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Topic: Gold collapsing. Bitcoin UP. - page 1484. (Read 2032284 times)

legendary
Activity: 4760
Merit: 1283
May 22, 2012, 03:56:37 PM

I desire real alternatives to the current private banking fiascos. Specifically, Public Banking. One may not 'End the Fed' without having an alternate system in place to take up the slack. And the only currently operating system that has proven effective as an alternative is Public Banking.

It is a road we will have to go down even if States seek to make a currency of PM's. Something that Utah has yet to come to grips with. PM enthusiasts would do well do abandon something that will never work for something that can work very well...

i agree with this.  i'm sure you're aware of Ellen Brown's work.

N. Dakota has totally bypassed the recession by forming the Bank of N. Dakota owned by the people and for the people.  Every state needs this as it would yank power away from the Fed and Federal gov't.


For the record, I'm down with chodpaba and cypherdoc on this one.

My love/hate relationship with gold has a reasonable significant 'hate' component because I fear the potential for gold to be used even more distructively than our current fiat regimes.

I will state again that I like distributed crypto-currency solutions along the lines of the trail blazed by Bitcoin the best from a theoretical point of view because it can fail if it is abused by those who have achieved the power to do so.

From a practical standpoint, a publicly owned banking system run as a service to the citizens of a political state seems the most tenable near-term solution.  I 'one world currency' with no cash alternative is, I fear, the most likely near term outcome however.

legendary
Activity: 966
Merit: 1003
May 22, 2012, 03:55:20 PM

Utah passed a bill to accept.. wait for it gold AND SILVER...  as legal currency..   Not just gold, as you argue is how it will be done in the future.. It's just silly to assume that only gold will be used Wink

Only, without an actual banking system to accommodate all the day-to-day things that have to happen with PM's as currency it will remain little more than a curious historical footnote, with no real effect on the way the economy of Utah operates...

of course.  But gold and silver are like peas and carrots.. Where one goes so does the other.  Even the Utah legislature managed to not fuck it up Smiley
legendary
Activity: 1316
Merit: 1005
May 22, 2012, 03:54:06 PM
i have a VERY good imagination.   Grin

I know Smiley

I desire real alternatives to the current private banking fiascos. Specifically, Public Banking. One may not 'End the Fed' without having an alternate system in place to take up the slack. And the only currently operating system that has proven effective as an alternative is Public Banking.

It is a road we will have to go down even if States seek to make a currency of PM's. Something that Utah has yet to come to grips with. PM enthusiasts would do well do abandon something that will never work for something that can work very well...

It doesn't matter whether the Federal Reserve system is in place, or public banking. Replacing the banking system is different from replacing the currency unit. Banking is separate from, and rests atop the foundational monetary unit. Distribute the banking system however you want, but unless control of the base money is distributed as well, then to be blunt - you may as well be pissing in the wind.

Precious metals act as a fundamental force, limiting banking from becoming overly reckless. The same is occurring in the Bitcoin system: exchanges, lending and depository functionality is being built using Bitcoin as a base.

yes, but we have to wonder whether you desire Armageddon as that's what hyperinflation and the resultant destruction of the USD would entail for all.

It's the last thing I want, but like a race condition, the financial system has gone past the point of being able to stop the runaway process of inflation before it causes major problems.

A crash is inevitable, but an attempt at throwing an exception is being made. The problem is that the exception being thrown is resulting in more of a BSoD than a drop to a CLI with an error.

There are other servers running, so the slack will be picked up. I still wouldn't want to be on one of the crashed ones, even if they don't look like they've crashed.
legendary
Activity: 1764
Merit: 1002
May 22, 2012, 03:49:42 PM
what's this?  gold bugs arguing amongst themselves?  woot!!!
legendary
Activity: 966
Merit: 1003
May 22, 2012, 03:45:23 PM
legendary
Activity: 1764
Merit: 1002
May 22, 2012, 03:36:42 PM

??

I didn't when I checked mtgox it was 5.02..

edit: its 5.08 now..  I'll change it just for joo Wink, woot btc now is collapsing slightly slower then gold!! Wink

you're like my childhood friend, John Begian.  i used to tackle him out of bounds on his 20 yd line but invariably he'd walk the ball back in and spot it on the 25 Cheesy.  

i think he had strabismus or something.

legendary
Activity: 1316
Merit: 1005
May 22, 2012, 03:33:01 PM
I disagree with your 20 x undervalued example.  I think gold is undervalued, but not by 20 to 1 Wink.

It was just an example. I don't think it's 20:1 either. It's most likely between 25-50:1 Smiley

Silver has historically always had a monetary function as well.  I don't see the ratio ever hitting 100 to 1, considering the mining ratio is 10 to 1, not gonna happen..  As far as extra storage costs, thats minuscule compared to the value of the PM..  to say that someone wouldn't take payment in silver over gold because it will cost 0.013 percent instead of 0.01% (for gold) (monthy rates) for storage is silly Wink.  Again the way I see it silver is undervalued and a major change in the ratio will be towards the fundamentals. 

If gold becomes offically accepted in a currency capacity, silver will also..  After all, silver (last circulated in 1964) was still used as an official currency in the US for 30 years after they took the gold away (in 1933)..

One could argue that silver is more of an official currency then gold is Wink

It has, and it will retain that aspect. I expect Mexico and certain other regions that are richer in silver than gold to support silver more readily, at least domestically. Western nations are another story.

Private parties can make use of gold or silver for exchange right now. A main barrier is convenience - it's easier to exchange dollars, Euros, or whatever other medium is more convenient. This applies mostly to western nations. Use as a transactional medium isn't the issue; use as a means of saving is.

If metal is going to sit for a long time, 10x or more in storage costs is not reasonable. Consider the amount of storage expansion that would be necessary to house official reserves. Can you imagine how much bigger Ft. Knox or West Point would have to be to accommodate 10x the physical material? Even a 50:50 mix of gold:silver reserves would require facilities 25x the size. Space is the premium even over cost, not to mention rapidly escalating security measures that rise with the area involved.

There is nothing that guarantees a bi-metal stance. Only real market forces, which cannot be ignored, but can be delayed. Eventually, silver may surpass gold in reserves. Even platinum or rhodium may come to be used more readily.

The difference is incentive. Imagine this scenario: Facebook decides that it will only release an app for iPhone and announces this. With hundreds of millions of users, how many people will take into consideration availability of the FB app for their next phone purchase? It will assuredly not be an insignificant number.

Now imagine that I control the supply of diamonds, a la De Beers. Western governments announce that diamonds and fiat currencies may be used for transactions, and anything else will be penalized, with rewards paid for reporting unauthorized forms of payment. How many sheeple will use anything other than diamonds and fiat?

Replace diamonds with silver. How many people will use gold? Now reverse the two. How many people will use silver? The incentive structure favors one over the other, and the social herd will avoid pain to seek the path of least resistance so they can continue to eat, breed, and avoid introspection. It's a very well-examined, emergent psychosocial pattern. It's been analyzed, modeled, tested, and manipulated. It'll always be limited by fundamental factors in the end, but it can go against them until exhausted. Don't fight the flow.
legendary
Activity: 1764
Merit: 1002
May 22, 2012, 03:23:48 PM


I have to wonder whether chodpaba desires atrocities.


yes, but we have to wonder whether you desire Armageddon as that's what hyperinflation and the resultant destruction of the USD would entail for all.
legendary
Activity: 1764
Merit: 1002
May 22, 2012, 03:21:40 PM

I have to wonder whether chodpaba desires atrocities.

I desire real alternatives to the current private banking fiascos. Specifically, Public Banking. One may not 'End the Fed' without having an alternate system in place to take up the slack. And the only currently operating system that has proven effective as an alternative is Public Banking.

It is a road we will have to go down even if States seek to make a currency of PM's. Something that Utah has yet to come to grips with. PM enthusiasts would do well do abandon something that will never work for something that can work very well...

i agree with this.  i'm sure you're aware of Ellen Brown's work.

N. Dakota has totally bypassed the recession by forming the Bank of N. Dakota owned by the people and for the people.  Every state needs this as it would yank power away from the Fed and Federal gov't.
legendary
Activity: 966
Merit: 1003
legendary
Activity: 1764
Merit: 1002
May 22, 2012, 03:13:59 PM

Hey cyph:


Historically, each time gold has touched the -2 sigma mark, the precious metal has rallied. Only an imaginary correlation can break completely without consequences. Back in physical reality, there are limits to how far circumstances can be pushed before it can't go any further.

i have a VERY good imagination.   Grin
legendary
Activity: 966
Merit: 1003
May 22, 2012, 03:11:40 PM


Bitcoin 5.02   (down ~7%)


like i said, don't fudge the figures! Cheesy

edit:  gold 1566!!!  BTC 5.09

??

I didn't when I checked mtgox it was 5.02..

edit: its 5.08 now..  I'll change it just for joo Wink, woot btc now is collapsing slightly slower then gold!! Wink
legendary
Activity: 1316
Merit: 1005
May 22, 2012, 03:07:47 PM
Silver is useful enough that it could command huge valuations if a severe supply issue pops up.  I would not rule out a return to the magical 7:1.  But I am certainly not counting on it by any stretch no matter what.

I'm expecting/hoping that at some point parity will be met and exceeded, even if briefly Smiley

People believed Ron Paul Bush's crap because he is a politician that says things they want to hear. But it's the same thing that makes him ineffective. The Pauls Bushes have carved out a niche is all. It keeps all the PM socialist dreamers from actually changing anything...

It's a universal argument that can applied be almost anywhere.

Another variant:

Developers believed Steve Ballmer's crap because he is a manager who says things they want to hear. But it's the same thing that makes him ineffective. Ballmer has carved out a niche is all. It keeps all the developer dreamers from actually changing anything...

End result: momentum continues no matter what - it can only be influenced. At least in business, the client has more influence than in politics.

The Pauls give every indication of believing everything they say.  It's some combination of laudable, amusing, and pathetic.

Robespierre gave every indication of believing in what he said. It was some combination of integrity, absurdity, and horror.

I have to wonder whether chodpaba desires atrocities.

Hey cyph:


Historically, each time gold has touched the -2 sigma mark, the precious metal has rallied. Only an imaginary correlation can break completely without consequences. Back in physical reality, there are limits to how far circumstances can be pushed before it can't go any further.
legendary
Activity: 1764
Merit: 1002
May 22, 2012, 03:04:57 PM


Bitcoin 5.02   (down ~7%)


like i said, don't fudge the figures! Cheesy

edit:  gold 1566!!!  BTC 5.09
legendary
Activity: 966
Merit: 1003
May 22, 2012, 03:04:02 PM
I find it highly unlikely there will be an official revaluation of gold anytime soon.  Only Ron Paul is serious about returning to the gold standard, all the rest of the politicians think its bubkis, and the unwashed masses dont' even understand the issue..  The fiat ponzi can continue on for decades just fine..

It's a simple fact that oil is a pervasive commodity, touching the structural basis of everything in modern life that requires energy production, and gold is highly associated with it as a payment method that cannot be artificially diluted (so far). Yet gold's value has barely risen in relation to the overall growth afforded by oil. That means, using the company analogy above, gold is trading as though its shares are perhaps 0.05/share instead of 1/share.
I disagree with your 20 x undervalued example.  I think gold is undervalued, but not by 20 to 1 Wink.

Relative to other asset/wealth classes, gold is unbelievably undervalued - especially when considering the above. No gold standard is necessary for revaluation - only acknowledgement of gold's monetary function. Since gold is the primary choice for a monetary metal, silver may not be in the limelight immediately. So yes, fundamentals will be, and always are reflected eventually, but the short-term (on major cycles that can be years) will probably be distorted to favor the functional capacity inherent with official recognition.

Are you willing to take the risk (possibly years) of watching gold be officially accepted in a currency capacity while silver is denied? A GSR of 100:1 is easily conceivable in that situation, even if it would be temporary. As cypherdoc can attest, it's a bitch to store a large amount of physical metal; at large scales (tons), the disparity between gold and silver storage becomes extreme in terms of both space and expense. Old money is not going to throw away an additional 10-30% in storage fees just to hold silver; they are not forced to hold silver the way industrial users are. Gold is still optimal for monetary purposes.

Hold both, but mostly gold (phase mostly out of silver on any good GSR declines). And Bitcoin Smiley

Silver has historically always had a monetary function as well.  I don't see the ratio ever hitting 100 to 1, considering the mining ratio is 10 to 1, not gonna happen..  As far as extra storage costs, thats minuscule compared to the value of the PM..  to say that someone wouldn't take payment in silver over gold because it will cost 0.013 percent instead of 0.01% (for gold) (monthy rates) for storage is silly Wink.  Again the way I see it silver is undervalued and a major change in the ratio will be towards the fundamentals. 

If gold becomes offically accepted in a currency capacity, silver will also..  After all, silver (last circulated in 1964) was still used as an official currency in the US for 30 years after they took the gold away (in 1933)..

One could argue that silver is more of an official currency then gold is Wink
legendary
Activity: 1764
Merit: 1002
May 22, 2012, 02:47:59 PM
bedrock



bedrock?  more like butter. Wink
legendary
Activity: 1316
Merit: 1005
May 22, 2012, 02:45:57 PM
I find it highly unlikely there will be an official revaluation of gold anytime soon.  Only Ron Paul is serious about returning to the gold standard, all the rest of the politicians think its bubkis, and the unwashed masses dont' even understand the issue..  The fiat ponzi can continue on for decades just fine..

Not a 1:1 standard, or any kind of fixed ratio.

If a company has 1,000,000 worth of actual equipment, 1,000,000 shares should be valued at ~1/share. Observe the lack of arbitrary unit denomination (€, $, ¥).

Gold is the preferred payment for oil among many producers. Both oil and fiat currencies are consumable: they can burn up or evaporate through dilution. Gold remains. In effect, providing oil and receiving gold is getting a long-term store of value in exchange for a short-term supply of a consumable good.

Oil has enabled massive wealth generation, and much of the oil has been paid for with gold. Much of the oil has also been paid for with fiat, but unlike a stock split (which is a good approximation of gold's wealth accumulating power), fiat is like a new share issuance that dilutes existing shareholders' wealth.

It's a simple fact that oil is a pervasive commodity, touching the structural basis of everything in modern life that requires energy production, and gold is highly associated with it as a payment method that cannot be artificially diluted (so far). Yet gold's value has barely risen in relation to the overall growth afforded by oil. That means, using the company analogy above, gold is trading as though its shares are perhaps 0.05/share instead of 1/share.

Relative to other asset/wealth classes, gold is unbelievably undervalued - especially when considering the above. No gold standard is necessary for revaluation - only acknowledgement of gold's monetary function. Since gold is the primary choice for a monetary metal, silver may not be in the limelight immediately. So yes, fundamentals will be, and always are reflected eventually, but the short-term (on major cycles that can be years) will probably be distorted to favor the functional capacity inherent with official recognition.

Are you willing to take the risk (possibly years) of watching gold be officially accepted in a currency capacity while silver is denied? A GSR of 100:1 is easily conceivable in that situation, even if it would be temporary. As cypherdoc can attest, it's a bitch to store a large amount of physical metal; at large scales (tons), the disparity between gold and silver storage becomes extreme in terms of both space and expense. Old money is not going to throw away an additional 10-30% in storage fees just to hold silver; they are not forced to hold silver the way industrial users are. Gold is still optimal for monetary purposes.

Hold both, but mostly gold (phase mostly out of silver on any good GSR declines). And Bitcoin Smiley
legendary
Activity: 966
Merit: 1003
May 22, 2012, 02:45:15 PM
this thread was started 3/13

Bitcoin  5.40

Gold 1690.


today 5/22

Bitcoin 5.08   (down ~6%)

Gold 1570  (down ~7%)

BTC still isn't up.   Gold still hasn't collapsed.

AAPL 557  (gonna be close, but support seems like bedrock at ~525)

legendary
Activity: 1764
Merit: 1002
May 22, 2012, 02:19:26 PM
Wash, rinse, repeat:

legendary
Activity: 4760
Merit: 1283
May 22, 2012, 02:10:19 PM

People believe Ron Paul's crap because he is a politician that says things they want to hear. But it's the same thing that makes him ineffective. The Pauls have carved out a niche is all. It keeps all the PM dreamers from actually changing anything... The same thing that the Grateful Dead did for the New Left.

The Pauls give every indication of believing everything they say.  It's some combination of laudable, amusing, and pathetic.

They are there to neutralize you.

Whether accident or design the end result is the same.

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