aliveandkicking

It seems you like playing games. I think the subject of deflation is worth discussing even if you do not If you have an opinion let us clearly hear what it is, using language that makes sense to people who share a common understanding of words that are used in dictionaries or can be agreed upon by readers and listeners. Infinite money suppply must mean that money is valueless. Infinite does not mean very big Do you mean very big? Or do you mean potentially infinite?

Obviously there is not an infinite amount of cash Please use use clearer and more correct english language to say what you mean. Credit is created by levering a relatively small amount of cash.

Robert Mugagbe has shown it can be done. I know he was Oxford educated and amonst the elite but do you really think a determined government cannot do the same? But at the moment they dont need to. Many of the doom and gloom stories about deflation have just not happened as predicted.

If liquidity is infinite then money has no value. So liquidity has to be less than infinite. Edit; RH beat me to it. But RH Dont be fooled into thinking that cash in a bank cannot be made worthless. It can be. And if the cash is not spent then that will be the outcome. Your theory that 'they wont do that is not based on reason. It is an irrational belief to think you will not be encouraged to spend by any means necessary to prevent deflation But this spending will support asset prices generally and aspects of this crisis will no longer apply because asset holders with debt will no longer be under water and will feel happier spending and lenders will feel happier lending. All in all the certain outcome that money will be spent means that interest rates will rise when inflation rises. Inflation will rise. Or the world will end and gold will go to the biggest thug.

That is only true for full reserve banking which is pretty well not practised anywhere on earth in reality. Our banks are fractional reserve banks which are allowed to lend money they borrow from others. By defininition if no fractional reserve bank had any leverage then only cash the bank already owned could be lent to customers and it would be a full reserve bank. A fractional reserve bank cannot create credit without creating savers deposits with that bank. Credit is created by matching savers rates to borrowers rates for a profit. Eg the bank with 1 dollar borrows 99 from a saver to lend 100 to a borrower to be levered 99:1 or whatever the leverage is. Or it creates credit of 100 which is spent by a buyer of things sold by a customer of that bank who then has savings of 100 with the same bank. If the 'saver' wants to be repaid the bank has to borrow from another source and might chose also to delever by not rolling over loans or by not issuing new ones as old ones expire. As the bank delevers people who wish to borrow money are turned away or must pay higher interest rates which discourages borrowing for many. If all the banks delever fully there will be something like 97% less money in the world. So prices will presumably fall 97% also or some huge amount.

If only you could agree to say hyper increases in money supply might lead to hyper inflation Related to this style of debate we have: 1. Moderator goldfinger saying it is irrational to give any reasons why hyperinflation cannot be prevented. 2. Moderator RH saying that hyperinflationists are irrational nutters Do people want a debate?

Perceiving or perception is an act of interpretation using the mind. If we can change our mind then we can change our perceptions. If we dont change our mind then we can only perceive what we saw before The USA is the worlds largest economy. Other economies like Germany or Japan say are not full of consumers or people who want to take on more debt. These other economies want a strong USA economy so that firms like BMW or Sony remain strong. If BMW sells cars to the USA it gets dollars. If Germany wants to support the economy of Germany it can buy dollars Meanwhile these same nations support the USA militarily and diplomatically as it gets easier and protected access to oil in the middle east. Then there is the dollar as worlds reserve currency. The basis for the numbers in the banks is contracts between people who do not want to be double crossed. Most of the money in the world is dollars that are lent to other people. If i borrow 100 from you and lend 100 to Dr Bubb i am massively levered and exposed to losses if Dr Bubb does not repay me. So that loss if it happens creates a profit loss for me of the full 100 unless i have security i can sell. The banks are damaged and dont want to lend. Most of the money in the world is created by lending. The feds are mainly lending new money into existance that they expect to get repaid. The feds are private banks so you can imagine they want to be repaid or end up with no losses . But you probably think banks are criminal organisations that invent the money out of thin air and no matter how long we were to sit down and talk about banking you could not possibly conceive they did not So I imagine if Dr Bubb were to sit down with you and talk about banking you would also really struggle to understand how he could possibly not agree with you also. Perception is a funny thing. None of us can really see anything. All we can do is attempt to sense what is there and allow it to come to us and then compare what we think we sense with what we imagine we have already seen while allowing what is there to come to us unchanged by what we imagine we saw earlier.

If it makes sense to you to value silver more than the market i can supply you with market priced silver and place it in a nice box and you can pay me for my labour and holidays and so forth. But if you want to sell it back to me i can only afford to pay you the market price minus my commission because i will have already paid for the holidays and need more of them to maintain my lifestyle. If that makes sense to you then it does not have to make sense to me. Just let me know when you want to proceed.

Supply and demand figures for gold dont make sense and if people are accumulating silver for its monetary value that does not makes sense either. Silver is of course hugely valueable but it is produced mainly as a biproduct of copper production. I have said all of this before and got the same stick from the same people still waiting for silver to have its day in the sun Silver is just one of a myriad of commodities that humans want and get when they desire it and can afford it Why silver? Why not pork or wood etc etc etc

It seems the modus operandi of the moderators on this board that when a person does not agree with the moderators investment decisions it is assumed the person cannot think or does not think or cannot think soundly I imagine you know i was not saying that. But if it makes you feel better than you are welcome to believe i am nuts. I try to be helpful. But if you are interested in why i think what i think then I refer you to Jim Rogers comment that the supply demand dynamics of gold are different to other commodities that he thinks are likely to give better returns but for sure the man must be holding gold also. Marc Faber made the comment about a year ago that his very wealthy clients dont hold more than about 5% of their net worth in gold. So the question then is what else is seen to be a good investment? I think you are able to understand why platinum is more highly priced than gold. Platinum was i think up over 40 yesterday. I think you are yourself holding platinum? But if industrialisation collapses will people value platinum? It is for these reasons that we do tend to value things differently today. Man cannot live comfortably with gold in the safe, he has to buy things with it. Gold will likely peak when people buy things with their profits. But what about platinum? What about uranium if peak oil is a reality that will influence our lives in the near future? My point about other metals such as platinum is related to the way such metals are used to create the modern life we are living which is more complex than the simpler times of yesteryear. Such days could however return if we get economic collapse back to simpler times. I am not wanting to really consider that kind of thing at my age with a newborn baby and so forth. Others can worry about it they want. On the topic of margin i think you are mixing things up? A broker can offer margin because you place a deposit with him that covers his exposure and punters tend to place bets that cancel to reduce his exposure. that kind of margin is different to the way a bank levers its profits by borrowing short and lending long so that with 4 dollars of own money say, it borrows 96 and lends 96 to profit on 96 of interest received that it sets, while paying 96 of interest out that it sets, so that it has margin on 96 dollars. In times of unpredictability the broker can increase the margin requirements so customer exposures are reduced so that his own exposures are reduced. i would say the authorities will know when it suits them to make margin changes that will hurt the side they want to hurt. For example if they tighten bank lending regulations on amount of leverage then that will be deflationary and favour a fall in the gold price so a margin change after that event might force people running losses to take the losses via margin calls rather than trade out. Who knows if they really want to hurt people to their advantage maybe we will see a 9 in the price of silver. Not a risk i am prepared to personally take as buyer now. On the other hand if we see 9 it might be safe to buy. But one way or another i am sure you know about everything i have said. each of us looks at the same thing and connects the dots as we think is best for us.

From a traders viewpoint platinum has made some impressive moves at over 2000 to around 1000 and now 1300 and every chance it will be over 2000 before gold is. In an economic recovery where there is less fear of collapse gold will fade in favour of stuff people require. And in 2004 $850 was nowhere to be seen anytime soon It seems if: 1. you are certain of economic collapse then trade wholely with gold 2. If you are optimistic of economic recovery then trade mainly with something that is required.

Your response to me seems to have been generated by your strong beliefs about world economical collapse. Such a collapse will amost certainly lead to war and chaos. The world is not so different to when i was in my twenties back in the 1970's. At the time the world seemed a very scary place but my boss pointed out to me that it was no different to any other time he could remember. Because most people including yourself do not want war and chaos then most people tend to work towards economical solutions that enable a reasonable peace to be maintained. China and America are for example long term allies where America support china in ww2 with lend lease in the same way it supported the UK with lend lease. The main pacific so called allied powers of the day were the ABCD powers versus the so called Axis powers. When Russia changed sides it too got lend lease assistance. Russians are surprisingly artistic and romantic if chaotic and have reasons to distrust the west as does iran but Russia today is embracing western methodology because they want what the west has got or at least less of the unpleasant parts of the chaotic parts they presently live with. For example they need to introduce rule of law rather than what they have at the moment which is something different related to respect of power - no matter how ugly it is. Hyperinflationism seems to be aligned with anarchism which is the belief all powers other than the individual is tyranny I am inclined to believe your attitude towards me was to be tyranical in the hope that you and the others could achieve your objectives for world distruction so that your belief system can be satisfied that only the individual is important Most people are operating in a group world type environment of cooperation or working towards that as on objective

No. Still waiting for that 9 to buy

I expect the price of palladium is related to it being mined with platinum rather like silver is usually produced from refining copper ore

Probably if hydrogen fuel cells are in cars they will use generators as brakes and create more hydrogen and oxygen or something? And the platinum will be the inert metal for the electrolysis? But wait there is more info: A fuel cell works by catalysis, separating the component electrons and protons of the reactant fuel, and forcing the electrons to travel through a circuit, hence converting them to electrical power. The catalyst typically comprises a platinum group metal or alloy

As far as i know platinum was at almost 1500 usd per onze today. I would guess platinum keeps its price today because it is a way of preserving wealth and it is an industrial metal The first point i made earlier is to ask why should silver have some particular mystique that is more special than other industrial metals? Presumably the availability of silver is such that it can be priced around 100 times lower than platinum? Gold is not the king of the metals in our current industrial era. The second point i made was that gold will be king if industrialisation collapses and we return to widespread war and chaos

But confuscious he say also The wise man sees this process with different eyes to the man who can only see the contents of his own mind. When mattel toys sells plastic ducks around the world that are not manufactured by American labour it saves money and is able to produce greater profits for its owners. The countries who enable this process get a share of the profits and learn also how to make plastic ducks. Why would china stop making plastic ducks for America? Confuscious he say: Some see revolution. Some see changes. And some cannot see that nothing has changed.

Well congratulation for repeating it If jake wants to be ignorant and think i am stupid then so be it

I assume you have heard of platinum

Gold is for eternity but most of us have simpler ambitions and where necessary chip board and plastic will probably be part of my final journey

At some point the investors will see there is no value in holding gold and they will sell to buy something useful which could be plastic or whatever is useful to them. Meanwhile other investors are investing in plastic already My point was that the world is different and we do value things differently today than when there was a gold standard. Gold has to be useful to have value. A certain amount goes to jewelry, in dentistry gold is still the most valueable material for a crown in terms of biting ability and durability. Gold is fantastic for electrical contacts and as wires in tiny integrated circuits. Etc. Etc. For sure it is valueable. But it still has to compete with other valueable materials and there seem far more of them today than in former times.

My point was that you appeared dismissive of people who did not trust the seller saying no brains were needed I felt it was fairly natural when it comes to money that people would not trust another - rather they want to verify things.

He said in the shops I have lived in places other than finland - finland being exceptional in my recent experience Finland has a significant amount of uranium in some of the water when bore holes are used I have a gold crown in my mouth which i counted as in my body If you dont know about US manufacturing i will leave that one for you to find out about. Go to a small airport for example and report the makers names. Go to a farm and note who makes the complex vehicles and machines. Who makes the computers? Who makes the very large buisiness computers? Few countries do make them. The us is a major manufacturer of stuff You misunderstood my comment about the gold coin copy Typically forgers place a heavy metal inside the gold so on the outside it is just pure gold. Which is why gold bars have drill holes in them where they have been tested to see if the inside is the stated purity. For large bars unless you have the traceable paperwork for the bar things get complicated as more holes need to be drilled or it needs melting down to be tested.

I suppose it is true that such a coin would be collectable also.

You could only assume it was real even if you were an expert. And an expert dealer can always pass it onto another person. A determined person with knowledge could produce a less valueable coin that would be next to impossible to seperate from the real thing without analysis or damage to the coin, which is why you need the paperwork when you sell the coins