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"When Money Dies" Author Adam Fergusson And James Turk Discuss (Hyper)Inflation In The Past, In The Present And In The Future

Tyler Durden's picture





 

When it comes to discussing monetary history, and specifically what happens when it all goes horribly wrong, there are two must read tomes: one is "The Dying of Money" by Jens Parsson (pdf link) and the other one is "When Money Dies" (pdf link) by Adam Fergusson. Today, we are lucky to bring to you a must watch interview between James Turk of the GoldMoney Foundation and the author of the former, Adam Fergusson. They discuss the fateful decisions that led to hyperinflation in post-First World War Germany, and how central bankers as well as ordinary members of the public today would be well advised to heed this warning from history. Fergusson discusses how the hyperinflation affected different groups in German society in different ways – with debtors benefiting and huge numbers of middle-class savers wiped out. Riots, corruption and political extremism were just some of the malignancies encouraged by the hyperinflation. He points out that those who held hard currencies as well as people who held tangible assets like gold and silver were in-large part protected from the worst economic consequences of the hyperinflation. In his words: “gold remained at all times in Germany the measure of what was important to them.”

James and Adam discuss whether or not today there is any way for governments in the developed world to repay their huge debts. Both men conclude that inflation is the only politically viable method of repudiating these unmanageable obligations. Fergusson highlights the importance of velocity and the demand for money in determining whether or not inflation turns into hyperinflation – though points out that this tipping point can take a surprisingly long-time to arrive; in Germany, people kept confidence with the rapidly devaluing mark throughout the First World War, despite clear signs that the country was heading for a currency crisis.

Fergusson thinks that we are heading for high inflation in many countries, but is doubtful that Weimar Germany’s nightmare currency collapse can be replicated in a sophisticated modern economy. He concludes with a quote from Jean-Claude Juncker, prime minister of Luxembourg, who recently commented with respect of the sovereign debt crisis: “we all know what has to be done; what we don’t know is how to get re-elected once we done it.”

 


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Sun, 10/30/2011 - 15:02 | Link to Comment GeneMarchbanks
GeneMarchbanks's picture

Great explanation of how it is a process as oppose to an event. Interesting times...

 

 

Sun, 10/30/2011 - 15:08 | Link to Comment ratso
ratso's picture

Great expostion of the topic.

This has always been the only way that the debt probelms in the developed countries will be handled.

Sun, 10/30/2011 - 17:21 | Link to Comment DormRoom
DormRoom's picture

errr... its hyperinflation in BRICS, especially China.  Western countries have to contend with high-hyperstagflation.  It's a more unmanageable beast.  And that is what the US is headed towards with every injection of QE.

Also, China's economy is not diverse enough to deal with hyperinflation, so it's going down for the count, if the US continues with QE.

 

Sun, 10/30/2011 - 19:09 | Link to Comment XitSam
XitSam's picture

Can you explain how a diverse economy affects hyperinflation?

Sun, 10/30/2011 - 19:13 | Link to Comment earleflorida
earleflorida's picture

QE3 was implicitly telegraphed by author "Bob Woodward" as obama,' pulls-out-all-stops', late 1st qtr 2012

Sun, 10/30/2011 - 17:11 | Link to Comment SRSrocco
SRSrocco's picture

HYPERINFLATION AND THE DEATH OF THE US TREASURY MARKET

I put a comment in one of the SILVER POSTS on ZeroHedge in the beginning of last week showing how silver was heading higher.  This was not due to Technical Analysis which I believe is DEAD, but due to fundamentals.  Future money printing and hyperinflation will make the current price of $35 silver seem like a blip on the screen.

I have written a new post which you can find at the SGS website, SILVERGOLDSILVER showing the amount of leverage between the US Treasury Market and GOLD-SILVER.  Here is the Link: http://www.silvergoldsilver.com/index.php?option=com_smf&Itemid=39&topic=499.0

Hyperinflation is coming.  The only Deflation I see on the horizon is the Deflation of IQ's.  You can't have deflation when the world is printing money hand over fist...and the money they are printing is worthless fiat currency.

Lastly, I also wrote the PEAK SILVER REVISITED article that was published on ZeroHedge here a few weeks ago.  Peak Silver is coming, so it's best to own that real physical metal in ones own sweating palms.  I have a new article coming out that I hope Tyler will publish on the COLLAPSE OF ROME and THE USA due to a FALLING EROI.

Times are a changing....

Sun, 10/30/2011 - 19:47 | Link to Comment SamuelMaverick
SamuelMaverick's picture

Awesome link SRSocco, puts things in perspective, it is amazing how small the actual gold / silver market is, and one has to appreciate the future consequences if a percentage of the treasury market money starts going to PM's.  Sadly the future looks bright for those with enuf intestinal fortitude to ride out the PM voliltility during the next year or so, the average joe is going to get financially hurt with this slow and steady currency debasement / inflation.   I do not think the breakout for PM's will take much longer than that.

Sun, 10/30/2011 - 22:23 | Link to Comment Bollixed
Bollixed's picture

"Hyperinflation is coming.  The only Deflation I see on the horizon is the Deflation of IQ's." 

That's a great line.

Mon, 10/31/2011 - 00:04 | Link to Comment DarkestPhoenix
DarkestPhoenix's picture

I'm sorry, pardon my ignorance....what are IQs?  Assuming not intelligence quotient.  Mine is 36, re-re level.

Sun, 10/30/2011 - 23:05 | Link to Comment FEDbuster
FEDbuster's picture

So if debtors win in a hyper inflation, what asset class can be leveraged the most (for most people)?  Answer: real estate, but the real estate market is dead.  So are equities an alternative?  Zimbabwe stock market had 200% + up days. 

I am going long food and guns at this point, but would you leverage silver to take advantage of the debt destruction hyper inflation brings?

Sun, 10/30/2011 - 17:17 | Link to Comment Tapeworm
Tapeworm's picture

If you want to see when money dies, you should see the collapse of the price of my original hardcopy of his book once it was re-issued.

Mon, 10/31/2011 - 21:46 | Link to Comment Ahmeexnal
Ahmeexnal's picture

next time buy flowing hair dollars or 1933 double eagles.

Sun, 10/30/2011 - 14:58 | Link to Comment LloydBlankenfiend
LloydBlankenfiend's picture

There aren't many of us here in Luxembourg and now they allow us foreigners to vote Jean-Claude Juncker wouldn't need to worry, although addmitedly we are but a pimple on Deutschelands asshole!

Sun, 10/30/2011 - 15:00 | Link to Comment X.inf.capt
X.inf.capt's picture

got pyhsical?

Sun, 10/30/2011 - 15:01 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Yes indeed.  Got food and water security.  Yeah got that too.

Sun, 10/30/2011 - 15:17 | Link to Comment X.inf.capt
X.inf.capt's picture

me too,

plus a hell of alot of skills....

BRING IT!!!!!

Sun, 10/30/2011 - 16:30 | Link to Comment topcallingtroll
topcallingtroll's picture

Bring it huh?

Whats going to get you in depresionary collapse wont be the zombie hordes. Your killer will be brought to you by the fly, or rat, or poorly treated water, and possibly even the lowly skeeter.

Sun, 10/30/2011 - 16:33 | Link to Comment X.inf.capt
X.inf.capt's picture

GOT VACCINATIONS?

i do.....

Sun, 10/30/2011 - 16:38 | Link to Comment peekcrackers
peekcrackers's picture

Got 12 ga and gas mask

Sun, 10/30/2011 - 16:38 | Link to Comment X.inf.capt
X.inf.capt's picture

.

Sun, 10/30/2011 - 16:50 | Link to Comment peekcrackers
peekcrackers's picture

I would rather die on my feet fighting , then live on my knees begging and prying !

Sun, 10/30/2011 - 19:24 | Link to Comment earleflorida
earleflorida's picture

be patient my grasshopper - your raison d` etre will come,...  

Sun, 10/30/2011 - 15:00 | Link to Comment LawsofPhysics
LawsofPhysics's picture

Infinte growth on a finite world, good luck with that.

Sun, 10/30/2011 - 15:09 | Link to Comment X.inf.capt
X.inf.capt's picture

it had to end

eventually....

im glad im not responsible for this....

the last thing i would want to face is a bunch of torches, pitchforks and ropes, held by very 'unhappy' people...

Sun, 10/30/2011 - 15:44 | Link to Comment john39
john39's picture

they have a plan for that... its called throw the expendable strawmen under the bus while you hide.  

Sun, 10/30/2011 - 16:00 | Link to Comment X.inf.capt
X.inf.capt's picture

.

but in this information age, everyone knows who they are...

all of them....

and thats a legacy that will follow their surnames for along time...

i dont envy them and thiers....

Sun, 10/30/2011 - 16:59 | Link to Comment css1971
css1971's picture

The names you have are the puppets.

Sun, 10/30/2011 - 22:38 | Link to Comment X.inf.capt
X.inf.capt's picture

sorry, i dont have any names,

and im not going to waste my time lookin' for the offenders...

i have alot of people to help, now and later...

thats how we are going to survive, by helpin' not huntin'

Mon, 10/31/2011 - 16:56 | Link to Comment Uchtdorf
Uchtdorf's picture

It is the "plus one" theory. In a fight, you always assume that you are up against an opponent plus one more. so you must watch your own back while delivering justice to the visible one.

In a survival situation, you look how you can help plus one more to create an ally instead of an enemy. Build a community to avoid being the lone wolf who cannot survive without the pack.

Sun, 10/30/2011 - 15:11 | Link to Comment Ghordius
Ghordius's picture

The Economics of Inflation
Bresciani-Turroni 1931

The only comprehensive work that was not written with a political agenda.
Gives an understanding how supply chains change with inflation (more vertical integration) and how fixed-cost investments surge.
Includes the effects from and to the other countries, etc.
For example industry workers LOVED inflation, the seriously rich nearly as much, why so many politicians got assassinated, how gov reacted, etc.

Sun, 10/30/2011 - 16:05 | Link to Comment disabledvet
disabledvet's picture

wasn't good for government was it! the oddity is that the easiest way to repudiate a debt is too...repudiate the debt! that is precisely what happened on Thursday (sure, it's an "insurance policy"...but all a debt is in strictly "legal terms" is an obliglation to repay at a later date) This is why i simply cannot understand these decisions coming out of the ECB. So what if all of Greece's debt were repudiated? Big deal! Recapitalize the banks--and put everything in the country up for sale. You'd have happy German housewives from now 'till Springtime! (Probably go a long way towards solving the so called "demographic issue" as well. Take that maypole and plant it on some Greek Island baby!) Anywho--"what precisely is the ECB obligating ANYONE to do here?" Nothing as far as i can tell. Well...okey-dokey then!:
http://www.youtube.com/watch?v=zDAmPIq29ro&feature=player_detailpage

Sun, 10/30/2011 - 17:39 | Link to Comment Marco
Marco's picture

Except sovereign debt isn't backed by a countries assets, if you want their islands you have to take them the old fashioned way ... with guns.

Sun, 10/30/2011 - 15:09 | Link to Comment JimBobOMG
JimBobOMG's picture

Thanks for the PDF!

Sun, 10/30/2011 - 15:10 | Link to Comment Old. No. 7
Old. No. 7's picture

One box of Kraft Macaroni and Cheese (add your own milk & margerine) at Winn-Dixie supermarket is $ 1.79.

Sun, 10/30/2011 - 15:24 | Link to Comment Silver Alert
Silver Alert's picture

Yes, and it's a smaller box too.

Sun, 10/30/2011 - 16:07 | Link to Comment disabledvet
disabledvet's picture

with only one macaroni. phuckers.

Sun, 10/30/2011 - 15:29 | Link to Comment Quinvarius
Quinvarius's picture

I am pretty sure that stuff was like .35 cents when I was in college.

Sun, 10/30/2011 - 16:23 | Link to Comment ziggy59
ziggy59's picture

agree..was a staple!! 3/buck ...on sale 4/buck..at pathmarkin late '70s

Sun, 10/30/2011 - 16:03 | Link to Comment DosZap
DosZap's picture

Old. No. 7

Year before last, it was $0.75,last yr, $1.00......................

66% per yr, in 2yrs.There is NO inflation,except what you need to stay alive with.

Sun, 10/30/2011 - 22:51 | Link to Comment fourchan
fourchan's picture

nice return, go long mac n cheese short dollar

Sun, 10/30/2011 - 16:26 | Link to Comment High Plains Drifter
High Plains Drifter's picture

when you are hungry it will go down easy too......

Sun, 10/30/2011 - 18:10 | Link to Comment Augustus
Augustus's picture

The can of coffe once contained a full 16 oz.  Now it is 11.5 oz and has a higher price.

 

As for motorfuel,

The included taxes are now greater than what I once paid at the pump.

 

Mon, 10/31/2011 - 05:36 | Link to Comment DutchR
DutchR's picture

Bought some 'Tesi Bon' Mac&Cheese last week here in Holland (Albert Heijn).

NET WT.7.25oz (206g) €1.69   so that makes $2.39

Sun, 10/30/2011 - 15:38 | Link to Comment Griffin
Griffin's picture

No one should be surprized to see inflation go up after all this money printing, eating our savings and pensions.

What Jean Claude Junker wants is a fiscal union of Europe to begin with, then the end of democracy and full EU control of European states.

When the crash comes, it will crash Europe into a superstate. That is what was always the goal of the Europe project.

The people behind this will take this as far as they have to to succeed, all the way to the edge.

If there are no major surprizes, they will probably pull this off.

Sun, 10/30/2011 - 15:17 | Link to Comment dick cheneys ghost
dick cheneys ghost's picture

Sorry for the stupid question..........but How does the fact that oil is priced in dollars and the recycling of petro dollars factor into the discussion?

Sun, 10/30/2011 - 15:22 | Link to Comment Ghordius
Ghordius's picture

Oil has a political price for the moment.

Sun, 10/30/2011 - 15:32 | Link to Comment Ahmeexnal
Ahmeexnal's picture

oil is the true barbarous relic.

when a troy ounce of silver is allowed to reveal its true value, measured not in ficticious amounts of fake debt money but in TERAWATTS HOUR, then we shall bear witness to a true revolution in technology/economics/awareness.

Sun, 10/30/2011 - 15:53 | Link to Comment LasVegasDave
LasVegasDave's picture

Glad to agree with you for once Lizard King

Sun, 10/30/2011 - 16:43 | Link to Comment X.inf.capt
X.inf.capt's picture

Troll alert!

Sun, 10/30/2011 - 16:08 | Link to Comment disabledvet
disabledvet's picture

that ain't no relic. it's barbarous that's for sure. it doesn't get any more "forward looking" as they say.

Sun, 10/30/2011 - 15:44 | Link to Comment Quinvarius
Quinvarius's picture

It means M2 is not reporting even 1/3 of the dollars that are really out there because it only sees what is in the US banking system.  It ignores the money we printed and bought oil with.  Aside from that, buying oil in whatever currency you want is just an accounting entry.  You should not actually take that petro dollar recycling nonsense at face value.  If it were true, Saudi Arabia and the other Arab countries would have more Treasuries than a mere 240b.  For comparison, the USA spends about 500B a year on oil.  The combined oil exporting Arab total should be much larger than 240B after 40 years.

Sun, 10/30/2011 - 16:10 | Link to Comment disabledvet
disabledvet's picture

hmm. well...i like you. "those are poor countries" that's why. Rich countries "have trillions of treasuries."

Sun, 10/30/2011 - 22:01 | Link to Comment fnord88
fnord88's picture

Love to know how much Gold they got stashed away though. They are not stupid, they know USD is just paper.

Sun, 10/30/2011 - 15:21 | Link to Comment Sudden Debt
Sudden Debt's picture

 

 

Don't worry, we've got smart enough people running things and..... and...

OH MY GOD!!!!!!!! WE'RE FUCKED!!!!!!

Time to buy the neighbourhood for 500 ounces of silver buddies! :)

 

Sun, 10/30/2011 - 16:11 | Link to Comment disabledvet
disabledvet's picture

it is true that for but a few onces of gold you can buy a fully loaded brand new Honda Civic. Interestingly.."the authorities don't have a problem with that."

Sun, 10/30/2011 - 16:17 | Link to Comment sabra1
sabra1's picture

or, one canadian house can buy a town, call yourself sheriff and mayor!

Sun, 10/30/2011 - 15:28 | Link to Comment Atomizer
Atomizer's picture

Fuck you Adam, why didn't you tell them about the China agreement made just months ago? Huh? Did you have a brain fart?

The problem is all associated with this... Circus tricks no longer work in a 24/7 social media environment. This includes you Adam!!

Permit me to issue and control the money of a nation, and I care not who makes its laws.
-Mayer Amschel Rothschild

Sun, 10/30/2011 - 15:46 | Link to Comment achmachat
achmachat's picture

pretty harsh words.
Care to fill us in on what exactly you are talking about before you start looking like a crazy person rambling at the wall?

Sun, 10/30/2011 - 17:09 | Link to Comment Atomizer
Atomizer's picture

Perhaps you can explain the foreign policy law that has already taken effect. I would love to hear your 'crazy person rambling at the wall' CFR money grifting nonsense explanation.

Tag, your it!

Sun, 10/30/2011 - 18:57 | Link to Comment akak
akak's picture

Tag my it?

 

Please learn the difference between "your" and "you're" --- the misuse of such basic words does nothing to add to the credibility of your opinions.

 

Sun, 10/30/2011 - 19:17 | Link to Comment Libertarians fo...
Libertarians for Prosperity's picture

 

 

Once again, you're a fucking idiot.  The only person who falls on their face more than you is Tmosley.

He used it correctly.

 

Sun, 10/30/2011 - 19:30 | Link to Comment akak
akak's picture

And The Troll Who Officially Haunts Me intrudes where he is not wanted nor needed once again.

 

Really, in just HOW many ways are you going to continue demonstrating your ignorance and stupidity here? 
Of course, the sentence should have read "Tag, you're (you are) it". 

Idiot!

 

PS: I went grocery shopping yesterday, and despite your much-vaunted "deflation", I noticed prices across the board continue to climb, at FAR more than the government-reported 1 or 2%, too.  But yep, must be deflation --- because you and Bernanke continue to say it is.  Curse those damned lying eyes of mine!

Sun, 10/30/2011 - 19:32 | Link to Comment Libertarians fo...
Libertarians for Prosperity's picture

 

 

I thought you were referring to the "your" in his post.  I didn't even read the bottom part. Since you're such an idiot, I automatically assumed you had no idea wtf you were talking about.

Perhaps if you would post just one factually correct comment over the span of 50, I wouldn't be forced to doubt you so uniformly.

 

 

Sun, 10/30/2011 - 19:34 | Link to Comment akak
akak's picture

I thought you were referring to the "your" in his post.  I didn't even read the bottom part.

So eager to attack in bitterness and blind hate that you don't even bother to read the necessary antecedent comments, eh?  I guess that says a lot about your true motivations for participating in this forum.

Sun, 10/30/2011 - 20:07 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

much as i understand your point, ak, a couple of zH's were trying to get at something and it wasn't grammatical

what was atom_Z_er talking about?  the gold market?  what about the council on for. relations?  what's the point, here? 

Mon, 10/31/2011 - 00:36 | Link to Comment malalingua
malalingua's picture

DO NOT USE DR. PAUL'S PICTURE!  We, supporters have a hard enough time, we don't need people to think you are a Ron Paul supporter. 

Mon, 10/31/2011 - 11:46 | Link to Comment BigJim
BigJim's picture

I expect that's why he did it.

Sun, 10/30/2011 - 21:11 | Link to Comment goldfish1
goldfish1's picture

look at laundry detergent:

 

the packages are getting incrementally smaller every few months as the prices climb.

Mon, 10/31/2011 - 00:13 | Link to Comment malalingua
malalingua's picture

Public service announcement. 

 

http://www.ecenglish.com/learnenglish/youre-vs-your

Sun, 10/30/2011 - 18:55 | Link to Comment Quinvarius
Quinvarius's picture

Why don't you answer his question and quit posturing?  Your posts don't even make any sense.

Adam's book is an excellent source of information on Weimar.  Now take your meds and buy a copy.

 

Sun, 10/30/2011 - 20:24 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

well, maybe that's all there is to this

at this point i couldn't say, for sure: china agreement?  CFR? 

but just b/c a well-known author and historian knows a lot about his specialty and can roll with james turk doesn't mean he doesn't have an agenda, too, Quin

excuse me while i self-medicate...L0L!!!

 

Sun, 10/30/2011 - 15:36 | Link to Comment lolmao500
lolmao500's picture

This should become viral... well it already is...

http://www.dailykos.com/story/2011/10/29/1031267/-Keep-Wall-Street-Occup...

"Keep Wall Street Occupied." Let's Help This Go Viral.

A fast, easy, free, and non-violent way to drive the big banks out of their greedy little minds is sitting in your mailbox right now. You just don't know it yet.

http://www.youtube.com/watch?v=2JlxbKtBkGM

Sun, 10/30/2011 - 15:42 | Link to Comment Lord Welligton
Lord Welligton's picture

Most enjoyable and enlightening.

Sun, 10/30/2011 - 15:45 | Link to Comment aleph0
aleph0's picture

Excellent interview .. Thank you ZH

 “we all know what has to be done; what we don’t know is how to get re-elected once we done it.”

#1 AFAIK, he wasn't elected (by the people) in the first place.

#2 After his statement in Der Spiegel 1999/52, he surely doesn't think he would ever be elected does he ?

 

 

 

Sun, 10/30/2011 - 15:49 | Link to Comment rumblefish
rumblefish's picture

anyone found the above mentioned  books in epub format so I can read them on my ipad?

 

 

Sun, 10/30/2011 - 20:58 | Link to Comment Crumbles
Crumbles's picture

Look back & scroll up, Grasshopper. Tap on the book title in blue text so the .PDF opens. Tap on the center of the screen then tap the "open in iBooks" button in the upper right of d screen.
Read. Enjoy. And next time, RTFM !

Or ask any middle school kid.

Sun, 10/30/2011 - 16:13 | Link to Comment deepsouthdoug
deepsouthdoug's picture

Like to see Zero Hedge run a poll to see if its readership sees hyperinflation or hyperdeflation is the most likely outcome for the USA and the western world. 

Sun, 10/30/2011 - 16:30 | Link to Comment High Plains Drifter
High Plains Drifter's picture

OMG !   do we have to?   you have no idea what you are asking.............:)

Sun, 10/30/2011 - 16:34 | Link to Comment wisefool
wisefool's picture

Snarc: Make the poll duration 60 minutes. That gives Ben 15 minutes to suck up the liquidity, and timmy 45 minutes to adjudicate if it was done properly.

Sun, 10/30/2011 - 16:47 | Link to Comment traderjoe
traderjoe's picture

There will be no discernible difference between the two.

Sun, 10/30/2011 - 17:00 | Link to Comment wisefool
wisefool's picture

+1 Exactly as was pointed out in the interview. "People from the countryside had food to sell, but they could not sell it because they did not want worthless paper ..... " (para) Germany never was a country of corruption untill this point, the money was worthless because people suspected their neighbor of gaming the system.

Despite "modernernity" the economy will be just the same and as you mentioned crops (in modern terms work product) will spoil in the fields (deflation) and paper money will be used for heating.

Make a choice:

Ron Paul=Sound Money.

Herman Cain= Simple Taxation. (And nobody can give him any crap until Romney releases his taxes and we find out just how "Progressive"  "Liberal"  "Elegatarian" and "Charitable" the current tax code is. 

Mon, 10/31/2011 - 12:07 | Link to Comment Zero Debt
Zero Debt's picture

By unit of account: hyperdeflation in terms of money (gold) and hyperinflation in terms of credit (dollars).

Sun, 10/30/2011 - 16:17 | Link to Comment The Big Ching-aso
The Big Ching-aso's picture

Gold?   Protection?  No way according to Denninger who no doubt knows more than these guys.

Not that he's ever been through a Depression mind you but hey what does experience have to do with really knowing what the hell you're talking about anyway.

Sun, 10/30/2011 - 16:31 | Link to Comment dizzyfingers
dizzyfingers's picture

Experience helps us keep out of trouble. Lack of it helps get us in.

Better to follow ones own instincts, but listen intently to the experienced, and not so much to those who aren't.

 

Sun, 10/30/2011 - 18:38 | Link to Comment bill1102inf
bill1102inf's picture

Denninger has good reason not to like gold as an investment.  Jan 07 - $640 to today $1750, gold has increased about 1100 per ounce.  Meanwhile denninger has called the demise of many companies including netflix, etc.  There are MANY option plays that resulted in gains in a matter of weeks (or hours) that dwarf the gains in gold.  

Sun, 10/30/2011 - 20:52 | Link to Comment akak
akak's picture

And just how well are all those option plays going to work out as a hedge when the dollar and other major fiat currencies enter the death spiral of rapid depreciation or outright collapse?  And just how useful would all those option plays end up being if your bank is closed, your credit and debit cards no longer work, and any bank, trading, IRA or 401k account you may have is frozen by order of the government while the currency is rapidly depreciating or officially devalued?

The paper game (which Karl Klownshoes Denninger just LOVES with all his heart and soul) will only benefit you until the game is over --- then your presumed profits will evaporate along with the rotten and collapsing financial and monetary infrastructure propping up that game.  In case you hadn't noticed by now, Karl Klownshoes Denninger has less than zero credibility when it comes to gold, or monetary theory or history in general, over which subjects he is as least as ignorant as (and FAR more arrogant and disingenuous in his bloviations than) any Joe Sixpack.

Anyway, I will take the average annual 20+% appreciation in the price of gold during the last ten years over the piddly-ass 0.2% interest on a bank account, or the 1% (nominal) interest on a two-year CD, or the net -40+% REAL return on stocks over the same period.

 

EDIT: How cute, I got a red arrow from Klownshoes!  That's a real badge of honor --- like getting 40 green arrows from the other posters here on ZeroHedge, or being banned from the MarketTicker forum (aka Stalag 18).

Sun, 10/30/2011 - 21:04 | Link to Comment Crumbles
Crumbles's picture

Wonder just how old Karl buttfuker was when he was sodomized - pretty obvious from reading the massive number of anal references in his column.

Sun, 10/30/2011 - 23:16 | Link to Comment akak
akak's picture

Who says he was necessarily on the receiving end?

Mon, 10/31/2011 - 00:07 | Link to Comment DavidPierre
DavidPierre's picture

Further to the above re: Kurl Doucheinger...

 -A total 9/11Moron who AIDS AND ABETS the criminal/mafia/cabal that planned and executed treason and murder.  By banning comments concerning his 9/11 idiocy on his  blog he is also guilty of destroying the 1st amendment.

Since he is an ACESSORY AFTER THE FACT he should  face the same justice as the original criminals.

 He has publicly shown himself as a party to the offence by comforting these criminals, assisting them to not face prosecustion by actively surpressing and tampering with evidence in order that they escape arrest and avoid conviction.

TEA-BAGGER ! *

*(XXX definition)

Sun, 10/30/2011 - 16:20 | Link to Comment topcallingtroll
topcallingtroll's picture

Great book, but read with caution.

The world has always been scary and fragile. We tend to freak out when we first realize it. Dont just freak out and buy a bunch of gold and hide it in your toilet after reading this book.

PVC tubing, vertical stacking, buried three feet deep, with all sorts of junk metal and BB's scattered and buried in your yard will work a lot better.

Sun, 10/30/2011 - 16:44 | Link to Comment peekcrackers
peekcrackers's picture

or if you can find  lead paint ..

air tight bag sunk in the paint , works wonders

Sun, 10/30/2011 - 17:07 | Link to Comment FutureShock
FutureShock's picture

Interesting how he noted everyone held on to the currency, increasing savings and not by not spending brought the depression. Inflation to near 20% before all confidence is lost. The winners were companies using low rate loans to build factories and export as well as holding other currencies. So keep an eye on savings I suppose but what currency do you turn too?.  Does the military matter more than currency de-valuation?  

Those that say bring it with thier gold and guns look around your community with tons of children and people that don't have a clue as to any of the possible outcomes and think again. "Don't let it history happen again"  Regulations on goverment employment at all levels should be the first step before anything. 

Sun, 10/30/2011 - 17:10 | Link to Comment Fozzy Slippers
Fozzy Slippers's picture

There are not enough jack boots to protect the Oligarch. All you phuks will be dragged through the streets and beat to a pulp.

You have ruined it all. And now you will pay.

Sun, 10/30/2011 - 17:26 | Link to Comment Atomizer
Atomizer's picture

“Lord of the Flies” is the label corporate media types are trying to attach to our comrades in the trenches. With new reports of rape, underage prostitution, heroin dealing, theft, public fornication, infighting, etc., etc., at various Occupy camp almost daily, it's not surprising that the media stooges would feel the need to attach some snarky meme to the glorious movement. What they fail to realize is that it is all part of the master plan.

The powerful forces behind the Occupy movement understand that our current system must first be destroyed before a new Progressive world can be built. Each Occupy camp and rally should be viewed as a microcosms of what the final revolution will look like.

Old ways of thinking are replaced with groupthink. Reason, morality, and intellect are of no value. The Piggys of the world will be stripped of their technology. Those technologies will be repurposed to meet the needs of the movement. Should tragedy befall the Piggys, in the form of a rock upside the head, or a fall from some height. It will be of no concern, for they had it coming.

“This is what democracy looks like” is the movements rallying cry, but make no mistake, it is a ruse. A socialist utopia is not possible when the opposition is in the majority and can vote against it. So the conch shell of democracy must be shattered.
http://thepeoplescube.com/peoples-blog/topic7976.html

 

 

Sun, 10/30/2011 - 21:53 | Link to Comment gwar5
gwar5's picture

Yes, sadly #OWS has been totally debauched with the marxist/socialist effetes defecating on cop cars and publically masturbating to express their deep felt romance for  Utopian egalitarianism. Woodstock for Welfare.

 

They're always stepping forward in droves to demand their "Fair Share" of the wealth, but we never see one of them stepping forward to demand their fair share of work. 

 

#OWS should have stuck to Ending the FED and breaking up the "Too Big To Fails" to cut the money supply to their Corporatist agents running Washington DC. Next time, Sigh.

 

 

Sun, 10/30/2011 - 17:48 | Link to Comment cpgone
cpgone's picture

Wow, Prof. Fergusson ,wow.

What a treat .

100000 stars.

Sun, 10/30/2011 - 18:01 | Link to Comment CashCowEquity
CashCowEquity's picture

inflation and hoes

It costs much more to pimp nowadays

 

:-(

Sun, 10/30/2011 - 18:46 | Link to Comment economics1996
economics1996's picture

That was cool seeing a icon I read years ago come to life.  Thanks Prof. Fergusson.  For the rest of us the inflation rate is 3.9% and climbing.

Sun, 10/30/2011 - 19:26 | Link to Comment CashCowEquity
CashCowEquity's picture

people who downvote me are gay.

Sun, 10/30/2011 - 19:38 | Link to Comment akak
akak's picture

We're here, we're queer, get used to red arrows.

 

Sun, 10/30/2011 - 19:51 | Link to Comment Edelweiss
Edelweiss's picture

 One question I have to ask is, what's likely to precipitate a hyperinflation scenario in the US?  Obviously money supply has exploded in the last decade, but inflation is mild compared to all the examples listed in the video.  One thing that is critical, is a crisis of faith in the currency as a store of value.  Most of us on ZH have had our crisis, and planned accordingly. 

Sun, 10/30/2011 - 20:12 | Link to Comment saiybat
saiybat's picture

A bubble in treasuries that grows exponentially and the government uses them to spend more. Then they burst and the printing presses are ramped up.

Sun, 10/30/2011 - 20:49 | Link to Comment THE DORK OF CORK
THE DORK OF CORK's picture

I don't buy this historical narrative to explain this present crisis as none of us are living in "sovergin" states at war or paying for previous wars. - paper can be saved if credit deposits become goverment money tokens and we owe each other tokens rather then inflated assets / deposits that have destroyed the productive capacity of countries as it has infected the national money systems.

This Hayek like obsession with Goverment defecits is bunk in a era when all credit is insured which makes these loans money.

Gold is only a protection in this envoirment from bankers who want to peserve private debt contracts AT ALL COSTS .

 Given the bankers control us Gold I am afraid is the only insurance.

 

Sun, 10/30/2011 - 21:16 | Link to Comment Rockfish
Rockfish's picture

 

 

So much of the Weimar history reflects the reality of today.  As a result I believe there are some of the actions I should take during the NOW time.

  • Locate where you can live off the land or close enough to supplement what you produce and your labor can be paid for in food, fuel ..., Water.
  • Amass gold, silver, copper, hand tools useful for trade. Even a modest stash would be worth a fortune.
  • Put in place self sustaining energy even if some of those flat screens have to go.
  • Build strong relationships with neighbor and blood. No man is an Island.

"I will exploit the NOW to prepare for the future"

Sun, 10/30/2011 - 21:27 | Link to Comment Crumbles
Crumbles's picture

Why not:

Nationalize the Federal Reserve Banks. Eliminate all bonus payments and Salaries over $250k. Reinstate Glass-Steagall rules.

Devalue the currency by a factor of 20 to one. Issue new coinage and US Treasury Gold and Silver certificates.

BUT FIRST, OVER THE NEXT SIX MONTHS, BY WHATEVER MEANS NECESSARY, PURCHASE GOLD AND SILVER BY THE TON AND TAKE DELIVERY IN, SAY, DENVER.

Might just be a plan that Dr. Paul could run with? After his election, that is.

Sun, 10/30/2011 - 21:28 | Link to Comment gwar5
gwar5's picture

James Turk and his interviews at Goldmoney have been warriors against the Fed and central banker policies. Alisdair MaCleod (of the clan MaCleod) is often interviewed by Turk.

 

Sun, 10/30/2011 - 21:29 | Link to Comment gwar5
gwar5's picture

James Turk and his interviews at Goldmoney have been warriors against the Fed and central banker policies. Alisdair MaCleod (of the clan MaCleod) is often interviewed by Turk.

 

Mon, 10/31/2011 - 00:01 | Link to Comment Lazane
Lazane's picture

stack and stack, don't break your mama's back

Mon, 10/31/2011 - 02:30 | Link to Comment nontaxpayer
nontaxpayer's picture

I say, bring it on. Let it all burn. There will be a wealth transfer and I will be on the receiving end.

Mon, 10/31/2011 - 11:42 | Link to Comment SRSrocco
SRSrocco's picture

Here we go...

Mon, 10/31/2011 - 16:42 | Link to Comment johnjb32
johnjb32's picture

Must Watch.  This would bring about an all-powerful, unaccountable body which would have to be fed with money whenever and in whatever quantities it wants but which would be 'inviolable' by lawsuit brought by any other body. - Jenna Orkin
 
Terrific video! -- MCR

 

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