Market News, Analysis, and commentary primarily on the precious metals markets, gold, silver, mining.
Showing posts with label Gold Standard. Show all posts
Showing posts with label Gold Standard. Show all posts
Thursday, February 3, 2011
Keiser Report: Silver Stick for JP Vampire (E118)
This time, Max Keiser and co-host, Stacy Herbert, talk about French President Nicolas Sarkozy going postal on JP Morgan CEO, Jamie Dimon and about the US Drug Enforcement Agency goes Village People with their big lipped rubber ducky for sale. In the second half of the show, Max talks to Sandeep Jaitly of Bullionbasis.com about a gold standard, backwardization and the Austrian school of economics.
Tuesday, January 25, 2011
Stunner: Gold Standard Fully Supported By... Alan Greenspan!?
Stunner: Gold Standard Fully Supported By... Alan Greenspan!?
You read that right. After such establishment "luminaries" as World Bank president Robert Zoellick, Warren Buffett's father Howard, Jim Grant, and, most recently, Kansas Fed president Thomas Hoenig, all voiced their support for a return to a gold standard, the most recent addition to the motley group of contrite voodoo shamans is none othe than the man who is singlehandedly responsible for America's addiction to cheap toxic credit, who spawned such destroyers of the middle class as the current Chaircreature, and who currently is the chief advisor in John Paulson's crusade to gobble up every ounce of deliverable physical in the world: former Fed Chairman - Alan Greenspan! In an interview with Fox Business, the man who refuses to go away into that good night: "We have at this particular stage a fiat money which is essentially money printed by a government and it's usually a central bank which is authorized to do so. Some mechanism has got to be in place that restricts the amount of money which is produced, either a gold standard or a currency board, because unless you do that all of history suggest that inflation will take hold with very deleterious effects on economic activity... There are numbers of us, myself included, who strongly believe that we did very well in the 1870 to 1914 period with an international gold standard." And a further stunner: Greenspan himself wonders if we really need a central bank. Now our only question: why couldn't the maestro speak as clearly and coherently during his tenure which resulted in our current near-terminal financial state. And as a reminder, courtesy of Dylan Grice, if and when we do get a return to a gold standard there would be a need to reindex the monetary base to a real time equivalent price of gold, putting the price of the precious metal at about $6,300: "The US owns nearly 263m troy ounces of gold (the world's biggest holder) while the Fed's monetary base is $1.7 trillion. So the price of gold at which the US dollars would be fully gold-backed is currently around $6,300." And here you have people worried about day trading volatility...
h/t Mike Krieger
Monday, January 17, 2011
The Gold Standard Journal
http://goldstandardinstitute.org/GSI/wp-content/uploads/2010/06/TheGoldStandardJournal.pdf
"The reality is that the Gold Standard is NOT for the rich… just the opposite. Under Gold, a wage earner gets a true value for his work, either in Gold coins, or Silver. These coins do not depreciate, they are never defaulted on, indeed history shows that they tend to increase their buying power over the years. By contrast, paper 'legal tender' is constantly losing value… the only question being how quickly; over decades, years, or a la Zimbabwe and Weimar Germany, days! Holders of paper money always lose, the only question being how quickly; over decades, years, or days."
"The reality is that the Gold Standard is NOT for the rich… just the opposite. Under Gold, a wage earner gets a true value for his work, either in Gold coins, or Silver. These coins do not depreciate, they are never defaulted on, indeed history shows that they tend to increase their buying power over the years. By contrast, paper 'legal tender' is constantly losing value… the only question being how quickly; over decades, years, or a la Zimbabwe and Weimar Germany, days! Holders of paper money always lose, the only question being how quickly; over decades, years, or days."
Thursday, January 6, 2011
GATA UPDATE (4 Articles)
Brazil says it won't let U.S. 'melt the dollar'
Submitted by cpowell on 05:30PM ET Wednesday, January 5, 2011
By Robin Yapp
The Telegraph, London
Wednesday, January 5, 2011
http://www.telegraph.co.uk/finance/currency/8241635/Brazil-pledges-to-st...
SAO PAULO, Brazil -- Brazil has sounded a new note of warning in the international "currency war" by pledging not to allow the United States to "melt the dollar."
Read more...
Kansas City Fed president calls gold standard 'very legitimate'
Submitted by cpowell on 05:43PM ET Wednesday, January 5, 2011
From Reuters
Wednesday, January 5, 2011
http://www.reuters.com/article/idUSTRE7044L620110105
KANSAS CITY, Missouri -- A gold standard that forces countries to back their currency reserves with bullion is a "legitimate" monetary system, though it would not prevent financial crises, Kansas City Federal Reserve President Thomas Hoenig said on Wednesday.
Read more...
Return of gold standard is now respectable issue, Rickards tells King World News
Submitted by cpowell on 05:33AM ET Thursday, January 6, 2011
8:30a ET Thursday, January 6, 2011
Dear Friend of GATA and Gold:
Read more...
Peter Brimelow: Gold is pole-axed but bugs (and others) are calm
Submitted by cpowell on 05:47AM ET Thursday, January 6, 2011
By Peter Brimelow
MarketWatch.com
Thursday, January 6, 2011
http://www.marketwatch.com/story/gold-pole-axed-but-bugs-and-others-calm...
NEW YORK -- Gold gets pole-axed, but the radical gold bugs, and even some more orthodox observers, remain
Read more...
Submitted by cpowell on 05:30PM ET Wednesday, January 5, 2011
By Robin Yapp
The Telegraph, London
Wednesday, January 5, 2011
http://www.telegraph.co.uk/finance/currency/8241635/Brazil-pledges-to-st...
SAO PAULO, Brazil -- Brazil has sounded a new note of warning in the international "currency war" by pledging not to allow the United States to "melt the dollar."
Read more...
Kansas City Fed president calls gold standard 'very legitimate'
Submitted by cpowell on 05:43PM ET Wednesday, January 5, 2011
From Reuters
Wednesday, January 5, 2011
http://www.reuters.com/article/idUSTRE7044L620110105
KANSAS CITY, Missouri -- A gold standard that forces countries to back their currency reserves with bullion is a "legitimate" monetary system, though it would not prevent financial crises, Kansas City Federal Reserve President Thomas Hoenig said on Wednesday.
Read more...
Return of gold standard is now respectable issue, Rickards tells King World News
Submitted by cpowell on 05:33AM ET Thursday, January 6, 2011
8:30a ET Thursday, January 6, 2011
Dear Friend of GATA and Gold:
Read more...
Peter Brimelow: Gold is pole-axed but bugs (and others) are calm
Submitted by cpowell on 05:47AM ET Thursday, January 6, 2011
By Peter Brimelow
MarketWatch.com
Thursday, January 6, 2011
http://www.marketwatch.com/story/gold-pole-axed-but-bugs-and-others-calm...
NEW YORK -- Gold gets pole-axed, but the radical gold bugs, and even some more orthodox observers, remain
Read more...
Wednesday, January 5, 2011
Jim Rickards - Gold Standard Coming, Fed’s Hoenig Correct
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/1/6_Jim_Rickards_-_Gold_Standard_Coming,_Feds_Hoenig_Correct.html
Fed Governor Hoenig shocked many observers yesterday when he stated, “The gold standard is a very legitimate monetary system...We're not going to have fewer crises necessarily. You will have a longer period of price stability or price level stability, but I don't know that you'll have lower unemployment, I don't know that you'll have fewer bank failures.” King World News immediately interviewed Jim Rickards who has worked with both the Fed & US Treasury, and who also has a background in national defense as well as consulting with government directorates around the world.
Jim, you said that battle lines would be drawn on this debate and this is the second major figure who has joined with World Bank President Zoellick openly discussing the use of gold in the monetary system. What is your take on this development?
“What Hoenig has done, as Robert Zoellick did before him, is to legitimize the debate. This is not the last word on gold and there is a long way to go both intellectually and mechanically before we get to a gold standard. What is important is that the discussion is now out of the shadows and in the main arena and it will take on a life of its own from here with participation from many sides. Hoening may have lost his vote on FOMC but he has not lost his voice.”
With regards to the battle lines, how do you think Fed Chairman Bernanke will feel about this?
“Hoenig and Zoellick are not stalking horses for Bernanke and the Board of Governors. An honest debate about a gold standard is the last thing Bernanke wants. However, because of speeches like Hoenig's and the new prominence of Ron Paul in the Congress, this debate is now taking off whether Bernanke likes it or not and he will not be able to contain it.
The battle lines are being drawn between honest gold backed money and fiat money. The G20, IMF, central banks and most academic economists are on the side of fiat money and the citizens, certain honest intellectuals and a few economists are on the side of gold. Let the games begin.
Hoenig is right that even with a gold standard there will continue to be business cycles with occasional periods of higher unemployment and bank failures. But it's not as if fiat money has avoided those calamities. From the severe recessions in the 1970's and 1980's, the sovereign debt crisis of the early 1980's, the stock market crash of 1987, the recession of 1989-1990, the bond market crash of 1994, the LTCM collapse of 1998, the tech bubble crash of 2000 and the Panic of 2008 it's not as if it's all been smooth sailing under fiat money.
It's hard to see how gold could do worse and history says it will do much better. One need only look at inflation, unemployment and economic growth in the period 1870-1914 versus 1971-2010 to see the clear beneifts of gold which seems to produce both consistent growth and low inflation notwithstanding occasional business cycle volatility.”
You can still have variations due to tightness in supplies, but it is proven that there is tremendous stability in pricing when you are on a gold standard. We had food riots in 2008 from Haiti to Bangladesh to Egypt over the soaring costs of basic foods. Food costs have now eclipsed 2008. It seems it is not only morally the right thing to do, being on a gold standard, but also the humane thing to do as far as providing price stability?
“Good question. Commodities are not just the playthings of speculators or mere industrial inputs. In many cases, commodities are actually food and their price volatility represents the difference between a steady diet or starvation for billions of people. If a gold standard contributes to lower volatility in food prices and fewer price related supply disruptions that's a social good over and above any economic good that is created.”
How do we get there Jim?
“Well, as I've said before, there's more to a gold standard than just snapping your fingers and wishing it to be so. It will require a lot of study, a lot of planning and a lot of technical work to execute. One clear implication is that given the amount of money printing in recent years, a much higher price of gold is required to create an equilibrium between the current money supply and the amount of official gold available to support it.
Estimates of that higher price can vary over a wide range depending on what definition of "money" you use and what gold to paper ratios you require. My own analysis indicates a range of between $5,000 to $11,000 per ounce of gold; of course, some estimates are much higher.”
There is the easy way and there is the other path which could very well involve social disorder, violence and failure of the current monetary system. A gold standard is coming to the United States, and the US can do this willingly, or “kicking and screaming” as Jim Rickards has said in the past. Let’s hope we choose the easy path.
Eric King
KingWorldNews.com
Fed Governor Hoenig shocked many observers yesterday when he stated, “The gold standard is a very legitimate monetary system...We're not going to have fewer crises necessarily. You will have a longer period of price stability or price level stability, but I don't know that you'll have lower unemployment, I don't know that you'll have fewer bank failures.” King World News immediately interviewed Jim Rickards who has worked with both the Fed & US Treasury, and who also has a background in national defense as well as consulting with government directorates around the world.
Jim, you said that battle lines would be drawn on this debate and this is the second major figure who has joined with World Bank President Zoellick openly discussing the use of gold in the monetary system. What is your take on this development?
“What Hoenig has done, as Robert Zoellick did before him, is to legitimize the debate. This is not the last word on gold and there is a long way to go both intellectually and mechanically before we get to a gold standard. What is important is that the discussion is now out of the shadows and in the main arena and it will take on a life of its own from here with participation from many sides. Hoening may have lost his vote on FOMC but he has not lost his voice.”
With regards to the battle lines, how do you think Fed Chairman Bernanke will feel about this?
“Hoenig and Zoellick are not stalking horses for Bernanke and the Board of Governors. An honest debate about a gold standard is the last thing Bernanke wants. However, because of speeches like Hoenig's and the new prominence of Ron Paul in the Congress, this debate is now taking off whether Bernanke likes it or not and he will not be able to contain it.
The battle lines are being drawn between honest gold backed money and fiat money. The G20, IMF, central banks and most academic economists are on the side of fiat money and the citizens, certain honest intellectuals and a few economists are on the side of gold. Let the games begin.
Hoenig is right that even with a gold standard there will continue to be business cycles with occasional periods of higher unemployment and bank failures. But it's not as if fiat money has avoided those calamities. From the severe recessions in the 1970's and 1980's, the sovereign debt crisis of the early 1980's, the stock market crash of 1987, the recession of 1989-1990, the bond market crash of 1994, the LTCM collapse of 1998, the tech bubble crash of 2000 and the Panic of 2008 it's not as if it's all been smooth sailing under fiat money.
It's hard to see how gold could do worse and history says it will do much better. One need only look at inflation, unemployment and economic growth in the period 1870-1914 versus 1971-2010 to see the clear beneifts of gold which seems to produce both consistent growth and low inflation notwithstanding occasional business cycle volatility.”
You can still have variations due to tightness in supplies, but it is proven that there is tremendous stability in pricing when you are on a gold standard. We had food riots in 2008 from Haiti to Bangladesh to Egypt over the soaring costs of basic foods. Food costs have now eclipsed 2008. It seems it is not only morally the right thing to do, being on a gold standard, but also the humane thing to do as far as providing price stability?
“Good question. Commodities are not just the playthings of speculators or mere industrial inputs. In many cases, commodities are actually food and their price volatility represents the difference between a steady diet or starvation for billions of people. If a gold standard contributes to lower volatility in food prices and fewer price related supply disruptions that's a social good over and above any economic good that is created.”
How do we get there Jim?
“Well, as I've said before, there's more to a gold standard than just snapping your fingers and wishing it to be so. It will require a lot of study, a lot of planning and a lot of technical work to execute. One clear implication is that given the amount of money printing in recent years, a much higher price of gold is required to create an equilibrium between the current money supply and the amount of official gold available to support it.
Estimates of that higher price can vary over a wide range depending on what definition of "money" you use and what gold to paper ratios you require. My own analysis indicates a range of between $5,000 to $11,000 per ounce of gold; of course, some estimates are much higher.”
There is the easy way and there is the other path which could very well involve social disorder, violence and failure of the current monetary system. A gold standard is coming to the United States, and the US can do this willingly, or “kicking and screaming” as Jim Rickards has said in the past. Let’s hope we choose the easy path.
Eric King
KingWorldNews.com
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