The Spring of Discontentment

Re: # 17 Re: Ron Paul

Sattar sahib

Thank you for bring up Ron Paul's link. Unfortunately, his bid for president has yielded only 14 delagates. He makes way too much sense for America to listen to him attentively. Only slick talkers with forked tongues can get anywhere in the political circus that passes for democrazy...

The chickens, it seems, may well be coming home to roost. The credit implosion has been underway only for a few months and, regardless of what officialdom and their pimps on Wall Street tell you, there is NO END IN SIGHT... It may be almost 2010 before the true magnitude (depth and breadth) of the economic fiasco is evident.

In practical terms what does it mean to folks around the world? As far as I can see, this is the beginning of the end of the empire. A global military contraction, call it retreat if you want, will begin and be well underway before the NEXT president's term is over. The 702 US military bases in 135 countries (located outside 50 US states) will HAVE to start unwinding.

The fate of the US dollar as a global reserve currency is sealed. The party is over for the Old Model and its down hill from here. On to the New Model.

No matter what, the US is a Great Power and keeps many aces up its sleeve. The dollar may be shod, but what is to stop the formation of the North American Union (NAU) and the launch of the Amero currency, implicitly backed by Canadian natural resources?? Mexico and Canada will have a hard time preventing the Big Giant from "ASSIMILATING" them.

Resistance is futile

...SR

#13 Posted by haji004

Bernanke's naïve comment the Dollar traded at its three year lowest against the Yen as well ...

Bernanke naive? Hmmm ... the author obviously knows something Bernanke does not.

There's an axiom in the markets that when housemaids and bartenders (and kiryana merchants) jump into the markets, it's time to get out.

I asked Anil Saheb a question a while ago which he never answered. It is:

Dollar depreciated 11% during 2007 against Euro, but less than 6% against JPY. If all three are floating currencies and the USD goes down, others should go up by the same proportion merely by translation. JPY didn't. Why?

Above is the acid test for folks who just shoot off from the mouth with typically superficial understanding.

(P.S. The recent rise of JPY was due to unwinding of Carry Trades following an increased risk-aversion in Credit markets which changes all the time. Nothing to do with value of USD).

Here is another 'deeda-ver'

Dr Tarik El Diwany
http://www.islamic-finance.com/item18_f.htm

SR,

... 'tis about time you showed up ...

... don’t be so hard on us … at least I’ve been reading your posts and links with avid interest. I am not an economist but can kinda-sorta sense when something is waaaaay out of line. I once made a brief outline of issues involving US debt … issues that continue to bother me to this day. The economic picture has only become more disturbing since them … and we continue to spend like drunken sailors (are the plasma TVs two-for-one yet?).

http://www.chowk.com/interacts/10127/1/0/0#256542

Here's the Ron Paul link you once provided … certainly worth reading (or listening to …)

http://www.lewrockwell.com/paul/paul303.html


(What's the scoop with posting live links ... ???)

Hayat sahib ...

badi mushkil say hota hae chaman mein deeda-ver paida

Talking about the ills of a fiat monetary system among main stream media audience is like pissing in the wind. But still I'm glad that there is another, besides me, who feels strongly enough about the unsustainability of this system and writes about it.

I got burnt out casting pearls before swine, as this forum is full of MBAs and banker types who simply will not make the paradigm shift... What they do not perceive, they can not conceive.

I'm sure you've read Alan Greenspan's articles about the evils of fiat money and the necessity of having the gold standard to preserve liberty. I posted them in 2002.

http://www.chowk.com/interacts/5535/1/0/0#117586

This, of course, was before he became a whore and sold out to the devil.

In another piece that was posted on Chowk in June 2003,

http://www.chowk.com/articles/6252

I wrote the following:

"...Gold has entered a long-term bull market and in time we should see another gold rush. After three decade of fiat money reign and despite efforts by governments and bankers to discredit the yellow metal as an “ancient barbaric relic” that has no place in modern financial systems, gold has survived and is returning to reclaim its power and prestige. After 22 year of silence in the financial doghouse the yellow dog is barking again. Gold is coming back in fashion..."

There are many main-stream MBA-types who poo-poo such words, but now-a-days they are getting fewer and further between.

A bit further in that 2003 article I added:

"...one day, and that day may arrive sooner than any one imagines, we should see that the price (in U.S. dollars) of an ounce of gold and the S&P 500 Index are the same number. We shall go a step further and add that we should also see the day, in the not very distant future, when one ounce of gold is worth a unit of the Dow Jones Industrials. Today one Dow unit can buy 24 ounces. In 1999 one Dow unit bought 42 ounces. The reader may think that we have taken leave of our senses and have become delusional to make such a suggestion. It has happened a few times before, most recently in 1979-1980. We shall stubbornly stand our ground.

Gold, oil, grain, meat and other natural resources should outperform all paper assets for the next few years, not only in the U.S. but around the world..."

Further still:

"...Over the next few years the U.S. Dollar should continue to decline much more in value, thus further eroding the equity and debt markets in its wake..."

Needless to say, I agree with your overall stance.

We ain't seen nothin' yet...

...SR

(should start looking for some good lubricant imho...)

Not a very comforting thought especially when a Pushtoon gentleman advises such a course of action.

Regards

Re: # 9
Of course...I did that quite a long time...
As far as your statement "The US only mints cents" is concerned...I would have to disappoint you...No the US mints gold coins as well...and regularly for that matter...

Re: # 12
Bernanke is known as "Ben B-52 Bernanke"...he would carpet bomb the US with liquidity...the dollar is rapidly losing its purchasing power...and yesterday after Bernanke's naïve comment the Dollar traded at its three year lowest against the Yen as well (don't forget that the Dollar is also trading at its lowest against the Euro since Tuesday)...

Bernanke is really between the devil and the deep sea...should start looking for some good lubricant imho...

Ahmad Hayat

p.s. US has sent ships to eastern Mediterranean on the orders of Admiral Mullen (JCS who visited Pakistan three weeks ago as well)...today's breaking news...and as McCain said famously or infamously in a pretty bad imitation/re-rendition of Beach Boys Bomb, Bomb Iran...exciting if not interesting times to come

Author,

You wrote:

"... and once again like every paper and/or political money ever circulated in known Human history the Dollar is fading."

What do you make of Bernanke's remark in the Senate Testimony on 28 Feb, and the related comment? (emphasis mine).

Bernanke also told the Senate panel that the dollar's depreciation is 'a positive factor' for reducing the U.S. trade deficit.

``This is the Bernanke shock, causing much faster dollar depreciation than expected,'' said Michiyoshi Kato, a senior vice president of currency sales in Tokyo at Mizuho Corporate Bank Ltd., a unit of Japan's second-largest publicly traded lender by assets. ``We are entering into another world of dollar weakness. The Fed is not unhappy about that.'' (Bloomberg)

Re: # 10

And that my friend is the reason Islam opposes this INTERESTing terrorism!

For the guilty to delcare a war in return is true terrorism!

Sleep well.

Government is not the only guilty party. It doesn't simply print money from a mint. It borrows from the Fed which is comprised of private banks that create money out of thin air by the magic of fractional-reserve banking and then charge interest on it. These banks are also huge beneficiaries of this 'taxation'.

Dear Mr. Goldfinger, do invest in Gold, 20-30% I'd say. Countries do too! Reserves, you know!

The US governemt only mints cents, by the way!

Thank God, OUR women prefer 22K instead of the 14K trash that the liberated (?), rich, sexy(?) and fair-skinned (!) women abroad do.

We have something right at least!

Don't they have huge oil pools? Dunno if Gold can ever be considered as a measure, it is the advance in science and technology that still holds them in good stead.

We would have to go to the occidental nations for newer medicines and technologies and this would ensure their standing in the world.

I thought India is the largest consumer/buyer of gold in the world. Can't we assume that the citizens' wealth to be the nation's when the situation arises?

Re: # 6:

Loose monetary policy would likely increase inflation, resulting in reduced purchasing power.

Ejaz,

(but thanks to all the Fed rate cuts we will also have a reduction in purchasing power. )

Why wud rate cuts result in a reduction in purchasing power.

Regards

Re: # 3
Von Mises would have the last laugh...down with Keyenes...down with Freidman...