanke uttered the words, "When he asked me why don't we hold diamonds, I almost cringed man. God somebody get me a Valium."

On a side note, I just read Atlas Shrugged again, and it is as good now as it was in 2003.

Tue, 03/27/2012 - 01:09 | 2293484 LiquidityandLunacy
LiquidityandLunacy's picture

its tradition

Tue, 03/27/2012 - 03:05 | 2293590 infiniti
infiniti's picture

If you were an investor in the ETNs and suffered a loss, or have knowledge relating to events, please contact Jake Zamansky at (212) 742-1414, or by email at


Well, there was that Bernanke speech this morning.


Can I get my money back now?

Tue, 03/27/2012 - 01:12 | 2293489 Anarchyteez
Anarchyteez's picture

Just stack. Confusingly simple.

Tue, 03/27/2012 - 03:23 | 2293608 Vic Vinegar
Vic Vinegar's picture

Respirating, libertarian / evolving anarchist, with a background
in manufacturing.

I'm currently building a t-shirt line that will put a major sized burr
under the saddle of Banker occupation (as Max would say).

I would also like to advertise on ZH and make a ZH donation for
every shirt sold. coming to the net next week.

Hope to talk to you soon Tyler and thanks for your work.

Thanks for sharing

Tue, 03/27/2012 - 08:30 | 2293821 tarsubil
Tue, 03/27/2012 - 01:15 | 2293495 amanfromMars
amanfromMars's picture

And what is one to make of this tale ......

Trick or treat? Fact or fiction?  And in the big scheme of things, does it really matter, other than giving spivs something else to play with and create another market in dream trading and bubbles for bursting? 


Tue, 03/27/2012 - 01:17 | 2293503 drwillia1
drwillia1's picture

Markets coming to a crescendo

Tue, 03/27/2012 - 01:19 | 2293505 Dermasolarapate...
Dermasolarapaterraphatrima's picture

Lots of "barbarians" out there"

Turkish Government "Goes For Gold"; Seeks To "Transfer" Private Gold Holdings Into Bank System


India buys 200 tons gold from IMF

Sri Lanka Buys 10 Metric Tons of Gold

Russia is still buying gold - not selling it


Tue, 03/27/2012 - 01:57 | 2293538 meetired
meetired's picture

I'm a good little honkey Hispanic, and that nigra did me wrong.  We minorities get no respect when killing each other..


Who had bets on the whitey?  You lose.


But gold is forever.

Tue, 03/27/2012 - 03:12 | 2293600 Vic Vinegar
Vic Vinegar's picture

It's been a long time since I've seen mynhair.  Are you him?  Seems like it, 'cept that he liked miners over phyz.

What a terrible comment you had until the end.  What gives? 

Meet me in ZHchat and perhaps you can expand on your "wisdom". 

Buy physical.

Tue, 03/27/2012 - 02:04 | 2293546 evolutionx
evolutionx's picture


We now live in a world where governments print worthless pieces of paper to buy other worthless pieces of paper that combined with worthless derivatives, finance assets whose values are totally dependent on all these worthless debt instruments.  Thus most of these assets are also worth-less.

Tue, 03/27/2012 - 09:34 | 2293980 IrritableBowels
IrritableBowels's picture

How many times are you going cut and paste this?

Tue, 03/27/2012 - 02:15 | 2293556 chump666
chump666's picture

FRANKFURT (Dow Jones)--German market research group GfK's forward-looking consumer climate index will fall in April on higher oil prices after a six-month upward climb, data released Tuesday by Reuters news agency showed.
The index is expected to be 5.9 points for April, down from an unrevised 6.0 points in March and contrary to the rise to 6.1 points forecast by economists in a Dow Jones Newswires survey.
While GfK's overall consumer climate index refers to the following month, its sub-indexes--economic expectations, income expectations and buying propensity--refer to the current month.
The income expectations sub-index fell sharply in March, erasing nearly all of the previous month's marked gain. It fell to 34.3 points from 41.3 points in February.
After a fall in February, the economic expectations index rose to 7.2 points in March from 5.9 points in February.
The propensity to buy index fell slightly, to 38.6 points, from 39.2 points in February.

Tue, 03/27/2012 - 02:23 | 2293563 ivars
ivars's picture

These prediction charts have been matching the price development of silver and gold over last year pretty well (silver prediction for today made March 13, 2011 was between  32,5-33,0 USD), and I hope will continue to do so:

Short term gold:

Short term silver:

Long term (2017) gold:

Long term ( 2017) silver:


Tue, 03/27/2012 - 21:40 | 2296193 MeelionDollerBogus
MeelionDollerBogus's picture

your image shows 100 to 300 $ / oz error of gold price vs the red line apparently following the action.

Why such a large error? What is the mathematical basis for this? You can see that I'm trying to nail it as close as possible without over-fitting data

you can see here visually where the basis is for the rate of change models are (52 week, 277 week)

you can see here what happens when I overfit the hourly data on gold (10yr dataset) to try the model (277 week) but it still gets a tight margin of error +/- $50/oz for months of data-set, +/- $100/oz at further extremes

and again here you can see visually what is the basis for me choosing the 277 week model. What is the math basis for your predictions? How can I convince myself they should be trusted? How can you tighten up the error-margin looking forward?

Tue, 03/27/2012 - 02:48 | 2293580 honestann
honestann's picture

In gold we trust.


Because gold is real, rare, durable, divisible, honest, consistent, has absolutely zero counterparty risk whatsoever, and cannot be created by financial preditors like central banksters and governments.  Oh, and gold today buys just about the same as it purchased 5000, 500, 50 and 5 years ago.  Imagine that!

In the modern times we live in today, when every government and [virtually] every large organization on earth is utterly dominated by predators, physical gold is a reasonable measure of financial self-protection.  However, paper gold is just a worthless piece of paper like all other pieces of paper.

PS:  Any real, physical, durable good that is difficult to produce is also perfectly fine to hold value.  Gold is simply the easiest to carry around and exchange as well as save.  If you don't like gold, buy platinum, palladium, silver, rhodium... or ammo.

Tue, 03/27/2012 - 04:36 | 2293651 jjsilver
jjsilver's picture

It is imperative the private for profit central bank be eliminated; the control of money must be returned to congress where it lawfully belongs.

5 USC 7311


An individual may not accept or hold a position in the Government of the United States or the government of the District of Columbia if he— (1) advocates the overthrow of our constitutional form of government; (2) is a member of an organization that he knows advocates the overthrow of our constitutional form of government; (3) participates in a strike, or asserts the right to strike, against the Government of the United States or the government of the District of Columbia; or (4) is a member of an organization of employees of the Government of the United States or of individuals employed by the government of the District of Columbia that he knows asserts the right to strike against the Government of the United States or the government of the District of Columbia.
Tue, 03/27/2012 - 06:18 | 2293701 mogul rider
mogul rider's picture

I use my bricks as painted door stops.

It just kindof lays there and holds the door open.


It's worth soemthin apeerently.

Tue, 03/27/2012 - 12:44 | 2294733 XitSam
XitSam's picture

Ah, that could explain the rash of door stop thefts recently.

Tue, 03/27/2012 - 07:20 | 2293739 tradewithdave
tradewithdave's picture

Has anyone identified who produced this video?  It appears to be in support of the recent Rotschild/Economist Magazine business editor's new book titled "In Gold We Trust" with its "money as technology" claim.

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