The Long Cold Winter

All things outside of Burning Man.
Post Reply
can't sit still
Posts: 4645
Joined: Tue Aug 23, 2005 4:21 pm
Location: SoCal

Post by can't sit still » Mon Apr 18, 2011 6:38 pm

1durphul, since the dollar is held as the reserve currency by so many countries, they will all suffer during a crash. Dunno about Hong Kong or Singapore. I wouldn't touch mutual funds anyway. I expect bio-tech to do OK. Don't know much about stocks.
There is an old saying in economics; "never start a panic but, if you do, make sure that you are first to the exit." Bill Gross exited U.S. treasuries. This may have the effect of starting a stampede,,, who knows? Texas university has run for the exits; http://kingworldnews.com/kingworldnews/ ... _Bars.html

The Chinese are doing some bailing-out in Europe. Guess what they're using??? U.S. Treasuries :o They're dumping them as fast as they can.
2 year Greek debt is costing 20%. This is a recognition that Greece will never be able to pay back. Spain is the next at bat. Italy is not far behind. GB is in bad shape but, the London banking cartels are holding the line for the moment.
I don't post things because I believe that they are the absolute truth. I post them because I believe that they should be considered.

User avatar
geekster
Posts: 4867
Joined: Wed Sep 08, 2004 2:53 pm
Location: Hospice For The Terminally Breathing
Contact:

Post by geekster » Tue Apr 19, 2011 5:57 pm

Dollar isn't going to be the reserve currency much longer. IMF is already moving to a "basket" approach.

But hey, at least we can give the unemployed capes!

http://news.yahoo.com/s/ap/20110419/ap_ ... unemployed
Pabst Blue Ribbon - The beer that made Gerlach famous.

can't sit still
Posts: 4645
Joined: Tue Aug 23, 2005 4:21 pm
Location: SoCal

Post by can't sit still » Tue Apr 19, 2011 6:29 pm

The basket had better be a bucket. All the major currencies are crap. Compared to gold, they all suck big time. Denominating a new basket will just be a new screw job. The dollar is crashing so bad, it makes weak currencies look good. From The Daily Reckoning;
"While the dollar remains the world's reserve currency, it is not acting like it. The dollar's value has been dropping against just about everything. Really. Everything. Would you believe that the top- performing currency of 2011 is the Paraguayan Guarani? And that's not all; the next best performing currencies are the Mauritian Rupee, Hungarian Florint, Czech Koruna, Russian Ruble and Colombian Peso.

This is not a joke. Not only are these currencies atop the leader board for 2011, but each of them has also appreciated at least 25% against the US dollar during the last two years. The Colombian peso is up 44%!"
An IMF basket is monetary auto-eroticism. :lol:
I don't post things because I believe that they are the absolute truth. I post them because I believe that they should be considered.

User avatar
geekster
Posts: 4867
Joined: Wed Sep 08, 2004 2:53 pm
Location: Hospice For The Terminally Breathing
Contact:

Post by geekster » Tue Apr 19, 2011 8:25 pm

The dollar as reserve currency made sense in the post-WWII world. The US was the only major manufacturing economy on the planet. We were the largest in production of practically every raw and finished product. We were the world's number one oil exporter.

That all began to change in the 1980's when Japan and Germany found their economic footing once they got their infrastructure built back up. Then it changed even more when the Eastern European economies began to repair the damage from decades of socialism. Then add the rise of India and China, and the US dollar really no longer has any real reason to be the reserve currency.

The actions of the US in "quantitative easing" and diluting the value of the dollar makes it even less attractive as a reserve currency. Who wants to hold a reserve of something that keeps losing value? What has saved us so far is that currencies such as he Euro have been losing value faster than ours but currencies such as the Swiss Franc have been stable.

The US dollar no longer makes economic sense as a reserve currency. We don't produce much steel anymore, you can't open a mine in the US or drill a well even though we still have a huge amount of these resources available. We no longer have the energy to refine aluminum due to energy shortages created by government policies and lawfare from enviroterroist groups.

We are basically nothing special at this point. China is the manufacturing giant, Brazil is the main source of raw materials, India has cheap technology.
Pabst Blue Ribbon - The beer that made Gerlach famous.

can't sit still
Posts: 4645
Joined: Tue Aug 23, 2005 4:21 pm
Location: SoCal

Post by can't sit still » Tue Apr 19, 2011 8:52 pm

The U.S. dollar IS the reserve currency,,,,, but, only because nobody can figure out how to get rid of the dollars that they hold. :shock:
I don't post things because I believe that they are the absolute truth. I post them because I believe that they should be considered.

can't sit still
Posts: 4645
Joined: Tue Aug 23, 2005 4:21 pm
Location: SoCal

Post by can't sit still » Wed Apr 20, 2011 10:06 pm

The FED is leveraged 50--1. They also hold tons of toxic derivatives.
"To avoid the potentially untidy embarrassment of being insolvent on paper, the Fed
quietly made an accounting change several weeks ago that will allow any losses to be
reported as a new line item - a "negative liability" to the Treasury"
How nice,,, an accounting change. Now, any loss by the FED automatically is a negative liability to you and me. BASTARDS.
http://www.johnmauldin.com/images/uploa ... 041911.pdf

Strangely enough,,,, there just isn't enough money to go around. Everybody needs to borrow shitpots of money and it just isn't available;
http://www.chrismartenson.com/blog/brea ... near/56594

Some years ago, Russia defaulted on it's loans. They failed to pay GOV employees for months,, sometimes years. It would seem that GOV would just print the money and pay them. Gideon Gono did that in Zimbabwe. He got a bit of inflation." 89.7 sextillion percent hyperinflation"
If America is run by the banking interests, would GOV continue to service it's debt but fail to pay it's employees? Would the FED try to preserve the FRN and starve the GOV employees? Dunno.
I don't post things because I believe that they are the absolute truth. I post them because I believe that they should be considered.

can't sit still
Posts: 4645
Joined: Tue Aug 23, 2005 4:21 pm
Location: SoCal

Post by can't sit still » Thu Apr 21, 2011 7:38 am

The stage is set. As we get closer to the opening of the drama, the dates become more firm. The auditions have ended and the cast is chosen. The final script changes are being worked out. Autumn of 2011 will bring the opening curtain. We will all play a part.
"This is the new California governor Jerry Brown (24) opinion in any case, who believes that the United States is facing a regime crisis identical to that which led to the Civil War (25)."

http://www.leap2020.eu/GEAB-N-54-is-ava ... a6340.html
I don't post things because I believe that they are the absolute truth. I post them because I believe that they should be considered.

User avatar
1durphul
Posts: 704
Joined: Mon Apr 27, 2009 1:14 pm

Post by 1durphul » Thu Apr 21, 2011 10:23 am

can't sit still wrote:The basket had better be a bucket. All the major currencies are crap. Compared to gold, they all suck big time. ....

This is not a joke. Not only are these currencies atop the leader board for 2011, but each of them has also appreciated at least 25% against the US dollar during the last two years. The Colombian peso is up 44%!"
An IMF basket is monetary auto-eroticism. :lol:
What about this doesn't look like a bubble in gold valuation to you? You have people using emotion (fear of dollar collapse) as their only justification for buying gold. If that fear passes and people begin to sell back their gold it will initiate a panic as the value begins to rapidly fall. Honestly that is the far more likely scenario than the US Gov't defaulting. The entire world is holding the bag on the American dollar. Only the gullible would be left holding the bag on gold. You can bet that some of the actual wealthy holders are beginning to sell off their gold now, knowing that the panic begins shortly.

User avatar
1durphul
Posts: 704
Joined: Mon Apr 27, 2009 1:14 pm

Post by 1durphul » Thu Apr 21, 2011 10:28 am

http://www.fool.com/investing/general/2 ... ubble.aspx

Perhaps a few months ahead, but that is about how far ahead you want to be on a coming crash.

can't sit still
Posts: 4645
Joined: Tue Aug 23, 2005 4:21 pm
Location: SoCal

Post by can't sit still » Thu Apr 21, 2011 6:58 pm

It's all about the dollar. Gold is going down in other currencies;
http://news.goldseek.com/BullionVault/1303393000.php

The bubble is in treasuries, NOT in gold. At the CFTC hearings, one of the bullion banks admitted that they sell every gold bar 100 times. Since then, there has been a mad stampede to convert un-allocated gold to allocated gold.
We all heard bubble and crash at $ 500,,, at $ 600,, at $ 700, etc, etc. Texas university bought $ 1 billion in gold. They did NOT buy paper-gold or futures or ETF. Everybody knows that the half of the ETFs don't have the metal that they claim. They've already been caught naked on silver. THAT is why silver has gone crazy,,, Failure to deliver.

Gold will go naked before long. The LBMA has almost defaulted [failure to deliver] and had to be bailed out by an emergency gold loan from Deutsches bank.
Judge for yourself. There are plenty of reasons that gold is in NO bubble.
http://www.24hgold.com/english/news-gol ... +Willie+CB
I don't post things because I believe that they are the absolute truth. I post them because I believe that they should be considered.

User avatar
1durphul
Posts: 704
Joined: Mon Apr 27, 2009 1:14 pm

Post by 1durphul » Fri Apr 22, 2011 9:36 am

can't sit still wrote:It's all about the dollar. Gold is going down in other currencies;
http://news.goldseek.com/BullionVault/1303393000.php

http://www.24hgold.com/english/news-gol ... +Willie+CB
You'll have to excuse me if I'm skeptical of any domain with "gold" in the domain name. I somewhat doubt that they are giving me news that isn't either intentionally made to benefit their gold selling business, or biased through their own (most likely irrational) beliefs about it.

can't sit still
Posts: 4645
Joined: Tue Aug 23, 2005 4:21 pm
Location: SoCal

Post by can't sit still » Fri Apr 22, 2011 6:55 pm

I don't post things because I believe that they are the absolute truth. I post them because I believe that they should be considered.

User avatar
geekster
Posts: 4867
Joined: Wed Sep 08, 2004 2:53 pm
Location: Hospice For The Terminally Breathing
Contact:

Post by geekster » Mon Apr 25, 2011 10:10 pm

http://blogs.dailymail.com/donsurber/archives/32861

Absolutely brilliant, the entire article, absolutely dead ON (well, except for the Ron Paul part).

Oh, and who was the largest corporate donor to the Obama campaign?

Goldman Sachs.
Pabst Blue Ribbon - The beer that made Gerlach famous.

can't sit still
Posts: 4645
Joined: Tue Aug 23, 2005 4:21 pm
Location: SoCal

Post by can't sit still » Tue Apr 26, 2011 7:29 am

Geekster, the blame is laid on Big, Bad, Bald, Ben Bernanke. Considering the money powers that he represents, it's doubtful that his actions are taken by choice. The article claims that the actions were "experimental". NOT true. History has proved them to a guaranteed failure. GOV was hoping to inflate away the debt without destruction of the economy. It never works that way. http://www.oftwominds.com/blogapril11/o ... atrick.net
We get the same outcome that previous fools reaped;
http://www.zerohedge.com/article/guest- ... omic-abyss
China has just announced that they plan to reduce their foreign reserves down to $ 1 trillion. You know that they will dump ALL U.S. paper that they can unload.
It's "game over" for the U.S. GOV. The date for our economic demise has been moved closer,,, again.
http://www.zerohedge.com/article/task-n ... erica-over
The fact is that GOV / banks have continually postponed a return to the real world. This makes the outcome far worse;
http://www.moneyandmarkets.com/a-financ ... mb-2-44264
Our price inflation will get worse. It is claimed that America will be a totally different country when gas reaches $ 10 a gallon. Who knows?
http://globaleconomicanalysis.blogspot. ... ation.html
I don't post things because I believe that they are the absolute truth. I post them because I believe that they should be considered.

User avatar
geekster
Posts: 4867
Joined: Wed Sep 08, 2004 2:53 pm
Location: Hospice For The Terminally Breathing
Contact:

Post by geekster » Tue Apr 26, 2011 7:59 pm

Actually, the problem IS Bernanke or at least the policy he has been tasked to carry out.

The problem is this:

Obama thinks he needs to spend trillions more dollars than he actually has.

This means that he needs to borrow like there is no tomorrow because revenues are down.

Generally what one does when they must attract more lenders to lend you money is that you must increase the interest rate that you pay in order to attract them. But President Erkel can't afford to raise interest rates because if that happens, we go right back into a second mortgage crisis.

So how do you borrow bazillions of gigabucks without raising interest rates? You get the Federal Reserve to simply roll the presses, print the money, and they buy treasury debt with it. Viola ... you can run as big a deficit as you want as long as you keep the presses rolling.

But the consequence is that if you increase the number of dollars, you decrease the value of each one. So that is why the US Dollar hit an all time record low against the Swiss Franc yesterday.

World commodities are traded in dollars. As the dollar declines in value, the price of commodities rises. So the price of oil rises when paid for in dollars (not rising nearly so much for a person paying for it in Swiss Francs).

So this is also what is pushing the world to a different reserve currency. Nobody wants to hold any significant amount of something that is losing value. Nobody wants to see the value of their foreign currency reserves decline while Obama tells Bernanke to roll the presses.

So the world is fleeing dollars ... which puts more dollars up for sale on foreign exchanges which depresses the value of the dollar even more.

Obama is doing every single thing he can possibly think of to absolutely destroy the economy of the United States.

He isn't empowering anyone, he isn't redistributing anything, he is basically making everyone in this country poorer.

He will go down in history as the President that ruined the US economy. Within 12 months it will be pitchfork and torches at the White House gates.
Pabst Blue Ribbon - The beer that made Gerlach famous.

can't sit still
Posts: 4645
Joined: Tue Aug 23, 2005 4:21 pm
Location: SoCal

Post by can't sit still » Tue Apr 26, 2011 8:40 pm

"Within 12 months it will be pitchfork and torches at the White House gates."
Not true ! Both ARAMCO and Sino-Pec [Saudi and China] are cutting back exports to keep the price of oil high. China is going to unload 2/3rds of their foreign currency reserves. Guess which currency goes first.
NOBODY will be able to afford to drive to Washington with their pitchfork.
I don't post things because I believe that they are the absolute truth. I post them because I believe that they should be considered.

User avatar
geekster
Posts: 4867
Joined: Wed Sep 08, 2004 2:53 pm
Location: Hospice For The Terminally Breathing
Contact:

Post by geekster » Wed Apr 27, 2011 1:13 am

There's plenty within walking distance.
Pabst Blue Ribbon - The beer that made Gerlach famous.

User avatar
Simon of the Playa
Posts: 19041
Joined: Thu Sep 06, 2007 6:25 pm
Burning Since: 1996
Camp Name: La Guilde des Hashischins
Location: Rochester, Nevada.

Post by Simon of the Playa » Wed Apr 27, 2011 7:25 am

yeah, somehow i fully expect that you two will be sitting behind the screen instead of actually doing anything about anything..i dont foresee either of you handling said pitchforks

talk about cosmic shadenfreude....you'll only be happy if your delusions of calamity occur...


totally useless. you should spew this nonsense on people who might appreciate your constant drum beat of doom.


like born again Christians and Jihadist Muslims.
Frida Be You & Me

User avatar
geekster
Posts: 4867
Joined: Wed Sep 08, 2004 2:53 pm
Location: Hospice For The Terminally Breathing
Contact:

Post by geekster » Wed Apr 27, 2011 7:54 pm

Well, I guessed the wheels would be falling off the cart in March. But apparently I was one month off.
The Fed cut its growth estimate for 2011 to between 3.1 percent and 3.3 percent from a January forecast of 3.4 percent to 3.9 percent.
I'll be shocked if they get that much after later revisions. That is a backing down of roughly 1/2 of a percent.
The Fed also raised its estimate of inflation this year to a range of 2.1 percent to 2.8 percent, taking into account a recent surge in oil prices. However, it bumped its core inflation forecasts only marginally to a 1.3 percent to 1.6 percent range.
Which is only because they have changed how inflation is calculated. If we were calculating inflation the same way as we were doing it during the Carter administration, inflation would be somewhere around 10% right now. So they keep jiggering the calculations in order to get the desired results.
As for unemployment, it lowered its forecast but said it would stay elevated over its three-year forecast period.
So basically the forecast says less economic growth, more inflation, high unemployment. That is consistent with the policies I am seeing executed by this administration which would be expected to cause high unemployment, high inflation, and low economic growth. So basically, Bernanke says they are right according to plan, which I agree with provided your plan is to keep people out of work and make them poorer so more of them depend on government programs. Once you accomplish that, then you just promise more programs in order to stay in office. Pretty simple economic policy right out of the Hugo Chavez / Robert Mugabe school of economics.
Pabst Blue Ribbon - The beer that made Gerlach famous.

can't sit still
Posts: 4645
Joined: Tue Aug 23, 2005 4:21 pm
Location: SoCal

Post by can't sit still » Wed Apr 27, 2011 8:42 pm

Geekster, the growth estimates are pumped up by GOV spending,,, with fresh printed money. They don't really mean much.
I should clarify my post on China, Saudi and oil. Many years ago, the u.s. secretary of treasury told world leaders that the dollar is our currency and their problem.
lately, Geithner printed like a maniac and figured that our bond holders were SOL. Well, our bondholders are losing money on the bonds being devalued. SO, they just hold oil off market and make up the difference in the oil price.
Russia just came out and said that they have enough dollars already. So, china is dumping dollar assets at the same time that it cuts off all oil exports. Saudi is cutting back exports. Russia doesn't want our dollars.
The R.O.W. is using a LOT more oil. http://oilprice.com/Energy/Crude-Oil/Pe ... -2011.html
So, we see declining supply,,,, increasing consumption and a weaker dollar. Do you think that gas may go a bit higher?
BTW, what kind of pitchfork does one take to a lynching. I have a clam-fork, a potato-fork and a hay-fork. Can the torches be ethanol [clean burning] or must they be traditional,,, pitch? Too many decisions. :?
I don't post things because I believe that they are the absolute truth. I post them because I believe that they should be considered.

User avatar
geekster
Posts: 4867
Joined: Wed Sep 08, 2004 2:53 pm
Location: Hospice For The Terminally Breathing
Contact:

Post by geekster » Thu Apr 28, 2011 9:36 am

That's kind of my point. They put out these "growth estimates" hoping for a psychological bounce that creates a self-fulfilling prophesy. Then they provide inflated numbers at the end of the quarter and then quietly revise them down later. In other words, at the end of a quarter or month they might report higher GDP growth than actually happened. That gets wide exposure in the press. Then they revise those numbers down in subsequent reports and the revisions don't get as widely reported.

And today we have:
Initial claims for state unemployment benefits jumped 25,000 to a seasonally adjusted 429,000, up from a slightly upwardly revised 404,000 the preceding week, the Labor Department said. Economists polled by Reuters were expecting claims to slip to 392,000 from the previously reported 403,000.
So every week/month/quarter we get these "unexpected" results. How many times does the result have to be "unexpected" before it dawns on them that the people they are polling have their heads up their asses?

Unemployment is going to settle but not because there are fewer people unemployed. It is because of how the data are collected. First of all "new claims" will go down as companies cut to the bone and simply can't lay off anymore. It doesn't mean they are hiring, it just means they have laid off all they can and remain in business.

Secondly, the unemployment figure itself will begin to drop as benefits expire for more people. Once your benefits end, you are no longer "unemployed" in government statistics. So as more people run out of benefits, the "official" unemployment number will drop but the number of people actually working won't rise.

One needs to look at labor force participation which is currently at a lower rate than it was in the late 1970's.

Anyway, these past two weeks are where the wheels begin to fall off the cart. Quantitative easing is ending. Who is going to fund Obama's deficit once the fed stops the printing press? The dollar is now at record lows relative to commodities and the Swiss Franc. If interest rates rise, it causes another housing crisis but they need to raise rates to attract lenders to buy treasury debt.


The bottom line is that it looks like the administration has painted itself into a corner and it looks intentional. Rather than addressing the problem, they simply treated the symptoms and now they have run out of treatment. Rather than stopping the bleeding, they have been simply getting more towels to wipe it up. Now they are out of towels and the patient is still bleeding. In fact, they have made the problem worse.
Pabst Blue Ribbon - The beer that made Gerlach famous.

User avatar
Lassen Forge
Posts: 5320
Joined: Tue Feb 22, 2005 9:35 pm
Location: Where it's always... Wednesday. Don't lose your head over it.

Post by Lassen Forge » Thu Apr 28, 2011 12:29 pm

They're not wiping up the blood - they're using lukewarm water from a hose... directil on the hemmorage.

User avatar
geekster
Posts: 4867
Joined: Wed Sep 08, 2004 2:53 pm
Location: Hospice For The Terminally Breathing
Contact:

Post by geekster » Thu Apr 28, 2011 5:05 pm

So, for today we have yet more:
NEW YORK (Reuters) - Silver soared to an all-time high on Thursday and gold rose to another record, as a falling dollar and signs that the Federal Reserve would maintain a loose monetary policy boosted precious metals' appeal as a hedge against inflation and economic uncertainty.
Treasuries pared gains after a U.S. auction of $29 billion in seven-year notes drew weaker-than-average demand. The securities yielded 2.712 percent compared with a forecast of 2.698 percent in a Bloomberg News survey of nine of the Fed’s primary dealers. The bid-to-cover ratio, which gauges demand by comparing total bids with the amount of debt offered, was 2.63, the lowest since November, versus a 2.89 average at the past 10 sales.
NEW YORK (CNNMoney) -- Wal-Mart's core shoppers are running out of money much faster than a year ago due to rising gasoline prices, and the retail giant is worried, CEO Mike Duke said Wednesday.
...
Wal-Mart shoppers, many of whom live paycheck to paycheck, typically shop in bulk at the beginning of the month when their paychecks come in.

Lately, they're "running out of money" at a faster clip, he said.

"Purchases are really dropping off by the end of the month even more than last year," Duke said. "This end-of-month [purchases] cycle is growing to be a concern.
Pabst Blue Ribbon - The beer that made Gerlach famous.

can't sit still
Posts: 4645
Joined: Tue Aug 23, 2005 4:21 pm
Location: SoCal

Post by can't sit still » Fri Apr 29, 2011 8:54 pm

I try not to repeat myself but, sometimes repeating is the only way that I can construct a complete picture.
Wages have been stagnant since the '70s. The bankers papered over this problem by force-feeding credit into the system. The interest extracts a portion of the wealth. Due to compounding interest, the extraction becomes more painful after a time.
The whole country is so saturated with debt that, it can't absorb any more. The private sector has quit borrowing to a large extent. GOV jumped in to make up the difference and keep the banks from losing income. Now, GOV is saturated. The charts all show an exponential rise in indebtedness.
The banks expect our children and grandchildren to make good on our debts.
The saturation is too complete,, the interest too high. It can't be sustained from any angle of attack.
NOBODY can cough-up that much money. The banks want GOV to raise the debt limit so that future generations will be enslaved. There is NO possibility of this happening in the near-term. http://news.goldseek.com/GoldSeek/1304094153.php
The dollar has hit an all-time low. You can expect to see prices rising commensurately.
http://www.cnbc.com/id/42809381
I don't post things because I believe that they are the absolute truth. I post them because I believe that they should be considered.

User avatar
geekster
Posts: 4867
Joined: Wed Sep 08, 2004 2:53 pm
Location: Hospice For The Terminally Breathing
Contact:

Post by geekster » Sun May 01, 2011 12:17 pm

http://online.wsj.com/article/SB1000142 ... 10028.html

Or as Nathan Wurtzel said: "Here's why Obama and the Soros-Podesta Complex are talking about Trump. They don't want you talking about this:"
Companies that blend ethanol into fuel get a $5 billion annual tax credit, and there's a tariff to keep foreign producers out of the U.S. market. Now 40% of the corn crop is "directed to ethanol, which equals the amount that's going into livestock food," Mr. Pope calculates.

The rapidly depreciating dollar is also sparking inflation, although Mr. Pope says that's a "hard" topic for him to discuss, trying to be diplomatic. But he doesn't deny that money is cheap. Investment bankers are throwing cash at the firm—a turnaround from 2008, when money was scarce—even though Mr. Pope doesn't need it right now.

Rising prices are already squeezing food producers' "two to three percent" earnings margins. "Many of us had our costs hedged in the commodity markets and we all took on strident measures to control our cost structures," Mr. Pope says. "In the case of Smithfield, we closed six processing plants and one slaughter plant. We also closed 15% of all our live production business." But "once those measures are done, we have no choice but to pass those prices down" to consumers.

Now food price inflation is popping up across the country. A pound of sliced bacon costs $4.54 today versus $3.59 two years ago and $3.16 a decade ago, according to the Bureau of Labor Statistics. Ground beef is $2.72, up from $2.27 in 2009 and $1.74 in 2001. And it's not just Smithfield's products: "You eat eggs, you drink milk, you get a loaf of bread, and you get a pound of meat," he drawls. "Those are the four staples of what Americans eat in their diet. All of those are based on grains."
Pabst Blue Ribbon - The beer that made Gerlach famous.

User avatar
1durphul
Posts: 704
Joined: Mon Apr 27, 2009 1:14 pm

Post by 1durphul » Sun May 01, 2011 11:48 pm

geekster wrote:So, for today we have yet more:
NEW YORK (Reuters) - Silver soared to an all-time high on Thursday and gold rose to another record, as a falling dollar and signs that the Federal Reserve would maintain a loose monetary policy boosted precious metals' appeal as a hedge against inflation and economic uncertainty.
Treasuries pared gains after a U.S. auction of $29 billion in seven-year notes drew weaker-than-average demand. The securities yielded 2.712 percent compared with a forecast of 2.698 percent in a Bloomberg News survey of nine of the Fed’s primary dealers. The bid-to-cover ratio, which gauges demand by comparing total bids with the amount of debt offered, was 2.63, the lowest since November, versus a 2.89 average at the past 10 sales.
NEW YORK (CNNMoney) -- Wal-Mart's core shoppers are running out of money much faster than a year ago due to rising gasoline prices, and the retail giant is worried, CEO Mike Duke said Wednesday.
...
Wal-Mart shoppers, many of whom live paycheck to paycheck, typically shop in bulk at the beginning of the month when their paychecks come in.

Lately, they're "running out of money" at a faster clip, he said.

"Purchases are really dropping off by the end of the month even more than last year," Duke said. "This end-of-month [purchases] cycle is growing to be a concern.
I wonder if 2006 Housing price news reports looked exactly the same...

User avatar
geekster
Posts: 4867
Joined: Wed Sep 08, 2004 2:53 pm
Location: Hospice For The Terminally Breathing
Contact:

Post by geekster » Mon May 02, 2011 11:25 am

Go to the bathroom, get a cup of coffee, and watch this. This describes precisely the same conclusions I have come to. It always feel validating to see someone else reach the same conclusions independently. It's long. I haven't figured out how to pause it. It is worth watching.

http://www.stansberryresearch.com/pro/1 ... PSIM2AS/PR

UPDATE: found a youtube link. It is 1 hour and 16 minutes long but at least you can pause this one.



The problem with his "solution" is private currency. THAT is what I disagree with. The way to avoid the problem is to have your investments in things that are either commodities tied to the dollar or in foreign currency that is better managed.

In other words, I agree with his conclusions but not his notion of private currency. "non-dollar" based investment? Sure. Private currency? No.
Pabst Blue Ribbon - The beer that made Gerlach famous.

User avatar
1durphul
Posts: 704
Joined: Mon Apr 27, 2009 1:14 pm

Post by 1durphul » Mon May 02, 2011 11:56 am

geekster wrote:Go to the bathroom, get a cup of coffee, and watch this. This describes precisely the same conclusions I have come to. It always feel validating to see someone else reach the same conclusions independently. It's long. I haven't figured out how to pause it. It is worth watching.

http://www.stansberryresearch.com/pro/1 ... PSIM2AS/PR

UPDATE: found a youtube link. It is 1 hour and 16 minutes long but at least you can pause this one.



The problem with his "solution" is private currency. THAT is what I disagree with. The way to avoid the problem is to have your investments in things that are either commodities tied to the dollar or in foreign currency that is better managed.

In other words, I agree with his conclusions but not his notion of private currency. "non-dollar" based investment? Sure. Private currency? No.
LOL, this guy is using gas as an example of the American dollars power? The reason that gas is so expensive in all those other countries is because it is taxed much much higher than ours.

User avatar
geekster
Posts: 4867
Joined: Wed Sep 08, 2004 2:53 pm
Location: Hospice For The Terminally Breathing
Contact:

Post by geekster » Mon May 02, 2011 12:26 pm

He is absolutely correct in his analysis of why the US can simply print money to escape debt as long as we are the global reserve currency and that once we are no longer the reserve currency, that ability goes away.

Right now countries are forced to buy dollars for such commodities as oil and food. Once those commodities are no longer traded in dollars in world markets, we are in a world of hurt and the movement in that direction is already underway.

I don't agree with some of his mitigation strategies but I do agree with his analysis and his hyperinflation conclusion. Nobody that has had formal schooling in economics could possibly come to any other conclusion. It is simply plain arithmetic. There isn't really much room for "opinion". Simply looking at what is being done, we have really no choice but to see massive inflation soon. It is already beginning but the continued falling of housing costs is skewing the official numbers.

Inflation figures reported by the Treasury include housing costs. But people do not buy a house every month. Their house payment doesn't change month to month either. The current CPI (consumer price index) is much different than the CPI used in in the late 1970's and early 1980's. If we were using the same CPI and unemployment calculations now that we used then, we would currently be in a situation of double-digit inflation and unemployment, just like we were at the end of the Carter administration.

Once the dollar is no longer the world reserve currency, every time the fed prints money, the dollar will fall rapidly in value. The rapidly increasing cost of oil right how has the impact of rapidly increasing demand for dollars just as the fed is printing them.

So what the Obama administration has done is cranked up the presses on dollars while taking active measures to push world oil prices up which increases the demand for those dollars. Stopping drilling in the Gulf, attacking Libya have driven the price of oil up and this increased demand for dollars is the only thing that is preventing the dollar from falling more rapidly than it is already.

If we were to stop ethanol production which would increase the supply of grains in the world market and depress prices, and allow unfettered drilling and stop the war in Libya which would reduce the price of oil, our dollar would drop like a rock.
Pabst Blue Ribbon - The beer that made Gerlach famous.

User avatar
1durphul
Posts: 704
Joined: Mon Apr 27, 2009 1:14 pm

Post by 1durphul » Mon May 02, 2011 12:57 pm

geekster wrote:He is absolutely correct in his analysis of why the US can simply print money to escape debt as long as we are the global reserve currency and that once we are no longer the reserve currency, that ability goes away.

Right now countries are forced to buy dollars for such commodities as oil and food. Once those commodities are no longer traded in dollars in world markets, we are in a world of hurt and the movement in that direction is already underway.

I don't agree with some of his mitigation strategies but I do agree with his analysis and his hyperinflation conclusion. Nobody that has had formal schooling in economics could possibly come to any other conclusion. It is simply plain arithmetic. There isn't really much room for "opinion". Simply looking at what is being done, we have really no choice but to see massive inflation soon. It is already beginning but the continued falling of housing costs is skewing the official numbers.

Inflation figures reported by the Treasury include housing costs. But people do not buy a house every month. Their house payment doesn't change month to month either. The current CPI (consumer price index) is much different than the CPI used in in the late 1970's and early 1980's. If we were using the same CPI and unemployment calculations now that we used then, we would currently be in a situation of double-digit inflation and unemployment, just like we were at the end of the Carter administration.

Once the dollar is no longer the world reserve currency, every time the fed prints money, the dollar will fall rapidly in value. The rapidly increasing cost of oil right how has the impact of rapidly increasing demand for dollars just as the fed is printing them.

So what the Obama administration has done is cranked up the presses on dollars while taking active measures to push world oil prices up which increases the demand for those dollars. Stopping drilling in the Gulf, attacking Libya have driven the price of oil up and this increased demand for dollars is the only thing that is preventing the dollar from falling more rapidly than it is already.

If we were to stop ethanol production which would increase the supply of grains in the world market and depress prices, and allow unfettered drilling and stop the war in Libya which would reduce the price of oil, our dollar would drop like a rock.
I've always believed there are many reasons why we are in Iraq. The top reason is to protect Saudi Arabia from Iran in my opinion. A secondary reason is probably so we can invade Saudia Arabia the minute they switch away from the dollar.

We have the largest military for many reasons, fighting the cold war was probably only one strategic goal.

Post Reply

Return to “Open Discussion”