otbricki

Decoding What Gold Is Telling Us

Let's be real here. Pelosi, Reid and Frank have been members of the minority party of the House from 1995 through 2007. Anything coming out of that body of the Legislature leading up to this fiasco was approved by a Republican majority.

On Feb 20 01:31 PM 5142152-337 wrote:

> psheridan2: I agree with most of what you stated, however, GMiki
> is absolutely correct. The Wall Street CROOKS made things worse,
> after the Washington CROOKS initiated the mess. Look, if Barney
> Frank, Harry Reid, and Nancy Pelosi didn't exist, how much trouble
> would this great country be in financially? Some, to be sure, but
> not to the extent they have created this black hole.

Gold: The Only Remaining Bubble?

Exactly right.

1. YOUR TAXES equal what government spends. No more no less. The taxes may be deferred a bit when government borrows, but you will pay in either inflation or direct transfers. The Regan and Bush 'tax cuts' are a lie because they did not cut spending. The idea that deficits aren't important is wrong simply because government spending detracts from the private sector's freedom to allocate funds where the opportunities are.

2. The remaining argument is how big you want government to be. The correct measure of the size of government is how much government spends. Starting with Reagan Republicans have grown government just as fast as Democrats.

3. Don't neglect the effect of the end of the cold war on Clinton's results.

On Feb 19 11:55 AM Anandakos wrote:

>
> Austrian,
>
> You have slandered George HW Bush and Bill Clinton unwittingly and
> unjustly. The US government went on a THIRTY year deficit spending
> spree when Ronald Reagan cut taxes so dramatically in 1981. It is
> true that he rectified some of the shrinkage in the next two years
> with partially compensatory increases, but he set the stage for thirty
> nearly uninterrupted years of spiraling debt. Bush 41 made an attempt
> to right the ship and lost his second term, and then Clinton pumped
> more water out and lost Congress. By the end of Clinton's term --
> partially because of the DotCom boom but mostly because of the 1993
> tax increases -- the government was running an overall surplus.
> No, it hadn't gotten back to a full operating surplus as it should
> have, but it was a lot better than anything since Kennedy's term.
>
>
> People will argue forever about the proper proportion of GDP to devote
> to government activities, but one thing is not debatable: the only
> long-term (greater than 10 years' duration) debt that the government
> should accrue is for genuinely productive infrastructure investments
> and the cost of wars of defense. It's fine for it to run temporary
> (3 to 5 year) deficits during the low part of business cycles, but
> it has to liquidate the debt in the high part of the cycle.
>
> The problem is that selfish people say "we have to give the people
> their money back" in the high part of the cycle, so the debt has
> only rarely been liquidated.
>
> On Feb 18 04:14 PM austrian63 wrote:

The End of the U.S. As We Know It: Tracking the Dollar Downward

Things to keep in mind with these fanciful debts based on social entitlements:

1. The money has not been spent, so the debt doesn't actually exist. Non-existent debt doesn't affect credit ratings. Or the economy as it is practiced today.
2. Since the debt doesn't exist interest payments on the non-existent debt are non-existent.
3. Since the debt doesn't exist there are no 'full faith and credit' obligations to pay it back, or even to incur it in the first place. Just some hot air floating around generated by politicians.
4. This debt will be issued in future dollars, less valuable than current dollars.
5. The future debt will be payable in even further future (aka neverland) dollars worth even less than future dollars. Interest will also be paid in neverland dollars. If indeed we are still using dollars at all by then.
6. Who knows by then maybe we won't even be using money. And if we still are I bet there will be a lot more of it.

So those neverland payments on future debt probably will take about 46 cents actual real old fashioned American money to pay off. What a good steak used to cost.

I wouldn't get my shorts in a knot over it.

Yellow Gold vs. Crude Black Gold: Who's Ready to Rally?

The gold / oil price ratio is at historically high levels. It is much less risky to buy oil right now.

Nine Ways to Profit in 2009

One thing I don't think will happen is that 2008's trades will work in 2009.

I think User 330190 has the right idea.

Don't Miss the Coming Gold Bull

Monetary supply has been pumped up by the Fed however that is being countered by massive deleveraging and deflation. Banks are just taking the money and using it to build reserves. The velocity of what the Fed is printing is zero or so close to it that is irrelevant. Not to mention that a lot of it is purchase of undervalued assets that is not inflationary. Socialist as all hell, but not inflationary.

With continued foreclosures, defaults, unemployment and whatnot in the works for the next year at least don't count on banks doing anything but sucking up the output of the printing presses for a good while.

Obama can spend a trillion on stimulus and it won't matter. Another trillion on the national debt won't change anything and won't lead to hyperinflation. The federal debt problem is a problem measured in the 10's of trillions.

Zero interest rates, quantitative easing and so on - we have seen it before in Japan. It led to a stagnant economy, but nothing like hyperinflation at all.

Yes you can invest in gold if you want, but don't count on big returns. Or even keeping up with inflation. Gold is pretty well priced compared with other hard assets right now. Buying now is not buying low.

Gold Prices Could Double...or More than Double

Hard Assets Investor = Pump Gold As Much As Possible.

Gold Poised to Move Higher

I don't know when the concept of gold as money will totally die out. But it WILL happen. It is totally archaic and not based on anything but habit and tradition.

On Dec 28 04:04 PM Roger Knights wrote:

> "Sooner or later people are going to realize that value of gold is psychological only"...

Gold Poised to Move Higher

Sorry to disappoint you but my mortgage is paid off. My youngest son just finished college too. Without any student loans.

Regardless of who I voted for, if we have hyperinflation it will be due to the massive debt accumulated due to the Republican concept of 'supply side economics' i.e. cut taxes but spend all you want on foreign military adventures that do nothing to shore up the US economy.

As far as central banks selling gold didn't we just see a lot of that last year? I thought so. Central banks buy and sell gold for political reasons. They don't have investment goals.

On Dec 28 02:12 PM Dollar Bull Sh** wrote:

> gold is a horrible investment....thats why central banks arent selling
> it....its idiots like otbricki that i guarantee a. bought his house
> at the peak and is now in foreclosure b. will be in line receiving
> soup from the government and c. probably voted for mr. hyperinflation
> obama ...good luck guy

Gold Poised to Move Higher

Paper money can also be composted and used to grow food or burned to provide energy.

On Dec 28 02:09 PM ejhickey wrote:

> You could say the same thing about paper money. well maybe our paper
> money does have some other uses- wallpaper, insulation and toilet
> paper substitute

Chart of the Week: Gold

Gold is at record high levels vs other commodities. Nobody cares about mideast tensions while we have an oil glut. Gold is trading in a downward trending channel. The world is in deflation.

And we have gold bugs writing articles how gold is going make a big run to the upside.

Makes sense I guess.

Gold Poised to Move Higher

Let us get this straight. Gold is not an investment. It does not return any income after purchase. It has no intrinsic value since it has no utilitarian value. It costs money to store. One can talk about fundamentals in that it is costing more to produce over time, but since owning it produces no income it truly has the same fundamental value as any other non-productive asset, i.e. zero.

Gold is a hedge against currency value fluctuations. The only reason people buy and sell it because of its historical use as money. There is no other reason that it has any value.

There is a reason that the value of gold drops in a famine. You can't eat it and you can't use it to produce food.

Sooner or later people are going to realize that value of gold is psychological only, and our past obsession with this metal will be regarded as a historical curiosity.

Bernanke's Great Lie: The Gold Standard and the Great Depression

I think that it is a mistake to focus to much on just the Great Depression. One also needs to consider economic cycles prior - the Long Depression and so on.

Conventional thinking is that these cycles were also triggered by deflations and money supply shortages.

I am also leery of the idea of any arbitrary physical object, be it paper or material as a store of wealth. True wealth comes from the utilitarian value of the things that you own.

So aitvaras, you say you are a gold investor. But then you advise to buy gold and not trade it. How do you reconcile these statements? At least superficially they appear to be mutually exclusive.

Silver and Gold: More Than Just A Christmas Carol

GLD has resisted the commodity depreciation of the past several months very well. As a result oil, copper silver, nat gas, wheat and many other fundamental building blocks of modern civilization are at very low prices relative to gold based on a historical basis. The real long term valuation of gold is pinned to real goods like how many bushels of wheat it can buy.

So long as dollars are buying commodities cheaply it is difficult to see how gold is going to be above $900.

It is all well and good to talk about gold relative to money supply, But so long as banks are deleveraging, that money supply might as well be buried in a giant mattress. When the BoJ cut interest rates in the 80's in their real estate crash, there was no follow on inflation because they soaked the money right back up on the back end. Velocity of money is the issue here. Money right now has the velocity of the Great Pyramid of Giza.

Peter Schiff likes to make the statement that investors should be buying outside the US - Europe, Asian rim etc. because he thinks the US economy will collapse soon. Nah. If the US economy goes down the drain no place is safe. The US trade deficit has been financing the rest of the world's economic and capital needs for decades. Take it away and foop the whole house of cards ex-US comes tumbling down.

People like to talk about the advantages of being the world's reserve currency. Well that isn't a one way street. There is a dark side to it also.

Gold Marks Two Important Milestones

Gold has had a declining 100 day MA since May and has a chart pattern clearly pointing to 700-720 in February.

Not exactly when I would be a buyer.