when a robber wants your money there is no way he can do #1 so he uses #2.......all differences are as above.....and thats way the democratic way of life works as its all logical and the "gun" can never be used to convice someone....
Using a gun is much easier, especially if your underlying philosophical beliefs are illogical.
Also, lets not forget the shadow economy where all wages are cash. There is no minimum wage effect there.
My whole point is that with a price floor such as minimum wage, if you never hit the floor it has no effect on prices. Given the low minimum wage rate the last 10 years this floor has effectively ceased to exist, thus moving it up slightly will have a very minimal effect on labor prices and thus inflation.
Retired United States Mint guy, now working on an Everyman Type Set.
I think all of your points are very well thought out!
I do think however that this new Global economy we now live in is giving us economic conditions we have not had to deal with before.
It may be that permanent commodity inflation will take the place of wage inflation, as the new culprit for the future, and I also believe there is great wage inflation in many other countries that are chasing down the worlds supply of items. According to one friend in China, five years ago in Shanghai the average wage for an educated person was $1,000 per year that has now changed to over $5,000.
I also think that since our government has borrowed the trillions out of S.C., the Federal employees pension plans, and every other pool of money that they could find the last 30 years, just voting for those that want to balance the budget will simply not cut it.
Without term limits the game is never going to change in Washington. No one ever gets elected by wanting to cut past programs, and the cutting will have to be drastic.
Being in Texas and having Mexican workers around my city all the time I personally can tell you I would rather have a radical Catholic around than a radical Muslim.
My question is this, since it will take the Mexicans a couple of generations to become really good tax payers, and since 50% of Americans currently pay no Federal taxes at the present time, who is going to make to take up the slack over the next 50 years to pay back all the money the Federal Government has borrowed from the baby boomers? In addition as DeepCoin pointed out, " lets not forget the shadow economy where all wages are cash" Wal Mart's new debit card bank deal was set up because they cliam that 50% of their customers do not even have a bank account.
Who out there invested in these Bear Stearns funds? Perhaps one of our pension funds was an investor?
So let me see if I have this right? Folks put $638,000,000 in one of these funds, and with that the fund goes and borrows $11 billion, WOW!
The funds collateral is junk bonds and bad mortgage loans, which go belly up!
The investors that put in $638 million lose everything, and the investors that loaned $11 BILLION on the $638 million now have losses of billions more.
The rating agencies rate the transaction as AA or AAA.
So who goes to jail?
Dollar Slumps to Record Low Versus Euro on Bear Stearns Losses July 18 (Bloomberg) -- The dollar fell to a record low against the euro and dropped versus the yen after Bear Stearns Cos. reported hedge fund losses.
The dollar fell against 13 of the 16 most-active currencies today after Bear Stearns told investors in one of its hedge funds they won't get any money back.
The situation underscores the severity of the shakeout in collateralized debt obligations, securities that the funds used to bet on subprime mortgage loans. Bear Stearns said in the letter that the funds faced ``unprecedented declines'' in bonds that were rated AAA or AA, the two top investment grades.
The fund that now has nothing left for investors, the High- Grade Structured Credit Strategies Enhanced Leverage Fund, had $638 million of capital as of March 31, according to performance reports sent to clients at the time. The enhanced fund borrowed about $11 billion, or almost 20 times its capital.
Here is a description of a surreal exchange that took place during Ben Bernanke's testimony before Congress:
"The Fed 'has consistently stated that upside risks to inflation are its predominant' concern, Bernanke said.
The panel's chairman, Rep. Barney Frank, D-Mass., said that finding 'troubles me.' In Frank's view, the biggest problem is the growing gap between low-wage and high-wage workers. "
Barney Frank thinks the Federal Reserve should be addressing income disparity?
<< <i>Here is a description of a surreal exchange that took place during Ben Bernanke's testimony before Congress:
"The Fed 'has consistently stated that upside risks to inflation are its predominant' concern, Bernanke said.
The panel's chairman, Rep. Barney Frank, D-Mass., said that finding 'troubles me.' In Frank's view, the biggest problem is the growing gap between low-wage and high-wage workers. "
Barney Frank thinks the Federal Reserve should be addressing income disparity? >>
That was his predominant line of questioning. I must say that I am generally quite amused by the congressmen/women asking the question. And I feel increasingly sorry for Bernnanke (and Greenspan) before him for having to explain common sense. What an aweful job.
I think Monsterman already said this but the Fed just does what the CONGRESS forces them to do, and yes we do have a bunch of idiots running our government. I will tell you guys once again, we need to throw these old political hacks out!
DeepCoin, I do not know who this is address to? “So, are you recommending we short the dollar over the next time frame?”
For my personal part I have done just what most recommended in this thread over the last few years,” the safe road”, I am not a gambler and therefore do not “ play” the markets or short stuff. That said, what is the rate of return on U.S. Treasuries over the last five years when you take into account the fact that the dollar has lost so much value?
How much money are China, Japan, and the Arabs losing on their treasury purchases, roll overs etc.? To say nothing of all the others.
My gut here tells me that Mr. Bernanke keeps throwing out this inflation crap in every speech because he knows that it is the only thing he can try to explain.
He cannot very well get in front of the news guys, and Congress, and say, “Hey look you guys have to start canceling these programs and these over seas wars, cause we cannot fool the note buyers forever, with the low interest we are paying them, and the devaluations in the dollar, they are not even making any interest on these notes, we have no way to pay them off, and there will come a time that they will not roll them over.”
Since he cannot tell anybody this but his staff , he just keeps saying Woo, Woo the inflation devil is out there!
No one has any clues on who is taking these multi billion dollar hedge fund baths yet? I have not seen anything yet that says something like,”The Texas teacher retirement fund announced today they lost $50 million in the Bear Stearns Hedge Fund Scam”
He cannot very well get in front of the news guys, and Congress, and say, “Hey look you guys have to start canceling these programs and these over seas wars, cause we cannot fool the note buyers forever, with the low interest we are paying them, and the devaluations in the dollar, they are not even making any interest on these notes, we have no way to pay them off, and there will come a time that they will not roll them over.”
The funny thing is that the self proclaimed "watchdog of inflation" (ie the FED) is the very source of that inflation. I wonder if the majority of the public understands that. Therefore being concerned about inflation while cranking it up, is ludicrous.
gold and deep...both you guys are right on track.....let me make one comment here on this
>>>>I do think however that this new Global economy we now live in is giving us economic conditions we have not had to deal with before. >>>>
and this
>>>The panel's chairman, Rep. Barney Frank, D-Mass., said that finding 'troubles me.' In Frank's view, the biggest problem is the growing gap between low-wage and high-wage workers. "
on this first....goldsaint ...you are right....but in my eyes here is why....and it also applies to the second quote
barney frank is a total idiot...period...and in fact is clueless like so many on the hill......here is exactly why we have economic conditions we have not had to deal with before
we have evolved into a global economy and 90% of people here know that but dont have a clue exactly what the ramifications are...so here goes....our population is approx 300 mill and the world has 6 billion thus we are a mere 5% of the population that being said as barney " fife " stumps around wondering why the rich are getting richer and the poor are getting poorer ....he is clueless ...the problem is the globe is getting...errrrrrr gotten educated ....today their are 55 million people in india under the age of 30 with a college degree...and they are VERY hungry for work and they want our jobs.....they do their math in their heads and dont need a calculator like our kids do...they are tech geeks....engineers ...scientists ....and doctors...been to the hospital lately...i dont know about you but our hospitals is loaded with them....not only india....pakistan ....korea...you name it...the fact is our kids are getting smoked on the educational front.....also this new world order will work longer hours...make less mistakes and work for less...you see the problem....look at it this way...i played 13 years in the nfl.....i was one of 32 middle linebackers in the world....and made the "big bucks ".....one of 32...in the whole wide world...heck it is easier to be a president of some country than start at middle linebacker in the nfl....but...thats because football is only played in america ( right now )...but what if everyone in the world played football like they do soccer i might never of happened .....by increasing the competition there would be billions more trying out for my job ....den maybe i no make da big doe no mo!!!!..same thing with the middle class erosion here in this country....somebody somewhere has taken that job leaving john doe out looking for a lesser paying job.....the fact is there is so much more competition now......and our kids arent prepared to compete.....and they will suffer a very slow...slow erosion of their standard of living...which btw is pretty darn good....with an ipod here and tivo there...here a cell....there a gps...everywhere a new car ...the middle class hasnt done that bad...but its all over unless they increase their skill set and GET BACK IN THE GAME and make it happen and quit wondering what happened......heck i oughta know....the reason i played so long ( injury free btw ) is because i out trained everyone....and i mean everyone as nobody out worked me
monsterman
my goal is to find the monsters and i go where they are but i sometimes miss some.... so if you have any and want to sell IM THE BUYER FOR THEM!!!
out of rockets ...out of bullets...switching to harsh language
"Men who had never shown any ability to make or increase fortunes for themselves abounded in brilliant plans for creating and increasing wealth for the country at large." Fiat Money Inflation in France, Andrew Dickson White (1912)
July 19 (Bloomberg) -- China's economy grew at the fastest pace in 12 years in the second quarter and inflation accelerated the most in nearly three, adding pressure on the government to raise interest rates and cool investment.
Gross domestic product expanded 11.9 percent from a year earlier, the statistics bureau said in Beijing today, up from 11.1 percent in the first quarter. Inflation climbed to 4.4 percent in June, breaching the central bank's annual 3 percent target for a fourth month.
``China will continue to strengthen and improve macro- economic controls in the second half of this year,'' the statistics bureau said in today's statement. China's export- fueled growth will probably also fan tension with the U.S. and Europe, which contend that an artificially low yuan unfairly favors its exporters.
The figures ``appear to give policy makers little room to delay a lending and deposit rate hike,'' said Martin Haigh, head of Asian sales trading at Cazenove Asia Ltd., in a note.
The yuan traded at 7.5638 at 10:24 a.m. in Shanghai, from 7.5639 before the report was released. The median estimate of 23 economists surveyed by Bloomberg News was for second quarter growth of 11 percent. China this month raised its estimate for 2006 growth to 11.1 percent from 10.7 percent previously, without revising its quarterly growth figures.
The central bank is expected to increase the benchmark one- year interest rate from 6.57 percent and the deposit rate from 3.06 percent at least once this year, according to 21 of 25 economists surveyed by Bloomberg News last month.
Interest Rates
The bank has raised interest rates twice this year and ordered lenders to set aside more reserves five times.
China's economy accounts for about a 10th of global growth and its appetite for commodities drove the prices of copper, nickel and iron ore to records this year. Premier Wen Jiabao advocates ``moderate'' measures to cool growth. He wants to avoid a sudden slowdown that could throw hundreds of thousands out of work and fan social tension in the world's most populous nation.
``The economy has clearly picked up momentum,'' said Glenn Maguire, chief Asia economist at Societe Generale SA in Hong Kong, who predicts the central bank will raise interest rates and order banks to set aside more money to quell lending. ``It is harder for China to defend currency criticisms when producing such strong growth.''
Pig Shortage
A shortage of pigs following an outbreak of disease and surging international grain prices was among the main drivers of China's inflation, complicating efforts of the central bank to contain unpopular price increases.
``Tightening monetary policy isn't going to immediately rectify rising food prices,'' said Jing Ulrich, chairwoman of China equities at JPMorgan Chase & Co. in Hong Kong. ``The government will have to use different methods.''
The government will increase the supply of poultry, beef and eggs and tighten controls on corn exports, the National Development and Reform Commission, the country's top planner, said this week.
Inflation has fanned stock market speculation because it outpaces returns on bank deposits, encouraging households to bet on equities. The key one-year deposit rate is 3.06 percent. The benchmark CSI 300 stock index has gained 87 percent this year.
Interest Income
To make savings more attractive, lawmakers last month passed legislation that will allow cabinet to scrap or reduce a 20 percent tax on interest income. In May the government raised stamp duty on traded shares to cool the stock market.
The CSI 300 has fallen about 11 percent since its June 19 record. The index fell 0.3 percent to 3797.02 at 10:23 a.m. in Shanghai.
``After the recent cooling of the stock market caused by the stamp duty and expectations for a lot of further tightening measures, people realized there is risk investing in stocks,'' said Sun Mingchun, an economist at Lehman Brothers Holdings Inc. in Hong Kong.
China abandoned a decade-old peg to the U.S. dollar in July 2005 and allowed its currency to gain 2.1 percent. Since then it has risen by a total of 9.4 percent.
That isn't enough for some U.S. lawmakers. Senators Hillary Clinton and Barack Obama plan to co-sponsor legislation pushing for faster gains in the yuan.
Trade Tensions
EU Trade Commissioner Peter Mandelson said this month that Chinese ``barriers'' cost the bloc as much as 20 billion euros ($27 billion) a year in lost commerce.
Fixed-asset investment in urban areas jumped 26.7 percent in the first half from a year earlier, the statistics bureau said. That was up from 25.3 percent in the first quarter and 24.5 percent in all of 2006, party fueled by cash generated from China's trade surplus.
Growth in industrial output climbed 19.4 percent from a year earlier after increasing 18.1 percent in May, the statistics bureau said. That beat the 17.5 percent median estimate of economists surveyed by Bloomberg News.
Besides monetary policy, China has cut export rebates twice this year to discourage investment in industries that pollutes and use energy heavily, including steel, cement and fertilizers. The government also curbed land use and restricted project approvals.
Clean-Up Plans
The State Environmental Protection Administration this month imposed fines on 162 companies in eight provinces that exceeded emission standards and ordered them to stop work and submit clean-up plans.
China exported $112.5 billion more than it imported in the first six months, an increase of 84 percent from a year earlier. The NDRC forecasts the trade surplus to widen to $250 billion to $300 billion this year, up from $177.5 billion for all of 2006.
That inflow of money has pushed China's foreign reserves, the world's largest, to $1.3 trillion at the end of June and money supply growth accelerated for the first time in four months, increasing 17.1 percent. Banks lent 2.5 trillion yuan in the year to the end of June, already 80 percent of last year's total.
``Continued widening of China's trade surplus has not only increased the tension with its trading partners, but also has been adding fuel to its growth engine,'' said Liang Hong, senior economist at Goldman Sachs Group in Hong Kong.
The export- and investment-driven economy is drawing closer to replacing Germany as the world's third largest. Gross domestic product expanded 11.1 percent in 2006 to 21.09 trillion yuan ($2.79 trillion). Germany's economy was valued at $2.89 trillion.
To contact the reporter on this story: Nipa Piboontanasawat in Beijing at npiboontanas@bloomberg.net
Yeah...it was kind of funny in a peculiar kind of way. Gold mining stocks, at least Newmont and CDA and NEM were active earlier this week and late last week...it's almost as if the pickers could see this happening. I can't imagine how they started pressing the mining stocks well before the rise. Are some of cohodk's lines crossing just right or what...how did they know?
I bot NEM on the the 11th at 40.60 after it had pulled back from $42.50 after saying they had unwound their hedges. Everyone thinks there are huge shorts in the market but these are really just hedging practices.
Unfortunately there are stocks that have performed much better than NEM, but it does look like it is breaking its downtrend line. It is meeting resistance at the 200 dma. It wouldnt surprise me if it is not a stand alone company.
>>>>Are some of cohodk's lines crossing just right or what...how did they know?>>>
actually its pretty easy now ( not always so ).....here are the facts to predetermine where gold is going in the short term
1) the global economy is really off and running and its and brainer many other countries will raise rates to cool it off....starting with china....japan will double their fed funds rate by the end of the year ( there will be some yen carry trade unwinding soon )...england just raised and will do so again if needed...the eu will also raise rates if and when needed
2) but not us.....as to raise rates here will be disastrous ....as the housing market would hit the wall thanks to the sub prime
that being said....the dollar has been falling like a rock....and will continue to do so in light of how stuck we are....
that being said the fed chairman would rather inflate with worthless paper than implode the economy as jobs is his number one concern...and to raise rates now would send us into the toilet...he will give you all the bs and pee on your leg and tell you its raining when talking about inflation....IT IS NOT IN CHECK...IT CANT POSSIBLY BE IN CHECK....CORE INFLATION IS HIS CONCERNS BUT YOU FEEL HEADLINE INFLATION WHICH WAS OVER 10% LAST YEAR AND WILL BE THAT AGAIN THIS YEAR
a 100 k sal in jan 06 will be worth 70 something christmas this year...and thats a fact...i call it my grocery bag ....havent you noticed you 100 dollar bag of groceries keeps getting smaller and smaller
the fact is the gov is broke....i cant tell you enough how broke they are...............look here to see how many people they are screwing
thus....the people in the world cant come here ( finanacially ) for safe haven like they have in the past....and will flock to gold....that fact and with gold just under major resistance at 675 it was a nobrainer that a test of 700 is in the cards now
now you know why newmont dumped their hedge book
monsterman
my goal is to find the monsters and i go where they are but i sometimes miss some.... so if you have any and want to sell IM THE BUYER FOR THEM!!!
out of rockets ...out of bullets...switching to harsh language
my next door neighbor got his house repoed last month as fema aka uncle sam hasnt paid him for over a year....and now a katrina victim has moved into the house ....i talked to the realtor and she said "unreal"....they got a 25,000 grant from the government for the down payment and complained about paying 1,000 in closing fees ( which btw was also given to them previously )...so you can now say hello to my neighbors
houston is now the murder capital of the world as our dumb mayor doesn't have enough police to keep the peace....in fact we are rationing out police resources now and washington has dumped us too as ...as i said they are broke....rationing police resources means ....when it gets bad enough they will have to make a choice as to who gets raped...your mother...your wife...your daughter as they can only protect 2 of the 3...its that bad here
sorry to get off topic but i have known for years uncle sam is slow pay no pay and I WOULD NEVER DO BUSINESS WITH UNCLE SAM....and i can assure you he wanted me to and i told him...no way!!!
monsterman
my goal is to find the monsters and i go where they are but i sometimes miss some.... so if you have any and want to sell IM THE BUYER FOR THEM!!!
out of rockets ...out of bullets...switching to harsh language
As the billions, perhaps trillions, of dollars, euros, and yen bounce from asset class to asset class looking for some place to make a decent return, how long well it be before these printed paper assets reach the Gold market in full force?
How rare is gold? If you gather together all the gold mined in recorded history, melt it down, and pour it into one giant cube, it would measure only about eighteen yards across! That's all the gold owned by every government on earth, plus all the gold in private hands, all the gold in electronics, in coins and from bars. It's everything that exists above ground now, or since man learned to extract the metal from the earth. All of it can fit into one block the size of a single house. It would weight 91,000 tons - less than the amount of steel made around the world in an hour. That's rare. -- Daniel M. Kehrer
Believe it or not I actually know several numismatists that own about one cubic foot of gold if you piled it altogether. Gee that seems like a huge amount for one person to own considering the size of all the Gold, and considering the fact that there are 6 billion people on the planet.
Here is an interesting side note;
By John A. Rubino Jul 20 2007 3:43PM “Recall that the only reason Japan or Europe can generate even their current meager rates of growth is the willingness of U.S. consumers to buy their Hondas and BMWs. As the dollar plunges, Japanese and European goods, priced in suddenly-appreciating currencies, will become prohibitively expensive for U.S. consumers, who will respond by buying U.S.-made alternatives or nothing at all. Correctly interpreting this change in buying patterns as a threat to their vital export sectors, European and Japanese leaders will respond with the only weapon they have left: monetary inflation. They’ll cut interest rates and buy dollars with their currencies, flooding the world with euros and yen the way the U.S. now floods the world with dollars. The result of these “competitive devaluations” will be a death spiral for all major fiat currencies, in which European or Japanese bonds will fare as badly as their U.S. cousins.”
This sounds reasonable to me, and if this does in fact happen will the Europeans and Asians rush to buy Gold?
When this threadzilla was started on 12-2-04, silver was at $7.90 an ounce and gold was at $450.
Now silver is at $13.26 and recovering from a nasty crash of around $1.50 only 6-7 weeks ago(from memory, not going to look it up right now) and gold is also recovering from a somewhat smaller hit and sits at $683.29 as of today.
What that amounts to is that Silver is up 68% since then and Gold is up 52%.
I'd say that's a fairly strong arguement for precious metals.
JMO and 2 cents worth.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Well let's not forget that silver and gold began this 6 year run at around $4.50 & $263 respectively in 2001. It's no secret that metals have outperformed equities in this period. Spare me the diatribes on gold's 20 or 50 year history. What matters is now and the next few years (if you want history go look at DOW performance from 1966-1982 or the fact that it took took stocks until 1954 to exceed the 1929 highs). Gold has actually lagged the industrial metals (Copper, Nickel, Palladium, Platinum) and has lots of ground to still make up. When metals run their course, I'll be one of the first ones to find another ride.
There will be many more stiff shakeouts of the metals that will scare the majority of people out or from even considering metals. That's the way they work. Indeed they may get turned back at $700 once again, but there is unfinished business at $875....$1000...and beyond. I can't fathom this market not exceeding it's former high from 1980 considering that in that time we have increased the money stock by 13X and inflationary things on average (homes, cars, services, a big mac, etc) are up by 4X. There's ground to be recovered: potentially up to 4X the previous high, though $2000-2300 is generally believed to be the inflation adjusted high for 1980 gold (using govt CPI stats of all things....hence understated).
<< <i>Well let's not forget that silver and gold began this 6 year run at around $4.50 & $263 respectively in 2001. It's no secret that metals have outperformed equities in this period. Spare me the diatribes on gold's 20 or 50 year history. What matters is now and the next few years (if you want history go look at DOW performance from 1966-1982 or the fact that it took took stocks until 1954 to exceed the 1929 highs). Gold has actually lagged the industrial metals (Copper, Nickel, Palladium, Platinum) and has lots of ground to still make up. When metals run their course, I'll be one of the first ones to find another ride.
There will be many more stiff shakeouts of the metals that will scare the majority of people out or from even considering metals. That's the way they work. Indeed they may get turned back at $700 once again, but there is unfinished business at $875....$1000...and beyond. I can't fathom this market not exceeding it's former high from 1980 considering that in that time we have increased the money stock by 13X and inflationary things on average (homes, cars, services, a big mac, etc) are up by 4X. There's ground to be recovered: potentially up to 4X the previous high, though $2000-2300 is generally believed to be the inflation adjusted high for 1980 gold (using govt CPI stats of all things....hence understated).
roadrunner >>
Oh, I'm not forgetting anything. I was just looking at the start date of this thread and was curious as to the changes over this particular timeframe.
I know well when this all began, you and I PM'd each other a few times about it back then. When silver was at it's low ebb, I bought a couple tons of it, literally. I imagine you remember.
I agree with everything you say here, this run still has some serious legs and I'm looking forward to the next several years. 2009 and 2011 strike me as the years when we finally make huge leaps and eventually reach and exceed the numbers you speak of.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Deadhorse, my comments were not meant to imply your post missed anything....it didn't. I know you know this market better than most anyone on the forum, myself included. But with the changing guard around here, there are lots of newbs that may have no clue how we got here. They may look at gold's lackluster performance over the past year and say the S&P kicked butt and is a better long term play (to each his own). They take all their gold history from the local newspaper which is usually slanted to the 25-30 year history. Of course they can go back and read the 75 pages on this thread if they have a few days (lol).
One rarely sees articles in the mainstream on the 6-8 year performance of the metals....only the past 18 months since the drop, and the overall 30 year history from 1980-1982. That's the public perception of gold. They have no clue as to what happened in the early 1970's and before. They have no idea on the effect of central bank sales, naked selling, ESF, PPT, and the fact that CB gold sales are never taken off the books. Whatever gold the US has sold in the past 15 years, is still listed as our asset, even though some other country may own it. If the CB's have sold up to 15,000 tons of gold in the 1990's one can figure out why gold is not priced a lot higher.
<< <i>Deadhorse, my comments were not meant to imply your post missed anything....it didn't. >>
Oh, I know that, just having a little fun on a Saturday morning here. No harm, no foul.
<< <i>I know you know this market better than most anyone on the forum, myself included. >>
Well now I'm blushing, I don't know if I'd agree with that, but I do appreciate the vote of confidence.
I think you and I are both going to do very well in the next few years in this area. Your posts are always most informative and I always follow up on any links you may give us.
BTW, regarding the gold sale by the CBs. I'm fairly confident it occured some time ago and I also believe Fort Knox is mostly empty, except for gold painted lead bars for the occasional media report and pictures.
Eventually, the manipulation will finally run out of steam and that's when the sauce hits the airscrew and we're all doing the happy dance.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
Here are some additional interesting facts for our discussion today!
David Leonhardt Published: July 18, 2007 Herald Tribune
“Last Thursday, U.S. stocks had one of their best days in years, with the Dow Jones industrial average and the Standard & Poor 500 stock index both jumping about 2 percent. "A record day on Wall Street," Brian Williams said that night at the top of the "NBC Nightly News" broadcast. "Stocks surging up to new highs."
The Wall Street Journal led its Friday paper with this headline: "Dow Again Soars to Record High Despite Unease." On Tuesday, the Dow cracked 14,000 for the first time, before closing at 13,971.
The idea that stock prices tend to rise over time really should not be surprising. The price of almost everything rises over time, thanks to inflation. Each year, governments print more money, which is the main reason that the price of groceries, cars, clothes and, yes, stocks keeps on going up. Of course, incomes are rising some, too.
The stock market's record high does not mean that stocks have been a wonderful investment lately. They haven't been.
The S&P 500, which is a much better measure than the Dow, closed Tuesday at 1,549.37, just 1.4 percent higher than the peak it reached in March 2000. Think about what that means. While the price of nearly everything has risen in the United States over the least seven years - the price of bread has increased nearly one-third, for instance - stocks have barely budged. They have only marginally outperformed cash sitting in a bureau drawer. So if we are going to talk about a stock market record, we should be doing the same for a whole lot of other things: "Loaves of Bread Surge to New Highs!"
I realize that this point can sound like statistical nitpicking, but it actually relates to something quite important. When you overlook inflation, you can start to think that every investment is a can't-miss investment, because its value always seems to be going up.
Today, the S&P remains 17 percent below its inflation-adjusted 2000 peak. A share in a mutual fund tied to the S&P 500, in other words, can't buy nearly as much today as it could in early 2000. Now, in a way, this might be considered a good sign. If the market isn't really at a record high, it may still have a lot of running room. But I wouldn't be too confident about that. Relative to corporate earnings, stocks remain more expensive than they have been at any time except the 1920s and the 1990s.”
ON GOLD July 17 (Bloomberg) -- The Osaka Securities Exchange will list Japan's first exchange-traded gold fund next month, as it taps increasing interest in commodities from investors diversifying portfolios.
It is also important to understand that gold selling by central banks never ever touches the open gold market. Instead, it goes to singular large buyers directly, which is more often than not other central banks. How these central banks do their book keeping can be very deceiving if there are lease or other agreements in place not disclosed to the public. It would be an interesting project to try to gather information, and calculations, about who claims to have how much Gold. All the central Banks, all the ETF’s some data about what is in the hands of the public. Who wants to bet the numbers of outstanding tons might exceed the 91,000 tons?
Still, I take them with a large block of salt. Nobody really knows the numbers, all we can do is make an educated guess based on as much info as we can gleen. Articles like those do help in the gleening, so thanks again.
I'll maintain the numbers given for gold are inflated just as the numbers for silver are even more inflated.
Still, there is no question in my mind that either gold is overpriced(and it's not) or silver is way, way underpriced(and it is).
I have other sources that tell me different. Sorry, no web links, it doesn't work that way. I'd say the ratio of refined silver to gold is much closer to 8 to 1 and dropping, maybe even less than that and perhaps much less. Along with that, the silver is being used up at a ratio that cannot and has not been replaced for at least 15 years. IOW, it's running at a deficit. Eventually, which is closer than many of us think and that no one from the big investment houses would ever tell us, the real truth and the impending monetary explosion/implosion is rapidly reaching a tipping point. The trick is to be sitting in the right place at the right time because when it happens, it will seem like it was virtually overnight. There'll be no time to hop on the train and when it finally slows down enough for the late comers to hop on, we should already be off and relaxing.
With a big-azz smile on our faces.
"Lenin is certainly right. There is no subtler or more severe means of overturning the existing basis of society(destroy capitalism) than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and it does it in a manner which not one man in a million is able to diagnose." John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
while the stock maket hits new highs ...its really deceiving because is you quoted the market in the price of gold....euro...pound...kiwi...cannook dollar ect it has actually been going down for 5 years
imho the government is always concerned with perception and they never want you to know the true facts such as
1) the real headline inflation has been over 10% annually for over 2 years now
2) the tax payers send in over 15.25% of their paycheck for social security and medicare as way too many dont even know the employer matches their 7.62% that they paid.....and the government has spent evry single penny of it
the fact is uncle sam is concerned about one thing ...and that's jobs....he will inflate like a big dog rather than have john doe american find out the truth....and stop spending....they have to have people get up evry morning and produce what ever they produce
the good news is all the governments do the same thing and our economic machine is pretty powerful as productivity here is huge and mighty.....but the fact is we have been losing our huge lead over the world...and our middle class has huge competition now where as not so 10 or 20 years ago
i remember when bush did the trade agreement which sent many menial overseas ...people were po`ed...and he said retrain....get more skills at a higher level....he was targeting the middle class ( the 50% right in the middle )...
.i think way too many didn't get the memo......................and now the congress is asking ben why are the rich getting richer and the poor getting poorer ???? duh
monsterman
my goal is to find the monsters and i go where they are but i sometimes miss some.... so if you have any and want to sell IM THE BUYER FOR THEM!!!
out of rockets ...out of bullets...switching to harsh language
while the stock maket hits new highs ...its really deceiving because is you quoted the market in the price of gold....euro...pound...kiwi...cannook dollar ect it has actually been going down for 5 years
Which means US assets are very cheap---including equities. As I mentioned months ago, "The British are coming." And they are bringing their German, Saudi, Chinese, Canadian and Australian friends with them. Is this a bad thing? NO. Americans bought up all the cheap European and Asian assets in the nineties and now they buy our cheap assets. The circle goes round and round.
Most all who are on these forums have the means to continue to outpace our neighbors. Only our level of fear will determine if we succeed.
i totally agree with you....as jp morgan once said....if you take all the money away from the rich and evenly distribute it amonst everyone it will be right back where it came from in 2 years
its just the creame always rises to the top......and the whale sheet always sinks to the bottom....no matter what country....no matter what race....no matter what economic climate
that being said....no where is it easier than in america as the political system combined with the capitalistic system works very well together
aka if you want more....make yourself worth more
monsterman
my goal is to find the monsters and i go where they are but i sometimes miss some.... so if you have any and want to sell IM THE BUYER FOR THEM!!!
out of rockets ...out of bullets...switching to harsh language
This may be a little long but I think most of you will really like this.
All of the paragraphs in quotes were taken from Bloomberg articles over the last several days.
So most of us know the story of how after World War II the powers that be, called the Globalists here, decided we could not have any more world wars due to nukes, and perhaps a global economy, with global socialistic political systems, would do the trick.
We also know the story of our own Government tried to pay for the start up of “Great Society”, and its minor wars, by simply printing money in the late 1970, and how that caused hyperinflation causing them to shift to creating debt to pay bills.
Many of us have been wondering about several serious issues facing our country, but I am beginning to think it was foolish to think the boys and girls in Washington did not have a plan.
Here are some of the more serious questions we have been asking for the last several years.
Just who is going to buy all of these U.S. notes as they come due, or the foreigners begin to dump them?
“July 23 (Bloomberg) -- Treasuries are getting an unexpected boost from pension funds controlling more than $14 trillion. Fund managers for companies including General Motors Corp., Alcatel-Lucent, and many others, are shifting away from stocks to prepare for accounting changes requiring them to more fully disclose the value of their holdings. Bonds are gaining favor as funds seek to avoid wider swings in prices that may accompany equities as the new rules take effect, possibly later this year. The switch couldn't come at a better time for the $4.4 trillion market for U.S. government bonds. The surge in equities this month to record highs has wiped out the pension deficits of the companies in the Standard & Poor's 500 for the first time in six years. Now the funds can afford to match future obligations to employees with fixed- income securities rather than trying to plug shortfalls in the funds.
Well then if the pension funds sell out of their stock holdings how low will the market go?
“(Bloomberg) -- Everyone from Nobel Prize laureates to the world's biggest bond investor says the Bush administration has reason to cheer the dollar's slide to historic lows. The currency has lost 13.2 percent since January 2001, when George W. Bush took office, the most under any president since at least Gerald Ford. A weaker dollar is helping the economy, and rather than causing foreigners to flee U.S. securities, the depreciating currency is making American goods less expensive abroad. The dollar set a new low of $1.3843 per euro last week, and is the weakest in 26 years versus the British pound. A U.S. tourist heading to England will pay more than $2 for one U.K. pound, up from about $1.65 at the end of 1997. Against the Canadian dollar, it's the lowest since 1977 and it's the weakest in seven years versus Brazil's real. The dollar's drop hasn't dented international investors' appetite for U.S. securities. They added a record $126.1 billion in May, Treasury data showed last week. The prior monthly record inflow was $120.9 billion in August 2006. Oppenheimer Funds Inc., which is based in New York and manages $250 billion, say the dollar may reach $1.45 per euro this year.”
Well exactly how will we have a global economy if American workers always make more money than their worldwide counter parts?
Well we cannot tell the American middle class that they are all going to have to take pay cuts, but we can do this;
We can tax the working folks in every form we can think of, and then give them social programs like the rest of the world to keep them quite. In addition we can import a whole new lower/middle class from Mexico who would love to work for minimum wage or a little more.
“(Bloomberg) – In the mid 1940’s nearly 37 percent of working people belonged to Unions, that number is 6 percent today.”
Well then if the pension funds sell out of their stock holdings how low will the market go?
Pensions being fully funded doesn't mean stocks are sold, or not bought. Once pensions reach a certain level - say 125% - of funding, management keeps the rest of the gains for themselves. So they have incentives to profit as much as possible, using other people's money.
“(Bloomberg) – In the mid 1940’s nearly 37 percent of working people belonged to Unions, that number is 6 percent today.”
there are lies, dammed lies, and statistics.
the author of that statement picked a time frame when unions were in their glory. the govt was backing them to increase production, changing laws to help them, the morons in charge finally allowed blacks and latinos, etc...
it seems the people who write these articles will use stats to persuade the reader to whatever conclusion they wish.
only by studying history and getting some perspective on what they spout non stop can you begin to see between the lines.
i picked this stat as an example, but i often see things like this.
so it appears union membership has gone back to its normal percentage before the war.
Fishcooker, It appears to me that the government is setting up the pension funds to buy at least a few trillion of the debt over the next few years. Below is another statement from an article from Bloomberg.
"The federal Pension Protection Act passed last year requires company pensions to bring assets in line with future liabilities. That means pensions, which in 2006 were underfunded by $350 billion as measured by the Pension Benefit Guaranty Corp., must be fully funded by 2013.
To catch up, many funds loaded up on stocks. The S&P 500 has gained more than 9 percent this year, including the reinvestment of dividends. Pensions at companies that are members of the index ended March with a cumulative surplus for the first time since 2000, according to David Bianco, a New York-based strategist at UBS Securities, a unit of UBS AG, the biggest money manager for wealthy investors.
The act was the first step in pension reform. Now, many fund managers and their advisers speculate that accounting rule makers will eliminate accounting techniques companies have used to minimize the effects of volatility in their pension holdings. To minimize volatility, many funds decide to buy bonds, which experience lower swings in prices. "
As we have discussed before in this tread, when will the foreigners who take all of our Treasury note begin to spend that debt just buying assets?
I wonder if the Globalists ever figured in their calculations that emerging countries might get tired of owning paper and want to buy hard assets?
Here is another interesting question. If a foreign government gets millions of dollars in dividends, do you think they pay taxes on those dividends as all of us would have to do?
The Wall Street Journal July 24th 2007
“Governments Get Bolder in Buying Equity Stakes Foreign governments, flush with cash and no longer content with the meager returns to be had on safe but low-yielding investments like Treasurys, are becoming increasingly aggressive players on the equity front. The new boldness of these government-controlled investors was on display Sunday night when entities controlled by the governments of China and Singapore agreed to invest as much as $18.5 billion in return for stakes in the big British bank Barclays PLC.
But many other recent deals reflect the quest by China and other countries for higher returns on their mounting foreign-exchange reserves. Those holdings traditionally were invested in safe, liquid investments that could be quickly converted to cash to buy up local currency if it came under speculative attack. But in many countries, especially China and the oil-producing nations of the Middle East, global trade has swelled those holdings to far more than might be needed to stabilize their currencies. Since 2002, such holdings have increased 20% a year, according to U.S. Treasury calculations.
Sameer Al Ansari, executive chairman and chief executive officer of state-back investment firm Dubai International Capital, says he is scouring the world's 500 largest publicly traded companies looking for a place to invest as much as $10 billion. His next target: a U.S. company that he has already identified but will only describe as "a household name."
Last week, an investment fund controlled by the government of Qatar made a $21.8 billion takeover approach for British supermarket chain J Sainsbury PLC, one of the largest potential acquisitions ever by a state-owned fund.
In Europe, there is a rising clamor to restrict foreign investment. German Chancellor Angela Merkel said last week that state-controlled investors might use stakes in European companies to pursue political, rather than only financial, goals.
The trend toward more aggressive government investments also has the potential to reorder global financial markets. "We have entered a whole new world," says Jim O'Neill, head of Global Economic Research for Goldman Sachs International in London. "We are at the early stage of a secular process where the relations between the prices of stocks and bonds will change. The whole world is discovering the equity culture."
Gezzz...why are some of these rich entities so short sighted. Why go through all these "where to put your assets, how to stage your currency" types of questions? Hell, I suspect you could buy Zimbabwe, Botswana or some like country for a relatively small amount of money, certainly you could buy the government and any privately held assets. Heck, what could Kosovo or Serbia cost. Why piss your money away on improved assets with all the government requirements, international implicatioins, political BS and complications? Buy some backward poorly governed country, field an army, declare a benevolent monarchy and be done with it. Harvest all the resources and the sell the place to the next owner for cents on the dollar. It's all good. If somebody wants to call you on human rights or environmental concerns...show them the digit, there are no rights, it's a monarchy stupid! It's already being done but they are just so unsophisticated. Hell, you could make good money at it!
Gezzz...why are some of these rich entities so short sighted. Why go through all these "where to put your assets, how to stage your currency" types of questions? Hell, I suspect you could buy Zimbabwe, Botswana or some like country for a relatively small amount of money, certainly you could buy the government and any privately held assets. Heck, what could Kosovo or Serbia cost. Why piss your money away on improved assets with all the government requirements, international implicatioins, political BS and complications? Buy some backward poorly governed country, field an army, declare a benevolent monarchy and be done with it. Harvest all the resources and the sell the place to the next owner for cents on the dollar. It's all good. If somebody wants to call you on human rights or environmental concerns...show them the digit, there are no rights, it's a monarchy stupid! It's already being done but they are just so unsophisticated. Hell, you could make good money at it! >>
This is what China will do to Russia. Think about it. A common border. Lots of land for expansion and one of the richest raw material areas in the world. Who needs those raw materials more, China or Russia.
Today markes the first time in history that the US Dollar index closed under .8000 (closed at .7993 on 7/24/07) This does have some ramifications considering we have bounced off similar lows several times in the past few years.
Does this mean the PPT and ESF are running out of ammo? Will they take a stand at a lesser number? Or are we on our way to much lower numbers and much higher gold price?
<< <i>Today markes the first time in history that the US Dollar index closed under .8000 (closed at .7993 on 7/24/07) This does have some ramifications considering we have bounced off similar lows several times in the past few years.
Does this mean the PPT and ESF are running out of ammo? Will they take a stand at a lesser number? Or are we on our way to much lower numbers and much higher gold price?
roadrunner >>
Every 1% drop in the dollar is a 1% drop in the pproblem (more or less).
I'd look for a major rally starting around 77 or 78. This process will take years.
Gezzz...why are some of these rich entities so short sighted. Why go through all these "where to put your assets, how to stage your currency" types of questions? Hell, I suspect you could buy Zimbabwe, Botswana. Mhammerman, I love this but don’t go giving these guys any new ideas; you never know who is reading these threads.
RR Perhaps the Euro will go to $2.00 next year and then we can really sell lots of stuff to Europe. Oh, that is if we can make lots of stuff to sell?
The sooner we get amnesty for the Mexicans the quicker we can make cars and compete with the Japanese. Maybe we can even get our textile factories, and many others going again. If we can put our new lower middle class to work for the minimum wage I think we can be very competitive!
I watched an interesting interview from one pundit on CNBC tonight he said, “we should not worry about the subprime and Alt A mortgage market because unlike the savings and loan crash all these CDO’S, derivatives etc. are spread out across the world to the Japanese, Germans, Brits, Chinese etc.”
No one on the show ask him if that meant that lots more people around the world were just going to lose lots more money?
Botswana and Zimbabwe are both rich in Commodities that the rest of us need, They may not be able to feed themselves but if the dollar deteriorates much more and if Gold , copper , nickel , and diamonds go much higher , both Zimbabwe and Botswana will be in line to buy the USA
<< <i>The sooner we get amnesty for the Mexicans the quicker we can make cars and compete with the Japanese. Maybe we can even get our textile factories, and many others going again. If we can put our new lower middle class to work for the minimum wage I think we can be very competitive! >>
Unless they all apply for disability once they become legal. Then we have a problem.
Comments
when a robber wants your money there is no way he can do #1 so he uses #2.......all differences are as above.....and thats way the democratic way of life works as its all logical and the "gun" can never be used to convice someone....
Using a gun is much easier, especially if your underlying philosophical beliefs are illogical.
Also, lets not forget the shadow economy where all wages are cash. There is no minimum wage effect there.
Most are paid WELL ABOVE min wage.
Knowledge is the enemy of fear
Monsterman,
I think all of your points are very well thought out!
I do think however that this new Global economy we now live in is giving us economic conditions we have not had to deal with before.
It may be that permanent commodity inflation will take the place of wage inflation, as the new culprit for the future, and I also believe there is great wage inflation in many other countries that are chasing down the worlds supply of items. According to one friend in China, five years ago in Shanghai the average wage for an educated person was $1,000 per year that has now changed to over $5,000.
I also think that since our government has borrowed the trillions out of S.C., the Federal employees pension plans, and every other pool of money that they could find the last 30 years, just voting for those that want to balance the budget will simply not cut it.
Without term limits the game is never going to change in Washington. No one ever gets elected by wanting to cut past programs, and the cutting will have to be drastic.
Being in Texas and having Mexican workers around my city all the time I personally can tell you I would rather have a radical Catholic around than a radical Muslim.
My question is this, since it will take the Mexicans a couple of generations to become really good tax payers, and since 50% of Americans currently pay no Federal taxes at the present time, who is going to make to take up the slack over the next 50 years to pay back all the money the Federal Government has borrowed from the baby boomers? In addition as DeepCoin pointed out, " lets not forget the shadow economy where all wages are cash" Wal Mart's new debit card bank deal was set up because they cliam that 50% of their customers do not even have a bank account.
So let me see if I have this right? Folks put $638,000,000 in one of these funds, and with that the fund goes and borrows $11 billion, WOW!
The funds collateral is junk bonds and bad mortgage loans, which go belly up!
The investors that put in $638 million lose everything, and the investors that loaned $11 BILLION on the $638 million now have losses of billions more.
The rating agencies rate the transaction as AA or AAA.
So who goes to jail?
Dollar Slumps to Record Low Versus Euro on Bear Stearns Losses
July 18 (Bloomberg) -- The dollar fell to a record low against the euro and dropped versus the yen after Bear Stearns Cos. reported hedge fund losses.
The dollar fell against 13 of the 16 most-active currencies today after Bear Stearns told investors in one of its hedge funds they won't get any money back.
The situation underscores the severity of the shakeout in collateralized debt obligations, securities that the funds used to bet on subprime mortgage loans. Bear Stearns said in the letter that the funds faced ``unprecedented declines'' in bonds that were rated AAA or AA, the two top investment grades.
The fund that now has nothing left for investors, the High- Grade Structured Credit Strategies Enhanced Leverage Fund, had $638 million of capital as of March 31, according to performance reports sent to clients at the time.
The enhanced fund borrowed about $11 billion, or almost 20 times its capital.
"The Fed 'has consistently stated that upside risks to inflation are its predominant' concern, Bernanke said.
The panel's chairman, Rep. Barney Frank, D-Mass., said that finding 'troubles me.' In Frank's view, the biggest problem is the growing gap between low-wage and high-wage workers. "
Barney Frank thinks the Federal Reserve should be addressing income disparity?
<< <i>Here is a description of a surreal exchange that took place during Ben Bernanke's testimony before Congress:
"The Fed 'has consistently stated that upside risks to inflation are its predominant' concern, Bernanke said.
The panel's chairman, Rep. Barney Frank, D-Mass., said that finding 'troubles me.' In Frank's view, the biggest problem is the growing gap between low-wage and high-wage workers. "
Barney Frank thinks the Federal Reserve should be addressing income disparity? >>
That was his predominant line of questioning. I must say that I am generally quite amused by the congressmen/women asking the question. And I feel increasingly sorry for Bernnanke (and Greenspan) before him for having to explain common sense. What an aweful job.
Knowledge is the enemy of fear
DeepCoin,
I do not know who this is address to?
“So, are you recommending we short the dollar over the next time frame?”
For my personal part I have done just what most recommended in this thread over the last few years,” the safe road”, I am not a gambler and therefore do not “ play” the markets or short stuff. That said, what is the rate of return on U.S. Treasuries over the last five years when you take into account the fact that the dollar has lost so much value?
How much money are China, Japan, and the Arabs losing on their treasury purchases, roll overs etc.? To say nothing of all the others.
My gut here tells me that Mr. Bernanke keeps throwing out this inflation crap in every speech because he knows that it is the only thing he can try to explain.
He cannot very well get in front of the news guys, and Congress, and say, “Hey look you guys have to start canceling these programs and these over seas wars, cause we cannot fool the note buyers forever, with the low interest we are paying them, and the devaluations in the dollar, they are not even making any interest on these notes, we have no way to pay them off, and there will come a time that they will not roll them over.”
Since he cannot tell anybody this but his staff , he just keeps saying Woo, Woo the inflation devil is out there!
No one has any clues on who is taking these multi billion dollar hedge fund baths yet? I have not seen anything yet that says something like,”The Texas teacher retirement fund announced today they lost $50 million in the Bear Stearns Hedge Fund Scam”
The funny thing is that the self proclaimed "watchdog of inflation"
(ie the FED) is the very source of that inflation. I wonder if the majority of the public understands that. Therefore being concerned about inflation while cranking it up, is ludicrous.
roadrunner
Especially if it comes from furry bears.
2.Correct advice is strictly due to chance.
3. Predicting the future of the economy is
worse odds then the dice table.
4. Store up jelly donuts for the coming
economic disaster.
5. The one essential commodity to store up
as a measure of true value....TOILET PAPER
THE SOFT FLUFFY KIND.
6 Learn to speak a Chinese dialect, Hindu or Farsi.
7. Learn to hibernate 6 months of the year. It saves on
food and cleaning bills.
8.Don't tell anyone that you have food and water stored up.
They will come over some day and take it away from you.
9. A day is coming, when clean underwear, may be the monitary unit of wealth.
Camelot
>>>>I do think however that this new Global economy we now live in is giving us economic conditions we have not had to deal with before. >>>>
and this
>>>The panel's chairman, Rep. Barney Frank, D-Mass., said that finding 'troubles me.' In Frank's view, the biggest problem is the growing gap between low-wage and high-wage workers. "
on this first....goldsaint ...you are right....but in my eyes here is why....and it also applies to the second quote
barney frank is a total idiot...period...and in fact is clueless like so many on the hill......here is exactly why we have economic conditions we have not had to deal with before
we have evolved into a global economy and 90% of people here know that but dont have a clue exactly what the ramifications are...so here goes....our population is approx 300 mill and the world has 6 billion thus we are a mere 5% of the population that being said as barney " fife " stumps around wondering why the rich are getting richer and the poor are getting poorer ....he is clueless ...the problem is the globe is getting...errrrrrr gotten educated ....today their are 55 million people in india under the age of 30 with a college degree...and they are VERY hungry for work and they want our jobs.....they do their math in their heads and dont need a calculator like our kids do...they are tech geeks....engineers ...scientists ....and doctors...been to the hospital lately...i dont know about you but our hospitals is loaded with them....not only india....pakistan ....korea...you name it...the fact is our kids are getting smoked on the educational front.....also this new world order will work longer hours...make less mistakes and work for less...you see the problem....look at it this way...i played 13 years in the nfl.....i was one of 32 middle linebackers in the world....and made the "big bucks ".....one of 32...in the whole wide world...heck it is easier to be a president of some country than start at middle linebacker in the nfl....but...thats because football is only played in america ( right now )...but what if everyone in the world played football like they do soccer i might never of happened .....by increasing the competition there would be billions more trying out for my job ....den maybe i no make da big doe no mo!!!!..same thing with the middle class erosion here in this country....somebody somewhere has taken that job leaving john doe out looking for a lesser paying job.....the fact is there is so much more competition now......and our kids arent prepared to compete.....and they will suffer a very slow...slow erosion of their standard of living...which btw is pretty darn good....with an ipod here and tivo there...here a cell....there a gps...everywhere a new car ...the middle class hasnt done that bad...but its all over unless they increase their skill set and GET BACK IN THE GAME and make it happen and quit wondering what happened......heck i oughta know....the reason i played so long ( injury free btw ) is because i out trained everyone....and i mean everyone as nobody out worked me
monsterman
out of rockets ...out of bullets...switching to harsh language
>>6 Learn to speak a Chinese dialect, Hindu or Farsi.>>
i started chinese lessons last week ...here is the 1st lesson
English
Chinese
That's not right
Sum Ting Wong
Are you harboring a fugitive?
Hu Yu Hai Ding
See me ASAP
Kum Hia Nao
Stupid Man
Dum Fook
Small Horse
Tai Ni Po Ni
Did you go to the beach?
Wai Yu So Tan
I bumped into a coffee table
Ai Bang Mai Fu Kin Ni
I think you need a face lift
Chin Tu Fat
It's very dark in here
Wai So Dim
I thought you were on a diet
Wai Yu Mun Ching
This is a tow away zone
No Pah King
Our meeting is scheduled for next week
Wai Yu Kum Nao
Staying out of sight
Lei Ying Lo
He's cleaning his automobile
Wa Shing Ka
Your body odor is offensive
Yu Stin Ki Pu
Great
Fa Kin Su Pa
>>>>8.Don't tell anyone that you have food and water stored up.
They will come over some day and take it away from you.
my buddy is a morman.....i told him your 2 years of food will be taken from you....i bought 1,000 bullets and told him i protect and you feed :-)
out of rockets ...out of bullets...switching to harsh language
TIAA-CREF?
July 19 (Bloomberg) -- China's economy grew at the fastest pace in 12 years in the second quarter and inflation accelerated the most in nearly three, adding pressure on the government to raise interest rates and cool investment.
Gross domestic product expanded 11.9 percent from a year earlier, the statistics bureau said in Beijing today, up from 11.1 percent in the first quarter. Inflation climbed to 4.4 percent in June, breaching the central bank's annual 3 percent target for a fourth month.
``China will continue to strengthen and improve macro- economic controls in the second half of this year,'' the statistics bureau said in today's statement. China's export- fueled growth will probably also fan tension with the U.S. and Europe, which contend that an artificially low yuan unfairly favors its exporters.
The figures ``appear to give policy makers little room to delay a lending and deposit rate hike,'' said Martin Haigh, head of Asian sales trading at Cazenove Asia Ltd., in a note.
The yuan traded at 7.5638 at 10:24 a.m. in Shanghai, from 7.5639 before the report was released. The median estimate of 23 economists surveyed by Bloomberg News was for second quarter growth of 11 percent. China this month raised its estimate for 2006 growth to 11.1 percent from 10.7 percent previously, without revising its quarterly growth figures.
The central bank is expected to increase the benchmark one- year interest rate from 6.57 percent and the deposit rate from 3.06 percent at least once this year, according to 21 of 25 economists surveyed by Bloomberg News last month.
Interest Rates
The bank has raised interest rates twice this year and ordered lenders to set aside more reserves five times.
China's economy accounts for about a 10th of global growth and its appetite for commodities drove the prices of copper, nickel and iron ore to records this year. Premier Wen Jiabao advocates ``moderate'' measures to cool growth. He wants to avoid a sudden slowdown that could throw hundreds of thousands out of work and fan social tension in the world's most populous nation.
``The economy has clearly picked up momentum,'' said Glenn Maguire, chief Asia economist at Societe Generale SA in Hong Kong, who predicts the central bank will raise interest rates and order banks to set aside more money to quell lending. ``It is harder for China to defend currency criticisms when producing such strong growth.''
Pig Shortage
A shortage of pigs following an outbreak of disease and surging international grain prices was among the main drivers of China's inflation, complicating efforts of the central bank to contain unpopular price increases.
``Tightening monetary policy isn't going to immediately rectify rising food prices,'' said Jing Ulrich, chairwoman of China equities at JPMorgan Chase & Co. in Hong Kong. ``The government will have to use different methods.''
The government will increase the supply of poultry, beef and eggs and tighten controls on corn exports, the National Development and Reform Commission, the country's top planner, said this week.
Inflation has fanned stock market speculation because it outpaces returns on bank deposits, encouraging households to bet on equities. The key one-year deposit rate is 3.06 percent. The benchmark CSI 300 stock index has gained 87 percent this year.
Interest Income
To make savings more attractive, lawmakers last month passed legislation that will allow cabinet to scrap or reduce a 20 percent tax on interest income. In May the government raised stamp duty on traded shares to cool the stock market.
The CSI 300 has fallen about 11 percent since its June 19 record. The index fell 0.3 percent to 3797.02 at 10:23 a.m. in Shanghai.
``After the recent cooling of the stock market caused by the stamp duty and expectations for a lot of further tightening measures, people realized there is risk investing in stocks,'' said Sun Mingchun, an economist at Lehman Brothers Holdings Inc. in Hong Kong.
China abandoned a decade-old peg to the U.S. dollar in July 2005 and allowed its currency to gain 2.1 percent. Since then it has risen by a total of 9.4 percent.
That isn't enough for some U.S. lawmakers. Senators Hillary Clinton and Barack Obama plan to co-sponsor legislation pushing for faster gains in the yuan.
Trade Tensions
EU Trade Commissioner Peter Mandelson said this month that Chinese ``barriers'' cost the bloc as much as 20 billion euros ($27 billion) a year in lost commerce.
Fixed-asset investment in urban areas jumped 26.7 percent in the first half from a year earlier, the statistics bureau said. That was up from 25.3 percent in the first quarter and 24.5 percent in all of 2006, party fueled by cash generated from China's trade surplus.
Growth in industrial output climbed 19.4 percent from a year earlier after increasing 18.1 percent in May, the statistics bureau said. That beat the 17.5 percent median estimate of economists surveyed by Bloomberg News.
Besides monetary policy, China has cut export rebates twice this year to discourage investment in industries that pollutes and use energy heavily, including steel, cement and fertilizers. The government also curbed land use and restricted project approvals.
Clean-Up Plans
The State Environmental Protection Administration this month imposed fines on 162 companies in eight provinces that exceeded emission standards and ordered them to stop work and submit clean-up plans.
China exported $112.5 billion more than it imported in the first six months, an increase of 84 percent from a year earlier. The NDRC forecasts the trade surplus to widen to $250 billion to $300 billion this year, up from $177.5 billion for all of 2006.
That inflow of money has pushed China's foreign reserves, the world's largest, to $1.3 trillion at the end of June and money supply growth accelerated for the first time in four months, increasing 17.1 percent. Banks lent 2.5 trillion yuan in the year to the end of June, already 80 percent of last year's total.
``Continued widening of China's trade surplus has not only increased the tension with its trading partners, but also has been adding fuel to its growth engine,'' said Liang Hong, senior economist at Goldman Sachs Group in Hong Kong.
The export- and investment-driven economy is drawing closer to replacing Germany as the world's third largest. Gross domestic product expanded 11.1 percent in 2006 to 21.09 trillion yuan ($2.79 trillion). Germany's economy was valued at $2.89 trillion.
To contact the reporter on this story: Nipa Piboontanasawat in Beijing at npiboontanas@bloomberg.net
Knowledge is the enemy of fear
..........................................Poi Son
>>>..........................................Poi Son
buhahahahaha.....u b fooney
out of rockets ...out of bullets...switching to harsh language
Right On.
TV, , Ipods, the Conputer & Video Games are destroying the USA's kids. It's really sick.
683+ last time I looked, up from the mid 50's.
Yummy
I bot NEM on the the 11th at 40.60 after it had pulled back from $42.50 after saying they had unwound their hedges. Everyone thinks there are huge shorts in the market but these are really just hedging practices.
Unfortunately there are stocks that have performed much better than NEM, but it does look like it is breaking its downtrend line. It is meeting resistance at the 200 dma. It wouldnt surprise me if it is not a stand alone company.
Knowledge is the enemy of fear
actually its pretty easy now ( not always so ).....here are the facts to predetermine where gold is going in the short term
1) the global economy is really off and running and its and brainer many other countries will raise rates to cool it off....starting with china....japan will double their fed funds rate by the end of the year ( there will be some yen carry trade unwinding soon )...england just raised and will do so again if needed...the eu will also raise rates if and when needed
2) but not us.....as to raise rates here will be disastrous ....as the housing market would hit the wall thanks to the sub prime
that being said....the dollar has been falling like a rock....and will continue to do so in light of how stuck we are....
that being said the fed chairman would rather inflate with worthless paper than implode the economy as jobs is his number one concern...and to raise rates now would send us into the toilet...he will give you all the bs and pee on your leg and tell you its raining when talking about inflation....IT IS NOT IN CHECK...IT CANT POSSIBLY BE IN CHECK....CORE INFLATION IS HIS CONCERNS BUT YOU FEEL HEADLINE INFLATION WHICH WAS OVER 10% LAST YEAR AND WILL BE THAT AGAIN THIS YEAR
a 100 k sal in jan 06 will be worth 70 something christmas this year...and thats a fact...i call it my grocery bag ....havent you noticed you 100 dollar bag of groceries keeps getting smaller and smaller
the fact is the gov is broke....i cant tell you enough how broke they are...............look here to see how many people they are screwing
http://news.yahoo.com/s/ap/20070718/ap_on_re_us/katrina_contractors
just for 1 example....they are broke!!
thus....the people in the world cant come here ( finanacially ) for safe haven like they have in the past....and will flock to gold....that fact and with gold just under major resistance at 675 it was a nobrainer that a test of 700 is in the cards now
now you know why newmont dumped their hedge book
monsterman
out of rockets ...out of bullets...switching to harsh language
my next door neighbor got his house repoed last month as fema aka uncle sam hasnt paid him for over a year....and now a katrina victim has moved into the house ....i talked to the realtor and she said "unreal"....they got a 25,000 grant from the government for the down payment and complained about paying 1,000 in closing fees ( which btw was also given to them previously )...so you can now say hello to my neighbors
nice government eh
houston is now the murder capital of the world as our dumb mayor doesn't have enough police to keep the peace....in fact we are rationing out police resources now and washington has dumped us too as ...as i said they are broke....rationing police resources means ....when it gets bad enough they will have to make a choice as to who gets raped...your mother...your wife...your daughter as they can only protect 2 of the 3...its that bad here
sorry to get off topic but i have known for years uncle sam is slow pay no pay and I WOULD NEVER DO BUSINESS WITH UNCLE SAM....and i can assure you he wanted me to and i told him...no way!!!
monsterman
out of rockets ...out of bullets...switching to harsh language
As the billions, perhaps trillions, of dollars, euros, and yen bounce from asset class to asset class looking for some place to make a decent return, how long well it be before these printed paper assets reach the Gold market in full force?
How rare is gold? If you gather together all the gold mined in recorded history, melt it down, and pour it into one giant cube, it would measure only about eighteen yards across! That's all the gold owned by every government on earth, plus all the gold in private hands, all the gold in electronics, in coins and from bars. It's everything that exists above ground now, or since man learned to extract the metal from the earth. All of it can fit into one block the size of a single house. It would weight 91,000 tons - less than the amount of steel made around the world in an hour. That's rare. -- Daniel M. Kehrer
Believe it or not I actually know several numismatists that own about one cubic foot of gold if you piled it altogether. Gee that seems like a huge amount for one person to own considering the size of all the Gold, and considering the fact that there are 6 billion people on the planet.
Here is an interesting side note;
By John A. Rubino
Jul 20 2007 3:43PM
“Recall that the only reason Japan or Europe can generate even their current meager rates of growth is the willingness of U.S. consumers to buy their Hondas and BMWs. As the dollar plunges, Japanese and European goods, priced in suddenly-appreciating currencies, will become prohibitively expensive for U.S. consumers, who will respond by buying U.S.-made alternatives or nothing at all. Correctly interpreting this change in buying patterns as a threat to their vital export sectors, European and Japanese leaders will respond with the only weapon they have left: monetary inflation. They’ll cut interest rates and buy dollars with their currencies, flooding the world with euros and yen the way the U.S. now floods the world with dollars. The result of these “competitive devaluations” will be a death spiral for all major fiat currencies, in which European or Japanese bonds will fare as badly as their U.S. cousins.”
This sounds reasonable to me, and if this does in fact happen will the Europeans and Asians rush to buy Gold?
When this threadzilla was started on 12-2-04, silver was at $7.90 an ounce and gold was at $450.
Now silver is at $13.26 and recovering from a nasty crash of around $1.50 only 6-7 weeks ago(from memory, not going to look it up right now) and gold is also recovering from a somewhat smaller hit and sits at $683.29 as of today.
What that amounts to is that Silver is up 68% since then and Gold is up 52%.
I'd say that's a fairly strong arguement for precious metals.
JMO and 2 cents worth.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
There will be many more stiff shakeouts of the metals that will scare the majority of people out or from even considering metals. That's the way they work. Indeed they may get turned back at $700 once again, but there is unfinished business at $875....$1000...and beyond. I can't fathom this market not exceeding it's former high from 1980 considering that in that time we have increased the money stock by 13X and inflationary things on average (homes, cars, services, a big mac, etc) are up by 4X. There's ground to be recovered: potentially up to 4X the previous high, though $2000-2300 is generally believed to be the inflation adjusted high for 1980 gold (using govt CPI stats of all things....hence understated).
roadrunner
<< <i>Well let's not forget that silver and gold began this 6 year run at around $4.50 & $263 respectively in 2001. It's no secret that metals have outperformed equities in this period. Spare me the diatribes on gold's 20 or 50 year history. What matters is now and the next few years (if you want history go look at DOW performance from 1966-1982 or the fact that it took took stocks until 1954 to exceed the 1929 highs). Gold has actually lagged the industrial metals (Copper, Nickel, Palladium, Platinum) and has lots of ground to still make up. When metals run their course, I'll be one of the first ones to find another ride.
There will be many more stiff shakeouts of the metals that will scare the majority of people out or from even considering metals. That's the way they work. Indeed they may get turned back at $700 once again, but there is unfinished business at $875....$1000...and beyond. I can't fathom this market not exceeding it's former high from 1980 considering that in that time we have increased the money stock by 13X and inflationary things on average (homes, cars, services, a big mac, etc) are up by 4X. There's ground to be recovered: potentially up to 4X the previous high, though $2000-2300 is generally believed to be the inflation adjusted high for 1980 gold (using govt CPI stats of all things....hence understated).
roadrunner >>
Oh, I'm not forgetting anything. I was just looking at the start date of this thread and was curious as to the changes over this particular timeframe.
I know well when this all began, you and I PM'd each other a few times about it back then. When silver was at it's low ebb, I bought a couple tons of it, literally. I imagine you remember.
I agree with everything you say here, this run still has some serious legs and I'm looking forward to the next several years. 2009 and 2011 strike me as the years when we finally make huge leaps and eventually reach and exceed the numbers you speak of.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
One rarely sees articles in the mainstream on the 6-8 year performance of the metals....only the past 18 months since the drop, and the overall 30 year history from 1980-1982. That's the public perception of gold. They have no clue as to what happened in the early 1970's and before. They have no idea on the effect of central bank sales, naked selling, ESF, PPT, and the fact that CB gold sales are never taken off the books. Whatever gold the US has sold in the past 15 years, is still listed as our asset, even though some other country may own it. If the CB's have sold up to 15,000 tons of gold in the 1990's one can figure out why gold is not priced a lot higher.
roadrunner
<< <i>Deadhorse, my comments were not meant to imply your post missed anything....it didn't. >>
Oh, I know that, just having a little fun on a Saturday morning here.
<< <i>I know you know this market better than most anyone on the forum, myself included. >>
Well now I'm blushing, I don't know if I'd agree with that, but I do appreciate the vote of confidence.
I think you and I are both going to do very well in the next few years in this area. Your posts are always most informative and I always follow up on any links you may give us.
BTW, regarding the gold sale by the CBs. I'm fairly confident it occured some time ago and I also believe Fort Knox is mostly empty, except for gold painted lead bars for the occasional media report and pictures.
Eventually, the manipulation will finally run out of steam and that's when the sauce hits the airscrew and we're all doing the happy dance.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
David Leonhardt
Published: July 18, 2007
Herald Tribune
“Last Thursday, U.S. stocks had one of their best days in years, with the Dow Jones industrial average and the Standard & Poor 500 stock index both jumping about 2 percent. "A record day on Wall Street," Brian Williams said that night at the top of the "NBC Nightly News" broadcast. "Stocks surging up to new highs."
The Wall Street Journal led its Friday paper with this headline: "Dow Again Soars to Record High Despite Unease." On Tuesday, the Dow cracked 14,000 for the first time, before closing at 13,971.
The idea that stock prices tend to rise over time really should not be surprising. The price of almost everything rises over time, thanks to inflation. Each year, governments print more money, which is the main reason that the price of groceries, cars, clothes and, yes, stocks keeps on going up. Of course, incomes are rising some, too.
The stock market's record high does not mean that stocks have been a wonderful investment lately. They haven't been.
The S&P 500, which is a much better measure than the Dow, closed Tuesday at 1,549.37, just 1.4 percent higher than the peak it reached in March 2000. Think about what that means. While the price of nearly everything has risen in the United States over the least seven years - the price of bread has increased nearly one-third, for instance - stocks have barely budged. They have only marginally outperformed cash sitting in a bureau drawer. So if we are going to talk about a stock market record, we should be doing the same for a whole lot of other things: "Loaves of Bread Surge to New Highs!"
I realize that this point can sound like statistical nitpicking, but it actually relates to something quite important. When you overlook inflation, you can start to think that every investment is a can't-miss investment, because its value always seems to be going up.
Today, the S&P remains 17 percent below its inflation-adjusted 2000 peak. A share in a mutual fund tied to the S&P 500, in other words, can't buy nearly as much today as it could in early 2000. Now, in a way, this might be considered a good sign. If the market isn't really at a record high, it may still have a lot of running room. But I wouldn't be too confident about that. Relative to corporate earnings, stocks remain more expensive than they have been at any time except the 1920s and the 1990s.”
ON GOLD
July 17 (Bloomberg) -- The Osaka Securities Exchange will list Japan's first exchange-traded gold fund next month, as it taps increasing interest in commodities from investors diversifying portfolios.
It is also important to understand that gold selling by central banks never ever touches the open gold market. Instead, it goes to singular large buyers directly, which is more often than not other central banks. How these central banks do their book keeping can be very deceiving if there are lease or other agreements in place not disclosed to the public.
It would be an interesting project to try to gather information, and calculations, about who claims to have how much Gold. All the central Banks, all the ETF’s some data about what is in the hands of the public. Who wants to bet the numbers of outstanding tons might exceed the 91,000 tons?
Yeah!
IMF'a holdings
How much gold folk own
I think if stocks are analyzed against inflation, dividends should be included.
<< <i>Just digging around, here's what is easy to find...
IMF'a holdings
How much gold folk own >>
Thanks for the links, both interesting.
Still, I take them with a large block of salt. Nobody really knows the numbers, all we can do is make an educated guess based on as much info as we can gleen. Articles like those do help in the gleening, so thanks again.
I'll maintain the numbers given for gold are inflated just as the numbers for silver are even more inflated.
Still, there is no question in my mind that either gold is overpriced(and it's not) or silver is way, way underpriced(and it is).
I have other sources that tell me different. Sorry, no web links, it doesn't work that way. I'd say the ratio of refined silver to gold is much closer to 8 to 1 and dropping, maybe even less than that and perhaps much less. Along with that, the silver is being used up at a ratio that cannot and has not been replaced for at least 15 years. IOW, it's running at a deficit. Eventually, which is closer than many of us think and that no one from the big investment houses would ever tell us, the real truth and the impending monetary explosion/implosion is rapidly reaching a tipping point. The trick is to be sitting in the right place at the right time because when it happens, it will seem like it was virtually overnight. There'll be no time to hop on the train and when it finally slows down enough for the late comers to hop on, we should already be off and relaxing.
With a big-azz smile on our faces.
John Marnard Keynes, The Economic Consequences of the Peace, 1920, page 235ff
imho the government is always concerned with perception and they never want you to know the true facts such as
1) the real headline inflation has been over 10% annually for over 2 years now
2) the tax payers send in over 15.25% of their paycheck for social security and medicare as way too many dont even know the employer matches their 7.62% that they paid.....and the government has spent evry single penny of it
the fact is uncle sam is concerned about one thing ...and that's jobs....he will inflate like a big dog rather than have john doe american find out the truth....and stop spending....they have to have people get up evry morning and produce what ever they produce
the good news is all the governments do the same thing and our economic machine is pretty powerful as productivity here is huge and mighty.....but the fact is we have been losing our huge lead over the world...and our middle class has huge competition now where as not so 10 or 20 years ago
i remember when bush did the trade agreement which sent many menial overseas ...people were po`ed...and he said retrain....get more skills at a higher level....he was targeting the middle class ( the 50% right in the middle )...
.i think way too many didn't get the memo......................and now the congress is asking ben why are the rich getting richer and the poor getting poorer ???? duh
monsterman
out of rockets ...out of bullets...switching to harsh language
Which means US assets are very cheap---including equities. As I mentioned months ago, "The British are coming." And they are bringing their German, Saudi, Chinese, Canadian and Australian friends with them. Is this a bad thing? NO. Americans bought up all the cheap European and Asian assets in the nineties and now they buy our cheap assets. The circle goes round and round.
Most all who are on these forums have the means to continue to outpace our neighbors. Only our level of fear will determine if we succeed.
Knowledge is the enemy of fear
i totally agree with you....as jp morgan once said....if you take all the money away from the rich and evenly distribute it amonst everyone it will be right back where it came from in 2 years
its just the creame always rises to the top......and the whale sheet always sinks to the bottom....no matter what country....no matter what race....no matter what economic climate
that being said....no where is it easier than in america as the political system combined with the capitalistic system works very well together
aka if you want more....make yourself worth more
monsterman
out of rockets ...out of bullets...switching to harsh language
A VERY CLEVER PLAN!
This may be a little long but I think most of you will really like this.
All of the paragraphs in quotes were taken from Bloomberg articles over the last several days.
So most of us know the story of how after World War II the powers that be, called the Globalists here, decided we could not have any more world wars due to nukes, and perhaps a global economy, with global socialistic political systems, would do the trick.
We also know the story of our own Government tried to pay for the start up of “Great Society”, and its minor wars, by simply printing money in the late 1970, and how that caused hyperinflation causing them to shift to creating debt to pay bills.
Many of us have been wondering about several serious issues facing our country, but I am beginning to think it was foolish to think the boys and girls in Washington did not have a plan.
Here are some of the more serious questions we have been asking for the last several years.
Just who is going to buy all of these U.S. notes as they come due, or the foreigners begin to dump them?
“July 23 (Bloomberg) -- Treasuries are getting an unexpected boost from pension funds controlling more than $14 trillion. Fund managers for companies including General Motors Corp., Alcatel-Lucent, and many others, are shifting away from stocks to prepare for accounting changes requiring them to more fully disclose the value of their holdings. Bonds are gaining favor as funds seek to avoid wider swings in prices that may accompany equities as the new rules take effect, possibly later this year.
The switch couldn't come at a better time for the $4.4 trillion market for U.S. government bonds. The surge in equities this month to record highs has wiped out the pension deficits of the companies in the Standard & Poor's 500 for the first time in six years. Now the funds can afford to match future obligations to employees with fixed- income securities rather than trying to plug shortfalls in the funds.
Well then if the pension funds sell out of their stock holdings how low will the market go?
“(Bloomberg) -- Everyone from Nobel Prize laureates to the world's biggest bond investor says the Bush administration has reason to cheer the dollar's slide to historic lows. The currency has lost 13.2 percent since January 2001, when George W. Bush took office, the most under any president since at least Gerald Ford. A weaker dollar is helping the economy, and rather than causing foreigners to flee U.S. securities, the depreciating currency is making American goods less expensive abroad. The dollar set a new low of $1.3843 per euro last week, and is the weakest in 26 years versus the British pound. A U.S. tourist heading to England will pay more than $2 for one U.K. pound, up from about $1.65 at the end of 1997. Against the Canadian dollar, it's the lowest since 1977 and it's the weakest in seven years versus Brazil's real.
The dollar's drop hasn't dented international investors' appetite for U.S. securities. They added a record $126.1 billion in May, Treasury data showed last week. The prior monthly record inflow was $120.9 billion in August 2006. Oppenheimer Funds Inc., which is based in New York and manages $250 billion, say the dollar may reach $1.45 per euro this year.”
Well exactly how will we have a global economy if American workers always make more money than their worldwide counter parts?
Well we cannot tell the American middle class that they are all going to have to take pay cuts, but we can do this;
We can tax the working folks in every form we can think of, and then give them social programs like the rest of the world to keep them quite. In addition we can import a whole new lower/middle class from Mexico who would love to work for minimum wage or a little more.
“(Bloomberg) – In the mid 1940’s nearly 37 percent of working people belonged to Unions, that number is 6 percent today.”
Well then if the pension funds sell out of their stock holdings how low will the market go?
Pensions being fully funded doesn't mean stocks are sold, or not bought. Once pensions reach a certain level - say 125% - of funding, management keeps the rest of the gains for themselves. So they have incentives to profit as much as possible, using other people's money.
there are lies, dammed lies, and statistics.
the author of that statement picked a time frame when unions were in their glory.
the govt was backing them to increase production, changing laws to help them,
the morons in charge finally allowed blacks and latinos, etc...
it seems the people who write these articles will use stats to persuade the reader
to whatever conclusion they wish.
only by studying history and getting some perspective on what they spout
non stop can you begin to see between the lines.
i picked this stat as an example, but i often see things like this.
so it appears union membership has gone back to its normal
percentage before the war.
please continue, rant off.
It appears to me that the government is setting up the pension funds to buy at least a few trillion of the debt over the next few years. Below is another statement from an article from Bloomberg.
"The federal Pension Protection Act passed last year requires company pensions to bring assets in line with future liabilities. That means pensions, which in 2006 were underfunded by $350 billion as measured by the Pension Benefit Guaranty Corp., must be fully funded by 2013.
To catch up, many funds loaded up on stocks. The S&P 500 has gained more than 9 percent this year, including the reinvestment of dividends. Pensions at companies that are members of the index ended March with a cumulative surplus for the first time since 2000, according to David Bianco, a New York-based strategist at UBS Securities, a unit of UBS AG, the biggest money manager for wealthy investors.
The act was the first step in pension reform. Now, many fund managers and their advisers speculate that accounting rule makers will eliminate accounting techniques companies have used to minimize the effects of volatility in their pension holdings. To minimize volatility, many funds decide to buy bonds, which experience lower swings in prices. "
As we have discussed before in this tread, when will the foreigners who take all of our Treasury note begin to spend that debt just buying assets?
I wonder if the Globalists ever figured in their calculations that emerging countries might get tired of owning paper and want to buy hard assets?
Here is another interesting question. If a foreign government gets millions of dollars in dividends, do you think they pay taxes on those dividends as all of us would have to do?
The Wall Street Journal
July 24th 2007
“Governments Get
Bolder in Buying
Equity Stakes
Foreign governments, flush with cash and no longer content with the meager returns to be had on safe but low-yielding investments like Treasurys, are becoming increasingly aggressive players on the equity front.
The new boldness of these government-controlled investors was on display Sunday night when entities controlled by the governments of China and Singapore agreed to invest as much as $18.5 billion in return for stakes in the big British bank Barclays PLC.
But many other recent deals reflect the quest by China and other countries for higher returns on their mounting foreign-exchange reserves. Those holdings traditionally were invested in safe, liquid investments that could be quickly converted to cash to buy up local currency if it came under speculative attack. But in many countries, especially China and the oil-producing nations of the Middle East, global trade has swelled those holdings to far more than might be needed to stabilize their currencies. Since 2002, such holdings have increased 20% a year, according to U.S. Treasury calculations.
Sameer Al Ansari, executive chairman and chief executive officer of state-back investment firm Dubai International Capital, says he is scouring the world's 500 largest publicly traded companies looking for a place to invest as much as $10 billion. His next target: a U.S. company that he has already identified but will only describe as "a household name."
Last week, an investment fund controlled by the government of Qatar made a $21.8 billion takeover approach for British supermarket chain J Sainsbury PLC, one of the largest potential acquisitions ever by a state-owned fund.
In Europe, there is a rising clamor to restrict foreign investment. German Chancellor Angela Merkel said last week that state-controlled investors might use stakes in European companies to pursue political, rather than only financial, goals.
The trend toward more aggressive government investments also has the potential to reorder global financial markets. "We have entered a whole new world," says Jim O'Neill, head of Global Economic Research for Goldman Sachs International in London. "We are at the early stage of a secular process where the relations between the prices of stocks and bonds will change. The whole world is discovering the equity culture."
Gezzz...why are some of these rich entities so short sighted. Why go through all these "where to put your assets, how to stage your currency" types of questions? Hell, I suspect you could buy Zimbabwe, Botswana or some like country for a relatively small amount of money, certainly you could buy the government and any privately held assets. Heck, what could Kosovo or Serbia cost. Why piss your money away on improved assets with all the government requirements, international implicatioins, political BS and complications? Buy some backward poorly governed country, field an army, declare a benevolent monarchy and be done with it. Harvest all the resources and the sell the place to the next owner for cents on the dollar. It's all good. If somebody wants to call you on human rights or environmental concerns...show them the digit, there are no rights, it's a monarchy stupid! It's already being done but they are just so unsophisticated. Hell, you could make good money at it!
<< <i>"We have entered a whole new world,"
Gezzz...why are some of these rich entities so short sighted. Why go through all these "where to put your assets, how to stage your currency" types of questions? Hell, I suspect you could buy Zimbabwe, Botswana or some like country for a relatively small amount of money, certainly you could buy the government and any privately held assets. Heck, what could Kosovo or Serbia cost. Why piss your money away on improved assets with all the government requirements, international implicatioins, political BS and complications? Buy some backward poorly governed country, field an army, declare a benevolent monarchy and be done with it. Harvest all the resources and the sell the place to the next owner for cents on the dollar. It's all good. If somebody wants to call you on human rights or environmental concerns...show them the digit, there are no rights, it's a monarchy stupid! It's already being done but they are just so unsophisticated. Hell, you could make good money at it! >>
This is what China will do to Russia. Think about it. A common border. Lots of land for expansion and one of the richest raw material areas in the world. Who needs those raw materials more, China or Russia.
Knowledge is the enemy of fear
Does this mean the PPT and ESF are running out of ammo? Will they take a stand at a lesser number? Or are we on our way to much lower numbers and much higher gold price?
roadrunner
<< <i>Today markes the first time in history that the US Dollar index closed under .8000 (closed at .7993 on 7/24/07) This does have some ramifications considering we have bounced off similar lows several times in the past few years.
Does this mean the PPT and ESF are running out of ammo? Will they take a stand at a lesser number? Or are we on our way to much lower numbers and much higher gold price?
roadrunner >>
Every 1% drop in the dollar is a 1% drop in the pproblem (more or less).
I'd look for a major rally starting around 77 or 78. This process will take years.
Gezzz...why are some of these rich entities so short sighted. Why go through all these "where to put your assets, how to stage your currency" types of questions? Hell, I suspect you could buy Zimbabwe, Botswana.
Mhammerman,
I love this but don’t go giving these guys any new ideas; you never know who is reading these threads.
RR
Perhaps the Euro will go to $2.00 next year and then we can really sell lots of stuff to Europe. Oh, that is if we can make lots of stuff to sell?
The sooner we get amnesty for the Mexicans the quicker we can make cars and compete with the Japanese. Maybe we can even get our textile factories, and many others going again. If we can put our new lower middle class to work for the minimum wage I think we can be very competitive!
I watched an interesting interview from one pundit on CNBC tonight he said, “we should not worry about the subprime and Alt A mortgage market because unlike the savings and loan crash all these CDO’S, derivatives etc. are spread out across the world to the Japanese, Germans, Brits, Chinese etc.”
No one on the show ask him if that meant that lots more people around the world were just going to lose lots more money?
Perhaps, soon, we shall find out if the market is
overpriced or under priced.
Camelot
<< <i>The sooner we get amnesty for the Mexicans the quicker we can make cars and compete with the Japanese. Maybe we can even get our textile factories, and many others going again. If we can put our new lower middle class to work for the minimum wage I think we can be very competitive! >>
Unless they all apply for disability once they become legal. Then we have a problem.