Recsession Nancy Goldgreenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread
This is in response to Recession :: Nancy :: Gold
Understand this is my OPINION::
I am going against everything ever written about gold/silver.
In this coming Recession I believe that gold/silver will be of lessor value than they are today. Sounds absurd doesnt it. Here is my rationale for that statement::
During the depression Hoover wanted to implement changes to the system but Democratic Congress voted him down. The very things Hoover wanted to do was implemented by FDR. After FDR was elected he put Hoover in the Cabinet. (Strange). FDR then in 1932 outlawed all personal ownership of gold. Americans sold their gold to the FEDS for $28/oz. Upon completion of confiscation they set a value of $35/oz. A 25% increase in value. Then established central banking and the Federal Reserve.
During the recession of the 70's, the Hunt brothers attempted to corner the market on silver, at the same time gold went through the roof, Arabs wanted gold as well as American currency.
When the Hunts realized it could not be done they backed off, leaving a large number of silver brokers with large amounts of silver. (Junk bags of coins). During the mid 80's these brokers came back out to sell silver with claims of $9-12/oz. They were still stuck with the junk coins.
At the height of the gold rush it peaked to $856/oz plus 5% fee. Ask yourself, who was selling the gold? It wasn't the banks. It certainly was not coming from the mines. Russia began openly selling gold on the market in early 80's. (This was after the Carter Administration permitted the selling of technology to the Russians, they actually stripped the IBM 360/370 machines of the gold using slave labor). So much for the PEACE maker.
We are on the brink of a major recession, (6) stocks (high tech) are keeping the market floating. Why hasn't gold/silver shot up? The European banks have recently been selling gold. If it were going to be a hot commodity why are the bankers selling it off? I believe they know perfectly well (that when this recession hits) before long a revamping of all the worlds currency under one system of currency will be implemented without ties to gold/silver. We have gold brokers wanting you to buy a 1/10oz dingdong for 1/3 price of an ounce of gold. Why?
As long as gold is tied into currency valuations the governments of the world cannot create something from nothing. (over priced stock, gold valuations) etc. When gold/silver are removed from the equation they can manipulate the markets in any form they want. This is the beginning of setting the stage for a complete debit/credit society. You can only implement a new system when you have dismantled the existing system.
It stands to reason that if a debit/credit society is to come into existence, then all numismatic currency must be eradicated.
I WAIT FOR THE BEATINGS::
This recession will see then end of gold/silver as currency exchanges.
-- bobby knight (firstname.lastname@example.org), February 29, 2000
Sounds like a post hoc, ergo propter hoc to me.
-- Maher Shalalhashbaz (email@example.com), February 29, 2000.
1. fed reserve was established in 1913, and was the primary cause of the last great depression. just like it is now. 2. Hunt borthers did not back off. COMEX backed them off by going to liquidation only on their orders, which meant they couldn't buy, only sell, and the comex crooks made fortunes. just like they did with coffee and Jesse Livermore in the early part of the century. 3. In the end all forms of money go back to metals. Read Total Collapse for a good historical picutre of the last 3000 years of money
-- jerry zelfer (firstname.lastname@example.org), February 29, 2000.
Bobby, thankyou for your thoughts about gold. I find it very well reasoned.
Do you understand the relationship between gold and oil? Everytime I think understand it something happens to prove me wrong. It is my understanding that we have been giving OPEC gold as well as dollars to keep both the price of oil and gold down. With gold so cheap a gold derivitives market was played on the side hedged forward for years. The eruption in the price of oil has introduced volatility that wasn't there before. The gold derivative players are very nervous.
I would appreciate your comments. I am very confused.
-- NH (email@example.com), February 29, 2000.
fed reserve was established in 1913, and was the primary cause of the last great depression. just like it is now. 2. Hunt borthers did not back off. COMEX backed them off by going to liquidation only on their orders, which meant they couldn't buy, only sell, and the comex crooks made fortunes. just like they did with coffee and Jesse Livermore in the early part of the century. 3. In the end all forms of money go back to metals. Read Total Collapse for a good historical picutre of the last 3000 years of money
1) Excuse me : right about time of Fed Reserve, but this gave the Feds ability to centralize money. In the last recession there were discussions to take the presses away from the Reserve, but the only group to give it to was Congress. Fed Res was not the only cause of 29 crash. Multitude of factors.
2) Hunts had to back off, could not buy. I know I was selling. I had been buying silver at $32.00/roll in 73 thru 77. Sold at nice profit. 3) I don't need to read total collapse. It is only a matter of time for the WTO to begin 'blocks of credits' for trade purposes between countries. Do you really think the 20 billion e-trade will be made with payments of coinage? The Bio-Chip technology which will start out for identification purposes, medical monitoring, etc storing of medical information, will eventually be escalated to debit/credit transfers. Coinage will be obsolete and unusable.
4) Understand all governments have a problem with collecting taxes. As long as any type of currency exists, governments, global, federal, state, local cannot collect their (fair) share on cash purchases. Such as flea markets, auctions, drug deals, etc, anywhere cash is used without any receipts.
5) If the government announces that next week all paper money/coinage has to be turned in to be replaced with credits and the only transactions made are with a debit card, you like all the rest of us will be turning in your cash.
-- bobby knight (firstname.lastname@example.org), February 29, 2000.
Hi Bobby K.
You're reasoning is good, but it omits one "fact of government life." There's no way our government will allow deflation to occur. The stock market crashing would be minor compared to what happens if the value of the dollar tanks.
-- Dean -- from (almost) Duh Moyn (email@example.com), February 29, 2000.
Looking at the relationship between China and Russia, maybe the two countries have an agreement to bring the US economy down without firing a round. If Russia sells enough gold on the open market, this could cause great devaluations of the US gold market. (Wonder if they are selling silver too?) Heard several years ago, the Russians were also going to be selling off some of their diamond reserves.
If China defaults on its loans to the US, this could cause a major ripple in the stock market and banking systems.
Is it possible the two countries have a "little somethin goin" to crash the US economy?
-- suzy (firstname.lastname@example.org), February 29, 2000.
There is a tremendous Open Interest of gold ounces sold short, some of it is leased from central banks and sold short,some of it is from mines that have sold forward several years worth of production.
This is fine as long as the price of gold (and silver) stay equal to or falls below an equilibrium price. Said equilibrium based on the strike prices, lease rates and expiration dates of the various short sales. Last fall's gold price spike to $325/oz put Ashanti Goldfields in Ghana, Africa into receivorship liquidation due to share holder lawsuits and the inability for Ashanti to cover their sold forward hedge position with physical gold. Ashanti is not yet out of the woods yet, after management changes and the Ghanian government involvement. Larger gold mines like Barricks are also heavily hedged and vulnerable to any price spike.
If, as has been published, the US Treasury is monetizing our national debt by issuing less 30 yr T-Bonds and by buying same in the open market; then inflation will increase as the money supply increases and the cost of all commodities including oil, gold,silver, coffee, etc go up. This would trigger a price spike as the short positions get margin calls and are forced to cover or deliver the physical.
-- Bill P (email@example.com), February 29, 2000.
Didn't Russia just buy 70 tons of gold?
-- NH (firstname.lastname@example.org), February 29, 2000.