This Sept 2008 quote from fc is quite telling today in that the "older generation," in particular the ones that grew up in the 1920's to 1940's had it right. Yet we put them out to pasture in the 1980's and 1990's with new fangled finance and new paradigms. It's clear today they were right, and we were dead wrong. Chalk one up to the oldsters who were dead right when it counted, but none of us would listen.
roadrunner >>
That is so true and I have been caught in that conundrum like everyone else that actually remembers the past and warns of the future. But I do have one example when the "older generation" got it wrong. I remember when Greenspan said of the repeal of the Glass-Steagal Act in 1999 that is was a relic and was only valid during the time of the Great Depression. He also stated at a different time that derivatives were good and would keep the economy from crashing. Markets are much smarter these days he says. Ten years later we are where we should not be if Citibank had not merged with Travelers (Clinton kills Glass-Steagal) and if Greenspan had not kept rates uber low (post 9/11) and of course a few other tasty tidbits to add to create the Financial Blitzkrieg of 2008-9.
I, renman95 hate to be a D&G'er. I actually look at eternal hope (but not so much change). But my alt-ego, Comrade Renski, sees things much different. Comrade Renski remembers conversations at dinner table when he was youth and listened to parents of old country speak of horrible -isms. That is why I have noticed Comrade Renski signing off on many posts of late.
U.S. stock futures slumped on Monday after the White House said bankruptcy might be the best option for General Motors, forced out its chief executive and told Chrysler to form an alliance with another car maker, while hopes for a new round of global stimulus spending looked likely to fall short of earlier expectations...
Another blunder by another politician. These guys need coveralls and real jobs.
what difference does it make if it takes multiple times more greenbacks to buy a particular amount of the yellow metal in the future? Does that mean holders of gold have won the lottery or something? I think not; it merely means they have averted financial disaster and have been able to maintain their purchasing power as the currencies fail. It's difficult to quantify at what point someone has made a "profit" on long-held precious metals, correct? I'd love to say, yes, I've made an 800% profit on my gold (bought at today's prices and sold when gold reaches $8000), but is it really a profit? It seems to me that in this case, the dollar has lost value, and not gold gaining in value.
I agree totally. This key point needs to be bought forward in every thread on the price of gold. Devaluing the dollar allows the government to skip out on its obligations and promises to: savers, bondholders, retirees - and everyone on fixed income who structured their finances thinking that the dollar would be stable over time. It was wrong to trust the politicians then, and it is wrong to trust them now. 'Nuf said.
As for those still earning a living, and those "investing" in companies or other assets...............make all that money. You go guy! Put yourself into a higher tax bracket using those devalued dollars - and see how a regressive tax scheme feels. I remember when Carter was making it impossible to get ahead by honesty and hard work - this is turning out to be worse. I also remember when Reagan lowered the tax rates and it was actually hard to digest the fact that I had more money and it was worth more as well.
Those who think that a socialist utopia will come as a result of punitive taxes and centralized government planning & control haven't learned anything in history class - if they even have history class anymore that covers what happened during the communist 5 and 10-year plans in Russia, circa 1950's - 1960's. The destruction of the individual and the resulting loss of incentive to achieve results. The graft and corruption necessary just to survive. The faked economic reporting and cronyism that prevented any changes or improvement if it stepped on the toes of party bigwigs. Ultimately, they got millions of tons of American wheat, produced by American farmers who had an abundance of because of American productivity. How quickly they forget what communism did to East Germany and Eastern Europe - complete deterioration of their ability to improve their standards of living - the poor quality goods and polluted cesspools of industrial waste throughout Eastern Europe. Hmmmmm...
Q: Are You Printing Money? Bernanke: Not Literally
<< <i>what difference does it make if it takes multiple times more greenbacks to buy a particular amount of the yellow metal in the future? Does that mean holders of gold have won the lottery or something? I think not; it merely means they have averted financial disaster and have been able to maintain their purchasing power as the currencies fail. It's difficult to quantify at what point someone has made a "profit" on long-held precious metals, correct? I'd love to say, yes, I've made an 800% profit on my gold (bought at today's prices and sold when gold reaches $8000), but is it really a profit? It seems to me that in this case, the dollar has lost value, and not gold gaining in value.
I agree totally. This key point needs to be bought forward in every thread on the price of gold. Devaluing the dollar allows the government to skip out on its obligations and promises to: savers, bondholders, retirees - and everyone on fixed income who structured their finances thinking that the dollar would be stable over time. It was wrong to trust the politicians then, and it is wrong to trust them now. 'Nuf said.
As for those still earning a living, and those "investing" in companies or other assets...............make all that money. You go guy! Put yourself into a higher tax bracket using those devalued dollars - and see how a regressive tax scheme feels. I remember when Carter was making it impossible to get ahead by honesty and hard work - this is turning out to be worse. I also remember when Reagan lowered the tax rates and it was actually hard to digest the fact that I had more money and it was worth more as well.
Those who think that a socialist utopia will come as a result of punitive taxes and centralized government planning & control haven't learned anything in history class - if they even have history that covers the communist 5 and 10-year plans in Russia, circa 1950's. The destruction of the individual and the resulting loss of incentive to achieve results. The graft and corruption necessary just to survive. The faked economic reporting and cronyism that prevented any changes or improvement if it stepped on the toes of party bigwigs. How quickly they forget what communism did to East Germany and Eastern Europe - complete deterioration of their ability to improve their standards of living. >>
You make some outstanding and often-overlooked points about how socialism destroys the soul of the people, and their drive to work, to produce, because they have no incentive. That's the greater crime of high taxation, and ironically, those in the Soviet bloc countries are probably best able to cope with socialism because they've experienced its tragic course of events, as opposed to Americans, who are ill-equipped to handle the creeping socialism we've experienced, and what's yet to come.
.....GOD
"Ask, and it shall be given you; seek, and ye shall find; knock, and it shall be opened unto you." -Luke 11:9
"Hear, O Israel: The LORD our God is one LORD: And thou shalt love the LORD thy God with all thine heart, and with all thy soul, and with all thy might." -Deut. 6:4-5
"For the LORD is our judge, the LORD is our lawgiver, the LORD is our king; He will save us." -Isaiah 33:22
Again, the price of gold is only reflecting the value of the dollar. As these political mis-steps continue, the confidence of the dollar will erode, along with its value. If the politicians want to avert a disaster in the US, they will have to become accountable and honest - which would be a major shift in practice, imo.
The market price of gold knows which way it's going. Maybe it can still turn around, but either way - gold will know. That's kind of aggravating to the politicians, I am sure.
Q: Are You Printing Money? Bernanke: Not Literally
<< <i>what difference does it make if it takes multiple times more greenbacks to buy a particular amount of the yellow metal in the future? Does that mean holders of gold have won the lottery or something? I think not; it merely means they have averted financial disaster and have been able to maintain their purchasing power as the currencies fail. It's difficult to quantify at what point someone has made a "profit" on long-held precious metals, correct? I'd love to say, yes, I've made an 800% profit on my gold (bought at today's prices and sold when gold reaches $8000), but is it really a profit? It seems to me that in this case, the dollar has lost value, and not gold gaining in value.
I agree totally. This key point needs to be bought forward in every thread on the price of gold. Devaluing the dollar allows the government to skip out on its obligations and promises to: savers, bondholders, retirees - and everyone on fixed income who structured their finances thinking that the dollar would be stable over time. It was wrong to trust the politicians then, and it is wrong to trust them now. 'Nuf said.
As for those still earning a living, and those "investing" in companies or other assets...............make all that money. You go guy! Put yourself into a higher tax bracket using those devalued dollars - and see how a regressive tax scheme feels. I remember when Carter was making it impossible to get ahead by honesty and hard work - this is turning out to be worse. I also remember when Reagan lowered the tax rates and it was actually hard to digest the fact that I had more money and it was worth more as well.
Those who think that a socialist utopia will come as a result of punitive taxes and centralized government planning & control haven't learned anything in history class - if they even have history that covers the communist 5 and 10-year plans in Russia, circa 1950's. The destruction of the individual and the resulting loss of incentive to achieve results. The graft and corruption necessary just to survive. The faked economic reporting and cronyism that prevented any changes or improvement if it stepped on the toes of party bigwigs. How quickly they forget what communism did to East Germany and Eastern Europe - complete deterioration of their ability to improve their standards of living. >>
You make some outstanding and often-overlooked points about how socialism destroys the soul of the people, and their drive to work, to produce, because they have no incentive. That's the greater crime of high taxation, and ironically, those in the Soviet bloc countries are probably best able to cope with socialism because they've experienced its tragic course of events, as opposed to Americans, who are ill-equipped to handle the creeping socialism we've experienced, and what's yet to come.
>>
Interestingly enough, many people who grew up under communism have had a difficult time adjusting to capitalism. They were used to always having a job, now they have to look to find work. They may not have had much food, but now they have no money to buy food. Husbands and wives are now separated for long periods of time while one goes to a foreign country to work.
<< <i>Above post revised to add a couple more points.
Again, the price of gold is only reflecting the value of the dollar. As these political mis-steps continue, the confidence of the dollar will erode, along with its value. If the politicians want to avert a disaster in the US, they will have to become accountable and honest - which would be a major shift in practice, imo.
The market price of gold knows which way it's going. Maybe it can still turn around, but either way - gold will know. That's kind of aggravating to the politicians, I am sure. >>
Im not sure its a loss of confidence in the dollar, but rather in currency itself. Today, as the US Govt wields its mighty hand and influences business, the dollar rallies against the Euro.
DC is using up it's political clout faster than I have ever seen at any time in this here US of A.
The 'best thing' right now would be for Chrysler and the General to go 7 rather than 11. That would give the clowns who have no experience but are running things as though they know what they are doing a crises that they could REALLY hang their hat on. They give hundreds of billions to their ilk with no accountability but give 20 billion to two manufacturing companys and get a mad rush for power. Nobody in charge seems to even know how to change a tire.
<< <i>dbcoin, the fact that we benefited to a great extreme off foreign nations for the last 30 years has nothing to do with anyone's "disdain for humanity." It certainly doesn't even say that as a country we planned on that result or meant to take advantage of anyone. The USA had the world's reserve currency, most of the gold, and the soundest economy on earth. The fact is that it happened, and the current outcome is explainable as well (higher inflation being exported back to us). These are economic facts, "not disdain for humanity in general." Reserve currency or not, no nation cannot live beyond its means and debt forever without severe consequences. The fact they we went as long is a tribute to our financial "ingenuity."
You read far too much into threads. But for what it's worth, I have little confidence in our politicans or bankers to do the right things. I've felt that way since the mid-1990's. If that's "disdain for humanity in general," mea culpa.
For what it's worth, the financial debt cycle is in the 2nd inning. At best we've waded through 5-20% of the unseen debt out there. That means another 5 to 20 $700 BILLION bail outs if things go well. I tend to think it will be on the higher side of that - $15+ TRILL.
We'd better be at our very best for another few years because there are hundreds of TRILLIONs of toxic securities to account for. The mortgage crisis is just the warning shot. $700B will only cover the ante at the poker game that just started. But we'll need a lot more money to maintain a stake in this game. From a total dollar standpoint there is little you or I can do to help salvage this mess other than to write our elected officials. Less than 600 people will be calling the shots on where our financial future lies. Ironically, these very same 600 people got us to this precipice.
roadrunner >>
Roadrunner, I couldn't have said it better myself. I don't know why so many people love to bury their heads in the sand and keep borowing and spending their way through life?? This happens all the way from our illustrious leaders on capitol hill through the investment banks on Wall street down to the Joe six packs of the world. I realize most of us need to borrow money but for many people it's frivolous spending on items they don't really need and for TPTB it's all a big shell game of deceit primarily to line their pockets at the expense of somebody else. This country has become a greed based society and for many people anything is fair game as long as it benefits them.
<< <i>roadrunner, I invest in gold but don't have your disdain for humanity in general.
When things are at their worst, we are at our best. Things need to decline a little for it to spur us on and make things better for future generations. All things go in cycles. The financial debt cycle appears at its end. A new cycle will emerge. >>
You may want to take a look out the window, we have declined alot and it is not looking to rosie down the road.
PEACE! This is the first day of the rest of your life.
What a day! The US Coin Forum is all a buzz on the Mint announcing a very limited bullion release, no W coins except for a Buffalo proof. And on the PM side we are all a buzz on a record POG.
So I thought I would dogpile on the forum posts with this archived prediction of $8k by 2012. Let me say I hope we never see this. But I worry with todays news that some of the writing is already on the wall...massive debt and a world slowly decoupling from the dollar. The decoupling will take some time to be orchestrated.
What kind of America would we be living in if gold shot up to ridiculous values, not necessarily $8k? By 2012 oil may be in SDRs and/or Euros. The Dow may be at 40,000 but who cares because the dollar is under 10 from todays 70+ range. The huge drop could come from the dollar finally being allowed to trade on its own after being decoupled from a basket of currencies. That is when we could be in a full Weimar scenario.
History repeats...but not exactly.
I just hope that Washington gets their act together soon.
My kids are straight A honor students. Top 10 in their classes of over 600. I have trust funds for them and they espire to go to Princeton and Harvard. Are they pampered? Yeah, and I'm happy fo them. Your kids are too young to give you any crap except in their diapers. Talk to me in 10 or 12 years. Then you'll understand.
I'm an MS in the Sciences myself. I don't think, I do. >>
Just curious, how does one aquire a master's degree, yet cannot spell "aspire" accurately?
CAPE TOWN (MineFund.com) -- Speaking at Mining Indaba conference in Cape Town, James Turk forecast that gold could reach $8,000 per ounce by 2013-2015. He added that that may be too conservative.
Turk, the founder of digital gold currency GoldMoney, said individuals should own bullion not as an investment, but as a wealth preserver.
“Gold is not a commodity. It is not volatile. It is not an investment. Gold is money,” Turk told an audience of nearly 1,000 delegates.
He illustrated gold’s ability to retain its purchasing power by comparing the price of oil in British pounds, US dollars, German marks, euros and gold. Only gold had maintained its purchasing power since 1950, with massive losses for the currencies, especially the pound.
“Gold is a form of money that holds its value over time,” said Turk, adding, “capital is a precious resource that is best preserved with gold.”
He explained gold’s fundamentally different character as a tangible asset that was accumulated, or saved, rather than consumed. It’s value derives from its utility as a medium of exchange for things like food, shelter and communication.
“Gold as money is a mental tool that enables economic calculation unchanged through human history,” Turk told the audience of mining and investment professionals.
Turk bases his forecast on a long-range view of boom-bust cycles. He believes we are currently moving through a bust of epic proportions as individuals, companies and governments are forced to restore balance to their balance sheets.
“The bust has not yet peaked and you should own gold to preserve wealth until it has.”
He projected the cycle via a ratio of the Dow Jones Industrial Average to gold. He assets that the ratio will again revert to one, and that’s where his $8,000/oz prediction lands.
Turk said that a collapse of the dollar was inevitable because the United States, among other countries, was in a structural crisis that could not be avoided via interest rate increases.
“The US is not suffering from a cyclical deficit, but a structural one. It is a path to hyper-inflation.
“Japan’s credit rating has just been cut. It is probably the first slow fuse to be lit.”
Turk laid his thesis against the strong correlation of the Federal Reserve’s monetization of US debt with the S&P 500. Since the launch of quantitative easing, the correlation has been almost perfect.
Meanwhile, he pointed out that the US appears to have entered a “debt compounding” phase. As a result, the country is now extremely vulnerable to even moderate increases in interest rates which have begun to move up.
“We cannot replicate the previous [1980s] high interest rate cure for mismanagement of the economy,” Turk concluded. He believes the US currency will inevitably collapse as a consequence.
My kids are straight A honor students. Top 10 in their classes of over 600. I have trust funds for them and they espire to go to Princeton and Harvard. Are they pampered? Yeah, and I'm happy fo them. Your kids are too young to give you any crap except in their diapers. Talk to me in 10 or 12 years. Then you'll understand.
I'm an MS in the Sciences myself. I don't think, I do. >>
Just curious, how does one aquire a master's degree, yet cannot spell "aspire" accurately? >>
Thats a low blow! LOL
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Your 401K, the stocks you own, your bank account i: just electronic numbers on a sheet. I like the idea of holding something physical and not just a printout of what I am worth which can go poof overnight. When the dollar collapses it will probably be an overnight event.
Just curious, how does one aquire a master's degree, yet cannot spell "aspire" accurately? >>
Thats a low blow! LOL
then how low a blow is it to point out the irony that the poster -- asking this question about someone else's spelling -- misspelled the word "acquire" in his critique?
<< <i>Your 401K, the stocks you own, your bank account i: just electronic numbers on a sheet. I like the idea of holding something physical and not just a printout of what I am worth which can go poof overnight. When the dollar collapses it will probably be an overnight event. >>
Or on a Sunday.
Currency reform of June 1948
The Deutsche Mark was introduced on Sunday, June 20, 1948 by Ludwig Erhard. The old Reichsmark and Rentenmark were exchanged for the new currency at a rate of 1 DM = 1 RM for the essential currency such as wages, payment of rents etc, and 1 DM = 10 RM for the remainder in private non-bank credit balance, with half frozen. Large amounts were exchanged for 10RM to 65 pfennigs. In addition, each person received a per capita allowance of 60 DM in two parts, the first being 40 DM and the second 20 DM.[4]
A few weeks later Erhard, acting against orders, issued an edict abolishing many economic controls which had been originally implemented by the Nazis, and which the Allies had not removed. He did this, as he often confessed, on Sunday because the offices of the American, British, and French occupation authorities were closed that day. He was sure that if he had done it when they were open, they would have countermanded the order.[5]
The introduction of the new currency was intended to protect western Germany from a second wave of hyperinflation and to stop the rampant barter and black market trade (where American cigarettes acted as currency). Although the new currency was initially only distributed in the three western occupation zones outside Berlin, the move angered the Soviet authorities, who regarded it as a threat. The Soviets promptly cut off all road, rail and canal links between the three western zones and West Berlin, starting the Berlin Blockade. In response, the U.S. and Britain launched an airlift of food and coal and distributed the new currency in West Berlin as well.
Very interesting thread, As I understand it, the problem is the debt crisis! Sure many Americans have bought too much on credit and now if they are without a job they will have to default. Our government is in a debt crisis too, Congress does not have the guts to make changes, but the problem can be solved and very quickly.
1) The federal government should stop loaning to states, those that are solvent. Small amounts should be loaned to those in trouble. 2) All government pensions should be reduced and all future pensions should be negotiated by a third party. 3) All wars should be concluded, and some troops should be placed on the borders. 4) Reduce government spending...... pay freeze is not enough........ 5) Eliminate the current tax code and go to a flat tax on the federal side. 6) Lift the band on deep water drilling and lets get some job numbers improving.
Our monetary problems are but the fault of Congress and no one else. The president can not spend 1 red cent, it must be approved by Congress.
<< <i>Just curious, how does one aquire a master's degree, yet cannot spell "aspire" accurately? >>
Thats a low blow! LOL
then how low a blow is it to point out the irony that the poster -- asking this question about someone else's spelling -- misspelled the word "acquire" in his critique? >>
It's been mentioned throughout this thread that gold's rise is just accounting for the weakness in the dollar. That's only a small part of the equation. In relation to the USDollar Index gold has increased 10 fold over the past 10 yrs. It's quite obvious the dollar's purchasing power has not generally declined by a factor of 10 across the consumer marketplace. Other factors such as debt levels, entitlements, confidence, etc. all play a role. The only real way to determine how the dollar is doing is by what it can buy, not how it stands in some index.
As far as gold ending up at $5,000-$8,000 or higher, that's still years away, but sometime this decade.
<< <i>And all the gold bs from 2 years ago....None has come true...So much for fortune telling. >>
Not a bad couple years of BS.
>>
Granted. Gold had a decent run-up as your chart indicates and I'm not complaining. But what irks me, it's the same PM demigods who predicted Gold to the moon by 2011 ($3k+) are still singing the same absurd tune, except to a higher level and people subscribe to that nonsense. Heck, even Sinclairs much publicized $1650 for 2011 hasn't come about. The PM market has done very well over the last 10 years, but so have all the major commodities.
"Bongo drive 1984 Lincoln that looks like old coin dug from ground."
<< <i>And all the gold bs from 2 years ago....None has come true...So much for fortune telling. >>
I'm still looking for $50 silver by July 1.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>But what irks me, it's the same PM demigods who predicted Gold to the moon by 2011 ($3k+) are still singing the same absurd tune, except to a higher level and people subscribe to that nonsense. Heck, even Sinclairs much publicized $1650 for 2011 hasn't come about. The PM market has done very well over the last 10 years, but so have all the major commodities. >>
Those numbers are just cheap publicity, but some macro event in the future might trigger a massive break upward.
Americans who turned in their gold for $20.67 per ounce in April 1933 didn't anticipate that Roosevelt would revalue it at $35 the next January, overnight.
<< <i>That tagline would certainly get my attention. This is not from any headline that is credible. It's from me. And I will explain how I got here.
In the 1970's as a YN I saw gold per ounce go from the $30's to low hundreds and then to a paradigm-type shift to $850.
That number back then was not fathomable. This is a mental exercise. VW's were advertised at $2,995 in the early 70's. My parents bought a house for $19,000 in SoCal and my dad made $14,000 per year. That same house would be $400,000 even in todays market...if there was a buyer. A safe minivan cannot be had for $19,000 today.
So, I think now we've reached a point in economic history where there needs to be another paradigm shift in valuing gold in light of todays credit-Hiroshima and energy-Hiroshima and other Hiroshimas. So, I pick an outrageous number like $8,000. Well, not so crazy actually. We were nearly at $1,050 this summer. Our credit crisis over this year and the next 5 years could easily devalue our dollar 3 or 4 fold. Ten, 15 or 20 cents on the current devalued dollar.
I think most here can agree that this current credit issue being solved by our elected "giants" isn't the last issue. There are more "issues" coming that are more interconnected to main street than Wall Street. If there is a visible run of the banks on CNN et al., the beginning of the end is at hand. The influence of these elected giants may actually harm any recovery and prolong our misery like FDR did in the thirties. Ren >>
Congressman Paul says the same thing about the geniuses in government are actually prolonging the pain that so many are feeling.
Americans who turned in their gold for $20.67 per ounce in April 1933 didn't anticipate that Roosevelt would revalue it at $35 the next January, overnight.
I'm sure that anyone who owned gold in 1933 didn't expect to be threatened with imprisonment or a $10,000 fine for non-compliance either. At that point, one has to think, "hey, who's side are they on, anyhow?"
Q: Are You Printing Money? Bernanke: Not Literally
Comments
This Sept 2008 quote from fc is quite telling today in that the "older generation," in particular the ones that grew up in the 1920's to 1940's had it right. Yet we put them out to pasture in the 1980's and 1990's with new fangled finance and new paradigms. It's clear today they were right, and we were dead wrong. Chalk one up to the oldsters who were dead right when it counted, but none of us would listen.
roadrunner >>
That is so true and I have been caught in that conundrum like everyone else that actually remembers the past and warns of the future. But I do have one example when the "older generation" got it wrong. I remember when Greenspan said of the repeal of the Glass-Steagal Act in 1999 that is was a relic and was only valid during the time of the Great Depression. He also stated at a different time that derivatives were good and would keep the economy from crashing. Markets are much smarter these days he says. Ten years later we are where we should not be if Citibank had not merged with Travelers (Clinton kills Glass-Steagal) and if Greenspan had not kept rates uber low (post 9/11) and of course a few other tasty tidbits to add to create the Financial Blitzkrieg of 2008-9.
I, renman95 hate to be a D&G'er. I actually look at eternal hope (but not so much change). But my alt-ego, Comrade Renski, sees things much different. Comrade Renski remembers conversations at dinner table when he was youth and listened to parents of old country speak of horrible -isms. That is why I have noticed Comrade Renski signing off on many posts of late.
Ren
Another blunder by another politician. These guys need coveralls and real jobs.
I agree totally. This key point needs to be bought forward in every thread on the price of gold. Devaluing the dollar allows the government to skip out on its obligations and promises to: savers, bondholders, retirees - and everyone on fixed income who structured their finances thinking that the dollar would be stable over time. It was wrong to trust the politicians then, and it is wrong to trust them now. 'Nuf said.
As for those still earning a living, and those "investing" in companies or other assets...............make all that money. You go guy! Put yourself into a higher tax bracket using those devalued dollars - and see how a regressive tax scheme feels. I remember when Carter was making it impossible to get ahead by honesty and hard work - this is turning out to be worse. I also remember when Reagan lowered the tax rates and it was actually hard to digest the fact that I had more money and it was worth more as well.
Those who think that a socialist utopia will come as a result of punitive taxes and centralized government planning & control haven't learned anything in history class - if they even have history class anymore that covers what happened during the communist 5 and 10-year plans in Russia, circa 1950's - 1960's. The destruction of the individual and the resulting loss of incentive to achieve results. The graft and corruption necessary just to survive. The faked economic reporting and cronyism that prevented any changes or improvement if it stepped on the toes of party bigwigs. Ultimately, they got millions of tons of American wheat, produced by American farmers who had an abundance of because of American productivity. How quickly they forget what communism did to East Germany and Eastern Europe - complete deterioration of their ability to improve their standards of living - the poor quality goods and polluted cesspools of industrial waste throughout Eastern Europe. Hmmmmm...
I knew it would happen.
<< <i>what difference does it make if it takes multiple times more greenbacks to buy a particular amount of the yellow metal in the future? Does that mean holders of gold have won the lottery or something? I think not; it merely means they have averted financial disaster and have been able to maintain their purchasing power as the currencies fail. It's difficult to quantify at what point someone has made a "profit" on long-held precious metals, correct? I'd love to say, yes, I've made an 800% profit on my gold (bought at today's prices and sold when gold reaches $8000), but is it really a profit? It seems to me that in this case, the dollar has lost value, and not gold gaining in value.
I agree totally. This key point needs to be bought forward in every thread on the price of gold. Devaluing the dollar allows the government to skip out on its obligations and promises to: savers, bondholders, retirees - and everyone on fixed income who structured their finances thinking that the dollar would be stable over time. It was wrong to trust the politicians then, and it is wrong to trust them now. 'Nuf said.
As for those still earning a living, and those "investing" in companies or other assets...............make all that money. You go guy! Put yourself into a higher tax bracket using those devalued dollars - and see how a regressive tax scheme feels. I remember when Carter was making it impossible to get ahead by honesty and hard work - this is turning out to be worse. I also remember when Reagan lowered the tax rates and it was actually hard to digest the fact that I had more money and it was worth more as well.
Those who think that a socialist utopia will come as a result of punitive taxes and centralized government planning & control haven't learned anything in history class - if they even have history that covers the communist 5 and 10-year plans in Russia, circa 1950's. The destruction of the individual and the resulting loss of incentive to achieve results. The graft and corruption necessary just to survive. The faked economic reporting and cronyism that prevented any changes or improvement if it stepped on the toes of party bigwigs. How quickly they forget what communism did to East Germany and Eastern Europe - complete deterioration of their ability to improve their standards of living. >>
You make some outstanding and often-overlooked points about how socialism destroys the soul of the people, and their drive to work, to produce, because they have no incentive. That's the greater crime of high taxation, and ironically, those in the Soviet bloc countries are probably best able to cope with socialism because they've experienced its tragic course of events, as opposed to Americans, who are ill-equipped to handle the creeping socialism we've experienced, and what's yet to come.
"Ask, and it shall be given you; seek, and ye shall find; knock, and it shall be opened unto you." -Luke 11:9
"Hear, O Israel: The LORD our God is one LORD: And thou shalt love the LORD thy God with all thine heart, and with all thy soul, and with all thy might." -Deut. 6:4-5
"For the LORD is our judge, the LORD is our lawgiver, the LORD is our king; He will save us." -Isaiah 33:22
Again, the price of gold is only reflecting the value of the dollar. As these political mis-steps continue, the confidence of the dollar will erode, along with its value. If the politicians want to avert a disaster in the US, they will have to become accountable and honest - which would be a major shift in practice, imo.
The market price of gold knows which way it's going. Maybe it can still turn around, but either way - gold will know. That's kind of aggravating to the politicians, I am sure.
I knew it would happen.
<< <i>
<< <i>what difference does it make if it takes multiple times more greenbacks to buy a particular amount of the yellow metal in the future? Does that mean holders of gold have won the lottery or something? I think not; it merely means they have averted financial disaster and have been able to maintain their purchasing power as the currencies fail. It's difficult to quantify at what point someone has made a "profit" on long-held precious metals, correct? I'd love to say, yes, I've made an 800% profit on my gold (bought at today's prices and sold when gold reaches $8000), but is it really a profit? It seems to me that in this case, the dollar has lost value, and not gold gaining in value.
I agree totally. This key point needs to be bought forward in every thread on the price of gold. Devaluing the dollar allows the government to skip out on its obligations and promises to: savers, bondholders, retirees - and everyone on fixed income who structured their finances thinking that the dollar would be stable over time. It was wrong to trust the politicians then, and it is wrong to trust them now. 'Nuf said.
As for those still earning a living, and those "investing" in companies or other assets...............make all that money. You go guy! Put yourself into a higher tax bracket using those devalued dollars - and see how a regressive tax scheme feels. I remember when Carter was making it impossible to get ahead by honesty and hard work - this is turning out to be worse. I also remember when Reagan lowered the tax rates and it was actually hard to digest the fact that I had more money and it was worth more as well.
Those who think that a socialist utopia will come as a result of punitive taxes and centralized government planning & control haven't learned anything in history class - if they even have history that covers the communist 5 and 10-year plans in Russia, circa 1950's. The destruction of the individual and the resulting loss of incentive to achieve results. The graft and corruption necessary just to survive. The faked economic reporting and cronyism that prevented any changes or improvement if it stepped on the toes of party bigwigs. How quickly they forget what communism did to East Germany and Eastern Europe - complete deterioration of their ability to improve their standards of living. >>
You make some outstanding and often-overlooked points about how socialism destroys the soul of the people, and their drive to work, to produce, because they have no incentive. That's the greater crime of high taxation, and ironically, those in the Soviet bloc countries are probably best able to cope with socialism because they've experienced its tragic course of events, as opposed to Americans, who are ill-equipped to handle the creeping socialism we've experienced, and what's yet to come.
Interestingly enough, many people who grew up under communism have had a difficult time adjusting to capitalism. They were used to always having a job, now they have to look to find work. They may not have had much food, but now they have no money to buy food. Husbands and wives are now separated for long periods of time while one goes to a foreign country to work.
Knowledge is the enemy of fear
<< <i>Above post revised to add a couple more points.
Again, the price of gold is only reflecting the value of the dollar. As these political mis-steps continue, the confidence of the dollar will erode, along with its value. If the politicians want to avert a disaster in the US, they will have to become accountable and honest - which would be a major shift in practice, imo.
The market price of gold knows which way it's going. Maybe it can still turn around, but either way - gold will know. That's kind of aggravating to the politicians, I am sure. >>
Im not sure its a loss of confidence in the dollar, but rather in currency itself. Today, as the US Govt wields its mighty hand and influences business, the dollar rallies against the Euro.
Knowledge is the enemy of fear
The 'best thing' right now would be for Chrysler and the General to go 7 rather than 11. That would give the clowns who have no experience but are running things as though they know what they are doing a crises that they could REALLY hang their hat on. They give hundreds of billions to their ilk with no accountability but give 20 billion to two manufacturing companys and get a mad rush for power. Nobody in charge seems to even know how to change a tire.
People need to wake up.
I should update my date to 12-12-12!
R95
<< <i>dbcoin, the fact that we benefited to a great extreme off foreign nations for the last 30 years has nothing to do with anyone's "disdain for humanity." It certainly doesn't even say that as a country we planned on that result or meant to take advantage of anyone. The USA had the world's reserve currency, most of the gold, and the soundest economy on earth. The fact is that it happened, and the current outcome is explainable as well (higher inflation being exported back to us). These are economic facts, "not disdain for humanity in general." Reserve currency or not, no nation cannot live beyond its means and debt forever without severe consequences. The fact they we went as long is a tribute to our financial "ingenuity."
You read far too much into threads. But for what it's worth, I have little confidence in our politicans or bankers to do the right things. I've felt that way since the mid-1990's. If that's "disdain for humanity in general," mea culpa.
For what it's worth, the financial debt cycle is in the 2nd inning. At best we've waded through 5-20% of the unseen debt out there. That means another 5 to 20 $700 BILLION bail outs if things go well. I tend to think it will be on the higher side of that - $15+ TRILL.
We'd better be at our very best for another few years because there are hundreds of TRILLIONs of toxic securities to account for. The mortgage crisis is just the warning shot. $700B will only cover the ante at the poker game that just started. But we'll need a lot more money to maintain a stake in this game. From a total dollar standpoint there is little you or I can do to help salvage this mess other than to write our elected officials. Less than 600 people will be calling the shots on where our financial future lies. Ironically, these very same 600 people got us to this precipice.
roadrunner >>
Roadrunner, I couldn't have said it better myself. I don't know why so many people love to bury their heads in the sand and keep borowing and spending their way through life?? This happens all the way from our illustrious leaders on capitol hill through the investment banks on Wall street down to the Joe six packs of the world.
I realize most of us need to borrow money but for many people it's frivolous spending on items they don't really need and for TPTB it's all a big shell game of deceit primarily to line their pockets at the expense of somebody else.
This country has become a greed based society and for many people anything is fair game as long as it benefits them.
<< <i>roadrunner, I invest in gold but don't have your disdain for humanity in general.
When things are at their worst, we are at our best. Things need to decline a little for it to spur us on and make things better for future generations. All things go in cycles. The financial debt cycle appears at its end. A new cycle will emerge. >>
You may want to take a look out the window, we have declined alot and it is not looking to rosie down the road.
Fred, Las Vegas, NV
So I thought I would dogpile on the forum posts with this archived prediction of $8k by 2012. Let me say I hope we never see this. But I worry with todays news that some of the writing is already on the wall...massive debt and a world slowly decoupling from the dollar. The decoupling will take some time to be orchestrated.
What kind of America would we be living in if gold shot up to ridiculous values, not necessarily $8k? By 2012 oil may be in SDRs and/or Euros. The Dow may be at 40,000 but who cares because the dollar is under 10 from todays 70+ range. The huge drop could come from the dollar finally being allowed to trade on its own after being decoupled from a basket of currencies. That is when we could be in a full Weimar scenario.
History repeats...but not exactly.
I just hope that Washington gets their act together soon.
Comrade Renski
and then the world ends on 12/21/2012.
just perfect.
Camelot
<< <i>Tom
My kids are straight A honor students. Top 10 in their classes of over 600. I have trust funds for them and they espire to go to Princeton and Harvard. Are they pampered? Yeah, and I'm happy fo them. Your kids are too young to give you any crap except in their diapers. Talk to me in 10 or 12 years. Then you'll understand.
I'm an MS in the Sciences myself. I don't think, I do. >>
Just curious, how does one aquire a master's degree, yet cannot spell "aspire" accurately?
Q]...how does one aquire a master's degree, yet cannot spell "aspire"... >>
--------------------------------
I think he meant esquire....................
http://gold.approximity.com/gold_price_models_sinclair.html
Box of 20
more articles by
Timothy Wood
$8,000 Gold by 2013-2015 May be Too Cheap
By Timothy Wood
Feb 10 2011 1:54PM
www.minefund.com
CAPE TOWN (MineFund.com) -- Speaking at Mining Indaba conference in Cape Town, James Turk forecast that gold could reach $8,000 per ounce by 2013-2015. He added that that may be too conservative.
Turk, the founder of digital gold currency GoldMoney, said individuals should own bullion not as an investment, but as a wealth preserver.
“Gold is not a commodity. It is not volatile. It is not an investment. Gold is money,” Turk told an audience of nearly 1,000 delegates.
He illustrated gold’s ability to retain its purchasing power by comparing the price of oil in British pounds, US dollars, German marks, euros and gold. Only gold had maintained its purchasing power since 1950, with massive losses for the currencies, especially the pound.
“Gold is a form of money that holds its value over time,” said Turk, adding, “capital is a precious resource that is best preserved with gold.”
He explained gold’s fundamentally different character as a tangible asset that was accumulated, or saved, rather than consumed. It’s value derives from its utility as a medium of exchange for things like food, shelter and communication.
“Gold as money is a mental tool that enables economic calculation unchanged through human history,” Turk told the audience of mining and investment professionals.
Turk bases his forecast on a long-range view of boom-bust cycles. He believes we are currently moving through a bust of epic proportions as individuals, companies and governments are forced to restore balance to their balance sheets.
“The bust has not yet peaked and you should own gold to preserve wealth until it has.”
He projected the cycle via a ratio of the Dow Jones Industrial Average to gold. He assets that the ratio will again revert to one, and that’s where his $8,000/oz prediction lands.
Turk said that a collapse of the dollar was inevitable because the United States, among other countries, was in a structural crisis that could not be avoided via interest rate increases.
“The US is not suffering from a cyclical deficit, but a structural one. It is a path to hyper-inflation.
“Japan’s credit rating has just been cut. It is probably the first slow fuse to be lit.”
Turk laid his thesis against the strong correlation of the Federal Reserve’s monetization of US debt with the S&P 500. Since the launch of quantitative easing, the correlation has been almost perfect.
Meanwhile, he pointed out that the US appears to have entered a “debt compounding” phase. As a result, the country is now extremely vulnerable to even moderate increases in interest rates which have begun to move up.
“We cannot replicate the previous [1980s] high interest rate cure for mismanagement of the economy,” Turk concluded. He believes the US currency will inevitably collapse as a consequence.
Timothy Wood
www.minefund.com
****
© 2010, MineFund.com > Commodity Investment Analysis & Analytics
<< <i>
<< <i>Tom
My kids are straight A honor students. Top 10 in their classes of over 600. I have trust funds for them and they espire to go to Princeton and Harvard. Are they pampered? Yeah, and I'm happy fo them. Your kids are too young to give you any crap except in their diapers. Talk to me in 10 or 12 years. Then you'll understand.
I'm an MS in the Sciences myself. I don't think, I do. >>
Just curious, how does one aquire a master's degree, yet cannot spell "aspire" accurately? >>
Thats a low blow! LOL
(x2,Meltdown),cajun,Swampboy,SeaEagleCoins,InYHWHWeTrust, bstat1020,Spooly,timrutnat,oilstates200, vpr, guitarwes,
mariner67, and Mikes coins
Box of 20
Thats a low blow! LOL
then how low a blow is it to point out the irony that the poster -- asking this question about someone else's spelling -- misspelled the word "acquire" in his critique?
Liberty: Parent of Science & Industry
<< <i>Your 401K, the stocks you own, your bank account i: just electronic numbers on a sheet. I like the idea of holding something physical and not just a printout of what I am worth which can go poof overnight. When the dollar collapses it will probably be an overnight event. >>
Or on a Sunday.
Currency reform of June 1948
The Deutsche Mark was introduced on Sunday, June 20, 1948 by Ludwig Erhard. The old Reichsmark and Rentenmark were exchanged for the new currency at a rate of 1 DM = 1 RM for the essential currency such as wages, payment of rents etc, and 1 DM = 10 RM for the remainder in private non-bank credit balance, with half frozen. Large amounts were exchanged for 10RM to 65 pfennigs. In addition, each person received a per capita allowance of 60 DM in two parts, the first being 40 DM and the second 20 DM.[4]
A few weeks later Erhard, acting against orders, issued an edict abolishing many economic controls which had been originally implemented by the Nazis, and which the Allies had not removed. He did this, as he often confessed, on Sunday because the offices of the American, British, and French occupation authorities were closed that day. He was sure that if he had done it when they were open, they would have countermanded the order.[5]
The introduction of the new currency was intended to protect western Germany from a second wave of hyperinflation and to stop the rampant barter and black market trade (where American cigarettes acted as currency). Although the new currency was initially only distributed in the three western occupation zones outside Berlin, the move angered the Soviet authorities, who regarded it as a threat. The Soviets promptly cut off all road, rail and canal links between the three western zones and West Berlin, starting the Berlin Blockade. In response, the U.S. and Britain launched an airlift of food and coal and distributed the new currency in West Berlin as well.
1) The federal government should stop loaning to states, those that are solvent. Small amounts should be loaned to those in trouble.
2) All government pensions should be reduced and all future pensions should be negotiated by a third party.
3) All wars should be concluded, and some troops should be placed on the borders.
4) Reduce government spending...... pay freeze is not enough........
5) Eliminate the current tax code and go to a flat tax on the federal side.
6) Lift the band on deep water drilling and lets get some job numbers improving.
Our monetary problems are but the fault of Congress and no one else. The president can not spend 1 red cent, it must be approved by Congress.
<< <i>Just curious, how does one aquire a master's degree, yet cannot spell "aspire" accurately? >>
Thats a low blow! LOL
then how low a blow is it to point out the irony that the poster -- asking this question about someone else's spelling -- misspelled the word "acquire" in his critique? >>
I dont have a master's degree.
Edited to add: Well, some of his mind is right.
Gold to Exceed $12,500 to Balance US Debt
Just updating our disaster-in-the-making.
<< <i>US Is Nearing Even Worse Financial Crisis: Jim Rogers
Gold to Exceed $12,500 to Balance US Debt
Just updating our disaster-in-the-making. >>
And all the gold bs from 2 years ago....None has come true...So much for fortune telling.
<< <i>And all the gold bs from 2 years ago....None has come true...So much for fortune telling. >>
Not a bad couple years of BS.
gold has increased 10 fold over the past 10 yrs. It's quite obvious the dollar's purchasing power has not generally declined by a factor of 10 across the consumer marketplace. Other
factors such as debt levels, entitlements, confidence, etc. all play a role. The only real way to determine how the dollar is doing is by what it can buy, not how it stands in some index.
As far as gold ending up at $5,000-$8,000 or higher, that's still years away, but sometime this decade.
roadrunner
<< <i>
<< <i>And all the gold bs from 2 years ago....None has come true...So much for fortune telling. >>
Not a bad couple years of BS.
Granted. Gold had a decent run-up as your chart indicates and I'm not complaining. But what irks me, it's the same PM demigods who predicted Gold to the moon by 2011 ($3k+) are still singing the same absurd tune, except to a higher level and people subscribe to that nonsense. Heck, even Sinclairs much publicized $1650 for 2011 hasn't come about.
The PM market has done very well over the last 10 years, but so have all the major commodities.
<< <i>And all the gold bs from 2 years ago....None has come true...So much for fortune telling. >>
I'm still looking for $50 silver by July 1.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>
<< <i>And all the gold bs from 2 years ago....None has come true...So much for fortune telling. >>
I'm still looking for $50 silver by July 1.
I sure hope you win that one
<< <i>
<< <i>US Is Nearing Even Worse Financial Crisis: Jim Rogers
Gold to Exceed $12,500 to Balance US Debt
Just updating our disaster-in-the-making. >>
And all the gold bs from 2 years ago....None has come true...So much for fortune telling. >>
Fortunately I kept my day job.
<< <i>But what irks me, it's the same PM demigods who predicted Gold to the moon by 2011 ($3k+) are still singing the same absurd tune, except to a higher level and people subscribe to that nonsense. Heck, even Sinclairs much publicized $1650 for 2011 hasn't come about.
The PM market has done very well over the last 10 years, but so have all the major commodities. >>
Those numbers are just cheap publicity, but some macro event in the future might trigger a massive break upward.
Americans who turned in their gold for $20.67 per ounce in April 1933 didn't anticipate that Roosevelt would revalue it at $35 the next January, overnight.
<< <i>That tagline would certainly get my attention. This is not from any headline that is credible. It's from me. And I will explain how I got here.
In the 1970's as a YN I saw gold per ounce go from the $30's to low hundreds and then to a paradigm-type shift to $850.
That number back then was not fathomable. This is a mental exercise. VW's were advertised at $2,995 in the early 70's.
My parents bought a house for $19,000 in SoCal and my dad made $14,000 per year. That same house would be $400,000 even in todays market...if there was a buyer.
A safe minivan cannot be had for $19,000 today.
So, I think now we've reached a point in economic history where there needs to be another paradigm shift in valuing gold in light of todays credit-Hiroshima and energy-Hiroshima and other Hiroshimas.
So, I pick an outrageous number like $8,000. Well, not so crazy actually. We were nearly at $1,050 this summer. Our credit crisis over this year and the next 5 years could easily devalue our dollar 3 or 4 fold.
Ten, 15 or 20 cents on the current devalued dollar.
I think most here can agree that this current credit issue being solved by our elected "giants" isn't the last issue. There are more "issues" coming that are more interconnected to main street than Wall Street. If there is a visible run of the banks on CNN et al., the beginning of the end is at hand. The influence of these elected giants may actually harm any recovery and prolong our misery like FDR did in the thirties.
Ren
Congressman Paul says the same thing about the geniuses in government are actually prolonging the pain that so many are feeling.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
I'm sure that anyone who owned gold in 1933 didn't expect to be threatened with imprisonment or a $10,000 fine for non-compliance either. At that point, one has to think, "hey, who's side are they on, anyhow?"
I knew it would happen.
anyway, ttt for 12/21/11
Liberty: Parent of Science & Industry
<< <i>I think there is precious little chance that our children will have as high a standard of living, in general, as we have had. >>
the way its going i agree.
I disagree. Don't underestimate American ingenuity! I have confidence in my sons and, in general, in their generation. They will think of something.
<< <i>Well...at least you had the courage to put a time-frame on your prediction! >>
Just another far fetched prediction from 5 years ago. He's not alone, there are hundreds of them.
<< <i>
<< <i>Well...at least you had the courage to put a time-frame on your prediction! >>
Just another far fetched prediction from 5 years ago. He's not alone, there are hundreds of them. >>
This.