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It occurs to me that the solution from government is similar to Roosevelt's confiscation of gold. The G7 and everyone else will take over all the banks and governments will own all the gold, only this time it's all the money.

 

It's been bothering me lately how there can be real governments (like Japan, not like the House of Saud) owning huge assets in these SWFs. Reserves are supposed to be kept out of the market (sterilized) not used in the economy. By using reserves, they effectively take ownership of assets with money that never should have existed. But once you have a few of these, the rest of the governments need to create their own SWFs. I think Paulson's "Facility" in the US and the G7 plan is to transfer assets to governments creating SWFs for all of them using fictitious money. The coming decades will be about governments owning everything. Control over allocation of those funds into private sectors is where the fighting and profits will be. In other words, whoever manages these funds controls the world.

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Forex Foxy, yes the log scale 50% retracement from 1974-2007 comes in exactly as depicted on your chart. We are there.

 

Another interesting Fibo using 1974 as a starting point in the chart below. Also log scale [it's all I use] Fibonacci Fan from the 1974 low to the 1987 top reveals we have completed a trip all the way through the fan and have found shport on the lowest fan...this should create a decent bounce...

 

Since the fan caught the 2001 Bin Laden low, the 2002-03 lows, and acted as supreme resistance a month ago, I'd say the odds are good that this low should catch it as well.

 

God help us all if it doesn't...

699433[/snapback]

thats quite interesting too.

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You could have asked the same question at the top of the housing bubble.  Why would a home builder sell houses when they were appreciating at 10% per year?  He did that because he needed liquidity to build more houses to profit from and probably because he knew houses were overpriced.

 

All trades are made because both parties think they are getting more value than they are giving up.  In most cases, one of them is wrong and it turn out one party is a winner while the other is a loser.

 

That's not true in all cases.  A man can take less than market value for a collectible car, say a Ferrari.  The winner is the guy who bought the Ferrari below market value. The loser is the guy who sold below market value. But maybe he needs that money to keep from losing his business during a slump which will net him much more than the Ferrari at some future point in time.  So they both "win".  "A" gets value and "B" gets liquidity.

 

So the coin dealer gives you the gold for money, because he doesn't believe gold will soon exceed the price you paid for it + premium or fees.  You buy it because you believe it will over the time frame you intend to keep it.  One of you will be proved wrong.  Or gold will stay flat and you transfer your money to him in fees/premium he collects with every sale.

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How about if both are right. Gold is not appreciating as fast as the dealer's fees, like short tem winning traders as opposed to long term buy and holders, who are also winning at a slower rate. :D

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The next bubble is like in Al Capones time

Selling protection to da people

I read in LA a good Kalashnikov goes 1200 $ ( means not made in china )

I 'll offer 2000 euro  :)

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Can private citizens own rifles in Belgium? :unsure:

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He who has the guns and lead gets the gold. :lol:

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No guns and no lead needed

 

1) Suppress gold price through paper contracts long enough, then take delivery at opportune time

2) Short mining shares to eventually shut them down

3) Hold the price of gold down long enough to hoard it

4) Create a market panic to drive down enough asset classes that regular folks sell their gold in hardship

5) Suppress access to buying gold through dealer network

 

anything else you might add that might be deviant enough to qualify

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the usa owes money. lots of money. tax receipts are going to be considerably less. the only way the usa can pay this money back is to inflate. make the money worth less.

dharma

ps a dollar during the depression bought alot more than it does today.

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paper money during any deflationary depression will always increase in value.

 

assests must be allowed to find there real market value.

 

deflation (credit destruction) is the the cure, not the problem.

 

monetizing its debt now would be a suicide. such a policy would create a devastating hyperinflationary spiral.

 

the logical solution would be to encourage real investment & production. for that to happen the dollar would need to be devalued.

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you seem to suggest debt is worth nothing?

 

i would suggest debt is backed by future labour, would you work for nothing? no, work requires time & energy.

 

time is money, money is power (energy)

 

it is infact gold that is backed with nothing.

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Unless the debtor defaults on the debt. Gold has no counterparties. :D

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No guns and no lead needed

 

1) Suppress gold price through paper contracts long enough, then take delivery at opportune time

2) Short mining shares to eventually shut them down

3) Hold the price of gold down long enough to hoard it

4) Create a market panic to drive down enough asset classes that regular folks sell their gold in hardship

5) Suppress access to buying gold through dealer network

 

anything else you might add that might be deviant enough to qualify

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It requires the power of the manipulator with the OK of government to pull off the suppression, thus the government guns are the final backstop. <_<

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I just got looking at any number of energy stocks for the first time in a long time and my first assessment is:

 

The world just dismantled investors like a knife going through hot butter. I guess the question is whether this is a starting point again or just a stop on the way lower.

 

APC

http://www.StockSharePublishing.com/ChartL..._1223842724.png

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if all debt was settled there would be no money.

 

for those who think gold is money, well that is your perspective, my perspective is that its just heavy yellow metal, and serves little purpose, other than intrinsic value. so, in that respect its no more valuable than tulip bulbs, ie its only worth what a speculative market is willing to pay for it.

 

unlike the current destruction of credit, gold contines to be mined, adding 2,500 tonnes (2% of total) on the market each year, which exceeds global population growth.

 

in a hyperdeflationary environment which is deleveraging credit (imaginary money), and forcing settlement of debts, then the most valuable asset is cash.

 

of course the opposite is true, in a credit expansion (inflationary), then assets such as commodities/stocks become more valuable than cash.

 

which are we in now?

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The government can print up unlimited cash, in fact they have a currency plant in my county. :blink:

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I have been trying to guess what the effect on the ZomBie 30-year Trashury will be next week if we do bounce.

 

From the looks of this weekend's global backstop I think everyone's bonds should have a fairly equally dispersed effect, sort of lessening the potential impact on U.S. Treasuries alone.

 

Though I'm sure the regular rotation of bonds to schlocks will occur.

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