Oldtent Archives 2010

when she’s not tripping over sandpaper, planes, saws, bits of cable, tins of paint and varnish?

Malaysia, a little north of Singapore and deeply immersed in a 30 year refit. We have Wifi but it’s so hit and miss that there are many days when I can’t drop in to the Tent. Mrs Lifeboat cheers those days, she reckons that’s when productivity increases!

Bill:
The CSI NY episode on tungsten bars airs mar 10 the 10:00 EST.

Still find if hard to believe that they won’t pull it - but my source is close to the production, that’s cetain.

Keep up the great work.
Will

should da ,wisha, hadda ,nope just on the watch list ,,but my little CPRK  [ Copper King Mining]   jumped  85.71% today ,,,,75% yesterday ,,,,,Can’t hit em all

…….Homework,,?….Hmmmmm

Ummmmm, as soon as I find out what my opinion is I’ll be sure to let you know. In the meantime my banners are curiously devoid of long-term emblems. So maybe that’s my opinion - being flexible. Except on PMs. There’s no doubt there at all, they’re the only solid ground in a sea of madness.

BTW, you gave me some homework the other day. I’m working on it…..

….actually its because each voter can vote twice…

….I tried to pick some posters with unique perspectives ….there are many more….but this group is a good cross section…

Speaking of the coming CFTC hearings, GATA made the FT again…

GOLD

Published: March 5 2010 09:46 | Last updated: March 5 2010 16:09

Gentlemen, please check your tinfoil hats at the door. Later this month, America’s commodities markets regulator will hold what should prove to be one of its more colourful hearings to address the gripes of an enthusiastic group of precious metals owners. Not content with having trounced most other investors over the past decade, they claim they have been deprived of far larger gains in, among other things, a “gold price suppression” conspiracy co-ordinated by the federal government and large banks.

Concrete action is unlikely – similar hearings in 2004 and 2008 yielded none – but do not expect the gadflies to be mollified either. Their claims that US government gold reserves have been sold without public knowledge to force down prices and support its fiat currency are tough to disprove categorically. Persistent net short positions on US futures exchanges would suggest something fishy if one believed there were no private contracts to offset them elsewhere.

This mix of fact and innuendo has long energised a small, impassioned audience, but record deficits and central bank money printing make their concerns resonate more broadly. They have also found an outlet among some right-wing radio stars, many of whom are also shills for bullion brokers. A comedian recently lampooned the connection in an advertisement for a fictional company using apocalyptic imagery urging customers to buy “gold, women, and sheep.”
But there is no such thing as bad publicity. A sceptical mention in this newspaper encouraged one group to rejoice, noting that this “just takes a while when you’re fighting all the power and money in the world.” Readers who laugh should remember that goldbugs are laughing all the way to the bank. In the words of tycoon Howard Hughes, “I’m not a paranoid deranged millionaire. Dammit, I’m a billionaire.”

www.ft.com/cms/s/3/fe12d070-283b-11df-9f8f-00144feabdc0.html

-END-

Even more astonishing, The Economist’s “Buttonwood” column has come close to saying there is a purpose to holding gold:

“To some, the lesson of all this is clear. If all the issuers of paper money want to see their currencies depreciate, then the only answer is to own an asset that central banks cannot debase—namely, gold. Part of bullion’s rise to more than $1,100 an ounce this year must be attributed to the conviction that governments will inflate away their debts.”

See “Race to the bottom”

www.economist.com/business-finance/displaystory.cfm?story_id=15606339

I posted to Molyminer this morning, thanking him for mentioning it to me several weeks, ago.  I own call options out in June and September.

Another chart I like is that of Etruscan……….EET.TO.  I have posted the charts of EDV.TO and CRU.TO that have broken out.  EET.TO is apparently the second leg of 3, along with CRU.TO, that EDV.TO plans on merging together into a mid-tier Gold producer in West Africa……….ala the AUY deal they did in fairly recent times.  If you look at a weekly chart of EET.TO, it is very similar to the chart of EDV.TO before the recent break-out.

“The planter, the farmer, the mechanic and the laborer form the great body of the people yet they are in constant danger of losing their fair influence in the Government. The mischief springs from the power which the money interest derives from a paper currency which they are able to control.” … Andrew Jackson, 7th President of the United States and central bank slayer par excellence

….From Midas

I’ve got an iron hand on the tiller…… thanks…..

I love Cotes de Rhone

Have been to Chateauneuf du Papes and did some cellar tastings……saw the boulders in the vineyard that work their magic

Tonight I took Mrs Winedoc out for dinner….we split a Nobilo NZ Sav Blanc

Have great evening

We go up from here

Winedoc

the uraniums held their position.
URZ & USU still lock good.
URRE looked good inthe AM
Patience will yield returns.
Best regards.
PS enjoyed a great Cote de Rhone this evening.

did anybody have a position in Gmo today?

We all made it through another week…Thank the Lord…good times will come……

The Constitution defines the dollar. It is a certain amount of gold. The paper receipts that at one time were known as U.S. Treasury notes were a representation of that dollar. Later there was a time when some of the notes were not issued by the Treasury, but by private banks. If the bank went out of business, what was the value of the note issued by that bank?

Converting the notes to a gold eagle would not necessarily be deflationary, if increasing amounts of notes and note equivalents continued to be issued.

Later, the system changed and the notes were issued but some were not convertible. Later, the system changed again and no notes were convertible.

Volatility of price due to a failure of the market to act as a fair pricing mechanism is not inflation, nor is it deflation. A fast or a slow rise in prices of some things is an attempt by the market to adjust to a fair price. So is a fall in price when the market is volatile.

A dump of fiat money into the market could be inflationary. But a dump of some fiat currency-money into a failed system is unlikely to be close to that which it needs. Is the collapse of credit and credit equivalents and the credit markets measureable when there is no fair way to measure the amount of value in them?

The derivatives phoney market has shown what happens when a fire hose is connected to the garden hose to attempt to refill the empty lake. The small hose has burst. It was the banking system and their system of stabliizing the commercial credit markets. It has been documented that they are reducing aggregate lending. This is deflation. The fire hose analogy describes what we had from the early 1990s. It wrecked the stability of the old system. The government might wish to use its fire hose. But the need won’t be filled because the commecial credit system has been broken.

Can a water bucket full of holes and leaking heavily be filled? Or do we need a new bucket? I think that the bucket is going to empty faster than it can be filled.

I think that to stop the mindless panic in the credit and other markets the deflation in these and other markets needs gold to plug the holes in the bucket. This will stop the deflation and it will stop the efforts to introduce inflation in a failed system.

Sinclair is describing his way of using gold to do this.

Friday, March 5th, 2010

Health Plan Backers Are Out on a Ledge

When we described the Obama-Reid-Pelosi healthcare monstrosity a couple of months ago as the Bill That Wouldn’t Die, we didn’t mean that literally. We were exaggerating, as you may have surmised, and we fully expected the legislation to smother quickly under the weight of its largely unread 2,000 pages. What convinced us that the legislation could not possibly pass was a lengthy and well-argued Wall Street Journal editorial that labeled it “The Worst Bill Ever”.  The Journal proved its case as far as we were concerned, and we thought it would carry some weight with millions of readers and Washington politicians.

How wrong we were. Not only is the bill alive and kicking, but now House Majority Leader Pelosi reportedly is confident that she can deliver enough votes to get it passed.  She pledged the other day to do so even if it threatens the political careers of some Democrats.  For sure, these guys are serious. But the damn-the torpedoes attitude is perplexing, given that the torpedoes are very real; for in fact, voters are actively hostile toward the bill and the likelihood that they will retaliate against the Democrats in November is high. It is not just some Fox-network pipe dream that the elections will bring a quick and merciful end to the Democrats’ strong majority-control of Congress.

Read the Rest of the Article

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ECH10 – March Euro (Last:1.3584)

The daily chart of the Euro futures gives us a sense of how far the euro might react in either direction to the non-farm payrolls report, which often sends markets scurrying one way or the other, or both.  One of the two patterns in question began more than a month ago with a compact but significant impulse wave that surpassed three prior lows back in the middle of 2009.  This D target is at 1.3398, and although the euro’s recent decline affords other, lower pivots, let’s take them one at a time.  The highest hidden pivot that recent trading can give us is at 1.3854, which will be in effect so long as 1.3550 holds.

the Cardium tight-oil formation underlying southwest Saskatchewan. Have a good weekend. Equiz.

tinyurl.com/yjevt4r

It makes no difference since investors believed that they could freely swap their fiat paper for Gold so they sold everything into a deflation death spiral believing that the Dollar was as good as Gold.  Your theory was never tested in the deflation death spiral of the 1929 era.  Thus, the reality was one of Dollar Deflation.

There wasn’t enough gold.

Just as today, the govt. could announce convertibility at $1,300 per oz.  Anybody could take their notes in, but it would be first come first served as they don’t have enough (assuming they have any at all).

Yes, I believe you are correct.  If one could go to the bank and exchange 20 paper Dollars for Gold, then the currency was backed by Gold.  Any argument of “if, but, or and” is simply futile.  The fact you stated is exactly why the Dollar was in a state of deflation as people knew they could turn their paper currency into Gold.  The Deflation state of the Dollar created the 1929 environment of Deflation where anybody could, and did, simply sell everything off in a deflationary death spiral because they knew they could go to fiat cash which was “as good as Gold.”  Thus, a chart of the Dollar in the 1929 era would have been a flat line just like the “set price” of Gold…………..a strong Dollar = Dollar Deflation.

This is exactly opposite of today, as you well know.  The Dollar has trended lower over the LT with the Dollar sitting around decade lows, screaming “Help, I’ve fallen and can’t get up.”  The deflation heads refuse to accept the Dollar Inflation at hand as they only see the FRB system in terms of Dollar inflation.  The second leg of Dollar inflation is devaluation through debt monetization which has nothing whatsover to do with the FRB system.  The delusion is in thinking that inflation can only be created through the FRB multiplication system- though Dollar Devaluation was the means of inflation in the early 30’s.  Dollar Devaluation in a floating fiat scheme can be done through either the FRB system, or outside that system by monetizing debt.  The derivative problems are guaranteeing that devaluation through debt monetization will expand world-wide creating simultaneous global currency inflation——-> Global competitive currency devaluations.  Along with it, the fiat index pricing schemes will (like the late 70’s) fail to function in terms of currency value as they have been created as a pure smoke and mirrors scheme to confuse the deflationists  less wary investors.

Thus, in many ways we are looking at an analogy to the late 70’s due to the similar “state of the currency” as the driving force of the markets, both locally, and world-wide.  This has been my thesis all along.

No,  Anybody, any individual or any foreign government could in 1911, upon demand, simply exchange a US note for gold or silver. After FDR then , perhaps one could begin to make a case of a ponzi scheme…but. surely not before. 

Here is an excellent video that explains how a “Fractional Reserve” gold standard works.

video.google.com/videoplay?docid=-2550156453790090544#