A Store Of Value.

[scepticus]

All the above is irrelevant to the main point which was that in a collapse gold hyperinflates hence loaves costing 9$ of gold.

I agree family and skills and some means of employing both productively is the best defence. Thats the real store of value.

To all those who think gold is a timeless store of value:

1 ZIMBABWE LOAF OF BREAD COSTED 9$ OF GOLD DURING THEIR COLLAPSE

How in the hell is that a store of value, (when you consider what a loaf would have costed when times were good)?????

[Injin]

then society has already collapsed, just the people are too stupid to realise.

Exactly.

Mutual voluntary exchange, the ability to plan for the future, wealth creation powered by the ability to refuse offers etc are almost dead in the west.

What's left are some habits from a better time - voting, some representative elements here and there but basically it's over, done for society. Everyone more or less is arguing about who should be forced to do what next and how badly the next guy should be punished for not obeying todays set of whims.

[Traktion]

All the above is irrelevant to the main point which was that in a collapse gold hyperinflates hence loaves costing 9$ of gold.

I agree family and skills and some means of employing both productively is the best defence. Thats the real store of value.

To all those who think gold is a timeless store of value:

1 ZIMBABWE LOAF OF BREAD COSTED 9$ OF GOLD DURING THEIR COLLAPSE

How in the hell is that a store of value, (when you consider what a loaf would have costed when times were good)?????

And how many Zimbabwe dollars would it cost? And the next day?

Relatively speaking, your gold would do better, even if things aren't as cheap as they were. At least you can still buy stuff.

I read the other day that Zimbabwe is now essentially using free market money. They often choose dollars at the moment, as they serve their purpose well:

"The fundamental change is that we have stopped printing money to cover our deficit," said Tendai Biti, the MDC's finance minister, who shrugs off death threats.

The hyperinflation crisis has in a sense solved itself. The Zimbabwe dollar faded away as the army and then everybody else refused to accept it. The US dollar is now the coin of daily life. Prices have been stable for months. "Forget about a local currency," said Mr Biti.

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/6526429/For-brave-investors-Zimbabwe-could-be-the-ultimate-turnaround-story.html

The state has failed and people are busy picking up the pieces and getting on with life - they don't need their government's fiat money to do this.

Of course, when the global reserve currency fails, it poses a "what will be used instead?" question.

[Lepista]

Interesting thought. In the state collapse scenario, where you say fags and booze might become a valuable trading commodity (a.k.a. "money"), what would happen to the huge reserves of whisky maturing in barrels in the depths of the scottish highlands...?

I guess they just get looted?

[scepticus]

And how many Zimbabwe dollars would it cost? And the next day?

Relatively speaking, your gold would do better, even if things aren't as cheap as they were. At least you can still buy stuff.

not as cheap? going from 30 cents to $9 is hyperinflation, alebeit a lesser one than zim$. Consider the case of a zim man with a job getting paid in zim $ and a man with no job and 4500$ of gold. The latter can buy 500 loaves of bread before he's stuffed. The man with the job is better off as long as he spends his money immediately, and is paid such that his wages increase with the inflation faster than gold depreciates.

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/6526429/For-brave-investors-Zimbabwe-could-be-the-ultimate-turnaround-story.html

The state has failed and people are busy picking up the pieces and getting on with life - they don't need their government's fiat money to do this.

The state failed because mugabe actively destroyed the country's means of production - its farms. After that there was hyperinflation when the country could not feed itself or import anything. The stabilisation has come about tthrough the power sharing agreement with tsvangirai and therefore through state (and internationally) led action. This has allowed exports to pick up a bit and brought in foreign currency in aid - hence their ability to use $.

[Injin]

not as cheap? going from 30 cents to $9 is hyperinflation, alebeit a lesser one than zim$. Consider the case of a zim man with a job getting paid in zim $ and a man with no job and 4500$ of gold. The latter can buy 500 loaves of bread before he's stuffed. The man with the job is better off as long as he spends his money immediately, and is paid such that his wages increase with the inflation faster than gold depreciates.

Hyperinflation is a massive increase in supply.

Still.

Relative changes in the amounts you can change one thing for another isn't any indication in and of itself of inflation (or deflation come to think of it.)

The state failed because mugabe actively destroyed the country's means of production - its farms. After that there was hyperinflation when the country could not feed itself or import anything. The stabilisation has come about tthrough the power sharing agreement with tsvangirai and therefore through state (and internationally) led action. This has allowed exports to pick up a bit and brought in foreign currency in aid - hence their ability to use $.

No, the state succeeded, which destroyed the economy, which then destroys the state.

This is the pattern of civilisation (thus far) you'll know it due to your marxism.

1) Freedom after a collapse of some kind.

2) People rebuild due to new found freedom

3) Parasites of various kinds move in

4) parasites multiply and start to organise

5) parasites grow too numerous and start to control the society they feed off

6) society stops being productive as freedoms diminish <-----We are here.

7) parasites die

8) collapse

9) goto 1)

Edited November 13, 2009 by Injin

[Traktion]

not as cheap? going from 30 cents to $9 is hyperinflation, alebeit a lesser one than zim$. Consider the case of a zim man with a job getting paid in zim $ and a man with no job and 4500$ of gold. The latter can buy 500 loaves of bread before he's stuffed. The man with the job is better off as long as he spends his money immediately, and is paid such that his wages increase with the inflation faster than gold depreciates.

And how many USD can they get with their gold now? How many USD can they get with their ZIM $ now?

The state failed because mugabe actively destroyed the country's means of production - its farms. After that there was hyperinflation when the country could not feed itself or import anything. The stabilisation has come about tthrough the power sharing agreement with tsvangirai and therefore through state (and internationally) led action. This has allowed exports to pick up a bit and brought in foreign currency in aid - hence their ability to use $.

Now the control of the currency is out of the hands of those who sought to abuse it, trade has picked up. Interesting, I would say.

[scepticus]

And how many USD can they get with their gold now? How many USD can they get with their ZIM $ now?

very few who started with some gold would have any left by now. A man who held a job through that time would liekly have acquired more assets to sell for $ than a man with no job and a little gold.

You are not listening and not acknowledging that I have shown that gold is not a store of value except in relative terms to some fiat currencies. But since fiat currency is not a store of value (a claim I have never made) then you can't argue that gold is a store of value by comparing it to fiat.

A store of value is a business, a skill or some asset like a house or garden. Even then there are no guarantees. We can see from zim that if the economy goes tits up no monetary tokens of any kind hold their value.

Now the control of the currency is out of the hands of those who sought to abuse it, trade has picked up. Interesting, I would say.

Not quite. The finance ministry is held by the MDC but other aspects of the economy are still controlled by ZANUPF. The process of restoring sensible currency to zim went like this:

1. avert civil war by a comprimise power sharing agreement

2. obtain international support due to 1

3. obtain foreign currency due to 2 and a pick up in exports

The reason things have picked up is because the worst of the fighting and destruction has ceased. Mugabe could have achieved this himself at any point had he stopped beating people up and confiscating farms.

Your view on money places it above all else but in the real world the value of the monetary system whether it be gold or paper is derived from the health of the underlying economy, not the other way round.

[Injin]

A store of value is a business, a skill or some asset like a house or garden. Even then there are no guarantees. We can see from zim that if the economy goes tits up no monetary tokens of any kind hold their value.

You can't store value.

It isn't possible.

That is all.

[lowrentyieldmakessense(honest!)]

Hyperinflation is a massive increase in supply.

Still.

Relative changes in the amounts you can change one thing for another isn't any indication in and of itself of inflation (or deflation come to think of it.)

No, the state succeeded, which destroyed the economy, which then destroys the state.

This is the pattern of civilisation (thus far) you'll know it due to your marxism.

1) Freedom after a collapse of some kind.

2) People rebuild due to new found freedom

3) Parasites of various kinds move in

4) parasites multiply and start to organise

5) parasites grow too numerous and start to control the society they feed off

6) society stops being productive as freedoms diminish <-----We are here.

7) parasites die

8) collapse

9) goto 1)

Yep

I like these lists

heres an old one

1) Dramatically shrinking economy, leading to

2) Soaring defaults, leading to

3) Massive bank losses, leading to

4) Severe contraction of lending, leading to

5) Further shrinking of economic activity, leading to

6) Collapsing tax receipts, leading to

7) Exponentially increasing budget deficit, leading to

8) Higher taxes, leading to

9) Further horrendous contraction of economic activity, leading to

10) Huge political pressure for easier credit and bank bailouts, leading to

11) Further dramatic expansion of the money supply, leading to (I THINK WE ARE HERE)

12) Runaway inflation and currency depreciation, leading to

13) Skyrocketing prices and long term interest rates, leading straight back to 1) in a vicious circle of biblical proportions

[dr ray]

Hyperinflation is a massive increase in supply.

Still.

Relative changes in the amounts you can change one thing for another isn't any indication in and of itself of inflation (or deflation come to think of it.)

No, the state succeeded, which destroyed the economy, which then destroys the state.

This is the pattern of civilisation (thus far) you'll know it due to your marxism.

1) Freedom after a collapse of some kind.

2) People rebuild due to new found freedom

3) Parasites of various kinds move in

4) parasites multiply and start to organise

5) parasites grow too numerous and start to control the society they feed off

6) society stops being productive as freedoms diminish <-----We are here.

7) parasites die

8) collapse

9) goto 1)

You know Injin, its the occasional post like this which make the rest endurable

<<hugs>>

[Traktion]

very few who started with some gold would have any left by now. A man who held a job through that time would liekly have acquired more assets to sell for $ than a man with no job and a little gold.

You are not listening and not acknowledging that I have shown that gold is not a store of value except in relative terms to some fiat currencies. But since fiat currency is not a store of value (a claim I have never made) then you can't argue that gold is a store of value by comparing it to fiat.

A store of value is a business, a skill or some asset like a house or garden. Even then there are no guarantees. We can see from zim that if the economy goes tits up no monetary tokens of any kind hold their value.

Why would they spend their gold if they had alternatives to spend? Either it has bought them what they needed in desperate times or they would still have some left.

Not quite. The finance ministry is held by the MDC but other aspects of the economy are still controlled by ZANUPF. The process of restoring sensible currency to zim went like this:

1. avert civil war by a comprimise power sharing agreement

2. obtain international support due to 1

3. obtain foreign currency due to 2 and a pick up in exports

The reason things have picked up is because the worst of the fighting and destruction has ceased. Mugabe could have achieved this himself at any point had he stopped beating people up and confiscating farms.

Your view on money places it above all else but in the real world the value of the monetary system whether it be gold or paper is derived from the health of the underlying economy, not the other way round.

He stopped being able to pay his military to oppress the populous with printed money. I would imagine this came before 1 or otherwise Mugabe would still be doing it. I agree he could have stopped doing it at any time instead though.

[scepticus]

You can't store value.

It isn't possible.

That is all.

I agree. The closest you can come is those things I cited.

There isn't a store of value. Gold is not a store of value as I have shown, however it may be a preferable means of exchange to the alternatives under particular circumstances.

We're on the same page here more or less. It's the goldbugs who've got things ass backwards.

[Game_Over]

You can't store value.

It isn't possible.

That is all.

Yes it is.

I've got 5000 tins of baked beans in my garage.

When the collapse occurs I won't even be swapping a tin for an ounce of gold

Because I can't eat gold.

But I can eat baked beans.

[scepticus]

The beans don't keep forever hence are not a store of value.

[Game_Over]

The beans don't keep forever hence are not a store of value.

They will keep longer than I will live, therefore, they are a store of value.

And even if they only kept 10 years, they would still be a store of value.

Your arguments are flawed.

But as I said on another thread, no one is actually interested when someone points out the obvious.

[dr ray]

Yes it is.

I've got 5000 tins of baked beans in my garage.

When the collapse occurs I won't even be swapping a tin for an ounce of gold

Because I can't eat gold.

But I can eat baked beans.

I hope you don't have to load it up on a mule or handcart when the collapse happens.

I'll be the one cycling past you with a pocketfull of sovereigns.

[Game_Over]

I hope you don't have to load it up on a mule or handcart when the collapse happens.

I'll be the one cycling past you with a pocketfull of sovereigns.

You can't eat sovereigns.

And our society survived for thousands of years precisely because value can be stored.

[dr ray]

You can't eat sovereigns.

And our society survived for thousands of years precisely because value can be stored.

There is societal collapse and starvation in many places in the world right now. Tell me, are those people starving because there is no food or because they dont have anything to buy it with.

Food is so plentiful they feed it to cattle and make fuel out of it. It is the means to purchase it that is the problem.

[scepticus]

There is societal collapse and starvation in many places in the world right now. Tell me, are those people starving because there is no food or because they dont have anything to buy it with.

Food is so plentiful they feed it to cattle and make fuel out of it. It is the means to purchase it that is the problem.

zimbabweans starved to death in their thousands.

Would you say a loaf of bread retailing for $8.91 (in gold or US$) is indicative of plentiful food supply?

Same goes for fuel.

[Number79]

I hope you don't have to load it up on a mule or handcart when the collapse happens.

I'll be the one cycling past you with a pocketfull of sovereigns.

the perfect example.

[Number79]

zimbabweans starved to death in their thousands.

Would you say a loaf of bread retailing for $8.91 (in gold or US$) is indicative of plentiful food supply?

Same goes for fuel.

was it all zimbabweans that were dying or just the poor ones? Those inside the cities and important cliques were not only continuing to put on weight but were quaffing the same delicacies as before.

there was plenty of food for those that could afford it although in the gap between the top and bottom being powerful was probably more important than money, although gold would stop you starving.

[scepticus]

was it all zimbabweans that were dying or just the poor ones? Those inside the cities and important cliques were not only continuing to put on weight but were quaffing the same delicacies as before.

there was plenty of food for those that could afford it although in the gap between the top and bottom being powerful was probably more important than money, although gold would stop you starving.

go and read up on it. They were 95% poor. Some were poorer than others.

Why, when previously zim was the breadbasket of africa?

Because mugabe destroyed their economy and the income of his people.

THEN he had to print.

[scepticus]

I hope you don't have to load it up on a mule or handcart when the collapse happens.

I'll be the one cycling past you with a pocketfull of sovereigns.

The following is a good explaination from a true collapsist believer to answer your little fantasy above:

In Zimbabwe the hyperinflation at the start sucked out most of the savings of gold and silver into circulation by people trying to sustain their existence...the trade deficit then caused all that gold and silver to circulate out and to not come back.

Currently all that is happening in Zimbabwe is the Government is issuing more and more money to pay for all the bonds it's issuing...

Following that path...The gold and silver bugs would begin having to spend their savings trying to survive until they were basically all gone...

Then once all the gold and silver was sucked out of the hands of the renters to the owners...hyperinflation would rocket.

None of you are owners unfortunately...

You mindless morons are so desperate...all it takes is the FED to mention that they are going to buy bonds...and all the inflationists begin to march in lockstep.

But the FED is going to avoid following the Zimbabwe path...Well not at first of course...They have to at least load all the suckers up on troop ships before they send them into the torpedos.

The FED has been threatening to hyperinflate for 7 years now...All the devout followers of the hyperinflationary jackpot religion think they are closer now than ever.

Everyone...The mindless morons...will leverage long...and once all you clowns are in...the top will short you all to oblivion and extract all that the mindless morons put in betting that this time is going to be the hyperinflationary jackpot.

Hyper why did AIG and the banks go bust?

Because they bet that inflation was going to last forever...and lost.

It's why the real estate sector collapsed.

The hyperinflationary jackpot bet was wrong...But the inflationists never seem to want to explain it.

It's just a classic case of the just think positive ignore the negative religion in action...or the just think inflation ignore deflation religion.

They just keep looking at Zimbabwe and dreaming about panning for gold all day to afford to buy a large muffin being marketed as a loaf of bread.

[Number79]

go and read up on it. They were 95% poor. Some were poorer than others.

Why, when previously zim was the breadbasket of africa?

Because mugabe destroyed their economy and the income of his people.

THEN he had to print.

I know exactly why, doesn't change the fact that there was plenty of food for those with power, influence or gold though.