Oldtent Archives 2007 - 2008

Good stuff. Since you mentioned oil priced in gold, this

is another chart I watch.  Looks a little toppy.

Auric

The main problem with this ‘debate’ is that it asks a fuzzy question: are we having inflation or deflation? (Price inflation, that is).

Of course, in terms of gold, we’re largely going to have price deflation, so that the dow/gold ratio will continue to approach one, and the price of the average home will approach 50 gold ounces.

But what about the US dollar?

The answer is not dissimilar to asking whether it’s better to play slot machines or craps?

If you walk into a casino, what’s the best game to play?  The thing about casinos is, the games are all bad, but you will lose your money more quickly in the slots, and more slowly in blackjack (without counting cards), and perhaps slightly even more slowly playing the pass/don’t pass line in craps and taking the odds there.

But, you do lose your money!  It’s a matter of velocity.  So, every game in a casino, over time, will be a loss (that’s why Vegas is a trillion dollar town), but in some games, you will lose your money faster than in others.

And so the same holds here.  If you compare things to gold, everything will eventually go down in how many ounces it takes buy (and I would include oil…eventually).  And, of course, this includes fiat money, whether the Euro or the dollar.

But folks ask, do we have inflation or deflation?  And they mean, in terms of dollars.

The dollar is just another thing to buy, and it is deflating in its value (in terms of gold) faster than some stuff and slower than other stuff.

Just like in roulette you’ll lose your money faster than in blackjack (if you play well) and slower than if you play the slots.

So, yes, the dollar is deflating against gold slower than housing is deflating against gold.  So, housing is coming down in terms of dollars.  But the dollar is deflating against gold faster than, say, commodities are deflating (and some are increasing) against gold.  So, the dollar is losing in terms of commodities.  We can make a big chart and place the dollar somewhere in it, in terms of how fast it’s losing value in terms of other things.

The problem is, things change quickly.  So, the dollar was losing value relative to Fannie Mae last year, and now Fannie Mae is losing value against the dollar this year.

Why engage in making this chart, which is only temporary anyway?

Just like the odds in Vegas play out over time, the dollar will drop over time.  And gold is going up over time.

So, we were just in a short period where Real Estate moved higher against the dollar.  Now it has reversed.  And, who knows, it may reverse again, if they print enough dollars and bail out enough folks and mortgage companies.  But, just like in Vegas, it’s all a bad bet.

Gold is the house.

Best to all,

Old Lurker

i listened to the audio interview with Bud Burrell  with Jim Puplava—–  i got really upset/sick/sh** in my pants/scared………… for those tenters still wondering what has happened to their jr’s going down or  going no where; so if anyone knows this guy Burrell, please inform the tent !!!! ( he did time at West Point , i would prefer he did time at Navy academy or on  nuc sub—-lol)   this is a must read for the all tenters :  FGC please attach to tent site :

www.financialsense.com     july 12 weekend edition  experts  2008  interview with bud burrell

www.thesanitycheck.com

www.deepcapture.com

www.cfrn.net/investgates

www.investigatethesec.com

www.321gold.com/editorials/russell/russell071408.html

Russell mentions matter of factly that the dow/gold ratio has

broken down but I’ve been watching this SOB ffor a while and

think it’s a lot more serious.

Someone here mentioned that Silver was saying that the party

wasn’t over yet. I think he was right!

Auric

BWTFDIKIJAI

I want to be a bond vigilante when I grow up.

This links deals also with the same topic - though not esp. with august 2010. For me not surpisingly because it seems to be much bigger than just august 2010.

http://www.aquariuspapers.com/astrology/2006/10/the_coming_card.html

$15 billion and $15 billion and $15 billion and $15 billion……..          along with maniacal laughter 

“Today Americans would be outraged if U.N. troops entered Los Angeles to restore order; tomorrow they will be grateful. This is especially true if they were told there was an outside threat from beyond, whether real or promulgated, that threatened our very existence. It is then that all peoples of the world will plead with world leaders to deliver them from this evil. The one thing every man fears is the unknown. When presented with this scenario, individual rights will be willingly relinquished for the guarantee of their well being granted to them by their world government.” - Henry Kissinger, speaking at a Bilderberg Group meeting in Evian, France, May 21, 1992.

http://www.survivalblog.com/

not much … but 15 billion is fifteen bill

for starters ..

p.s. sinclair says the Weimar experience … and he doesn’t know what you know hardly

some how you think turk doesn’t know what you know .. send him a little note so he can reference your views in his next article

why explain you have not understood even simple english

and mistake the allegator you are on for a log..

As discussed in the section Historical U.S. Inflation: Why Hyperinflation Instead of Deflation, the domestic economy has been through periods of both major inflation and deflation, usually tied to wars and their aftermaths. Such, however,

preceded the U.S. going off the gold standard in 1933. as per (gfcmiyc)

The era of the modern fiat dollar generally has been one of persistent and slowly debilitating inflation.

www.shadowstats.com/article/292

read the above and give it a critque

and william being a phd in austrian economics with 30 years of analysis .. with pretty good information. and he isn’t aware of your views.

you will have your deflation in spades ,, but not before the kitchen sink is monitized all 600 quadizzlion, brazilian of them

kindly explain to me what that does in a 600T nightmare in the OTC derivative market????

Liquidity and the fraud of supply and demand. Tough to gauge what supply and demand in gold is at the moment or ever.

When oil implodes on itself, gold will reign supreme.

I believe it to be a process that has been unfolding for about 8 years now. At a more mature stage of it, all will realize that the ultimate hedge against all that we want and desire as human beings is GOLD. Until then, we must wait patiently for the sheeple, the masses, etc…., who will not wake up fully until run over by the financial train wreck that they don’t even suspect is coming yet. At that point, they will all want to hedge their survival with the shiny yellow metal. That’s the way of a truly long term bull market, with few recognizing it and giving it the respect it deserves until near its end.

JBI

US TREASURY secretary Hank Paulson is working on plans to inject up to $15 billion (£7.5 billion) of capital into Fannie Mae and Freddie Mac to stem the crisis at America’s biggest mortgage firms.

The two companies lost almost half their market value last week as rumours of a government bail-out swept the stock markets, hammering share prices around the world.

Together, the two stockholder-owned, government-sponsored companies own or guarantee almost half of America’s $12 trillion home-loan market and are vital to the functioning of the housing market.

The capital-injection plan is said to be high on a list of options being considered by regulators as a means of restoring confidence in the lenders. The move would protect the American housing market, but punish shareholders in both companies.

Under the terms of the proposed move, the US government would receive a new class of shares in exchange for the capital, which would be hugely dilutive to shareholders.

http://tinyurl.com/66ypln

oil as a hedge

for about a day.. then a hedge the next day.. its about super short trades ,,as against a hold on the buck for less than five minutes ..

then the next day one of the kids , then the wife , then into pork bellys at night ..

off to beans then oil as a hedge ..

column writers who say things such as “commodities like crude oil that have become a hedge against the U.S. dollar weakness”, or “people are using oil as a hedge against systemic risk in the economy”.  I wont bother posting a link to these quotes since most Goldtenters will likely have  read the same thing in the last few days.

The mystery to me is why oil, rather than gold, should be attractive as “a hedge against the U.S. dollar weakness”.  I personally would never dream of investing in oil, as opposed to gold, as a hedge against U.S. dollar weakness.  So what’s up here with this fascination with oil as a hedge against the dollar?  I dont get it.

The only clue I could find was a statement that “Hedge funds are attracted to oil partly because of tight fundamentals”. Surprise !  Arent there tight fundamentals in gold production too because of rising energy and material costs for gold producers?  As I said, I dont get it.  So maybe Deadeye and Redneckokie will be able to enlighten me on what I think is a mysterious and ill-founded faith in oil as a “hedge against U.S. dollar weakness.”

I look forward to comments on this question.  Equiz.