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Turkey Once Again Proves That Gold Is First And Foremost Money

Tyler Durden's picture


The Turkish central bank has doubled the amount of gold that lenders can hold in reserves (as opposed to paper money - Lira) as part of their reserve requirement changes. As the WSJ reports, this shift from 10% to 20% means that Turkish banks can use their shiny yellow metal as fungible money reserves against foreign currency deposits. This move follows closely on the heels of our comments on last week's 'gold transfer' efforts in Turkey to unleash some of the country's vast personal holdings of Gold. This effort to draw down on the nation's individual gold reserves - the traditional form of savings in Turkey - is part of Ankara's efforts to reduce a finance gap that is currently around 10% of GDP but more importantly it should serve as a lesson reality-check for Bernanke that gold is money and in the words of a 70-year-old housewife "In an emergency, I can convert [gold] to cash and I don't have to wait for the bank to say the asset has matured." It would seem a better store of value than the Lira over the past decade or two and we suspect incentives will have to rise considerably to 'help' the people part with their savings-gold.

It would seem the rise in the value of Gold (in Turkish Lira) has been a 'good' store of value for the Turkish people over the past two decades...


Chart: Bloomberg


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Tue, 03/27/2012 - 09:37 | 2293972 GetZeeGold
GetZeeGold's picture



Gold is backed by nothing.....but everything else is backed by gold.


Tue, 03/27/2012 - 09:39 | 2293997 spiral_eyes
spiral_eyes's picture

Gold is backed by scarcity, history, and the reality that you can't print more of it. 

Paper is backed by petty politics

Tue, 03/27/2012 - 09:40 | 2294006 Zero Govt
Zero Govt's picture

Gold is as asset class, prices go up and down

productivity is the only real (human) asset class, Gold reflects that just like any other commodity

Tue, 03/27/2012 - 09:51 | 2294041 goldfish1
goldfish1's picture

Yet as money, PM's function better than any other asset class.


Tue, 03/27/2012 - 10:13 | 2294101 Gully Foyle
Gully Foyle's picture


"Yet as money, PM's function better than any other asset class."

No. Anything that is commonly accepted as a medium of exchange between at least two parties will function with an equal effiency.

There is an old Freak Brothers quote about how weed would do better in times of no money than money would in times of no weed.

Same principle.

The real problem is people confuse mediums of exchange with wealth. Wealth is owning rescources and the land those rescources are on.

Why do you think some states own all the water including rainwater?

The reason PMs seem to be increasing in value is the dollar is decreasing in value. Thus PM's are equivalent to cheese/milk/eggs, but closer to say truffles due to availability.


Tue, 03/27/2012 - 10:30 | 2294165 Badabing
Badabing's picture

My physical gold just vaporized!!!!!!

Tue, 03/27/2012 - 10:39 | 2294202 Transformer
Transformer's picture

The quote is, "Weed will get you through times of no money, better than money will get your through times of no weed."

Tue, 03/27/2012 - 10:51 | 2294241 Gully Foyle
Gully Foyle's picture


Fuck dude, all the weed I smoked then I'm surprised i recalled the quote or the source in any way.

Thanks for the correction.

Tue, 03/27/2012 - 10:30 | 2294166 GOSPLAN HERO
GOSPLAN HERO's picture

Gold is payment in full.

Tue, 03/27/2012 - 09:53 | 2294047 Quinvarius
Quinvarius's picture

Gold is money.  There are several differences between money and a commodity that people refuse to acknowledge at their own peril.  Anyone can store gold and silver indefinitely in their closet.  They never go bad like corn.  They cost nothing to store.  They take up little space.  Among other reasons, that is why gold is money and corn is not money.

Tue, 03/27/2012 - 10:16 | 2294112 Gully Foyle
Gully Foyle's picture


How well is "gold as money" working in Utah?

Anyone having their slivers accepted in a Utah 7/11 for Slurpies and a fillup of premium?

Tue, 03/27/2012 - 10:44 | 2294216 ParkAveFlasher
ParkAveFlasher's picture

Thanks for confirming the absence of a bubble.

Tue, 03/27/2012 - 11:35 | 2294398 chipshot
chipshot's picture

this dude just smacks of orwellian govi thick you can taste it

Tue, 03/27/2012 - 11:36 | 2294399 Yardfarmer
Yardfarmer's picture

some small scale grocery stores in CA have been accepting silver in payment.

Tue, 03/27/2012 - 12:20 | 2294621 Nage42
Nage42's picture

If the guy at the pump has a brain in his head, he should step in and say: "sure man, our 'official' exchange rate for direct silver to gas is 1 toz to 30$ gas dollars, and pull it out of his own wallet as he walks into the back room...

But then again, how many savy gas jockeys are we expecting to run into nowadays?  <5%  How many get clued 'da fsck in 2 years from now ~20% and 5 years from now? North of 50%?

Just pulling numbers outa my ass (as 'ya do!), but I'm thinking I'll not be far off..


Tue, 03/27/2012 - 15:47 | 2295324 LongBalls
LongBalls's picture

Your assuming PM investors are dumb enough to exchange them at the 7/11 when they can use FRN dyed toilet paper. 

Dollars = 2% less value y.o.y. (If you believe the gov's's more like 10%)

Gold = 10% plus in value y.o.y.

You decide.

Even when the proof such as the chart in the article is slapping them in the face some people refuse to SEE TRUTH!

Tue, 03/27/2012 - 16:43 | 2295567 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 .....

Wed, 03/28/2012 - 07:35 | 2296729 prole
prole's picture

Dear SPambot-

A- ZHers aren't retards exept for one Chinese idiot, even he isn't stupid enough to fall for your scam

B- If, on the outside chance of one in ten billion, that you actually know a way to make 16k per month, you would be busy DOING IT, not begging others to come run get the money.

Conclusion- nobody here is stupid enough for your scam. Kill yourself.

Tue, 03/27/2012 - 09:50 | 2294037 Rahm
Rahm's picture

Barbaric relic, bitchez!

Tue, 03/27/2012 - 10:04 | 2294072 Zero Govt
Zero Govt's picture

PM's do not perform better "as money" ...because all money is run by the same systemic vandals, monopolists (bankers and Govt) who have wrecked every monetary system in the world dating back mellenium

Gold and Silver has been wrecked (debased) by the same crew, be it the Roman Empire, Henry VIII or Ben Bernanke... so it matters not what money is, it matters what system you operate

the only money system that'll work is a free market (competition) in money... no rules on money and no monopolies on money ..let the market free (of Govt intervention) and let it compete

Tue, 03/27/2012 - 11:16 | 2294323 Bluntly Put
Bluntly Put's picture

I tend to agree. In that scenario gold rises to the top as the ultimate extinguisher of debt. In all forms gold is the foundation of our "monetary" system, as it represents the standard unit of account, the future value of any bill of credit requires a standard unit who's value must be assumed constant.

Paper currency is the poorest substitute for a standard unit of account as its value is completely inelastic and even in the world of nano second trading, completely unquantifiable. Only gold can hold the place of a standard unit of account, this history has documented beyond debate.

Tue, 03/27/2012 - 14:10 | 2294997 Esso
Esso's picture

Log scale inflation, bitchez!

Tue, 03/27/2012 - 10:18 | 2294119 GOSPLAN HERO
GOSPLAN HERO's picture

From Genesis 2 through Revelation 21 the Bible refers to gold and silver no less than 783 times.

Tue, 03/27/2012 - 10:45 | 2294222 ParkAveFlasher
ParkAveFlasher's picture

RIGHT.  And as far as taxes are concerned, payable in salted metal, "render unto Caesar what is Caesar's".  The wisdom is buried in the ancient texts like, well, like gold.

Tue, 03/27/2012 - 12:24 | 2294639 Peter Pan
Peter Pan's picture

Gold is first and foremost backed by man's stupidity as evidenced by war, deficit spending and out of control bankers. Minus those things and fiat might have had a chance. No chance of those things ever stopping so just hold gold and some silver.

Tue, 03/27/2012 - 10:14 | 2294106 GOSPLAN HERO
GOSPLAN HERO's picture

Gold has been used as money for over 5000 years ... somebody likes gold.

Tue, 03/27/2012 - 09:33 | 2293974 Bazinga
Bazinga's picture

I can see the long arm of Ankara reaching into the pockets of the Turkish citizens...

Tue, 03/27/2012 - 09:43 | 2294013 Zero Govt
Zero Govt's picture

politicos will reach for (rob) anyone and anything when they're in a hole of their own digging

"..the grasping hands, grab all they can.." (Depeche Mode)

Tue, 03/27/2012 - 09:34 | 2293978 Barry Mcokiner
Barry Mcokiner's picture

Tradition bitchez


Tue, 03/27/2012 - 09:35 | 2293983 francis_sawyer
francis_sawyer's picture

Why IN HELL would they ever want to enter the Eurozone?

Tue, 03/27/2012 - 09:38 | 2293995 GetZeeGold
GetZeeGold's picture





Tue, 03/27/2012 - 09:45 | 2294019 francis_sawyer
francis_sawyer's picture

'Tradition' in Europe = getting ass-raped by a Rothschild (without a reach around) because the other two hands are busy stealing your gold...

Tue, 03/27/2012 - 13:39 | 2294927 e-recep
e-recep's picture

hahaha, that was good.

Tue, 03/27/2012 - 10:19 | 2294120 Sudden Debt
Sudden Debt's picture

So their unemployed can drive straight into Europe without border control to find work and send the money back home to Turkey. A bit like Poland did.

Tue, 03/27/2012 - 09:37 | 2293994 centerline
centerline's picture

Freegold people are probably peeing all over themselves.

(note: I don't know enough about the mechanics of a freegold system here to really critique it, but I do like the core concepts of the freegold approach - FOFOA is one of the sites I visit from time to time).

Tue, 03/27/2012 - 10:03 | 2294076 goldfish1
goldfish1's picture

Thank you. Never heard that term - freegold. Looks interesting. Will read up.

Tue, 03/27/2012 - 12:15 | 2294595 dark pools of soros
dark pools of soros's picture

to have freegold you need a free market so i don't what FOFOA is smoking but all that stuff works well on the white board

Tue, 03/27/2012 - 09:38 | 2293996 Its_the_economy...
Its_the_economy_stupid's picture

But, but, you can't eat it and it doesn't produce a return/dividend.

Tue, 03/27/2012 - 09:40 | 2294005 GetZeeGold
GetZeeGold's picture



Yeah.....just rising year over year for 11 years


Tue, 03/27/2012 - 10:11 | 2294095 Terminus C
Terminus C's picture

gold has not risen over the last eleven years...

Tue, 03/27/2012 - 10:45 | 2294219 GetZeeGold
GetZeeGold's picture



These are not the droids you're looking for.


Tue, 03/27/2012 - 10:48 | 2294227 ParkAveFlasher
ParkAveFlasher's picture

TRUE.  It's price denominators have collectively been devalued.  Still worth 15-16 barrels of crude.

Wed, 03/28/2012 - 07:45 | 2296741 prole
prole's picture

gold has not only risen over the last eleven years, gold has risen over the last one hundred and eleven years, and was stable for the last three thousand one hundred and eleven years.

I would say gold has "risen" for the last forever, considering the fact that gold keeps its value, while paper fiat currency schemes crash and burn by the wayside all while gold shines.

Examples- "Continentals, US Dollars, Zimbabwe Dollars"

Tue, 03/27/2012 - 10:38 | 2294197 Badabing
Badabing's picture

Your both right it’s a great floor wax and desert topping!

Tue, 03/27/2012 - 10:41 | 2294209 Badabing
Badabing's picture

The big boyz lease it out for a dividend, what about that grasshopper.

Tue, 03/27/2012 - 09:37 | 2293998 Quinvarius
Quinvarius's picture

This is the kind of stuff that happens when you let a raggy unqualified housewife become Secretary of State and she threatens to kick people out of the SWIFT system.  The dollar has been fatally undermined.

Tue, 03/27/2012 - 10:15 | 2294111 Gully Foyle
Gully Foyle's picture


10 Reasons Why The Reign Of The Dollar As The World Reserve Currency Is About To Come To An End

The following are 10 reasons why the reign of the dollar as the world reserve currency is about to come to an end....

#1 China And Japan Are Dumping the U.S. Dollar In Bilateral Trade

A few months ago, the second largest economy on earth (China) and the third largest economy on earth (Japan) struck a deal which will promote the use of their own currencies (rather than the U.S. dollar) when trading with each other.  This was an incredibly important agreement that was virtually totally ignored by the U.S. media.  The following is from a BBC report about that agreement....

China and Japan have unveiled plans to promote direct exchange of their currencies in a bid to cut costs for companies and boost bilateral trade.

The deal will allow firms to convert the Chinese and Japanese currencies directly into each other.

Currently businesses in both countries need to buy US dollars before converting them into the desired currency, adding extra costs.

#2 The BRICS (Brazil, Russia, India, China, South Africa) Plan To Start Using Their Own Currencies When Trading With Each Other

The BRICS continue to flex their muscles.  A new agreement will promote the use of their own national currencies when trading with each other rather than the U.S. dollar.  The following is from a news source in India....

The five major emerging economies of BRICS -- Brazil, Russia, India, China and South Africa -- are set to inject greater economic momentum into their grouping by signing two pacts for promoting intra-BRICS trade at the fourth summit of their leaders here Thursday.

The two agreements that will enable credit facility in local currency for businesses of BRICS countries will be signed in the presence of the leaders of the five countries, Sudhir Vyas, secretary (economic relations) in the external affairs ministry, told reporters here.

The pacts are expected to scale up intra-BRICS trade which has been growing at the rate of 28 percent over the last few years, but at $230 billion, remains much below the potential of the five economic powerhouses.

#3 The Russia/China Currency Agreement

Russia and China have been using their own national currencies when trading with each other for more than a year now.  Leaders from both Russia and China have been strongly advocating for a new global reserve currency for several years, and both nations seem determined to break the power that the U.S. dollar has over international trade.

#4 The Growing Use Of Chinese Currency In Africa

Who do you think is Africa's biggest trading partner?

It isn't the United States.

In 2009, China became Africa's biggest trading partner, and China is now aggressively seeking to expand the use of Chinese currency on that continent.

A report from Africa’s largest bank, Standard Bank, recently stated the following....

“We expect at least $100 billion (about R768 billion) in Sino-African trade – more than the total bilateral trade between China and Africa in 2010 – to be settled in the renminbi by 2015.”

China seems absolutely determined to change the way that international trade is done.  At this point, approximately 70,000 Chinese companies are using Chinese currency in cross-border transactions.

#5 The China/United Arab Emirates Deal

China and the United Arab Emirates have agreed to ditch the U.S. dollar and use their own currencies in oil transactions with each other.

The UAE is a fairly small player, but this is definitely a threat to the petrodollar system.  What will happen to the petrodollar if other oil producing countries in the Middle East follow suit?

#6 Iran

Iran has been one of the most aggressive nations when it comes to moving away from the U.S. dollar in international trade.  For example, it has been reported that India will begin to use gold to buy oil from Iran.

Tensions between the U.S. and Iran are not likely to go away any time soon, and Iran is likely to continue to do what it can to inflict pain on the United States in the financial world.

#7 The China/Saudi Arabia Relationship

Who imports the most oil from Saudi Arabia?

It is not the United States.

Rather, it is China.

As I wrote about the other day, China imported 1.39 million barrels of oil per day from Saudi Arabia in February, which was a 39 percent increase from one year earlier.

Saudi Arabia and China have teamed up to construct a massive new oil refinery in Saudi Arabia, and leaders from both nations have been working to aggressively expand trade between the two nations.

So how long is Saudi Arabia going to stick with the petrodollar if China is their most important customer?

That is a very important question.

#8 The United Nations Has Been Pushing For A New World Reserve Currency

The United Nations has been issuing reports that openly call for an alternative to the U.S. dollar as the reserve currency of the world.

In particular, one UN report envisions "a new global reserve system" in which the U.S. no longer has dominance....

"A new global reserve system could be created, one that no longer relies on the United States dollar as the single major reserve currency."

#9 The IMF Has Been Pushing For A New World Reserve Currency

The International Monetary Fund has also published a series of reports calling for the U.S. dollar to be replaced as the reserve currency of the world.

In particular, one IMF paper entitled "Reserve Accumulation and International Monetary Stability" that was published a while back actually proposed that a future global currency be named the "Bancor" and that a future global central bank could be put in charge of issuing it....

"A global currency, bancor, issued by a global central bank (see Supplement 1, section V) would be designed as a stable store of value that is not tied exclusively to the conditions of any particular economy. As trade and finance continue to grow rapidly and global integration increases, the importance of this broader perspective is expected to continue growing."

#10 Most Of The Rest Of The World Hates The United States

Global sentiment toward the United States has dramatically shifted, and this should not be underestimated.

Decades ago, we were one of the most loved nations on earth.

Now we are one of the most hated.

If you doubt this, just do some international traveling.

Even in Europe (where we are supposed to have friends), Americans are treated like dirt.  Many American travelers have resorted to wearing Canadian pins so that they will not be treated like garbage while traveling over there.

If the rest of the world still loved us, they would probably be glad to continue using the U.S. dollar.  But because we are now so unpopular, that gives other nations even more incentive to dump the dollar in international trade.

So what will happen if the reign of the U.S. dollar as the world reserve currency comes to an end?

Well, some of the potential effects were described in a recent article by Michael Payne....

"The demise of the dollar will also bring radical changes to the American lifestyle. When this economic tsunami hits America, it will make the 2008 recession and its aftermath look like no more than a slight bump in the road. It will bring very undesirable changes to the American lifestyle through massive inflation, high interest rates on mortgages and cars, and substantial increases in the cost of food, clothing and gasoline; it will have a detrimental effect on every aspect of our lives."

Most Americans don't realize how low the price of gasoline in the United States is compared to much of the rest of the world.

There are areas in Europe where they pay about twice what we do for gasoline.  Yes, taxes have a lot to do with that, but the fact that the U.S. dollar is used for almost all oil transactions also plays a significant role.

Today, America consumes nearly a quarter of the world's oil.  Our entire economy is based upon our ability to cheaply transport goods and services over vast distances.

So what happens if the price of gasoline doubles or triples from where it is at now?

In addition, if the reign of the U.S. dollar as global reserve currency ends, the U.S. government is going to have a much harder time financing its debt.

Right now, there is a huge demand for U.S. dollars and for U.S. government debt since countries around the world have to keep huge reserves of U.S. currency lying around for the sake of international trade.

But what if that all changed?

What if the appetite for U.S. dollars and U.S. debt dried up dramatically?

That is something to think about.

At the moment, the global financial system is centered on the United States.

But that will not always be the case.

The things talked about in this article will not happen overnight, but it is important to note that these changes are picking up steam.

Under the right conditions, a shift in momentum can become a landslide or an avalanche.

Clearly, the conditions are right for a significant move away from the U.S. dollar in international trade.

So when will this major shift occur?

Only time will tell.

Tue, 03/27/2012 - 10:39 | 2294201 harmonymonkey
harmonymonkey's picture

They all hate us anyhow
So let's drop the big one now
Let's drop the big one now

~ R. Newman

Tue, 03/27/2012 - 13:13 | 2294837 Winston Churchill
Winston Churchill's picture

My wife(who is English) was refused service at two stores in the UK

recently,because she has picked up a slight Southern drawl with the odd American word,

peppering her speech.Had to show her British passport to get served.

That's our best ally.

Tue, 03/27/2012 - 15:50 | 2295347 LongBalls
LongBalls's picture

FATALLY being the key word.

Tue, 03/27/2012 - 09:37 | 2293999 Zero Govt
Zero Govt's picture

Govt/Central banks have a nasty habit of jumping aboard trends at their zenith (sounds like my investing!)

CB's increasing Gold purchases looks like a topping process, not bottom buying or mid-stream swimming

be carfeul out there, Gold goes down as well as up

Tue, 03/27/2012 - 09:43 | 2294015 aVian
aVian's picture

less than .5% of people own gold...yeah some bubble

Tue, 03/27/2012 - 10:13 | 2294105 Stuck on Zero
Stuck on Zero's picture

Not counting jewelry, teeth, and electronics!

Tue, 03/27/2012 - 09:45 | 2294020 espirit
espirit's picture

The knowledgeble few know that fiat always goes down when Phyzz isn't involved.

Check the value of U.S. pre '65 coinage verses post '64 and tell me it ain't so.

Tue, 03/27/2012 - 09:47 | 2294027 tocointhephrase
tocointhephrase's picture

Indeed, like anything else, but the base from which Gold is moving from is low. If you have your savings in paper currency then you would be crazy not to consider moving it into a store of value rather than have it lose value over the medium term. Sure it can go down, like it has over the last few months, but the tend is your friend and it is on thje up so this is a great opportunity to add to or start building from!

Tue, 03/27/2012 - 09:56 | 2294055 francis_sawyer
francis_sawyer's picture

The 'trend' you speak of is NOT gold going UP...

It's PAPER going down... That's the trend... Always has been... Always will be...

Wed, 03/28/2012 - 07:49 | 2296745 prole
prole's picture

be carfeul out there, Gold goes down as well as up.

Oh it does? Can you tell me when it is going back to 21? 21 US$, when is it going back "down" to that?

Tue, 03/27/2012 - 09:41 | 2294009 tocointhephrase
tocointhephrase's picture

there goes benny's toys, all thrown out the pram, come on benny dont sulk, its only money

Tue, 03/27/2012 - 09:43 | 2294017 andyupnorth
andyupnorth's picture

I really want to know how bullion vendors (e.g. GoldSilverBull) can sell 1oz Candadian Maples for $1700 while the Royal Canadian Mint sells them for $2700-$3000.

It's really troubling me.  I'm worried about fake gold coins...

Tue, 03/27/2012 - 09:50 | 2294038 tocointhephrase
tocointhephrase's picture

if your up north then why are you buying in dollars and not pounds, eh eh, calm down calm down

Tue, 03/27/2012 - 09:55 | 2294046 Undecided
Undecided's picture

Because they are different, Royal Canadian Mint sells specialty coins that they only issue say 10,000, or 200,000 of; hence the higher prices.  More of a colectable then the everyday Maple.

I buy from goldsilverbull and like the fact that they are not slow on delivery.

I buy from the Royal Canadian Mint, if i think there is a Market for the coins they are issue due to their rarity.

Tue, 03/27/2012 - 10:12 | 2294071 Paul Atreides
Paul Atreides's picture

Authorized Dealers and the RCM are almost identical pricing and only a couple points above spot. Where are you getting this from andyupnorth, please provide links or stop posting this nonsense.

If you want to buy RCM products from an authorized, reputable and BBB certified RCM dealer I recommend looking here.

Tue, 03/27/2012 - 10:18 | 2294113 Undecided
Undecided's picture


You can't buy regular silver Maples for example at the Mint, only collectables.

Tue, 03/27/2012 - 11:19 | 2294335 andyupnorth
andyupnorth's picture

Thanks Undecided for the clarification, and thanks Paul for the link to certified RCM dealers (although you didn't have to be rude about it).

In any case, I still think ZeroHedge (and most ZeroHedgers) are #1.


Tue, 03/27/2012 - 11:00 | 2294269 xela2200
xela2200's picture

Avoid numismatic.

Tue, 03/27/2012 - 14:51 | 2295113 andyupnorth
andyupnorth's picture

Indeed.  I'd buy for the gold, not for the 'art'.

Tue, 03/27/2012 - 09:50 | 2294035 Tom Green Swedish
Tom Green Swedish's picture

Who gives a shit?

Tue, 03/27/2012 - 09:58 | 2294062 francis_sawyer
francis_sawyer's picture

Are you inclined to "not give a shit" on every single thread this morning by adding your query?

Tue, 03/27/2012 - 10:38 | 2294198 fuu
fuu's picture

He has reached maximum ennui.

Tue, 03/27/2012 - 11:43 | 2294441 Clay Hill
Clay Hill's picture

... or the end of ex-lax.

Tue, 03/27/2012 - 15:33 | 2295261 GetZeeGold
GetZeeGold's picture

Looks like he just snapped today....

03/27/2012 - 09:50 2294036 Tom Green Swedish Who gives a shit? 03/27/2012 - 09:50 2294039 Tom Green Swedish Who gives a shit? 03/27/2012 - 09:50 2294035 Tom Green Swedish Who gives a shit? 03/27/2012 - 09:50 2294034 Tom Green Swedish Who gives a shit? 03/27/2012 - 00:47 2293445 Tom Green Swedish Who gives a shit? 03/27/2012 - 00:47 2293447 Tom Green Swedish Who gives a shit? 03/27/2012 - 00:46 2293444 Tom Green Swedish Who gives a shit?
Tue, 03/27/2012 - 09:53 | 2294044 Kaiser Sousa
Kaiser Sousa's picture

"importantly it should serve as a lesson reality-check for Bernanke that gold is money..."

now please continue.....

Tue, 03/27/2012 - 10:06 | 2294081 Monedas
Monedas's picture

It's getting late !  Do you know where your people's gold is ? Better keep it close in case you have to confiscate it ! Monedas, the Armenians, the Kurds, the Jews do not trust the Turkish government !   Monedas  2012   Mossad is developing "Camel Drones" to take out Iran's nuclear facilities ?

Tue, 03/27/2012 - 11:06 | 2294285 ParkAveFlasher
ParkAveFlasher's picture

+1 for camel drones.  built-in radar dome easily disguised.

Tue, 03/27/2012 - 10:12 | 2294102 engineertheeconomy
engineertheeconomy's picture

Buying physical Precious Metals is the only way for a person to keep his labors from being stolen, other than buying land.

Paper money is only used by Governments to steal their peoples labors, and their land.


Tue, 03/27/2012 - 10:37 | 2294195 fuu
fuu's picture

Is that chart for 1 oz? 3.024 BILLION Lira per oz?

What does a loaf of bread cost in Constantinople today?

Tue, 03/27/2012 - 10:51 | 2294240 edwardo1
edwardo1's picture

Here's how to think about physical gold, and why it is used as a reference point for valuing everything from cotton to coal.

It's relatively stable supply

It's relative indestructability

It's general lack of industrial utility-thereby not interfering with economic activity, as opposed to, for example, silver, oil, copper, etc. etc.

it's practically infinite divisibility

It's ease in being market and stamped

It's substantial difficulty in being counterfieted-misleading and somewhat alarmist ZH posts on tungsten laced gold notwithstanding

Think of these facets as the attributes that in effect "back" gold. As a store of value, in a world where humans long ago discovered that they require a mechanism in which to save surplus weath, the aforesaid facets have, collectively, bestowed gold with the role of

wealth reserve par excellence. It has nothing to do with

instrinsic value, it has to do with gold's unique profile in the world of human affairs/commerce.

Wed, 03/28/2012 - 06:54 | 2296703 _underscore
_underscore's picture

It's also looks nice & is great to play with.

Tue, 03/27/2012 - 10:53 | 2294249 edwardo1
edwardo1's picture

In my previous post, market should have read marked.

Tue, 03/27/2012 - 11:30 | 2294365 dumpster
dumpster's picture


why such a tedious reminder

just  click on edit and change the dang word



Tue, 03/27/2012 - 11:37 | 2294410 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:


Wed, 03/28/2012 - 01:59 | 2296553 MeelionDollerBogus
MeelionDollerBogus's picture

In regards to your silver chart out to 2017: isn't there a very high chance that oil will rise to 200 even as silver tries to get to 65, only to lead to a smash-down of oil at 50 and silver at 29? Such a move would be proportional (% terms, moving together) to the 2008 crash in oil & silver prices.

Or, if oil should continue "safely" up to say, 300, silver tagging along to $100, wouldn't that threaten so many other costs that many who would hope to own silver would be forced to sell it for rent, electricity, fuel & such and just barely be holding on, on top of the weight to worry about? When you forecast very high prices for silver like $100, $120, $145 / oz, where do you see wheat, electricty, oil at for the same time period?


Tue, 03/27/2012 - 14:49 | 2294443 Miss Expectations
Miss Expectations's picture

Gold is inexorably linked to ancient cities & civilizations...who's remaining secrets are housed in their museums:

Bagdad museum sacked

Cairo museum sacked

Syria/Damascus next?


Turkey (Ephesus Museum)?

These places are the cradles of civilization and should be held sacred...bomb, bomb, bomb...while we live in houses with polypropelene pipes and vinyl siding and shop at Walmart.  We're absolutely pathetic.

EDIT:  How the heck did Greece fall off my radar???


Geroulanos had submitted his resignation on Friday, after robbers made off with scores of artifacts including items dating back over 3,000 years from a museum in the ancient Greek city of Olympia.
But in a meeting between Geroulanos and Papademos, the culture minister was told his resignation had not been accepted, a statement from the prime minister‘s office said.

Papademos instead asked the culture minister to “exhaust all avenues” in the probe.
Police and the culture ministry have released a list of 77 items stolen from the Ancient Olympic Games museum.

They include a 3,300-year-old gold ring, a bronze statuette of a victorious athlete, a 2,400-year-old oil jar, clay lamps, bronze tripods and miniature chariot wheels, as well as dozens of idols of charioteers, horses and bulls.



Tue, 03/27/2012 - 12:54 | 2294769 macroeconomist
macroeconomist's picture

You can buy gold in Turkey with 0% premium, exactly at the paper price.  I converted all family savings into physical gold in March 2009 at 52TL per gram. Stands at around 97TL t the moment.

I do not know if you can travel with gold, but if so, for any gold bug a trip to Istanbul to purchase gold would save hundreds of dollars and mean a free holiday in one of the most beautiful cities in the world :) 


Wed, 03/28/2012 - 07:59 | 2296757 prole
prole's picture

You probably can't travel with much gold before some government steals it from you, but the news from Turkey is great as far as prices are concerned. What form are you reefering to? Bars? High Carat Jewelry? Coins?

Thu, 03/29/2012 - 21:36 | 2302493 macroeconomist
macroeconomist's picture

Actually any form, there is a gold market in Istanbul (Kapalicarsi) with lots of spot gold dealers, where you can buy bars, or coins. They even cut bars to sell 100g, 200g pieces but for that I'd recommend you find someone to help you with the process. 1kg and 500g bars are much easier to purchase, as well as coins.

Tue, 03/27/2012 - 13:36 | 2294918 lemonobrien
lemonobrien's picture

gold is backed by pussy, cause you can buy pussy with gold.

Tue, 03/27/2012 - 14:14 | 2295007 100percent
100percent's picture

Money is whatever the state will accept for payment of taxes.

Wed, 03/28/2012 - 08:00 | 2296758 prole
prole's picture

You're confusing money with slavery

Tue, 03/27/2012 - 14:28 | 2295048 Pancho Villa
Pancho Villa's picture

This has all happened before, and it will all happen again.

How many times has a government said: "You don't want to be always carrying around all that bulky gold. Let us relieve you of that heavy burden and in exchange we will give you some nice colorful strips of paper that will fit nicely in your wallet or purse and you can exchange them for gold whenever you like."?

Anyone who falls for that scam can kiss their gold goodbye.

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