Stability Of The European Union (18) March 26, 2013 To April 18, 2013 [View instapost]
I always thought it would eventually make sense for Germany to cuts its losses and leave the EU. Eventually, they would make up the losses by not having to subsidize AR accounts they would never really be able to collect on.
There are a lot of failed predictions running around. Here are some other predictions that I'm sure you will announce who else has lost creditibility in your mind.
Here's a fun theory. The reason that Germany can't get its gold back is because BB doesn't have it, and the reason he doesn't have it, is because he has been using what supposed to be in the vaults to keep the price of gold depressed. If gold is low, or suddenly drops, then that keeps people scared of bidding up the price of gold. As such, they chase equities and not gold, and no one can point a finger at the Fed and say, "see gold going up is a vote of no confidence in the Fed". So now, BB can say, "What? Gold isn't going up. That means we are in a full on recovery, which means that equities will go up because people will want to invest in real economic opportunities and not gold. If you want proof, just look at the equities markets. See they are going up." Which they are because he has been using the gold that is supposed to be in his vaults to sell into the markets to scare people away from gold and thus make his point.
So then Germany shows up and says give me my gold back, which BB doesn't have, but in order to get it, he would have to print to buy up what he has sold off, and thus raise the price back up, which is exactly what he has been trying to stop.
Stability Of The European Union (18) March 26, 2013 To April 18, 2013 [View instapost]
What we need is a law that says large corps can't charge anything for their products. Then we can have all the benefits of slavery, or at least get rid of all the laws that are apparently forcing us to buy the products of large corps.
Don't Get Caught Up In Panic Selling And Capitulation In Precious Metals [View article]
"not as a store of value. "
But it should be. A FRN is just that, its a note. A note is a claim on labor. What makes the note valuable is the strength of the notes claim on the underlying labor. So both the claim and the labor need to change in tandem for the note to have value.
If the claim is loosing value, or the labor is loosing value, or both, then the utility of exchange and thus as a unit of account go away. Think about it for a second. When you use a note to engage in exchange, what are you exchanging? You are trying to exchange for valuable assets created by valuable labor. If there is nothing valuable created by labor, then the note has no value.
Gold would have the same problem. If there were nothing to buy with gold, then it would have no value. The reason you are told to not care about the "store of value" part, is because the people telling you that want to tax you without you knowing about it. If a note is loosing its consumptive power, then you are taxed just as if a note that was not loosing its purchasing power was completely taken away from you. A tax is simply taking away the benefits of your labor (income) which is to consume. You can loose the ability to consume by having your notes taken away (the IRS) or by the note not storing value (things you can consume with it - the Fed).
Don't Get Caught Up In Panic Selling And Capitulation In Precious Metals [View article]
"nor is it useful in itself for any commercial or industrial application."
Not quite true. Gold is a very good money medium. In fact, it has been used quite extensively in the past for this purpose. This is why we have such a lore about it. The reason it is such a good medium is that it can't be counterfeited like fiat paper. The counterfeiting always runs the risk of massive dilution of confidence in the paper, and politicians having the incentives that they do are always threatening massive dilution of the paper as well.
Thus, there is always the possibility that gold will find a market again as a money medium or at least a reserve for paper notes. As such, there is always the thought that having some around will do you well, especially at the beginning of the rise of gold as a money medium again.
Until someone invents a different form of gov where politicians have much different incentive structures than what they have now, then the allure of gold as once again arising as a money medium will always be there. At any rate, until idiots in gov are eradicated, the use of gold as a money medium will always be a possibility and thus it has a use.
There has never been a period gov has not interfered in markets. It's the interjection of gov coercion into the markets that causes the booms and busts that threatens society. A free market does not have a business cycle. As long as gov imposes its regulations over free market regulations, then you need to be prepared for massive bubbles followed by massive pops that transfer massive wealth. Getting your history from dancing with the stars will not serve you well.
One of the hallmarks of tyranny is to prevent the individual from having savings. With savings, you can independence. If someone wants to have control, they can't allow people to be independent.
N Korea a few years ago reset their currency to wipe out people that had accumulated savings in the black markets (underground free markets where people actually can find food and clothes).
Here's What Happened The Last Time The Fed Owned All Outstanding Treasuries [View article]
"basically quoting Marx at this point"
Not at all. Marx couldn't distinguish between the quantity of labor and the quality of labor. In economics labor includes the work of the mind, thus people with good ideas (including execution) have labor that is far more valuable than people with bad ideas.
Good ideas take scarce resources and turn them into things that allow for increases in consumption. That's what increases everyone's standard of living. As such, you want all policies to favor production. That's why you want policies to eliminate stealing. When you are stealing, you are not producing. All of Marx's theories just boiled down to rationalizations as to why stealing is OK, and that's why societies that attempted his theories wind up very poor.
You use a gov to eliminate stealing with a cost/benefit in mind. A free market can bear some stealing, but will eventually eliminate as innovation eventually makes producing cheaper than stealing. You can have a central bank monopolize the money medium to fund the gov, but if you do you don't need things like an IRS, so it would be stupid to have one, like the US. However, if you do intend to use a monopolized money medium to fund your gov, the CB will have to structured in a radically different way to limit its opportunity to become an agent of theft, such as it is now.
Here's What Happened The Last Time The Fed Owned All Outstanding Treasuries [View article]
A balance sheet is just assets with the other side being ownership rights of one class or another. You can show a person a picture of an asset, but you can't of an ownership right. Ownership rights are just abstracts, and our accounting conventions break them up between liabilities and equity but any credit on a balance sheet is an ownership right by someone somewhere.
Thus, as the balance sheet grows, so to will ownership rights. If notes grow faster than ownership rights, then you have dilution of those notes. No human being knows where this point is. Only a market free of coercion gets this right. As such, a central bank is only guessing within an incentive structure that incents them to get it wrong.
Stability Of The European Union (18) March 26, 2013 To April 18, 2013 [View instapost]
http://seekingalpha.co...
Gold In The Crosshairs [View article]
There are a lot of failed predictions running around. Here are some other predictions that I'm sure you will announce who else has lost creditibility in your mind.
http://bit.ly/Zxjk4S
QC #256, April 12, 2013 [View instapost]
http://bloom.bg/17nLh2G
Here's a fun theory. The reason that Germany can't get its gold back is because BB doesn't have it, and the reason he doesn't have it, is because he has been using what supposed to be in the vaults to keep the price of gold depressed. If gold is low, or suddenly drops, then that keeps people scared of bidding up the price of gold. As such, they chase equities and not gold, and no one can point a finger at the Fed and say, "see gold going up is a vote of no confidence in the Fed". So now, BB can say, "What? Gold isn't going up. That means we are in a full on recovery, which means that equities will go up because people will want to invest in real economic opportunities and not gold. If you want proof, just look at the equities markets. See they are going up." Which they are because he has been using the gold that is supposed to be in his vaults to sell into the markets to scare people away from gold and thus make his point.
So then Germany shows up and says give me my gold back, which BB doesn't have, but in order to get it, he would have to print to buy up what he has sold off, and thus raise the price back up, which is exactly what he has been trying to stop.
Stability Of The European Union (18) March 26, 2013 To April 18, 2013 [View instapost]
Don't Get Caught Up In Panic Selling And Capitulation In Precious Metals [View article]
Don't Get Caught Up In Panic Selling And Capitulation In Precious Metals [View article]
http://bit.ly/14tuvU8
Don't Get Caught Up In Panic Selling And Capitulation In Precious Metals [View article]
http://bloom.bg/XPCibJ-V_bp0rsmSCyFrJL0J6x~b...
Don't Get Caught Up In Panic Selling And Capitulation In Precious Metals [View article]
But it should be. A FRN is just that, its a note. A note is a claim on labor. What makes the note valuable is the strength of the notes claim on the underlying labor. So both the claim and the labor need to change in tandem for the note to have value.
If the claim is loosing value, or the labor is loosing value, or both, then the utility of exchange and thus as a unit of account go away. Think about it for a second. When you use a note to engage in exchange, what are you exchanging? You are trying to exchange for valuable assets created by valuable labor. If there is nothing valuable created by labor, then the note has no value.
Gold would have the same problem. If there were nothing to buy with gold, then it would have no value. The reason you are told to not care about the "store of value" part, is because the people telling you that want to tax you without you knowing about it. If a note is loosing its consumptive power, then you are taxed just as if a note that was not loosing its purchasing power was completely taken away from you. A tax is simply taking away the benefits of your labor (income) which is to consume. You can loose the ability to consume by having your notes taken away (the IRS) or by the note not storing value (things you can consume with it - the Fed).
Its a trick, so don't fall for it.
Don't Get Caught Up In Panic Selling And Capitulation In Precious Metals [View article]
http://bit.ly/XNRvdl
Don't Get Caught Up In Panic Selling And Capitulation In Precious Metals [View article]
Not quite true. Gold is a very good money medium. In fact, it has been used quite extensively in the past for this purpose. This is why we have such a lore about it. The reason it is such a good medium is that it can't be counterfeited like fiat paper. The counterfeiting always runs the risk of massive dilution of confidence in the paper, and politicians having the incentives that they do are always threatening massive dilution of the paper as well.
Thus, there is always the possibility that gold will find a market again as a money medium or at least a reserve for paper notes. As such, there is always the thought that having some around will do you well, especially at the beginning of the rise of gold as a money medium again.
Until someone invents a different form of gov where politicians have much different incentive structures than what they have now, then the allure of gold as once again arising as a money medium will always be there. At any rate, until idiots in gov are eradicated, the use of gold as a money medium will always be a possibility and thus it has a use.
Hindenburg Omen - November 13, 2012 [View instapost]
Necessary Finger Crossing [View article]
QC #255, March 13, 2013 [View instapost]
N Korea a few years ago reset their currency to wipe out people that had accumulated savings in the black markets (underground free markets where people actually can find food and clothes).
Here's What Happened The Last Time The Fed Owned All Outstanding Treasuries [View article]
Not at all. Marx couldn't distinguish between the quantity of labor and the quality of labor. In economics labor includes the work of the mind, thus people with good ideas (including execution) have labor that is far more valuable than people with bad ideas.
Good ideas take scarce resources and turn them into things that allow for increases in consumption. That's what increases everyone's standard of living. As such, you want all policies to favor production. That's why you want policies to eliminate stealing. When you are stealing, you are not producing. All of Marx's theories just boiled down to rationalizations as to why stealing is OK, and that's why societies that attempted his theories wind up very poor.
You use a gov to eliminate stealing with a cost/benefit in mind. A free market can bear some stealing, but will eventually eliminate as innovation eventually makes producing cheaper than stealing. You can have a central bank monopolize the money medium to fund the gov, but if you do you don't need things like an IRS, so it would be stupid to have one, like the US. However, if you do intend to use a monopolized money medium to fund your gov, the CB will have to structured in a radically different way to limit its opportunity to become an agent of theft, such as it is now.
Here's What Happened The Last Time The Fed Owned All Outstanding Treasuries [View article]
Thus, as the balance sheet grows, so to will ownership rights. If notes grow faster than ownership rights, then you have dilution of those notes. No human being knows where this point is. Only a market free of coercion gets this right. As such, a central bank is only guessing within an incentive structure that incents them to get it wrong.