Free Republic

I agree. But to have more than 10% of a portfolio in PM's is asking for trouble, IMO.

Short-term US bonds are probably the safest right now - although you won't make any money with them.

Do you catch knives for a living? :-)

Gold, silver, and oil are decreasing for one reason only - international deflation, brought on by an intentional credit squeeze. It's happened many times before, and is actually needed from time to time when all money is debt-based.

Name me one player that can be verified. I was just over in Germany and the Czech Republic and saw nothing of the sort (especially blue).

BTW, I’m right about current Long Island Steinways. If you must have one make sure it was made in Hamburg.

I agree, but the Hamburg manufactured Steinways can be fine instruments

But they still cant hold a candle to the “Three B’s”, Baldwin, Bosendorfer, and Bechstein.

Newer Baldwins can be terrible. I agree that Bosendorfer and Bechstein can be great instruments if well maintained.

I see I've run across someone who likes to attack others without reason - @SSWIPE!

You are obviously an egotistical pianist - the kind I abhor. Your previous ignorant comment about Steinways shows how big your head truly is - and not filled with brains.

Name me ONE string player in a major orchestra who is not a principal or assistant-principal and plays on a distinctly different color violin as a matter of course. They don't exist - ignoramus.

Please don't think that you're the only one in the world with a music background - you're not...and there are an ENORMOUS number of gifted pianists who would put you to absolute shame!

Axl Rose would sound MUCH better if he used a guitar from Kmart. He's talentless, but noisy.

Not when you're 5th deck 2nd violin it's not.

This girl needs to understand that society doesn't revolve around her (or more importantly, her mother).

You're confusing "money" and "currency". They are not always the same - especially in a debt-based economy. Yes, "currency" is used as an indirect exchange, while our form of "money" is not.

Gold and silver can be used as "currency" in our country at face value, or by weight if the US Secret Service doesn't pay you a visit for doing that too often. However, gold and silver are not "money" in our economy, since "money" all across the world right now is defined as "the value owned through a promissory note". (I know, you don't read that in too many college textbooks, but the definition is a correct one).

"All real money can be traced back to it's use value."

If we're talking about a "properly run" economy then, yes, money can be traced back to its base - the "completion of labor that has economic value".

"The Fed creates money out of thin air via credit and keeping interest rates artificially low."

That's entirely not true. The Fed issues "currency" against a certain amount of securities that it purchases from Primary Dealers (banks). The Fed never "creates money out of thin air" since it doesn't primarily issue loans. You need to look at the H.4.1 report that the Fed issues weekly. It contains their balance sheet.

Having said this, the Fed needs to be abolished - because they favor the continuance of debt-based money. Instead, the US Treasury should issue our currency - and the issuance should be against completed labor, not debt.

"Tally sticks were viewed as money because of government fiat, that was why they were considered money, no different then the paper dollar today."

There's absolutely nothing wrong with paper currency - or tally sticks for that matter. What makes it wrong is when it's issued against debt. The debate really has nothing to do with precious metals. Paper currency issued by our US Treasury against completed labor would be FANTASTIC!

"As soon as Gold was allowed to compete with it, it ended it as money. I have no problem with the treasury issuing currency and ending the Fed."

On that we agree, my FRiend.

"But currency needs to be backed by gold so the currency cannot just be created out of thin air, destroying it as money."

No, currency needs to be backed by "completed labor" - which would be controlling in itself, since only so much labor gets completely in a sovereign nation each year. Any excessive issuance could be taxed back in to the US Treasury and destroyed, as needed.

"The government is spending because that is what Government does!"

Your wrong. Remember when a $300 million deficit was absolutely HUGE! Then President Bush brought us TARP - because he had no choice. Our nation's money supply is controlled completely by bankers. When they shut off credit it was like putting a boot on the throat of our nation. The US government knew that they had to create new debt as fast as possible, or the public would see the real results of an enormous depression. That was the wrong move by our government. Instead, they should have abolished the Fed and had the US Treasury issue our currency. However, the banks could then have threatened to immediately stop clearing every financial transaction they had control over. Chaos would have resulted. What would you have done?

"In reality, the federal government never is in deficit since it really is just a matter of how it is going to pay the bills, borrowing or printing money.

The Federal Government can only "create" new money by using income from its Trust Funds to buy US securities. That's why the Health Care "trust fund" is being established - it has absolutely nothing to do with health. Social Security and Medicare now have more outlays than income - so there is nothing in the "middle" to purchase securities with. Other than this, the Federal government has no means of creating money - and the Fed does not create money either.

"The bills always get paid, but of course the nation is much poorer because of the drain on the economy through taxes, direct or indirect."

The inhabitants of our nation are like frogs in a boiling pot. We have been made into financial slaves of the banks - and given away our nation to them.

"The economies are crashing because of their excessive spending and that is bleeding the economies."

They're crashing because their money supplies are crashing. When a loan defaults then it means that the "claim on future labor" against that promissory note will never be completed. This reduces the money supply by the amount of the default. Debt-based economies run on promissory notes. There are not enough of them right now - which is why the EuroZone is clamoring for the creation of Euro bonds.

"We don't see as much price inflation as we should because of the lowering of demand, but the inflation is still occurring since interest rates are not at the levels they should be, they are still being kept too low, resulting in malinvestment in higher goods."

We don't see much price inflation because we're in a depression. Think about it for one minute. Our nation's GDP is roughly $14 trillion/year. Our Federal government deficit spends at roughly $2 trillion/year (even though they lie and pretend it's a little lower).

10% of $14 trillion is $1.4 trillion. In other words, the nation's GDP would be more than 10% smaller is we stopped deficit spending tomorrow. The GDP during the Great Depression shrank a little over 10%, before international war broke out to re-introduce gradual inflation (brought on by the bankers, who funded all sides of the war effort).

"What you are seeing is the 'bust' of many years of 'boom' inflation."

No, I'm seeing a repeat of history. Remember the "Roaring 20's". Remember 1929? Remember the recovery after 1929? Remember the even larger bust that occurred after the fake recovery? Remember the New Deal? Remember the international war, where money was well placed to turn losers into leaders (like Adolf Hitler, who was a nobody until he got funding)?

People need to remember history. I fully believe we are heading for another world war, were many people will be killed - not for patriotism - but merely as the way that the banks use to re-introduce gradual inflation into the world economies and become even wealthier and more powerful.

That's not what we're seeing right now - and haven't seen for quite some time. Citizens of other countries absolutely love US dollars, which is a big reason why the Fed has to put so many into circulation. These people know that the US has the greatest possibility of "making good" on the claims of their future labor.

"The Fed in particular uses their power to produce fake deflation..."

And inflation...

"if I were to loan my money to someone to buy real estate) would probably be 10-15%. The fact that my money is not in demand at that rate is not a sign of deflation but of an entirely corrupted market.

We agree on the corruption of the market. This is why people should be very careful investing heavily in the stock market. It's operating on extremely low volume, with most of that being High Frequency Trading.

"The resulting economic decline is not deflation, but forced stagnation."

A reduction in the overall money supply against a level of goods and services IS deflation - by definition. Yes, we have economic deflation - forced on us by the large banks (Primary Dealers).

"Similarly the reluctance to buy goods does not represent deflation psychology but economic realism."

The reluctance to buy goods is a byproduct of deflation. Credit is harder to get, wages are going down, unemployment is high. The only real "credit" growth is in Federal deficit spending - namely student loans.

"Finally, PMs are not an investment now and are never an investment, but merely a store of value. There is no difference between your putting dollars in a mattress which you would do if you truly believed in deflation and my gold in my mattress. Your substitute (U.S. government bonds) is mostly the same and that you believe in coercion."

Your "store of value" is only valued against what it is backed by - currency. I am not, and never have been, a proponent of debt-based money like you infer. I very clearly advocate a currency that is based on the completion of labor, versus a claim on the promise of future labor. Gold and silver have nothing to do with that idea - which is why people so strongly advocating precious metals are so wrong in their understanding of monetary theory.

Gold and silver are considered the "thing" for an investor to run to when an economy sours. What we're seeing is an "emotional" attachment to precious metals, because people think that's where they should find refuge.

People need to understand the concept of debt-based money (or having a claim on someone's future labor...i.e. owning a bond).

The safest investment strategy right now, in my opinion, is to own "direct" claims on the future labor of others. Short term US T-bills are an excellent example of this. You won't earn any money, but you also won't lose your shirt with what is coming.

"Currency" (or what many incorrectly refer to as money) is just what we carry in wallets and purses. It's backed by "money", but isn't money in and of itself - it's a "2nd deed" if you will on money.

Gold and silver are typically bought and sold with "currency". In other words, they're "backed" by currency - a 2nd order deed to money.

Gold and silver are actually 3rd order deeds to money - a REALLY poor investment decision in times of a world-wide deflationary crisis.

Do I own some gold and silver? Yes. I believe that 10% of every investment portfolio should be put into something that is a direct contradiction to where you believe things are going. I use gold and silver as a 10% hedging strategy.

Then why isn't oil (or corn for that matter) money? Being a commodity has nothing to do with being money.

Real money always has started out as something useful.

Great Britain used "tally sticks" quite successfully for over 700 years as both their currency and money. Are you saying that sticks with notches in them are useful?

Gold is REAL money and serves as a valuable medium of exchange and currancy should be backed 100% with it.

Gold is not "real" money, since money is what society defines it to be. Right now, the international banks have forced debt-based "money" on all nations - which simply means that all of our currency is backed by debt (the promise of our future labor).

We do not need "gold" to have a proper form of currency. Instead, we need currency that is not backed by debt, but instead by the "completion" of our labor. The US Treasury should issue our currency - not the Federal Reserve. This is where the actual problems lies.

We are not in a deflationary environment, the FED is inflating as fast it can.

You're wrong. First off, why is the US government deficit spending as fast as it can? Answer: We're in a depression. Why is Western Europe imploding? Answer: They're in a depression. Why is China spiraling down? Answer: They're in a depression. The entire world is in a depression that was forced upon us by international banks pulling access to credit (debt). The stock market is currently rallying because the drug addicts (us) think that large amounts of new debt are on the immediate horizon.

The Fed does not "print money". The Fed does not "create" money. Instead, the Fed issues "currency", which is backed by money (securities). You also create money every time you use your credit card (you get debt, the owner of your debt gets claims on your future labor - or "money").

We just haven't seen a rise in most prices due to drop in demand, but the effect of inflation, malinvestment of capitial goods is still occuring and will result in a 'bust' soon.

You're wrong. The money supply (claims on the promise of future labor) is crashing all over the globe. Again, that's why both Democrats and Republicans alike are seeking to deficit spend and encourage Americans to enter new debt as fast as possible (TARP, student loans, cash for clunkers, etc., etc., etc.)

It's why the Euro Zone is desperate for the concept of a "Euro bond" that they can sell on a "Federal" level like we do with our US Treasuries.

We do see some price inflation, but it's accompanied by monetary deflation. Price inflation is a natural occurrence of a Depression, as companies run out of cost-cutting options except for raising their prices.

No it's not. It's a commodity.

Gold is typically bought with currency and sold for currency.

Currency isn't even money - it's a 2nd deed on "money" (which is a claim on the future labor of others - a bond - in our debt-based monetary system).

Expect gold and silver to go down (after the emotional commodity roller coaster is over). We are in a deep deflationary environment, not inflationary.

Many folks are excited about the prospect of property because of the price plunge and low interest rates.

However, taking on debt to finance property is an extremely risky endeavor in my own opinion.

It's my belief that property will continue its decline on average, and that it still has a long ways to fall - while the eventual bottom and long drawn-out growth will take many years to unfold.

I say this because economic history shows we still have another six or seven years of deflation before major warfare breaks out and reintroduces moderate inflation (through many countries gearing up for their war efforts - with the international banks loaning them the money to do so).

When is a good time to buy property? When war is imminent.

That's the common thought process. However, you can go look at the following chart for the US Dollar Index and see that is not the case:

http://www.bloomberg.com/quote/DXY:IND/chart

The rise in the price of gold and silver has more to do with the commonly held incorrect belief that we are in the midst of severe inflation, bordering on hyper-inflation. Gold and silver purchases have been more emotional than based on facts.

I'm not saying that to disparage anyone, but to point out the necessity of understanding debt-based money. We wouldn't be seeing the events unfolding all around the world if there was major inflation in play.

Instead, we're seeing all of the signs of deflation, which is why deficit spending is being done by both parties of Congress.

Western Europe has a major problem. They don't have a "Federal" government with the Euro in which to deficit spend. That's why you're hearing rumors concerning "Euro bonds". They're desperately trying to deficit spend to counteract their contracting money supply.

Weimar was an interesting economics study.

The German deutschmark was actually a pretty stable currency immediately following WWI and before the Treaty of Versailles.

German currency was/is debt-based, so it was backed by the sale of German treasury bonds.

The Treaty of Versailles stipulated that the Allies must be paid war reparations by Germany in their respective currencies.

This immediately had the effect of making German bonds extremely difficult to sell. This, in turn, forced the German government to change the value of existing currency - thus creating the eventual hyper-inflation.

The lesson to be learned is that countries only suffer hyper-inflation when they owe extremely large amounts of debt denominated in a currency which is not their own.

This is why the United States will not see hyper-inflation (we're seeing big time deflation right now...masked by deficit spending). We have massive debt, but it is all denominated in our own currency.

That's one marker of a Depression.

Sorry my FRiend, but that advice is not economically sound. The goal right now is not necessarily to make money - but to avoid losing it. Short-term Tbills offer that.

Think about it this way...all "money" is a claim on a promissory note.

If you own the actual promissory note then your have "1st deed" to the debt (i.e. short-tem Tbills)

If you own currency (what some incorrectly call "money") then you have a "2nd deed" to the debt (securities) that back the currency.

If you put your money into a bank for "safe" keeping then you have a "3rd deed" to debt, since your holding are backed by currency, which is then backed by securities.

A prudent investment goal in a Depression should be to have "first rights" to any debt that you own (such as securities). "2nd deed" and "3rd deed" can be greatly manipulated - or disappear altogether in very bad situations.

The equities market is hanging around 13,000 on the Dow with VERY small volume, and LARGE amounts of High Frequency Trading (HFT). That should signal warning bells to all investors.

Think of it this way...the equities market is Las Vegas on steroids, while the bond (debt) market more accurately tells the real story. There's a very good reason why bond yields have dropped through the floor on US securities.

If you were an investor in the world who needed to determine which country has the highest possibility of actually completing the future labor that it has promised then who would you pick?

Everyone is choosing the United States, which is why bond volume is so high and yields are so low.

This is also why those predicting the US dollar to be "toilet paper" are so very wrong, and have been for quite some time. The US Dollar Index has been strengthening, not weakening. Don't be surprised when it crosses 100 in the future.

Lastly, commodities such as oil, gold, and silver will not be having the spike that people expect (even though oil would do well when/if a world war breaks out).

International banks have the sovereign nations of the world by the throat, due to their money supplies being based on debt, which the banks largely control.

The money supplies are crashing all around the globe. Nations are attempting to "remedy" this situation by deficit spending like there's no tomorrow.

Notice how Presidents Bush and Obama both focus(ed) on encouraging Americans to take on new debt in order to increase the money supply?

"Trade in your old clunker and take out new debt on a new car!"

"Go to college and get an education with an easily obtainable student loan!"

"Refinance your house for a longer term!"

The fact is that we're in an enormous Depression (as is the world). Take away the deficit spending each year and our GDP would shrink by an annualized rate of over 10%. We're talking 1930's all over again.

When will this stop? When international banks decide to make credit available again.

When will that be? After they have reset the exponential curve on the money supplies of the world and taken their fill of loan collateral.

What will be the sign that we're exiting the Depression and heading towards moderate monetary inflation? A World War. War is always the way that the banks exit Depressions, and has been since the mid 1600's.

We haven't seen the worst yet. And it won't matter if Romney is elected. The Republicans will continue massive deficit spending - since to do anything else would be to admit the Depression that is currently being masked.

Can't we just balance the budget, take our lumps economically, and move forward after a few years?

No, debt-based money doesn't allow for that. Debt-based money is all about men controlling the future actions of mankind (slavery). It's all about making claims on the future labor of others. Our money supply is the total sum of all claims on the future labor of others. Every time principal is paid it causes the money supply to drop by that amount. If all debt were paid off then our money supply would be zero.

The answer is to have a money supply based on the completion of labor, not promissory notes (debt). The only way this can be achieved is to have the US Treasury issue our money - and have it ONLY be issued against completed labor.

Those that have read my previous economic writings over the last four years know that I have not diverged from this teaching. We're now seeing the ramifications come to pass.

Please understand...I fully believe we will be having an international war where very large numbers of men and women will die in a show of patriotism for their respective country. However, the entire war will be about nothing except reintroducing moderate inflation back into the world economies - which will greatly increase the value of the collateral that the banks have been taking. These soldiers will have died for no other reason than to make the international banks wealthier.

By the way, I am a military hawk. I fully believe in armed conflict for the right reasons.

People are still believing that we’re seeing inflation.

We are in a deflationary spiral that is being partially masked by Federal government deficit spending.

I expect to see silver in the teens as we go along. It’s just a commodity against a debt-based monetary system.

Nothing. You simply lose credibility if you complain about something that doesn't exist.

There are enough other battles to fight without making people afraid of the bogeyman.

Where do you see a reference to this in S1867? It seems like it explicitly holds an opposite view.

Please give me a citation from the text of your concerns...

Can you cite one example in S1867 that refers to a "one-world" government? Or going after those with seven days worth of food? Or those with a certain amount of ammo?

I thought not...

It may be scary wording, but it's not in the text of S1867.

Be careful of what you believe. There are enough battles to fight without getting people going down a dead-end path.

Can you cite an actual reference in the text of the bill that you disagree with?

Where does the text of the bill address having too much food?

Show me where the text of the bill states this...

This article is worthless. It does not cite references within the text of the bill that are objectionable. Why?

Secondly, it wastes the time of people when they could instead be focused on real problems.

The government and Fed are two separate entities.

I would agree that the government is fighting as hard as possible to stave off the inevitable deflationary spiral. That is the purpose of the vast amounts of deficit spending.

The Fed is just a conduit to the United States that is controlled by international banks. They have collapsed lending (thus the money supply) on purpose in order to perform an economic reset. This has happened many times in our history due to money being debt-based.

The banks have no intention of taking their feet off the throats of world governments until the reset has occurred. Look for world war to follow as gradual inflation is reintroduced into the world economies.

The government and Fed are two separate entities.

I would agree that the government is fighting as hard as possible to stave off the inevitable deflationary spiral. That is the purpose of the vast amounts of deficit spending.

The Fed is just a conduit to the United States that is controlled by international banks. They have collapsed lending (thus the money supply) on purpose in order to perform an economic reset. This has happened many times in our history due to money being debt-based.

The banks have no intention of taking their feet off the throats of world governments until the reset has occurred. Look for world war to follow as gradual inflation is reintroduced into the world economies.

Commodity prices will not perform well in the depths of the deflationary depression that is here, and will be getting much, much worse.

Commodity prices will not perform well in the depths of the deflationary depression that is here, and will be getting much, much worse.

What if the other nurse has even more debt? What do they do if they want to start having a family?

Not in a deflationary depression they don't. This guy is trapped.

Based on what? The thought of Republicans winning the election?

That's a fine theory, except for the problem that the ENTIRE developed world is mired in a deflationary depression.

I don't think a few Republicans are going to turn that around anytime soon - especially since George Bush gave us the first absolutely enormous dose of deficit spending.

And, yes, I voted for the man.

Ron Paul isn't a man - he's a COWARD!

I've personally gone out in the dead of night and taken trash bags out of dumpsters at abortion clinics. I took these bags to a friend's apartment and sorted through all of the baby body parts - holding them in my very hands. These babies were given a proper and decent burial instead of ending up in a Los Angeles dump.

To ignore the plight of a newborn baby that has been thrown away in a bucket is beyond what I'm able to grasp.

Ping for later...

It's not a fake US Dollar Index rally - it's a very real one.

That's what happens when a nation enters a deflationary spiral. Its money supply shrinks against its level of goods and services.

Less "units" of money means that each unit is worth more, not less.

Look for gold to go sub $600/oz. as we fall further into deflation.

As you desire.

I wish you well in your investment strategy.

No, I see a world economy ruled by men who seek their wealth through the control of the future labor of others.

These same men need to perform a worldwide economic reset in order to maintain their control. To not do this would be to enter into major inflation, or even hyper-inflationary, times. This reset was started in late 2007.

Remember the easy credit that was given prior to that time? Remember the "roaring 1920's"?

That's only one example where history serves as our guide.

We are in a world-wide deflationary spiral. The various nations are attempting to combat it via massive deficit spending. They are losing and will lose this battle.

Precious metals will collapse as we continue. Look at the metal charts in the summer and spring of 2008 as a taste of what I'm talking about.

I wish you well with your investment strategy.

Most commodities, including oil and precious metals are priced in currency. You can either buy them for currency or sell them for currency.

Inflation is an increase in the money supply of a nation against a level and demand of goods and services. Inflation will cause there to be more "units" of currency - causing each unit to be less valuable. That's why it then takes more currency to purchase items.

Deflation is a decrease in the money supply of a nation against a level and demand of goods and services. Deflation will cause there to be less "units" of currency - causing each unit to be more valuable. That's why it then takes less currency to purchase items.

Oil prices are based on supply and demand, and in the big scheme of things a global economic slowdown might reduce demand for oil. Probably not as simple as that with more oil being brought to market, particularly in Canada, more demand from developing nations, etc..

Oil prices are based on supply and demand, and also the relative strength of the currency used to purchase it.

Where does deflation / inflation, demand, supply, etc., for various commodities get into the mix with gold prices?

Gold and silver are simply commodities, albeit commodities with much more emotional attachment tied to them versus oil, etc.

I don't believe the international bankers would cause such an immediate meltdown as to produce anarchy.

Instead, we'll see a more gradual economic reset where we still go to the bottom, but as frogs in gradually heated water.

There will come a time when rumors of war will turn the attentions of the developed world into a more nationalistic focus.

I don't believe central bankers want to. In fact, I believe that the international banks (who control the central banks) want to perform an economic reset, and they initiated this course of action on purpose beginning in late 2007.

There will come a time after the economic reset has occurred that inflation will need to be reintroduced back into the world economies. History shows us that this has always happened through the introduction of major warfare.

Relax. Everything will be better when everyone comes to the realization that I’m always right....

LOL!!

How right you are. The United States sheep sit in front of their televisions and absorb every word.

This depression will be much worse than hyperinflation. Depressions cause wages to drop significantly (if you can find a job), while leaving existing debt in place at the previous dollar level.

It means people will have to work more hours to pay off the same debt obligations they currently have.

Yes, it will.

Look at Post #8 regarding the reasons why.

Not if you bought the majority of your silver holdings at $45/oz.

Look at Post #8 for further analysis...

Sure.

What happened to gold and silver in the Fall of 2008? They went down. Why did they go down?

It's because the world was entering into a deflationary depression, and commodities always perform poorly in that environment. That's why the price of oil was dropping as well.

Then what happened?

The countries of the world embarked on a crash course of deficit spending - attempting to replace the money supply that was being destroyed through debt defaults. The countries were pretty good at this - for a time.

We are now at a point in the world economies where countries no longer have the ability to deficit spend at levels needed to offset the deflationary spiral. This is why we're about to witness the disintegration of the European Union and the Euro.

This is why we are seeing precious metals and other commodities (such as oil) drop as of late. We're also seeing the US Dollar strengthen as debt keeps defaulting - causing a shrinking money supply. Less money against a level of goods and services makes each unit of money worth more - not less.

In addition to precious metals, I believe that we'll see oil fall below $35/barrel. News people will tell us how great this is. They have no clue how wrong they are.

Peter Schiff will sure be surprised when silver heads back down to sub $10/oz and gold reaches sub $600/oz.

What will be his analysis then?

The facts are that we are in a deflationary depression. Precious metals do not perform will in such an environment.

Don't worry. It will again trade under $10/oz once we are firmly entrenched in our deflationary spiral.

You'll be able to get gold at sub $600/oz as well.

No, I believe the founding fathers had these protesters in mind when they wrote the Constitution.

May you have a nice day as well.

HAHAHAHAHAHAHAHA!!!!!!

That was rich...

Psst....you know what??? My dad is bigger than your dad...

With that childish exchange it's now off to work...