Perspectives on the global economic changes

chanakyaa · Post by **chanakyaa** » 02 Dec 2013 08:21

Neshant wrote:I don't know what you mean by "disciplined" and "non-disciplined".

Disciplined - mean countries where capital markets are well developed, governed, contract (and overall) laws are upheld and strictly enforced in court of law in reasonable time frame, and the mercantile mindset is part of national attitude..and then you have countries who lack many of these characteristics.

What I'm trying to highlight is that in spite of trillions of dollar and euro printing...rest of the world (i.e. holders of these fiat currencies) are perfectly happy to transact in these fiat currencies. May be chinese want their factories going and Indian babus have their own agenda. Point is that the fiat currencies, by its enforcement as reserve currencies, have been a major source of advantage.

Neshant · Post by **Neshant** » 02 Dec 2013 08:45

chanakyaa wrote: Disciplined - mean countries where capital markets are well developed, governed, contract (and overall) laws are upheld and strictly enforced in court of law in reasonable time frame, and the mercantile mindset is part of national attitude..and then you have countries who lack many of these characteristics.

These days the only thing that is in a bull market in western countries is cronyism.

The biggest heists in all of history has/is taking place there with private bankers offloading their multi-trillion dollar market gambling losses onto the back of society.

Hardly anything that might be called disciplined.

The only way to have discipline is when the people who earn the wealth (productive society) get to select the monetary system rather than having govt/bankers impose a monetary system on them. Anytime control over the money is left in the hands of a few "wise men" at the top, its descends into cronyism & corruption.

Neshant · Post by **Neshant** » 02 Dec 2013 09:50

Today’s Wealth Destruction Is Hidden by Government Debt

Mises Daily: Thursday, November 21, 2013 by Philipp Bagus

Still unnoticed by a large part of the population is that we have been living through a period of relative impoverishment. Money has been squandered in welfare spending, bailing out banks or even — as in Europe — of fellow governments. But many people still do not feel the pain.

However, malinvestments have destroyed an immense amount of real wealth. Government spending for welfare programs and military ventures has caused increasing public debts and deficits in the Western world. These debts will never be paid back in real terms.

The welfare-warfare state is the biggest malinvestment today. It does not satisfy the preferences of freely interacting individuals and would be liquidated immediately if it were not continuously propped up by taxpayer money collected under the threat of violence.

Another source of malinvestment has been the business cycle triggered by the credit expansion of the semi-public fractional reserve banking system. After the financial crisis of 2008, malinvestments were only partially liquidated. The investors that had financed the malinvestments such as overextended car producers and mortgage lenders were bailed out by governments; be it directly through capital infusions or indirectly through subsidies and public works. The bursting of the housing bubble caused losses for the banking system, but the banking system did not assume these losses in full because it was bailed out by governments worldwide. Consequently, bad debts were shifted from the private to the public sector, but they did not disappear. In time, new bad debts were created through an increase in public welfare spending such as unemployment benefits and a myriad of “stimulus” programs. Government debt exploded.

In other words, the losses resulting from the malinvestments of the past cycle have been shifted to an important degree onto the balance sheets of governments and their central banks. Neither the original investors, nor bank shareholders, nor bank creditors, nor holders of public debt have assumed these losses. Shifting bad debts around cannot recreate the lost wealth, however, and the debt remains.

To illustrate, let us consider Robinson Crusoe and the younger Friday on their island. Robinson works hard for decades and saves for retirement. He invests in bonds issued by Friday. Friday invests in a project. He starts constructing a fishing boat that will produce enough fish to feed both of them when Robinson retires and stops working.

At retirement Robinson wants to start consuming his capital. He wants to sell his bonds and buy goods (the fish) that Friday produces. But the plan will not work if the capital has been squandered in malinvestments. Friday may be unable to pay back the bonds in real terms, because he simply has consumed Robinson’s savings without working or because the investment project financed with Robinson’s savings has failed.

For instance, imagine that the boat is constructed badly and sinks; or that Friday never builds the boat because he prefers partying. The wealth that Robinson thought to own is simply not there. Of course, for some time Robinson may maintain the illusion that he is wealthy. In fact, he still owns the bonds.

Let us imagine that there is a government with its central bank on the island. To “fix” the situation, the island’s government buys and nationalizes Friday’s failed company (and the sunken boat). Or the government could bail Friday out by transferring money to him through the issuance of new government debt that is bought by the central bank. Friday may then pay back Robinson with newly printed money. Alternatively the central banks may also just print paper money to buy the bonds directly from Robinson. The bad assets (represented by the bonds) are shifted onto the balance sheet of the central bank or the government.

As a consequence, Robinson Crusoe may have the illusion that he is still rich because he owns government bonds, paper money, or the bonds issued by a nationalized or subsidized company. In a similar way, people feel rich today because they own savings accounts, government bonds, mutual funds, or a life insurance policy (with the banks, the funds, and the life insurance companies being heavily invested in government bonds). However, the wealth destruction (the sinking of the boat) cannot be undone. At the end of the day, Robinson cannot eat the bonds, paper, or other entitlements he owns. There is simply no real wealth backing them. No one is actually catching fish, so there will simply not be enough fishes to feed both Robinson and Friday.

Something similar is true today. Many people believe they own real wealth that does not exist. Their capital has been squandered by government malinvestments directly and indirectly. Governments have spent resources in welfare programs and have issued promises for public pension schemes; they have bailed out companies by creating artificial markets, through subsidies or capital injections. Government debt has exploded.

Many people believe the paper wealth they own in the form of government bonds, investment funds, insurance policies, bank deposits, and entitlements will provide them with nice sunset years. However, at retirement they will only be able to consume what is produced by the real economy. But the economy’s real production capacity has been severely distorted and reduced by government intervention. The paper wealth is backed to a great extent by hot air. The ongoing transfer of bad debts onto the balance sheets of governments and central banks cannot undo the destruction of wealth. Savers and pensioners will at some point find out that the real value of their wealth is much less than they expected. In which way, exactly, the illusion will be destroyed remains to be seen.

panduranghari · Post by **panduranghari** » 02 Dec 2013 18:13

Theo_Fidel wrote:Yes, It is. which is why all the rhona-dhona about government debt is quite silly WRT the numbers.

BTW one can do the numbers quite easily. It is an asset until it is monetized.
.

Pass me what ever you are smoking, coz it shurely good shtuff.

panduranghari · Post by **panduranghari** » 02 Dec 2013 18:18

chanakyaa wrote: Point is that the fiat currencies, by its enforcement as reserve currencies, have been a major source of advantage.

And hence why we will NEVER EVER see gold standard again.

RoyG · Post by **RoyG** » 02 Dec 2013 23:50

A partial gold standard is coming judging by how much gold central banks are accumulating. So no it isn't just tradition as Krugman stated. If gov debt isn't that big a deal as stated by some posters then technically we should just keep printing forever and we'll be fine. But no, those with common sense know this can never be the case. If what the pro debt squad says is true, empires shouldn't have collapsed and Tughlak should have been ordained as the wisest guru the world has ever seen. Fiscal responsibility and government efficiency are a must and judging by the NUMBERS. Gov debt is a VERY BIG DEAL.

TSJones · Post by **TSJones** » 03 Dec 2013 00:39

RoyG wrote:A partial gold standard is coming judging by how much gold central banks are accumulating. So no it isn't just tradition as Krugman stated. If gov debt isn't that big a deal as stated by some posters then technically we should just keep printing forever and we'll be fine. But no, those with common sense know this can never be the case. If what the pro debt squad says is true, empires shouldn't have collapsed and Tughlak should have been ordained as the wisest guru the world has ever seen. Fiscal responsibility and government efficiency are a must and judging by the NUMBERS. Gov debt is a VERY BIG DEAL.

Gold is easily storable collateral if you got facilities like Fort Knox or The New York reserve. Oil fields, warehoused copper ingots etc, can be collateral but they can be hard to bring under your coontrol to enforce the loan. Gold is easier. Having said that, no nation is going to underwrite the price of gold. Ain't gonna happen.

RoyG · Post by **RoyG** » 03 Dec 2013 00:46

It is going to happen otherwise central banks wouldn't be storing the stuff.

Theo_Fidel · Post by **Theo_Fidel** » 03 Dec 2013 02:35

Sigh! Who said government debt is not an issue. The Tea Party ideological silliness of it, is meaningless murkhta however.
Government debt does matter but only in terms of job creation / inflation / interest rates / deficit rate, etc.
Certainly these are bigger issues than Government debt.
Saying $ Trillion deficit has no meaning on its own.

panduranghari · Post by **panduranghari** » 04 Dec 2013 15:55

RoyG wrote:It is going to happen otherwise central banks wouldn't be storing the stuff.

Saar Gold is the wealth of nations irrespective of which nation.

Just like oil can act like a wealth for those who have it in ground but they still hold gold.
Just like a huge population can act like wealth but they still hold gold.
Just like having technological superiority can act like wealth but as long as gold cannot be manufactured, they still hold gold.

Gold standard is passée.

Neshant · Post by **Neshant** » 05 Dec 2013 13:48

What we are beginning to see are capital controls.

The doors on movement of capital out of the country are sneakily being closed with legislation to do so quietly being put in place.

RoyG · Post by **RoyG** » 06 Dec 2013 19:12

panduranghari wrote:
RoyG wrote:It is going to happen otherwise central banks wouldn't be storing the stuff.
Saar Gold is the wealth of nations irrespective of which nation.

Just like oil can act like a wealth for those who have it in ground but they still hold gold.
Just like a huge population can act like wealth but they still hold gold.
Just like having technological superiority can act like wealth but as long as gold cannot be manufactured, they still hold gold.

Gold standard is passée.

Gold standard only ended a few decades so its not passe. While I agree that technological prowess, food security, etc is more important the world needs an anchor to ascertain the strength of its currency, especially now since the dollar is in decline and slowly losing its premiere reserve currency status. You still haven't addressed the central question: Why are central banks hording the stuff?

TSJones · Post by **TSJones** » 06 Dec 2013 21:01

RoyG wrote:Gold standard only ended a few decades so its not passe. While I agree that technological prowess, food security, etc is more important the world needs an anchor to ascertain the strength of its currency, especially now since the dollar is in decline and slowly losing its premiere reserve currency status. You still haven't addressed the central question: Why are central banks hording the stuff?

Yes, just 40 years ago.

TSJones · Post by **TSJones** » 06 Dec 2013 21:13

"What stops large data center operators from using available resources to generate bitcoins? There are at least 10,000 servers at our behest that spend at least 6 hours a day idling (don't ask why!). Why shouldn't a corp gain from this?"

Bit coins are unregulated. I don't see anything stopping anybody from doing just that. There are only 21 million bitcoins in existence.

That the flaw on having limited currency. Richer, more resource powerful entities, can sweep up the majority of the currency thus causing deflation.

Using the US as an example, beforee the establishment of the Federal Reserve most of the gold coins was swept up by the powerful banks and brokerages on the east coast. Thefore nobody had any gold coins and they were reduced to bartering such as paying the doctor with chickens. Some people want to go back to those days. It makes them feel all warm and fuzzy.

panduranghari · Post by **panduranghari** » 07 Dec 2013 15:35

RoyG wrote:
panduranghari wrote:
Saar Gold is the wealth of nations irrespective of which nation.

Just like oil can act like a wealth for those who have it in ground but they still hold gold.
Just like a huge population can act like wealth but they still hold gold.
Just like having technological superiority can act like wealth but as long as gold cannot be manufactured, they still hold gold.

Gold standard is passée.
Gold standard only ended a few decades so its not passe. While I agree that technological prowess, food security, etc is more important the world needs an anchor to ascertain the strength of its currency, especially now since the dollar is in decline and slowly losing its premiere reserve currency status. You still haven't addressed the central question: Why are central banks hording the stuff?

Here is what my friend who goes under the pseudonym costata says about the reason why gold is being hoarded.

http://neuralnetwriter.cylo42.com/node/4014?page=3

Hello costata, I have a question for me.

Okay costata fire away.

Thanks costata, my question is: If you had to explain New economic paradigm in a couple of paragraphs what would you say?

I'm glad you asked that question costata. Here's my answer:

The current $IMFS is backed by collateral. The ultimate collateral in this system is sovereign debt - the risk-free asset in the banking system against which all other assets are priced. This sovereign debt was always worthless because sovereign debt has never been repaid. (England being the sole exception and that was hundreds of years ago.) So, at some point, the system will need to be recapitalized with collateral that is NOT worthless.

Real estate IS big enough to back the new regime but it isn't an option for several reasons. (One, because it's already mortgaged to the hilt.) Oil is also big enough but it isn't an option because that's what underpins the current US dollar-based system. Apparently an oil-backed Euro was envisaged some time ago but that appears to be a no-go today IMHO. Gold is the only remaining option. Now you could simply adopt gold as the new risk-free asset and make the sovereign debt obviously worthless. A dumb move that would please the gold bugs (and no one willingly rewards stupidity except voters).

Alternatively you could back the sovereign debt with high-priced gold and thereby minimize the disruption to the status quo. You can't back the currencies with gold because you need to debase the currencies in order to reprice gold to a much higher level in order to back the mountain of sovereign debt and the even BIGGER mountain of debt based on the mountain of sovereign debt. You can't have it both ways. It's either sound currencies and unsound sovereign debt or sound sovereign debt and unsound currencies. Capisce?

BUT first you have to get sufficient gold into the hands of the sovereign debtors whose debt underpins the whole system - EMU, USA, major gold producers and so on. Done! Tick that off your list. BUT you also need to pacify the other people who matter these days (e.g. Russia and China). So even if a country is already positioned for the transition it makes sense to co-operate in kicking the can down the road for the countries who aren't ready yet.

And you may be wondering why the PTB are screwing countries senseless at the moment with the apparent goal of making their sovereign debt sound. "They" are doing it for three reasons (a) because they can and (b) because it is very profitable and (c) it is a convenient lever to use to obtain other much more important concessions. In order to be crystal clear, "very profitable" means that you get the full, present currency value of the sovereign debt and the uplift from the gold revaluation of BOTH the debt and the gold you own. It's a great deal if you are correctly positioned (and a ruthless prick).

Thank you costata. I may be nitpicking but you said "a couple of paragraphs" and that was five (5) paragraphs.

Shut up, you idiot!

Okay

Austin · Post by **Austin** » 08 Dec 2013 10:07

Bursting Of The Debt, Dollar, and Bond Market Bubbles By Gregory Mannarino

http://youtu.be/jJMSuql76SQ

TSJones · Post by **TSJones** » 08 Dec 2013 13:09

Bitcoin is crashing mainly due to drop in speculation by China.

http://www.huffingtonpost.com/2013/12/0 ... lp00000592

...down to 877

Much of Bitcoin's meteoric rise in the past few months has been due to speculative trading in China, the Wall Street Journal pointed out earlier this week (subscription only).

China's central bank shot a gigantic hole in that trade on Thursday by telling Chinese banks they couldn't use the untraceable digital currency, calling it "not a currency in the real meaning of the word."

That doesn't mean Chinese investors can't keep speculating in Bitcoin, but it is a blow to the credibility of the four-year-old currency. Created by an unknown hacker or hackers known as Satoshi Nakamoto, Bitcoin has the potential to be a long-lasting digital alternative to national currencies like the U.S. dollar and the Chinese yuan. But it has also become favored for illicit uses such as money laundering and drug-dealing, raising concerns about whether policy makers will ever embrace it fully.

Regardless of Bitcoin's long-term potential, there is little doubt its price has jumped too far too quickly: It traded for less than $100 just six months ago.

An official for Bitcoin exchange BTC China, where a growing percentage of Bitcoin trading takes place these days, told the WSJ that most Chinese investors are just hoping prices will keep rising long enough for them to sell and turn a profi

TSJones · Post by **TSJones** » 09 Dec 2013 02:45

Austin wrote:Bursting Of The Debt, Dollar, and Bond Market Bubbles By Gregory Mannarino

http://youtu.be/jJMSuql76SQ

WHen was this audio recorded?

Mannarino was correct that the sequester would be enacted. That happened in March of this year I believe. He also said that investors would dump gold and go to the stock market. And indeed they did. However, the other two guys in the audio were just flat wrong. Gold is now at 1230 and could go down further as the dollar strengthens.

panduranghari · Post by **panduranghari** » 09 Dec 2013 03:42

TSJones wrote:
Austin wrote:Bursting Of The Debt, Dollar, and Bond Market Bubbles By Gregory Mannarino

http://youtu.be/jJMSuql76SQ
WHen was this audio recorded?

Mannarino was correct that the sequester would be enacted. That happened in March of this year I believe. He also said that investors would dump gold and go to the stock market. And indeed they did. However, the other two guys in the audio were just flat wrong. Gold is now at 1230 and could go down further as the dollar strengthens.

I am hoping gold drops below $1000/oz. I got a sizeable paper profit in the bank from the sale of a property to buy gold with. Do you see the gold weakening as dollar strengthens. I do see dollar strengthening but gold weakening with declining inventories seems unlikely.

TSJones · Post by **TSJones** » 09 Dec 2013 10:46

^^^^My son sells investment grade US gold coins and silver and advertises all over the country. Graded US gold coins are very popular among the wealthy elderly. Business is really slow right now. It could be they're waiting to see the effects of the taper from QE3 and then waiting for market indicators to show movement.

One thing is for sure the hedge fund guys have moved out of gold.

China? I dunno. They can make the market move too.

You should be diversified. Gold should be only a part pf your portfolio.

Full disclosure:
I do not own gold right now but I benefit from a business realtionship with my son in his gold business.

Neshant · Post by **Neshant** » 09 Dec 2013 11:28

Before ever buying gold, you need to decide if you are a coin collector or an investor.

Investors don't usually buy numismatic & graded stuff - unless they really know what they're doing. Most of the time such stuff is over-priced and you never get back what you paid for it when selling. There are a few scam companies out there like Goldline, Monex..etc. that prey upon elderly folks getting them hyped up about buying numismatic & graded coins at inflated prices. They count on the fact that these old folks don't know how/where to look up the spot price of gold. These over-the-phone salesmen are the scum of the earth.

Investors will either go for recognized govt issued gold coins and to a lesser extent bars. Typically 1oz. Typically 24k instead of 22k. Typically maples (24k), eagles (22k), krugerrands (22k), buffalos (24k), philharmonics (24k). Or they will go for paper gold to flip.

I'm looking to pick up more physical gold coins. However I don't think its going to penetrate the $1k barrier. Once the taper announcement is made (which will surely be a lie as money will be printed behind the scenes regardless), I plan to scoop up some metal.

Austin · Post by **Austin** » 09 Dec 2013 12:37

TSJ the video upload show Nov 24 nothing beyond that but two more recent report from Greg Mannarino

Greg Mannarino on the $85 Billion a Month Gorilla in the Room

Neshant · Post by **Neshant** » 09 Dec 2013 14:15

Beware of mannarino.

The guy was pumping some poker card scheme before he jumped on the financial guru gig.

TSJones · Post by **TSJones** » 09 Dec 2013 14:42

My problem is that I am a collector. I have a small amount of US silver dollars and silver halves. Frankly, I've lost money on them but I could never sell them. It would be like selling my children. No way. Maybe if I was dying or something and needed the money. Otherwise, nope.

Stocks, I can sell though when I see a profit. No problemo.

Austin · Post by **Austin** » 10 Dec 2013 07:39

US Federal Reserve closer to tapering $85 bn bond buying programme

The US Federal Reserve is closer to a strategy for the wind down of its $85 billion-a-month asset buying program, the Financial Times reported. The plan would see the Fed add extra monetary easing by another means, at the same time as winding down asset purchases. The rate-setting Federal Open Market Committee meets next week.

chanakyaa · Post by **chanakyaa** » 10 Dec 2013 07:58

http://www.zerohedge.com/sites/default/ ... Africa.jpg

TSJones · Post by **TSJones** » 10 Dec 2013 08:05

Austin wrote:TSJ the video upload show Nov 24 nothing beyond that but two more recent report from Greg Mannarino

Greg Mannarino on the $85 Billion a Month Gorilla in the Room

,,,despite what Mannarino says the Fed WILL taper. It's just a matter of when not if.

Neshant · Post by **Neshant** » 10 Dec 2013 12:16

nothing will be tapered.

the printing will be going on 24x7 just like the stock market rigging.

Neshant · Post by **Neshant** » 10 Dec 2013 12:25

China In Africa

Without the military means of protecting their investments in Africa from Libya style foreign invasion, China's investments there are not safe. China has no real foothold on the continent other than selling/giving weak African governments cheap military weapons.

This raises another interesting question. Do India & China's interests converge in Africa?

US and western Europe are teamed up in Africa along with a few stooge Gulf Arab stages as suppliers of terrorists & weapons and more recently even national military invasions to over-throw African govts and take their resources.

India like China which is also investing in Africa has no counter to this and thus all investments in Africa are simply sitting ducks for a Libya style robbery.

panduranghari · Post by **panduranghari** » 10 Dec 2013 16:31

TSJones wrote:^^^^My son sells investment grade US gold coins and silver and advertises all over the country. Graded US gold coins are very popular among the wealthy elderly. Business is really slow right now. It could be they're waiting to see the effects of the taper from QE3 and then waiting for market indicators to show movement.

One thing is for sure the hedge fund guys have moved out of gold.

China? I dunno. They can make the market move too.

You should be diversified. Gold should be only a part pf your portfolio.

Full disclosure:
I do not own gold right now but I benefit from a business realtionship with my son in his gold business.

Could you please direct me to his website. My brother in US could buy from him. I use coininvestdirect.com and https://www.goldline.co.uk/

panduranghari · Post by **panduranghari** » 10 Dec 2013 20:03

Neshant wrote:Before ever buying gold, you need to decide if you are a coin collector or an investor.

Investors don't usually buy numismatic & graded stuff - unless they really know what they're doing. Most of the time such stuff is over-priced and you never get back what you paid for it when selling. There are a few scam companies out there like Goldline, Monex..etc. that prey upon elderly folks getting them hyped up about buying numismatic & graded coins at inflated prices. They count on the fact that these old folks don't know how/where to look up the spot price of gold. These over-the-phone salesmen are the scum of the earth.

Investors will either go for recognized govt issued gold coins and to a lesser extent bars. Typically 1oz. Typically 24k instead of 22k. Typically maples (24k), eagles (22k), krugerrands (22k), buffalos (24k), philharmonics (24k). Or they will go for paper gold to flip.

I'm looking to pick up more physical gold coins. However I don't think its going to penetrate the $1k barrier. Once the taper announcement is made (which will surely be a lie as money will be printed behind the scenes regardless), I plan to scoop up some metal.

Before that one should decide if he is a SAVER or a GAMBLER.

Before the gurus jump on me, most of us small shrimps are savers. To be an investor, we need money that we can afford to loose. TBH I have no money that I can afford to loose. If I wanted to be a gambler, I would have worked for Goldman Sachs and then killed myself.

panduranghari · Post by **panduranghari** » 10 Dec 2013 20:06

TSJones wrote:
Austin wrote:TSJ the video upload show Nov 24 nothing beyond that but two more recent report from Greg Mannarino

Greg Mannarino on the $85 Billion a Month Gorilla in the Room
,,,despite what Mannarino says the Fed WILL taper. It's just a matter of when not if.

Kings world news

Richard Russell wrote:: “When I read dozens of advisories, I sometimes dream that economics could be simple. How about this: the US Treasury issues bonds, the Federal Reserve buys these bonds with money it creates with the computer, money brought about from thin air. It’s money that nobody worked for an nobody took risks for. The newly created money amounts to over one trillion a year. It’s taking more and more newly created money to produce less and less in the Gross Domestic Product. That’s a trend that could easily end in hyperinflation.

Friday’s market provided a hint of a melt-up. Subscribers with strong stomachs may be indulging in this melt-up. Others with weaker stomachs are probably on the sidelines. My original thinking is that this melt-up would be so powerful and so insistent that few would be able to sit on the sidelines and watch. In investing, the ticket to success is to take big profits and small losses.

Philosophically, what do you gain when you make a killing in the market? Probably a more luxurious life, and a feeling of well being. But nobody can take his profits with him. Which is why Warren Buffett and Bill Gates are giving their money away while they are alive.

I never ask subscribers to do what I wouldn't do. And what am I doing? If I buy anything here, unless I hold it for a year, I'll be subject to short-term capital gains tax. Since I can't be sure that this advance will last for over a year, and thus give me tax break, I'm not going to enter this market.

Gold is another story. I continue to think that gold is building a base and that somewhere ahead gold is going to surge. For now I'll sit with my bullion and cash and patiently await developments.

Is this the beginning of the melt-up I’ve been talking about? It’s too early to tell. But if there was a time to speculate, this may be the time. Personally, I haven’t got the nerve to join in on the festivities. Boils down to a matter of – to each his own. I like the gold action. And this is where I put the bulk of my money.

By the way Sotheby’s just sold a pink 59-karat diamond for $83.1 million, a world’s record for any jewel. It’s a mad, mad world. Who can forget the Graff Pink that sold for $46 million by Sotheby’s in Geneva. Big money is putting millions into one-of-a-kind tangibles. Like Chinese gold-buying, it’s all an escape from the dollar. And it may well lead to hyperinflation, assuming the Fed continues on its course. I continue to believe that gold is constructing a huge base.

Everybody knows that it’s dangerous to arrive late at the party, but it seems that’s where we are. Is the stock market really on thin ice? And is the gold market really on the edge of an upside explosion? Nobody knows. Meanwhile the Fed controls the sword of Damocles, which is hanging over the market.

I can’t prove it but I suspect an inflection point for gold is close at hand. The Chinese, who own a massive amount of US securities, have become openly worried about the US dollar. The gold that has been shaken out of weak and worried US hands, has been shipped to the East, and particularly China. China has imported a net 986 tons of gold through Hong Kong during the first 10 months of the year.

China may not be so much intent on backing its currencies with gold, but in protecting itself from a potential collapse in the US dollar. From the US standpoint, it’s now a case of “inflate or die,” and much of the world knows this. Thus if the US decides not to default on its massive debts, it will have to resort to hyperinflation. If this happens, the US will single-handedly tear the world monetary system apart.

What worries me is that governments will do whatever they have to in order to remain in power. This can result in confiscation of the assets of US citizens. In the end, we only borrow the wealth during our lifetimes. We don’t take it with us. But the government can take it from us. Should this happen, I’m afraid we’ll see blood in the streets. America's massive debts will ultimately upset the world’s monetary system. There will be no escape, but there will be a diversion into spirituality. This is not the time to give up on your gold. I suspect gold’s inflection point is near.

TSJones · Post by **TSJones** » 10 Dec 2013 21:12

panduranghari wrote:
TSJones wrote:^^^^My son sells investment grade US gold coins and silver and advertises all over the country. Graded US gold coins are very popular among the wealthy elderly. Business is really slow right now. It could be they're waiting to see the effects of the taper from QE3 and then waiting for market indicators to show movement.

One thing is for sure the hedge fund guys have moved out of gold.

China? I dunno. They can make the market move too.

You should be diversified. Gold should be only a part pf your portfolio.

Full disclosure:
I do not own gold right now but I benefit from a business realtionship with my son in his gold business.
Could you please direct me to his website. My brother in US could buy from him. I use coininvestdirect.com and https://www.goldline.co.uk/

Hmmm, sorry but I really don't want to mix personal business with my internet ramblings.

If you're looking for a website in America that has a good reputation and a high BBB reliablity score then try Apmex.com

I have no business dealings with them and I don't know anybody at that site but they have a fair reputation. By that I mean if they charge your credit card at the agreed upon price, they will send the agreed upon coin(s).

Having said said that all gold salesmen will try to up sell you to a higher priced coin(s). It's how they make their money. So beware.

But if they charge your credit card they will send you your coin(s).

Always use your credit card because if there is anything wrong you can call your bank and refuse the charge on your card.

That about all I can tell you. I make no guarantees about Apmex.com, your experience may vary.

chanakyaa · Post by **chanakyaa** » 11 Dec 2013 05:40

China In Africa
Without the military means of protecting their investments in Africa from Libya style foreign invasion, China's investments there are not safe. China has no real foothold on the continent other than selling/giving weak African governments cheap military weapons.

Saar, if I understand the sequence correctly, shouldn't the interest develop first, followed by means to protect them (i.e. military)? It definitely worked for the British. Merchants were followed by royal army. Are you suggesting that providing cheap (don't they always make cheap stuff) military weapons is irrelevant?

Neshant · Post by **Neshant** » 11 Dec 2013 09:12

The interests and investments have already taken place. China just completed a multi-billion dollar rail line in Kenya or some such place in Africa. Just like Gadafi who spent a fortune developing Libya only to get murdered and have it all stolen by foreign invaders, China too could see its vast investments in Africa get robbed - the latest being its oil interests in Libya and previously Iraq.

I don't yet see how China can protect all the mines and stuff they are building in Africa.

Watch for "rebels" popping up to win "freedom" in the years ahead.

Neshant · Post by **Neshant** » 12 Dec 2013 11:13

svinayak · Post by **svinayak** » 12 Dec 2013 23:03

Will Bitcoin Undermine the U.S. Dollar?

Fake article are coming and creating confusion and connecting real world with psy ops world.

Somebody is pushing bitcoin to divert the attention from dallah

TSJones · Post by **TSJones** » 13 Dec 2013 03:21

The theory is, IF and that's a big if, the budget deal passes US congress, the taper is sure to commence. So in that theory I present the following argument:

Forget the taper here's what is really weighing down gold:

http://finance.yahoo.com/blogs/talking- ... 43618.html

paramu · Post by **paramu** » 13 Dec 2013 05:35

Gold Could Surprise On The Upside Next Year

IU.eu: How is gold priced?

Grubb: The global spot price is in real time but there are also two London fixing prices in the morning and afternoon. There isn’t a single gold price, which is a generally less well known fact.

There are wide variations on the gold price. There is a premium of $300 an ounce in Mumbai and $15-150 an ounce in Shanghai, while the Vietnam premium is about $150 an ounce.

TSJones · Post by **TSJones** » 13 Dec 2013 08:58

House overwhelmingly passes two year budget.

http://nbcpolitics.nbcnews.com/_news/20 ... ition?lite

Let's see what happens to gold and the dollar. Watch the indicators and you may make some money.