201 replies to this topic

[Pliny]

I agree. I think OBL being dead made the US seem competent which has renewed confidence in the dollar but I do not think this will last long. As you said Pliny, OBL being dead hasn't changed the economy. It looks like we may be hitting a floor, I think now may be an excellent time to buy, I will be picking up a few ounces tomorrow.

People expecting to make a quick buck are getting out, in my view. People concerned about the economy are still hedging themselves.

I don't think you will regret buying more. Looking at this moment, the downward trend has stopped. Good luck!

As for QE3, I think the Fed may hold off on QE3 for a few months. They may wait till the economy takes another downturn before they can justify implementing another round of quantitative easing.

Governments are so whimsical and so damaging. They may have noticed that the economy is not bounding back or stabilizing with all the QEing they are doing. Trying to ride out and ease tough times by inflating the money supply. They may change their monetary policy to fight inflation, which means no future QEing and higher interest rates and a tough time for people without savings and those with big mortgages or debts. They did encourage people to have those big mortgages pushing the dream of the Community Re-investment Act and encouraging lending to low income earners so they have no one to blame but themselves. Instead of pointing fingers at Wall Street they should be hanging people like Barney Franks out to dry. Government only causes good things though and does no wrong.

Edited by Pliny, 06 May 2011 - 08:10 AM.

[ZenOps]

Physical is a decent place to be if you are still worried about the economic outlook of the US (actually probably more importantly Greece, which looks like they are going to defect from the Euro after taking the bailout money, hah!)

Side note: You can almost look at the bagging of Bin Laden as a massive drag on the economy. I mean really, they built thousands of multi-billion dollar planes preparing for some sort of gigantic conflagration. But all it took was a few helicopters, a small team of SEALs, and a good old fashioned gun.

I assume Obama means to shift from military production to "solar panel" manufacturing now that Bin Laden is gone? I can't help but think that with Bin Laden gone, you've just lifted the veil so that everyone can go back to thumb twiddling the Xbox.

[maple_leafs182]

I don't think you will regret buying more. Looking at this moment, the downward trend has stopped. Good luck!

The two places I usually buy from were not selling. I think they are waiting for the market to rebound.

Governments are so whimsical and so damaging. They may have noticed that the economy is not bounding back or stabilizing with all the QEing they are doing. Trying to ride out and ease tough times by inflating the money supply. They may change their monetary policy to fight inflation, which means no future QEing and higher interest rates and a tough time for people without savings and those with big mortgages or debts. They did encourage people to have those big mortgages pushing the dream of the Community Re-investment Act and encouraging lending to low income earners so they have no one to blame but themselves. Instead of pointing fingers at Wall Street they should be hanging people like Barney Franks out to dry. Government only causes good things though and does no wrong.

Pliny, fighting inflation would be the right thing for the Federal Reserve to do and that is how I know they will not do it. Ben Bernake never does what is right for the economy, Bernake doesn't understand how the economy works.



I will be amazed if their is not some form of Quantitative easing by the end of this year or early next year.

[Pliny]

The two places I usually buy from were not selling. I think they are waiting for the market to rebound.

Did they say that theywere waiting for the market to rebound?

Ben Bernake never does what is right for the economy, Bernake doesn't understand how the economy works.

So it seems. I believe he has full confidence that he can manipulate the economy whatever way he likes but doesn't want to be held responsible for making the necessary corrections - which will negatively affect the average individual but, more importantly, government revenues.

I think they(the FEd and the White House) are afraid to do what's right.

[maple_leafs182]

Did they say that theywere waiting for the market to rebound?

Nope, that was just an assumption, they may have been sold out. I just asked if they had any for sale and they said no.

So it seems. I believe he has full confidence that he can manipulate the economy whatever way he likes but doesn't want to be held responsible for making the necessary corrections - which will negatively affect the average individual but, more importantly, government revenues.

I think they(the FEd and the White House) are afraid to do what's right.

I think they believe what they are doing is right, they are keynesians.

[Pliny]

Nope, that was just an assumption, they may have been sold out. I just asked if they had any for sale and they said no.

I was just doing some reading and indicators are that this is indeed a correction and commodities are slated to rebound. The US dollar is not expected to do well in the future.

I think they believe what they are doing is right, they are keynesians.

Of course. Keynesians believe they are doing right and they convinced politicians of that long ago, even before Keynes published his general theory in 1933. Keynes only served to convince them that their banking practices were valid - perhaps in a fascist society but not in a free society.

Edited by Pliny, 11 May 2011 - 08:34 AM.

[maple_leafs182]

I was just doing some reading and indicators are that this is indeed a correction and commodities are slated to rebound. The dollar is not expected to dowel linthe future.

I don't understand what that last sentence means.

The dollar is going to be rejected at some point, people and countries are already starting to diversify away from the dollar. At some point the Fed will be forced to buy up US bonds because nobody else will. I really can't see the US government or the Fed will allow the US to default on its debt, do you? I really do see silver going over one hundred USD's at some point, probably even higher.

Of course. Keynesians believe they are doing right and they convinced politicians of that long ago, even before Keynes published his general theory in 1933. Keynes only served to convince them that their banking practices were valid - perhaps in a fascist society but not in a free society.

I don't want to sound like a conspiracy theorist but at some level the Fed and the banks have to know what they are doing right? Central Banks had to of been installed to solely benefit big corporations because they clearly don't benefit the people.

Edited by maple_leafs182, 10 May 2011 - 10:14 PM.

[Pliny]

I don't understand what that last sentence means.

Took me a while to figure out what I meant too. It was a matter of spacing and I made the corrections.

I don't want to sound like a conspiracy theorist but at some level the Fed and the banks have to know what they are doing right? Central Banks had to of been installed to solely benefit big corporations because they clearly don't benefit the people.

Well, the Central bank idea was a plan. The men who made the plan thought they could best serve society by preventing the devastating effects that bank failures had on people and the economy. Unfortuantely, in their glee, they neglected to address what the real problem was in banking and chose to try and meet any demands upon a banks reserves by being able to centrally hold reserves and shift them according to need. The real problem was of course issuing too many receipts in relation to deposits - the fractional reserve system which, if they didn't have, made banking a simple warehousing operation with simple profits. The fractional reserve system made banking a very profitable business - except when there was a loss of confidence in a bank that started a run. Very few banks had reserves that could survive a run on deposits.

What the central bank system offerred was an all around solution. The bankers could still make huge profits on issuing receipts or lending money they didn't have and the problem of bank runs was solved.
Governments endorsed the plan, of course. Keynes put the macromanaging of the economy altogether in his general theory. The use of interest rates, the manipulation of the money supply, price controls, tariffs and taxes and all those tools that could be used to stabilize an economy.

The whole idea was a stabilization of the economy, a policy of economic growth and limited inflation. The objectives were all honourable indeed - they were "good intentions". Because a few men had incidentally concentrated that power in their hands was just a small benefit to them. The whole society, the concern for the common good, was the bigger consideration - at least that was the justification.

The biggest mistake, besides not correcting ill-conceived banking practices, was ignoring human nature which is motivated to take advantage of any opportunity to improve one's position, individually or collectively. That these men, or any that followed, believed they would never abuse their privileged position by creating winners or losers in an economy was the major miscalculation. Today they can't escape what they have wrought. There is such an imbalance in the economy, and it is held up so artifically, that the necessary correction would be a devastation to, mostly government and those who have become dependent upon government or are paid out of the public purse, society as a whole.

The choices are clear, continue with business as usual and face inevitable collapse, make the hard choices and economically change course abandoning artificial manipulation of the economy, or take an authoritarian/military complete overtaking of the economy - China may make that the necessary choice because we can't go through a period of economic weakness in rebuilding the economy without a threat of takeover from the Chinese. That's how I see it.

[maple_leafs182]

I think CME raising margins may have been a good thing. I think it got a lot of speculators out of the silver market. I would rather see higher silver requirements so there is less speculation which means less chance of a chance of a speculative bubble being created. Don't want a bubble like the US real estate bubble created in silver.

I think silver may fall more, I am guessing around 30, I will be making a big purchase then.

Edit: went down to just over 32, that's close enough for me, just bought some more today.

Edited by maple_leafs182, 13 May 2011 - 09:20 AM.

[maple_leafs182]

Took me a while to figure out what I meant too. It was a matter of spacing and I made the corrections.

Well, the Central bank idea was a plan. The men who made the plan thought they could best serve society by preventing the devastating effects that bank failures had on people and the economy.

Are you sure? I really don't think that was the reason, I think that was the message they used to sell the idea to the public. I really do believe the big banks and industrialists saw that having a Central bank would benefit them, it would give them a one up over all the others. I know that makes me sound like a conspiracy theorist but if you look at what has happened, that is exactly what has happened with Central banks.

Honest question here, does that really sound that crazy?

I think being able to steal all our wealth threw inflation was what the people who pushed for a central bank wanted.

[dre]

Are you sure? I really don't think that was the reason, I think that was the message they used to sell the idea to the public. I really do believe the big banks and industrialists saw that having a Central bank would benefit them, it would give them a one up over all the others. I know that makes me sound like a conspiracy theorist but if you look at what has happened, that is exactly what has happened with Central banks.

Honest question here, does that really sound that crazy?

I think being able to steal all our wealth threw inflation was what the people who pushed for a central bank wanted.

I think being able to steal all our wealth threw inflation was what the people who pushed for a central bank wanted.

Not really. Origionally the plan was the peg the dollar to gold (within 5%) and thats how the system worked for about 30 years. The dollar was decoupled from gold so that the government could gut tax rates for the wealthy and shift their part of the tax burden to the rest of the world.

Not a bad scam really, and there really wasnt any other good options at the time.

[Pliny]

Are you sure? I really don't think that was the reason, I think that was the message they used to sell the idea to the public. I really do believe the big banks and industrialists saw that having a Central bank would benefit them, it would give them a one up over all the others. I know that makes me sound like a conspiracy theorist but if you look at what has happened, that is exactly what has happened with Central banks.

Honest question here, does that really sound that crazy?

I think being able to steal all our wealth threw inflation was what the people who pushed for a central bank wanted.

Well, the public is faced with either bank failures or a stable economy. That was the option offered the public. Of course, the proponents knew quite well the benefits to themselves and the banking industry. I think they did honestly believe they were doing the right thing for society. They were elitists that felt they should have the right to macro-manage the economy for the collective good of society.

The British central bank was established in the last decade of the 17th century, in the 1690's, I believe. I just googled it and it was 1694. It's an interesting article: Bank of England

But anyway where I was about to go with that is that the French revolution occurred, coincidentally, when the King and French Parliament decided to solve their economic problems with the issuing of a paper currency, the "Assignat", It was an idea adopted because it worked so well in England with the English pound. Unfortunately, it was not understood by the French that the English did not just wantonly print their notes and the issue of them was tied to the banks reserves in gold and silver. It seems they just kept on printing the Assignat and after a few years it was a valueless piece of paper, and that circumstance sparked the French Revolution.

The central bank concept is not a wholly unsavoury idea. If governments could limit their spending and borrowing then it would not be so devastating. Tying the issue of dollars to the deposits in gold and silver is ok but you just have to see that the ease to print those dollars made it only a matter of time before the issuance would not be tied to deposits. Once that occurred governments were unrestrained in their spending and borrowing. They could afford wars, big mega-projects and five year plans. The distribution of wealth could be engineered with paper - today it is just a matter of, not even paper, just an electronic entry on a balance sheet - A credit on one and a debit on another.

Well, electronic entries and fiat paper currencies are what is called money today but unfortunately they lack several properties of what are the very essence and nature of money. They only hold two of the essential properties of money, they are an accepted means of exchange and are a measure of value and as long as they are an accepted means of exchange they are a future claim on goods and their measure of value is dependent more upon the level of confidence in that future claim. Since they are valueless by themselves, that is to say they have no intrinsic value, they violate the terms of a contract of exchange. The exchange does not satisfy itself but is dependent upon the future ability to make a claim on other goods in a future exchange. This puts an unreasonable variable in trade and an economy and makes it dependent upon the actions of those with the control of the creation of "means of exchange". It is trusted they will not violate economic law. But of course need for governments to spend will override economic law. Defense, and thus war, is necessary. Devastation and famine must be assuaged by all means available. Poverty must be eliminated. All must have a decent education and health care. We must be protected from every social problem by government. We must not ever suffer in life in any manner and die with dignity bequeathing all to the State for proper redistribution.

Since governments produce nothing but "money" it is their means of transferring wealth to themselves, being a claim on goods, and redistributing it as they see fit.

[dre]

Well, the public is faced with either bank failures or a stable economy. That was the option offered the public. Of course, the proponents knew quite well the benefits to themselves and the banking industry. I think they did honestly believe they were doing the right thing for society. They were elitists that felt they should have the right to macro-manage the economy for the collective good of society.

The British central bank was established in the last decade of the 17th century, in the 1690's, I believe. I just googled it and it was 1694. It's an interesting article: Bank of England

But anyway where I was about to go with that is that the French revolution occurred, coincidentally, when the King and French Parliament decided to solve their economic problems with the issuing of a paper currency, the "Assignat", It was an idea adopted because it worked so well in England with the English pound. Unfortunately, it was not understood by the French that the English did not just wantonly print their notes and the issue of them was tied to the banks reserves in gold and silver. It seems they just kept on printing the Assignat and after a few years it was a valueless piece of paper, and that circumstance sparked the French Revolution.

The central bank concept is not a wholly unsavoury idea. If governments could limit their spending and borrowing then it would not be so devastating. Tying the issue of dollars to the deposits in gold and silver is ok but you just have to see that the ease to print those dollars made it only a matter of time before the issuance would not be tied to deposits. Once that occurred governments were unrestrained in their spending and borrowing. They could afford wars, big mega-projects and five year plans. The distribution of wealth could be engineered with paper - today it is just a matter of, not even paper, just an electronic entry on a balance sheet - A credit on one and a debit on another.

Well, electronic entries and fiat paper currencies are what is called money today but unfortunately they lack several properties of what are the very essence and nature of money. They only hold two of the essential properties of money, they are an accepted means of exchange and are a measure of value and as long as they are an accepted means of exchange they are a future claim on goods and their measure of value is dependent more upon the level of confidence in that future claim. Since they are valueless by themselves, that is to say they have no intrinsic value, they violate the terms of a contract of exchange. The exchange does not satisfy itself but is dependent upon the future ability to make a claim on other goods in a future exchange. This puts an unreasonable variable in trade and an economy and makes it dependent upon the actions of those with the control of the creation of "means of exchange". It is trusted they will not violate economic law. But of course need for governments to spend will override economic law. Defense, and thus war, is necessary. Devastation and famine must be assuaged by all means available. Poverty must be eliminated. All must have a decent education and health care. We must be protected from every social problem by government. We must not ever suffer in life in any manner and die with dignity bequeathing all to the State for proper redistribution.

Since governments produce nothing but "money" it is their means of transferring wealth to themselves, being a claim on goods, and redistributing it as they see fit.

They only hold two of the essential properties of money, they are an accepted means of exchange and are a measure of value and as long as they are an accepted means of exchange they are a future claim on goods and their measure of value is dependent more upon the level of confidence in that future claim. Since they are valueless by themselves, that is to say they have no intrinsic value, they violate the terms of a contract of exchange.

Paper money is backed by demand just like any other commodity. Government backed currency is backed by how many goods and services there is in the marketplace. And the ONLY essential propery of currency is that is an accepted unit of economic account. Its just a temporary vehicle to facilitate transactions.

[Pliny]

Paper money is backed by demand just like any other commodity. Government backed currency is backed by how many goods and services there is in the marketplace. And the ONLY essential propery of currency is that is an accepted unit of economic account. Its just a temporary vehicle to facilitate transactions.

I understand. What you say is the general view of currency and money today.

Is an electronic entry a commodity backed by demand? The demand for paper currency is backed by confidence and stability in the government not by any value in itself. The Zimbabwe billion dollar bill is evidence of that. Its value is solely in the governments ability to decree and uphold it as a legal tender. The government then regulates the supply to create demand. That it has become a commodity unto itself and is traded against other currencies is true. Currencies were, at one time specie or receipts of deposits, and metamorphosed into the money itself. Money, unlike currency, is not a future claim on goods. It is a trade of equal value as determined by the parties involved in a transaction. Money is traded; not redeemed. Currencies, that are not specie, may be traded and redeemed for money or traded again and redeemed by the next person.


What becomes money in a society is determined by the society, it must have the quality of satisfying a trade without it being redeemed in a future transaction or being held as a claim to future goods.

[dre]

I understand. What you say is the general view of currency and money today.

Is an electronic entry a commodity backed by demand? The demand for paper currency is backed by confidence and stability in the government not by any value in itself. The Zimbabwe billion dollar bill is evidence of that. Its value is solely in the governments ability to decree and uphold it as a legal tender. The government then regulates the supply to create demand. That it has become a commodity unto itself and is traded against other currencies is true. Currencies were, at one time specie or receipts of deposits, and metamorphosed into the money itself. Money, unlike currency, is not a future claim on goods. It is a trade of equal value as determined by the parties involved in a transaction. Money is traded; not redeemed. Currencies, that are not specie, may be traded and redeemed for money or traded again and redeemed by the next person.


What becomes money in a society is determined by the society, it must have the quality of satisfying a trade without it being redeemed in a future transaction or being held as a claim to future goods.

The demand for paper currency is backed by confidence and stability in the government not by any value in itself.

No its backed by the size of the economy and the ammount of transactions in the market place. Just like gold, silver, or wheat. All of those things have a value thats based on how much wealth or labor people are willing to trade for them.