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E.D. Hart

E.D. Hart
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  • China Levels The Global Playing Field [View article]
    what are the implications for gold? thanks for the article...
    Feb 24, 2015. 02:38 PM | Likes Like |Link to Comment
  • Misconceptions About Gold [View article]
    Good luck with the shopping...
    Feb 19, 2015. 11:20 PM | 1 Like Like |Link to Comment
  • Misconceptions About Gold [View article]
    No, there is no rational reason to use granite as money. It doesn't function well as money, it doesn't possess the qualities that money should have:
    Here are some historic and modern day essential qualities of money:

    Proven Medium of Exchange
    Unit of Account
    Default Proof
    Naturally Limited in Supply
    Millennial Long Stores of Value
    and widely accepted as collateral and exchange

    Gold is NOT identical to tulip bulbs, beanie babies, shiny rocks, seashells, round stones with holes in them, and so on because they don't have all of the above qualities.

    Federal reserve notes serve as money because our government issues them, declares them to be money, and demands that taxes be paid in them. But nothing backs their value other than the aforementioned. The chief downfall of reserve notes is that governments can alter their supply radically--thus engaging in stealth wealth confiscation.

    Not ideal for money in the worst of times. In the best of times, people don't worry about their reserve notes.

    Gold can be demonetized by governments by charging tax status on gains (making it expensive to hold and exchange after gains), and changing its status as collateral at banks, among other things. Governments can confiscate gold...

    How do you wish to hold onto your wealth?

    As a gold bull I recognize that I must diversify my wealth into different asset classes: real estate, stocks, bonds, currencies, and commodities. ( I have a little plot of timber as my commodity allocation).

    Gold is an international currency, so it is rational, consistent, logical, and effective in diversifying my wealth basket. Gold bugs might go gonzo and always have say 30-50% of their wealth in gold--regardless of the fundamentals.

    Gold bulls look at the macro environment and determine which asset makes the most sense depending on what are the prevailing conditions in the market.

    Currently I'm a gold bull based on the market fundamentals of negative interest rates, record debt issuance, currency instability, and long term demand of the Asian countries.
    Feb 18, 2015. 10:16 PM | 1 Like Like |Link to Comment
  • Misconceptions About Gold [View article]
    Hello David,
    Most of what you say is true, but I think you missed my point.

    Gold is money, has been money with a long history, and will remain money for as long as it retains its properties.

    Those of you in this thead that may object to the semantic meaning of money can argue that it has been demonitized--and they are correct.

    Governments have done their best to demonitize gold to promote their own fiat currencies. So gold as money is waning...but the man point is that it is an asset with moentary qualities.

    The fact that silver has had greater monetary transactions at different points in history missed the point--in fact it reinforces my point that metals such as silver and gold have a diversifying role in a portfolio, and that their value is not arbitrary. As a world coin collector, I am well aware of which countries issue gold and silver coins.

    Gold has always played an important role in the international monetary system. Gold coins were first struck on the order of King Croesus of Lydia (an area that is now part of Turkey), around 550 BC. They circulated as currency in many countries before the introduction of paper money. Once paper money was introduced, currencies still maintained an explicit link to gold (the paper being exchangeable for gold on demand). [1]

    Gold and silver were used as the most common form of money throughout history. In many languages, such as Spanish, French, and Italian, the word for silver is still directly related to the word for money. Although gold and silver were commonly used to mint coins, other metals were used. For instance, Ancient Sparta minted coins from iron to discourage its citizens from engaging in foreign trade.[73] In the early seventeenth century Sweden lacked more precious metal and so produced "plate money", which were large slabs of copper approximately 50 cm or more in length and width, appropriately stamped with indications of their value.

    Gold coinage began to be minted again in Europe in the thirteenth century. Frederick the II is credited with having re-introduced the metal to currency during the time of the Crusades. During the fourteenth century Europe had en masse converted from use of silver in currency to minting of gold. Vienna transferred from minting silver to instead gold during 1328.

    Metal based coins had the advantage of carrying their value within the coins themselves – on the other hand, they induced manipulations: the clipping of coins in the attempt to get and recycle the precious metal. A greater problem was the simultaneous co-existence of gold, silver and copper coins in Europe. English and Spanish traders valued gold coins more than silver coins, as many of their neighbors did, with the effect that the English gold-based guinea coin began to rise against the English silver based crown in the 1670s and 1680s. Consequently, silver was ultimately pulled out of England for dubious amounts of gold coming into the country at a rate no other European nation would share. The effect was worsened with Asian traders not sharing the European appreciation of gold altogether.
    Furthermore: When Spanish explorers arrived in the “New World” of Central and South America (15th and 16th centuries) they encountered different native peoples. The Spanish and Incas had very little in common. Diverse old native Indian cultures spoke entirely different languages than European Spaniards, they worshipped entirely different gods, and they lived very different lives day to day. What they both did hold in common was a high esteem for gold and silver using them to craft some of their life’s most important tangible objects (religious items used in rituals, jewelry for adornment, coins for trade).[3]
    Feb 18, 2015. 09:56 PM | 1 Like Like |Link to Comment
  • Misconceptions About Gold [View article]
    Incorrect, I said "among other things",
    Granite is not fungible, rare, and malleable....even diamonds would be a poor currency--because they are not fungible. Gold, is easily worked into coins, like iron or silver or copper, but more rare, so more value can be contained in smaller amount.

    None of this is arbitrary as almost all civilizations have come to the same conclusion over millennia--gold is money because it has the characteristics that money needs.

    So the Greeks, Romans, Persians, French, Germans, Chinese, Indians, and all empires have made gold money, and demanded gold as money. Thats not by accident, nor is it arbitrary convention. Its intrinsic to the properties of gold.
    Feb 18, 2015. 06:40 PM | 1 Like Like |Link to Comment
  • Misconceptions About Gold [View article]
    Gold bulls recognize that gold cannot be infinitely printed, while fiat can, thus their attraction to it. It is rational to own some gold as a diversifying asset against the fallible beings that run Reserve banks around the world.
    Feb 17, 2015. 07:55 PM | Likes Like |Link to Comment
  • Misconceptions About Gold [View article]
    Not exactly, the cost of production of the two currencies is vastly different...its precisely not arbitrary because their is a high cost associated with producing it, among other things.
    Feb 17, 2015. 07:53 PM | 2 Likes Like |Link to Comment
  • Early Development Stage Gold Projects: An Excellent Risk Vs. Reward Proposition [View article]
    You don't
    go into any specific companies. I agree with your basic premises...
    Personally I am long PIRGF, Klondex, SAND, XPL, and BALMF.
    Feb 17, 2015. 11:51 AM | Likes Like |Link to Comment
  • Misconceptions About Gold [View article]
    Best explanation yet on SA about golds price movements, and absolutely spot on. Good writing to boot.
    Feb 16, 2015. 09:53 PM | 3 Likes Like |Link to Comment
  • Coming Fed Rate Hikes Actually Bullish For Gold [View article]
    And paradoxically, the rising rates may in fact actually cause higher money velocity, and cause higher inflation--at least in the initial stages. As long as real interest rates are low or can rally.

    A scenario exists where inflation ticks up ever so slightly, feds decide to raise rates, V increases causing accelerating inflation which sets off a positive feedback loop.

    Market commentators like their models simple and linear...few seem to consider non-equilibrium dynamics and feedback loops.

    The classic case for raising rates considers a negative feedback rate, but in the financial repression environment that we are currently in, at the zero bounds, the system breaks down, and positive feedback can ensue.

    Then, the fed can be locked into a lose-lose proposition as it is behind the curve unable to raise rates high enough and fast enough to get ahead of inflation (because of excessive government debt service) and not able to keep rates anchored for fear of excessive inflation.

    Both cases are bullish for gold. The bear case for gold would be Fed being run by another Fed Chair that was willing to raise rates high enough above inflation, and for long enough, to slow the money supply sufficiently.

    A new Volcker. How likely is that?
    Feb 13, 2015. 08:44 PM | 4 Likes Like |Link to Comment
  • Bullish Sentiment On Silver Wheaton - Fundamentals And Algorithmic Analysis [View article]
    Or, the bear market for precious metals, of the last 3 years--is near an end, as negative rates globally take a steep downturn. Currently Silver and gold are up for the year, even in a rising dollar environment. Thats bullish for PM.
    Feb 12, 2015. 02:25 PM | Likes Like |Link to Comment
  • Bullish Sentiment On Silver Wheaton - Fundamentals And Algorithmic Analysis [View article]
    Deflation is generally good for PM's--particularly in a negative interest rate environment--as we have now. Silver can rally from here even on deflationary scares.
    Feb 12, 2015. 12:19 AM | Likes Like |Link to Comment
  • Wary Of Gold Bugs, Bullish On Gold [View article]
    Debasement is the practice of lowering the value of currency. It is particularly used in connection with commodity money such as gold or silver coins. A coin is said to be debased if the quantity of gold, silver, copper or nickel is reduced.
    Feb 9, 2015. 08:50 PM | 1 Like Like |Link to Comment
  • Wary Of Gold Bugs, Bullish On Gold [View article]
    So, I'm being led by insane emotional propaganda because I believe that the dollar has over its history, had its purchasing power reduced?

    I had no idea.
    Feb 9, 2015. 08:50 PM | Likes Like |Link to Comment
  • Wary Of Gold Bugs, Bullish On Gold [View article]
    RE: "Right now USD is the lone paper not being debased."

    Surely a're not serious right?
    Feb 6, 2015. 12:24 PM | Likes Like |Link to Comment