The perpetual war: gold vs paperJuly 28, 2010 In its latest research report the Longwave Group uses the Kondratieff cycle, Dow to gold ratio and Homestake mining to Dow ratio provide a warning that the perpetual gold vs paper war may soon reach an ugly conclusion....for paper assets. All that is paper does not glitterApril 21, 2010 The following article by Adrian Douglas of GATA provides an overview of the recent CFTC hearings into silver market manipulation by big investment banks such as JP Morgan and HSBC. GATA also label the London Bullion Market Association (LMBA) a giant 100 to 1 leveraged ponzi scheme. It is important to note that all the worlds Mints, many governments, ETF's, Exchanges, banks, bullion dealers, hedge funds and large investors own or hedge gold and silver positions via the LMBA. If the market realises the LMBA is in fact a huge naked short paper ponzi scheme we could see a short squeeze that makes 1980 look like a minor blip. To quote a key LBMA executive when he was asked what happens if 2% of holders request physical metal delivery........."we then go into price discovery". Got your physical gold and silver? Weimar Gold & Silver Prices 1919-1923March 31, 2010 Weimar Germany hyperinflation prices of gold and silver in Marks from 1919 - 1923 by month. Charts are also presented to visually depict the speed and magnitude of the change. Consider the human story behind the numbers. How did people survive? UK gold sale: was it a bank bailout?March 25, 2010 Gordon Brown sold approximately 400 tonnes of the UK's gold at the bottom of the market in 1999-2002. Contrary to investment logic the sale was pre announced causing the gold price to plummet. This marked the bottom of the gold market and a decade long bull market which has seen gold move from $250 oz to over $1200 oz. Was Gordon Brown (and Peter Costello for that matter, as Australia sold most of its gold at the same time) manipulating the gold price down to allow heavily short investment banks to cover their positions? Gold as money presentationMarch 19, 2010 On Wednesday I presented to a large group of financial planners at the Van Eyk annual conference in Sydney. Full credit must go to Mark Thomas and his team at Van Eyk for allowing gold to headline alongside the chief economist from Goldman Sachs. It may have taken 10 years of 17% compounding growth and out performance of every other asset class on the planet but maybe gold is finally getting the mainstream recognition it deserves. Hyperinflation parallels: Weimar Germany vs US/UKFebruary 28, 2010 SocGen's Dylan Grice provides a gripping account of Germany's hyperinflationary episode, in which he charts the extended parallels between not just the precursor economy that lead to a 16,579,999% inflation in 1923 Weimar Germany, and modern day developed (and highly leveraged) countries, but between Germany's then central banker Rudolf von Havenstein, and the Greenspan-Bernanke duo. And while we know how "der Geld Marschall's" Weimar experiment ended, the future before the U.S., as a result of the Maestro's (both Senior and Junior) almost identical policy response is still open-ended. As the future of America is now exclusively in the hands of insidious economists, the following insight from Grice into the utility of economic models and decision-making should be sufficient to dash the hopes of any optimist for a favorable outcome. End the monetary experiment, retun to the gold standardFebruary 23, 2010 The absurdity of using the US dollar as the worlds reserve currency should not underestimated. The removal of gold in favour of the US dollar in 1971 as the check and balance of the worlds financial system has enabled the US (and the world) to create money out of thin air for nearly 40 years. The consequences were clear. As long as currencies remain relative to one another all governments were empowered to spend with reckless abandon, without need for old fashioned ideas such as raising taxes or balancing budgets. Developing nations loved this cycle because the increased deficit spending and access to consumer credit created demand for their export products. Developed nations liked it because they avoided the nasty boom bust cycles had access to cheap imported goods. Consumers loved it because stock prices moved higher and the humble home became a money tree with an ATM attached. Of course the US benefited most. For the selfless act of becoming the worlds monetary system anchor the US was able to build the greatest empire in history. With access to money without limit the US has funded global military activities and created dominant multinational corporations in food, health, banking, energy and all across the industrial complex. American consumers have also greatly benefited by achieving standards of living well beyond what would have ever been possible pre 1971. Bigger houses, more cars, better holidays, larger stock portfolios and of course bigger wastelines. Hyperinflation in historyJanuary 18, 2010 All FIAT currency is eventually worth its intrinsic value....exactly zero! The average life of a paper currency is less than 40 years. This article highlights recent episodes of hyperinflation and some of the social and political consequences. Hyperinflation 101January 15, 2010 Hyperinflation is purely a monetary phenomenon. Governments and Central banks print too much money. The new supply of money depreciates the value of all existing money. Rising prices are a symptom of inflation not the cause of inflation. Gold is better value today at $1100 than it was at $300January 07, 2010 Global investing guru Marc Faber believes that gold is less expensive today at $1100 per ounce than it was below $300 in 2001 due to an explosion of foreign exchange reserves in the world, zero interest rates, the huge debt overhang, and the expectation of further money printing Don't be fooled by deflation a tsunami of inflation is comingDecember 28, 2009 Today marks the 5 year anniversary of one of the wost natural disasters in human history. As I reflect on the warnings and terrible consequences of the Asian disaster, I can’t help but draw parallels to an inflation tsunami headed our way. The warning signs have been there all along: loose monetary policy, asset bubbles, competitive currency devaluations, bail outs, excessive debt and leverage, lax or even corrupt regulatory oversight, excessive government and manipulated asset markets. If only paper was as good as goldDecember 27, 2009 This article by Peter Schiff provides a nice overview of how we arrived at todays experimental backed by thin air monetary system. It also provides some insight into the likely consequences of close to 100 years of disasterous monetary policy. Consider not how high gold might go, instead think how low can paper money go. What Peter Schiff has written here is critically important to understanding wealth preservation in a new decade. Also Australian investors should not assume this is an American problem. Since 1971 all paper currencies are essentially derivatives of the US dollar. Despite being the 3rd largest gold producer in the world, Australia owns virtually no gold. In our wisdom we sold it all at the market bottom in 1999 and replaced it with those wonderful interest bearing US dollars which have subsequently lost more than 60% of their purchasing versus gold in just 10 years. Understanding the essential value of goldDecember 24, 2009 Gold is not a trading-item, gold represents a very specific asset class and an historic store of wealth. The essential value of gold does not change over the years, the value of everything else fluctuates AROUND GOLD. Gold is the basic unit of wealth as it has been for 5000 years. Gold is pale becuase it has so many thieves plotting against itOctober 01, 2009 Antal E. Fekete Professor of Money and Banking San Francisco School of Economics discusses how Keynesian and Friedmanite politicians and economists have never allowed a free discussion on the gold standard. The role of gold in your investment portfolioAugust 27, 2009 While some investors view precious metals as a short-term cyclical speculation, there are actually three important reasons for including precious metals in every investment portfolio. These are: strategic asset allocation, hedging and tactical asset allocation. Gold confiscation in AustraliaJune 19, 2009 Originally published in November 2008, Bron Suchecki's gold confiscation article is well researched and unique. Rarely do we see an Australian perspective on this issue. Whilst I agree with the core hypothesis that legislative risks exists, I feel it is very unlikely gold will be confiscated in Australia FDR style. It is my contention that governments will attempt (and fail) to use more sophisticated and less obvious methods such as derivatives manipulation, Capital Gains Tax and price controls. A short history of the gold cartelJune 07, 2009 Governments want a low gold price to make national currencies look good. Gold is recognizable the world over as the ‘canary in the coalmine’ when it comes to money. A rising gold price blurts the unpleasant truth that a national currency is being poorly managed and that its purchasing power is being inflated. Privatise the profits and socialise the losses 2.0April 10, 2009 This is taken from Congressman Mcfadden’s 1934 speech. It explains why only the bankers get the money and all the bankers’ losses and debts are given to the people so as to impoverish all of us first off and then enslave us with higher taxes to pay off the debt incurred when the money was given to the bankers. It explains what Obama will do in the future. This is the blueprint that Bernanke, Geithner and Obama are following. Inflation and the French revolutionMarch 03, 2009 As in so much else, the French revolutionary regime (1789-94) was the precursor of the centralized, totalitarian, managerial, pseudo-democratic despotisms that now reign over the West. It is also reminder that mass democracy and inflation go together, as surely as thunder and lightning. Let us revisit the Revolution, from a free-market, hard-money perspective. The ravages of inflationFebruary 03, 2009 Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become ‘profiteers,’ who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery. |
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