ozzy43

Are GLD and SLV Legitimate Investment Vehicles?

In response to the comment immediately above (if it does not, as the author insists, vanish quickly):

Anyone who believes that the Wall Street Journal and NY Times are disinterested, unbiased bystanders who would be willing to expose fraud by financial elites is really living in Wonderland. Many of the people benefiting from the fraud are among the same people who control those Establishment media. It's not surprising that someone who is so blind to the fraud that is the mainstream media would insist on blinding himself to other possible frauds. I notice that his post here was not even in response to the article above - did not address the significant points at all but preferred to post a diatribe on an article cited in the article above. Perhaps THAT is why the post will vanish, if it does. Sounds like obsession to me...

Now, in regard to the article in question, the issue some of us have is: self-directed 401k accounts do not permit acquisition of physical metals, but *do* permit investment in ETFs. In such a case, what would the author suggest as an alternate? Would CEF be the best bet? I don't like miners at this point because I expect this bear market rally to fail at some point, and that would likely drag down miners as well, though perhaps not to the same degree.

The Problem with GLD and SLV ETFs

The author raises valid concerns; however, GLD and SLV are within the scope of a 401(k) plan. Purchasing and storing physical metals are not.

The latter would be vastly preferrable, but today, government legislated vehicles like IRAs and 401(k)'s represent the only available investment dollars for most.

In a non-ideal world, the GLD and SLV ETF's have their place, and their risks.

Another Brick in the Wall: the GDP, Gold and Silver

I do not understand why intelligent people insist on citing fraudulent government statistics like the GDP. Garbage in, garbage out. Any analysis that relies on such bogus numbers must per force generate flawed conclusions. Using shadowstats.com numbers or some similar more reliable less biased measure would yield conclusions in line with reality rather than government sponsored fantasy.

What's It Going to Be: Inflation or Deflation?

An interesting analysis - I wonder what would happen if the author would use a more realistic basis for calculating inflation than the outrageously fraudulent CPI. Same goes for the equally fraudulent GDP.

I agree with brewtul - near term deflation then long term (probably hyper)inflation, thanks to both the feds and the Fed. The history of fiat currencies is pretty stark in this regard - we have centuries of history to rely upon for clear lessons. Just look at any chart of *real* inflation (i.e. increase in money supply) noting 1933 and 1971 and what happens to money supply afterward. A good primer:

www.chrismartenson.com...

Sections 6 to 10 are relevant to this discussion, but all are worth watching and thinking about.

Need Gold? Check Your Fed Holdings

Why does anyone bother responding to poster 'short gold' anymore? Except to chuckle at the boneheaded mistakes in math and logic he always makes, of course.

Regarding the gold constituting "77% of U.S. central bank reserves" - hilarious. That gold was leased out to bullion banks and sold on the private market to keep gold prices depressed. This is the story per Gary North anyway:

www.lewrockwell.com/no...

I have no way of knowing the truth, but it certainly fits with all of the other fraudulent activities of the criminal gang that is the Fed.

How would one go about verifying that 8k tons of gold is actually in the physical possession of the Fed? My guess is this was looted a long time ago, one reason they need to resort to the crass bailout scam being rammed through Congress as we speak.

Precious Metals: Emotions Still Stronger Than Fundamentals

"Why would anyone buy gold when the dollar is heading up? Also why are some advisers so slow to see that there has been a change?"

Perhaps 'some advisers' have determined that your 'change' - in dollar fortunes - does not appear to have any basis whatsoever in fundamentals, and therefore does not, in fact, represent a lasting change at all, but a transient rally to be followed by a crash.

Or did the US government suddenly do a 180 and become the very model of fiscal responsibility when I wasn't looking?? Fat chance.

Not all Metals are Created Equal (Part I)

This analysis seems to rely on the fundamental assumption that peak oil is a non-event. That is, it relies upon the presumption that we're not entering a completely new paradigm as regards global energy supplies. Perhaps this is accurate. But if the peakers are right - and I think an analysis which draws this conclusion is at the least plausible - then all of this analysis rests on flawed assumptions about the future state of the markets, and indeed the world.

An Energy Policy That Makes Sense, Revisited

A note on the "theory" of abiotic petroleum origin from Wikipedia:

The most important counter arguments to the abiotic theory involve various biomarkers which have been found in all samples of all the oil and gas accumulations found to date. The prevailing view among geologists and petroleum engineers is that this evidence "provides irrefutable proof that 99.99999% of all the oil and gas accumulations found up to now in the planet earth have a biologic origin." In this process, oil is generated from kerogen by pyrolysis. While, Thomas Gold hypothesized that bacteria exist deep within the Earth's crust, and are the source of the biomarkers, these bacteria have not been found, the natural abiogenic formation of high-carbon hydrocarbons has not been demonstrated, and evidence for the biotic origin of petroleum is abundant.

This can only loosely be classified as a theory (speculation would be a better term, or untested hypothesis), and it is one without any evidence whatsoever, whereas the standard view of petroleum biogenesis - which the vast majority of geologists hold - offers innumerable proofs. To hold the two up as peers is disingenuous to put it politely. It is yet another exercise in fantasy, intended to allow the holder of such a view avoid dealing with the unpleasant reality of peak oil.

An Energy Policy That Makes Sense, Revisited

While your diagnosis is relatively accurate, the course of treatment you prescribe is an exercise in fantasy, relying as it does on government to 'do the right thing'. In doing so, you mistake the nature of the beast. It has been government which - by offloading such externalities as air pollution from businesses onto taxpayers, and by implementing legislative, regulatory and judicial and even military protections (you didn't really think we were in Iraq to promote democracy did you???) in favor of the oil companies - is largely responsible for the current sorry state of affairs.

Government is NOT an agent of the people - it is NOT "an institution of social service" or even "an amiable, though often inefficient, organization for achieving social ends" (Rothbard) - it is, by and large, as Albert Jay Nock put it, "a distributor of economic advantage, an arbiter of exploitation", or even more damning, in Rothbard's view "it is the systematization of the predatory process over a given territory. ...The State provides a legal, orderly, systematic channel for the predation of private property; it renders certain, secure, and relatively 'peaceful' the lifeline of the parasitic caste in society."

This is the entity to which you wish to turn for solutions? It will never be what you think it is, and therefore will never behave as you wish and hope for it to behave. Because this would be precisely contrary to its very raison d'etre. You are assuming a grizzly bear is a cute stuffed teddy bear. That's a lethal mistake.

Therefore, your proposal is at its core, fatally flawed.