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Credit Crisis and Recession Deepen

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  • metalman
    replied
    Re: Credit Crisis and Recession Deepen

    Originally posted by jtabeb View Post
    Gold is the DEFLATOR, in other words (both correct)
    exactly. currencies are deflating against gold, gold is inflating against currencies. flip side of the same coin... if you'll excuse the pun!

    Leave a comment:


  • jtabeb
    replied
    Re: Credit Crisis and Recession Deepen

    Originally posted by metalman View Post
    reversion to the mean... over 100s of years gold is the mean. it's just that simple.

    Gold is the DEFLATOR, in other words (both correct)

    Leave a comment:


  • Contemptuous
    replied
    Re: Credit Crisis and Recession Deepen

    A "pithy" observation indeed Metalman. Peels away the SUIT, to handily recognize the financial twit inhabiting it (something akin to disturbing nesting fleas).

    Process works as efficiently as a Baloney Sausage machine, except in reverse [ deconstructing the Baloney Sausage ].


    Originally posted by metalman View Post
    you managed to get through the whole book? congrats. tried 3 times and never made it more than half way through. one of the worst written books ever. real world... it's all jocks and geeks. looked at this way...

    greenspan: geek
    cramer: jock
    rand: geek
    bernanke and central bankers generally: geeks
    most of congress & pols in general: jocks
    hedgies: geeks
    ibankers: jocks (except the analysts: geeks)
    paulson: jock

    the geeks always work for the jocks.

    Leave a comment:


  • jtabeb
    replied
    Re: Credit Crisis and Recession Deepen

    Originally posted by Hypatia1 View Post
    jtabeb --


    Don't waste your time worshiping Ayan Rand. Save your worship some one more real -- like the Easter Bunny.
    No worship (I actually believe in god, unlike rand). The only reason why I bring up the work is that the machinations described therein are likely to manifest themselves as this crisis plays out. Nothing more, nothing less.

    Leave a comment:


  • metalman
    replied
    Re: Credit Crisis and Recession Deepen

    Originally posted by Hypatia1 View Post
    jtabeb --


    I read Atlas Shrugged. It's pure fantasy written by someone without any sense of human nature. It's as realistic as stories about ultra chivalrous knights saving Christendom. The truth of the matter is that you couldn't become a knight by BEING chivalrous! A Knight would have to be ruthless, and so do Ayan Rand's heroes. Her heroes are single-mindedly Geeky and yet Ruthless. Very few people have that combination (Bill Gates does not really qualify as a geek in my book). It's almost always one or the other.

    Don't waste your time worshiping Ayan Rand. Save your worship some one more real -- like the Easter Bunny.
    you managed to get through the whole book? congrats. tried 3 times and never made it more than half way through. one of the worst written books ever. real world... it's all jocks and geeks. looked at this way...

    greenspan: geek
    cramer: jock
    rand: geek
    bernanke and central bankers generally: geeks
    most of congress & pols in general: jocks
    hedgies: geeks
    ibankers: jocks (except the analysts: geeks)
    paulson: jock

    the geeks always work for the jocks.

    Leave a comment:


  • Hypatia1
    replied
    Re: Credit Crisis and Recession Deepen

    jtabeb --


    I read Atlas Shrugged. It's pure fantasy written by someone without any sense of human nature. It's as realistic as stories about ultra chivalrous knights saving Christendom. The truth of the matter is that you couldn't become a knight by BEING chivalrous! A Knight would have to be ruthless, and so do Ayan Rand's heroes. Her heroes are single-mindedly Geeky and yet Ruthless. Very few people have that combination (Bill Gates does not really qualify as a geek in my book). It's almost always one or the other.

    Don't waste your time worshiping Ayan Rand. Save your worship some one more real -- like the Easter Bunny.

    Leave a comment:


  • FRED
    replied
    Re: Credit Crisis and Recession Deepen

    Originally posted by Thailandnotes View Post
    c1ue wrote:

    "My strategy is about moving into those countries, currencies, and businesses where future production will prosper and I'm perfectly willing to 'lose' relative gains in gold in the process."

    I wonder if you could elaborate.

    I opened a bank account with Standard Chartered in Singapore about 6 months ago so that I could more easily invest in other Asian currencies. I am curious about how confident you can be in predicting the future of economies in a variety of countries.

    Recently, there have been many stories about the price of gold here in Thailand. On Itulip I often read something along the lines of, "The price of gold is not rising. The dollar is falling." This is not accurate in the short term here. Gold is up about 20% in Thailand since September. The baht has only strengthened 7% in that time period.
    The official iTulip position from EJ's keynote at the hard assets conference in Las Vegas last year: gold rose in dollar terms 2001 to 2004 then in all currencies since 2004 but more in dollars.

    Leave a comment:


  • Thailandnotes
    replied
    Re: Credit Crisis and Recession Deepen

    c1ue wrote:

    "My strategy is about moving into those countries, currencies, and businesses where future production will prosper and I'm perfectly willing to 'lose' relative gains in gold in the process."

    I wonder if you could elaborate.

    I opened a bank account with Standard Chartered in Singapore about 6 months ago so that I could more easily invest in other Asian currencies. I am curious about how confident you can be in predicting the future of economies in a variety of countries.

    Recently, there have been many stories about the price of gold here in Thailand. On Itulip I often read something along the lines of, "The price of gold is not rising. The dollar is falling." This is not accurate in the short term here. Gold is up about 20% in Thailand since September. The baht has only strengthened 7% in that time period.

    Leave a comment:


  • metalman
    replied
    Re: Credit Crisis and Recession Deepen

    Originally posted by Rajiv View Post
    Yes but the transition from one form of money to another may be far from smooth -- it was smooth from gold to fiat dollars -- because fiat money can be inflated easily -- which was the main reason to shift from gold in the first place!
    reversion to the mean... over 100s of years gold is the mean. it's just that simple.

    Leave a comment:


  • Rajiv
    replied
    Re: Credit Crisis and Recession Deepen

    Originally posted by metalman View Post
    money is what a society says it is. yesterday green paper, tomorrow shiny metal.
    Yes but the transition from one form of money to another may be far from smooth -- it was smooth from gold to fiat dollars -- because fiat money can be inflated easily -- which was the main reason to shift from gold in the first place!

    Leave a comment:


  • jtabeb
    replied
    Re: Credit Crisis and Recession Deepen

    Originally posted by metalman View Post
    money is what a society says it is. yesterday green paper, tomorrow shiny metal.
    Don't tell that to c1ue!

    Leave a comment:


  • metalman
    replied
    Re: Credit Crisis and Recession Deepen

    Originally posted by jtabeb View Post
    I could not agree more. My gold and silver bullion coins are indeed circular!
    money is what a society says it is. yesterday green paper, tomorrow shiny metal.

    Leave a comment:


  • jtabeb
    replied
    Re: Credit Crisis and Recession Deepen

    Originally posted by Rajiv View Post
    Thus defining money is a circular argument
    I could not agree more. My gold and silver bullion coins are indeed circular!

    Leave a comment:


  • Rajiv
    replied
    Re: Credit Crisis and Recession Deepen

    The deflation argument rests upon the destruction of credit -- in other words, credit becomes scarce, and hence the money supply reduces.

    When the money supply reduces, things become less expensive for those who have money (credit) and those who don't have any credit starve -- or if they have working assets (assets that produce goods --e.g. food) - they become rich.

    FYI Currency is nothing but somebody's IOU

    See also Reinventing Money



    Also from the Money Primer Published by the US Senate
    26. What is legal tender?
    Legal tender is any form of money which the U.S. Government declares good for payment of taxes and both public and private debts.
    27. What is the most important form of money in the United States today?
    "Checkbook money" that is, demand deposits in commercial banks. They account, for 80 percent of all the money circulating in the country.

    28. Who issues money?
    Since the Revolutionary War, the U.S. Government. has minted coins and printed paper money, currency. Other goods, including tobacco receipts, have circulated as “money” although they were not legal tender. But, in the 19th century, the Government delegated its right to print legal tender money first to State banks, then to national banks.

    29. Today, who issues coins?
    Only the U.S. Treasury has the right to mint pennies, nickels dimes, quarters, half dollars and silver dollars. Then they are issued through the Federal Reserve Banks. The pennies are made of copper; the rest of alloys. Since 1934, the Treasury has minted no gold coins.

    30. What is currency?
    Currency is paper money, or folding money. Americans use several forms of currency: National Bank Notes, Federal Reserve Notes, Silver Certificates, Treasury Notes of 1890, U.S. Notes and Federal Reserve bank notes. About 94 percent of the currency in circulation today consists of Federal Reserve Notes, issued by the Federal Reserve banks.
    .
    .
    .
    .

    33. Do private banks issue money today?
    Yes. Although banks no longer have the right to issue bank notes, they can create money in the form of bank deposits when they lend money to businesses, or buy securities. (The next chapter will explain how banks create money.) The important thing to remember is that when banks lend money they don’t necessarily take it from anyone else to lend. Thus they “create” it.

    34. What backs U.S. currency?
    Federal Reserve Notes are backed by the credit of the U.S. Government. American citizens, holding Federal Reserve Notes, cannot demand anything for them except (a) that they be exchanged for other Federal Reserve Notes, or (b) that they be accepted in payment for taxes and all debts, public and private.
    Thus defining money is a circular argument

    Leave a comment:


  • jtabeb
    replied
    Re: Credit Crisis and Recession Deepen

    Originally posted by Rajiv View Post
    Today, ALL money is Debt.

    See the video Money as Debt

    Yet, the entire deflation argument rests on cash (currency) becoming precious relative to debt, hence an increase in the purchasing power of cash. Seen the vid b4.

    Leave a comment:

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