Gold strategy in the current economy

[Locke]

1 hour ago, Arpeggio said:

Stablecoins

And how has that gone historically?

1 hour ago, nero120 said:

The same way that one would peg a fiat currency to a head asset - via TRUST.

Indeed. The only thing I can think of off the top of my head is for public accounting/auditing of bullion vaults- allows unallocated sales to be much less dodgy than they currently are, but that would kind of defeat the purpose of globohomo state run gold vaults which is to rehypothecate the gold hundreds of times over.

1 hour ago, nero120 said:

But most crypto proponents understand neither money or crypto (or tech in general for that matter).

I wouldn't say a state lackey who is promoting a CBDC is a crypto proponent, but yes maybe one in a million people fundamentally understands money.

[Arpeggio]

1 minute ago, Locke said:

And how has that gone historically?

With so much crypto being speculative / bubbles I would think not much interest in Stablecoin. Tell me more?

....and what are your thoughts on this? China Gold reserves to be revealed in Central Bank Digital Currency announcement that threatens U.S. currency hegemony

"On the State of the Markets podcast, Hunt said he believes all will revealed upon the launch of a new Central Bank Digital Currency.....But could China and its allies be about to surprise the world by backing its digital currency by physical gold?"

Possibly of interest, Harvard article: https://hbr.org/2021/08/stablecoins-and-the-future-of-money

I'm not a fan of CBDC / cashless, and otherwise have a common interest in this thread with most other posters on it. Sorry for going off Gold a bit, but I find it relevant.

[Locke]

7 minutes ago, Arpeggio said:

Tell me more?

They are inherently scams designed to rinse money out of boomers who are attracted to words like "stable" and "guaranteed".

9 minutes ago, Arpeggio said:

But could China and its allies be about to surprise the world by backing its digital currency by physical gold?"

I think it's nonsense. The point of a CBDC is to enable a State to extract more wealth than traditional fiat from the humans living within its claimed geographic area of operation. If the fig leaf of "backed by gold" serves that, then they will do it, but from a practical perspective it will have zero weight.

9 minutes ago, Arpeggio said:

I'm not a fan of CBDC / cashless, and otherwise have a common interest in this thread with most other posters on it. Sorry for going off Gold a bit, but I find it relevant.

Gold has a long history as a method of accounting and so competing accountancy methods are relevant.

It doesn't matter if China has most of the gold. 

Look, if you lived on an island with 10 people and there was 10kg of gold in little coins and one guy owned 9.5kg of these coins, while the rest of you had 500g distributed among you, how much in gold would you charge him for a service such as retrieving coconuts compared to the rest of you?

This just means that you will have gold deflation in the West and gold inflation in the East and it balances itself out. Of course, the governments will have something to say over that and there will likely be some level of violence.

 

The thing you have to understand is that value does not exist. If you don't grok that at the base of your lizard brain, you will never understand what is happening with currencies.

Gold has no intrinsic value, because value does not exist. Gold has physical properties which have made it attractive to measure the imaginary concepts of wealth and value, but that does not mean it will always be the no.1 accounting solution. It also has serious downsides such as being very open to enabling physical theft.

Bitcoin is an open, encrypted record of transactions which depends on the commitment of its users to keep it secure. This makes it very attractive for a wide variety of everyday use cases and that is where its value comes from.

A major reason that the Chinese government has been able to accumulate all this gold is that the People in the West have lost their way spiritually. Socialism is in vogue and we, collectively, have allowed ourselves to be bamboozled by false promises of something-for-nothing and thereby permitted real economies to move to China, India, etc where they would not in a natural (i.e unmanipulated) market.

[Arpeggio]

6 hours ago, Locke said:

They are inherently scams designed to rinse money out of boomers who are attracted to words like "stable" and "guaranteed".

I think it's nonsense. The point of a CBDC is to enable a State to extract more wealth than traditional fiat from the humans living within its claimed geographic area of operation. If the fig leaf of "backed by gold" serves that, then they will do it, but from a practical perspective it will have zero weight.

Gold has a long history as a method of accounting and so competing accountancy methods are relevant.

It doesn't matter if China has most of the gold.

I understand in the context of what you are saying. With CBDCs it is a fig leaf to the ulterior motives. This was my concern of CBDCs than over who has most gold.

6 hours ago, Locke said:

Look, if you lived on an island with 10 people and there was 10kg of gold in little coins and one guy owned 9.5kg of these coins, while the rest of you had 500g distributed among you, how much in gold would you charge him for a service such as retrieving coconuts compared to the rest of you?

This makes sense. Would I be right in saying however, that after a parity is reached, it becomes a meritocracy.

6 hours ago, Locke said:

This just means that you will have gold deflation in the West and gold inflation in the East and it balances itself out. Of course, the governments will have something to say over that and there will likely be some level of violence.

A shame that governments tend to be greedy lazy b*stards and don't like meritocracy or self sufficiency.

6 hours ago, Locke said:

The thing you have to understand is that value does not exist. If you don't grok that at the base of your lizard brain, you will never understand what is happening with currencies.

............OK

I would assume you agree value does exist in work, innovation etc. The common language that can translate this value in trading concerns me, by which I mean the currency of course. I would like a currency that can't be devalued and manipulated, thus distorting and destroying aforementioned value. I don't think that will happen unless enough people want it and not want to speculate or be economic rent seekers. While surely, speculation and economic rent seeking would not be anywhere near as damaging in such circumstance.

6 hours ago, Locke said:

Gold has no intrinsic value, because value does not exist. Gold has physical properties which have made it attractive to measure the imaginary concepts of wealth and value, but that does not mean it will always be the no.1 accounting solution. It also has serious downsides such as being very open to enabling physical theft.

You can't eat gold and it wont give you a lift to work, being the kind of context I understand you are coming from here.

Apparently some Venezuelans are trading with Gold as a currency, due to the currency becoming worthless: https://services.ftn.media/gold-being-used-currency-venezuela

In Georgia it's potatoes apparently. In terms of value this is better than fiat, if only transferable for one use to the seller in exchange for potatoes (eating).

6 hours ago, Locke said:

Bitcoin is an open, encrypted record of transactions which depends on the commitment of its users to keep it secure. This makes it very attractive for a wide variety of everyday use cases and that is where its value comes from.

OK. This makes me think of the crypto guys who are dying mysteriously.

https://www.albawaba.com/node/3-crypto-billionaires-die-mysteriously-1501732

"one of them tweeted on the same day of his death that he is allegedly targeted."

6 hours ago, Locke said:

A major reason that the Chinese government has been able to accumulate all this gold is that the People in the West have lost their way spiritually. Socialism is in vogue and we, collectively, have allowed ourselves to be bamboozled by false promises of something-for-nothing and thereby permitted real economies to move to China, India, etc where they would not in a natural (i.e unmanipulated) market.

Agreed 💯

[nero120]

1 hour ago, Arpeggio said:

You can't eat gold and it wont give you a lift to work, being the kind of context I understand you are coming from here.

I always find it curious whenever I hear people say this, like talk about the point being missed entirely. Gold is money, not food or a ride. Gold, being money, will always buy you food or a ride. Anywhere, anytime.

https://youtu.be/9QRPhSJWxR8?t=51

[Locke]

9 hours ago, Arpeggio said:

This makes sense. Would I be right in saying however, that after a parity is reached, it becomes a meritocracy.

You would stop soaking him just for the fact he had most of the gold. Meritocracy is a tricky word. No human interactions are purely based on merit. If you were running a shop, you might give a discount to a woman because you like the shape of her boobies.

9 hours ago, Arpeggio said:

A shame that governments tend to be greedy lazy b*stards and don't like meritocracy or self sufficiency.

Governments don't exist. The people who label themselves as part of a government are always people who predate on humans, because the primary purpose of Government is to do exactly that. If you were interested in helping people, you wouldn't make it very far in a government. Look at Trump; a product of the internet age of memes (a manifestation of the Will of the People, he could not have come about in any other age), the deep state managed to neuter most of his obviously good-for-America actions.

At some point, a government becomes so corrupt that the members lose sight of the long term, or outright destroy it, to enrich themselves in the short term.

9 hours ago, Arpeggio said:

I would assume you agree value does exist in work, innovation etc.

No I would not. There is no value. 

9 hours ago, Arpeggio said:

The common language that can translate this value in trading concerns me, by which I mean the currency of course

Currency is an accounting system which comes about because having such a system in place increases the output of a society of people and outcompetes systems of barter economically.

9 hours ago, Arpeggio said:

I would like a currency that can't be devalued and manipulated, thus distorting and destroying aforementioned value.

Right, and that is personal preference. The prevalence of fiat currencies shows that a substantial fraction of people prefer to be controlled violently.

9 hours ago, Arpeggio said:

I don't think that will happen unless enough people want it and not want to speculate or be economic rent seekers.

Yep

9 hours ago, Arpeggio said:

While surely, speculation and economic rent seeking would not be anywhere near as damaging in such circumstance.

The participants would all be there by choice.

9 hours ago, Arpeggio said:

You can't eat gold and it wont give you a lift to work, being the kind of context I understand you are coming from here.

That applies to all currencies. Fundamentally, there is no such thing as value. It is not real.

9 hours ago, Arpeggio said:

OK. This makes me think of the crypto guys who are dying mysteriously.

https://www.albawaba.com/node/3-crypto-billionaires-die-mysteriously-1501732

"one of them tweeted on the same day of his death that he is allegedly targeted."

I think the kind of person who becomes a big figure in crypto circles is likely to be the kind who attracts this kind of drama. On the other hand, Hillary Clinton has actually whacked a list of people 2 feet long.

 

[Locke]

7 hours ago, nero120 said:

I always find it curious whenever I hear people say this, like talk about the point being missed entirely. Gold is money, not food or a ride. Gold, being money, will always buy you food or a ride. Anywhere, anytime.

No it won't. I can think of a dozen scenarios in which I would not want to have gold.

I like gold, I think it is a good vehicle for wealth (which again, does not exist), but it is not a sine qua non for money/currency. It does have downsides and unlike what people think, a counterparty; the palatability of it for your potential trading partners.

[nero120]

43 minutes ago, Locke said:

No it won't. I can think of a dozen scenarios in which I would not want to have gold.

"No it won't" is not an argument, but no ones forcing you to hold gold so do whatever you think is best. Good luck with that.

45 minutes ago, Locke said:

I like gold, I think it is a good vehicle for wealth (which again, does not exist), but it is not a sine qua non for money/currency. It does have downsides and unlike what people think, a counterparty; the palatability of it for your potential trading partners.

Gold is not "wealth" (which, by the way, is a concept not a tangible item, so yes it does exist but not in the way you seem to be thinking of it) it is money. Currency is not money, it is a money-substitute (didn't you ever wonder why most bank notes say something like "I promise to pay the bearer..."). Gold, being money, has no counterparty! Jesus, I don't think you understand that half the words you are using don't mean what you think they mean. 

[Locke]

1 hour ago, nero120 said:

"No it won't" is not an argument, but no ones forcing you to hold gold so do whatever you think is best. Good luck with that.

I do hold a substantial amount. You said 

10 hours ago, nero120 said:

Gold, being money, will always buy you food or a ride. Anywhere, anytime.

There are times and places when that's not true, so "No, it won't." is a complete argument.

1 hour ago, nero120 said:

I don't think you understand that half the words you are using don't mean what you think they mean.

I'm genuinely interested to see you define the words "money" and "currency"

[Arpeggio]

8 hours ago, Locke said:

You would stop soaking him just for the fact he had most of the gold. Meritocracy is a tricky word. No human interactions are purely based on merit. If you were running a shop, you might give a discount to a woman because you like the shape of her boobies.

She might be fobbing me off with fools boobs.

I would have to examine them fully. Get my monacle out. You can't fully replicate or imitate good boobs. Anything else is fake.

8 hours ago, Locke said:

Governments don't exist. The people who label themselves as part of a government are always people who predate on humans, because the primary purpose of Government is to do exactly that. If you were interested in helping people, you wouldn't make it very far in a government. Look at Trump; a product of the internet age of memes (a manifestation of the Will of the People, he could not have come about in any other age), the deep state managed to neuter most of his obviously good-for-America actions.

The higher you go the more that seems the case. I called it the exponential sh*t filter long before 2020. The FDA & CDC are at peak as I have exemplified previously elsewhere.

8 hours ago, Locke said:

Currency is an accounting system which comes about because having such a system in place increases the output of a society of people and outcompetes systems of barter economically.

Yes. Like a common language that translate 12 eggs = 10 carrots = 2 melons = 2 pints of milk, when it's easier to do it by a price from a currency.

8 hours ago, Locke said:

Right, and that is personal preference. The prevalence of fiat currencies shows that a substantial fraction of people prefer to be controlled violently.

I think they are ignorant.

[warpig]

On 23/11/2022 at 21:35, Arpeggio said:

Better late than never. What are your views on CBDC being backed by Gold as way to get people into accepting CBDC?

I meant to reply to this. The Western monetary system has been sacrificed in the pursuit of crude oil. For Western dominance to continue, it has to instill trust in the new CBDCs and so it has to be back-stopped with something, because our trust in Western governments is close to collapse. It's an open secret the East can smell Western blood and are vying for global financial dominance. It's also clear the East has been buying gold hand-over-fist for at least 15 years. China are estimated to have 30,000 tons of gold Vs the US's 8,000 tons and that's if the US hasn't leased it into oblivion... If Western financial powers are to compete with the BRICS on an international financial stage, it will have to be backed by gold, although I'm pretty sure it will be backed by other physical assets too. Domestically I don't believe it has to be backed by gold... but internationally... do Western powers have a choice?

[warpig]

On 19/12/2022 at 15:17, Locke said:

The thing you have to understand is that value does not exist. If you don't grok that at the base of your lizard brain, you will never understand what is happening with currencies.

Gold has no intrinsic value, because value does not exist. Gold has physical properties which have made it attractive to measure the imaginary concepts of wealth and value, but that does not mean it will always be the no.1 accounting solution. It also has serious downsides such as being very open to enabling physical theft.

We have basic needs... food, shelter, water and security. Anything you can source and trade means it has value. Therefore value is intrinsic to the natural world. Excess value has historically been stored in gold... and this will continue, because there's nothing as permanent as gold.

Bitcoin is the most commonly stolen, fragile and lost financial asset of all time.

[scottbeard]

12 hours ago, warpig said:

Bitcoin is the most commonly stolen, fragile and lost financial asset of all time.

I'm going to go out there and say cash is stolen more commonly than Bitcoin.

[nero120]

1 hour ago, scottbeard said:

I'm going to go out there and say cash is stolen more commonly than Bitcoin.

But the centralized nature of crypto exchanges means you can steal far larger amounts far more easily. Crypto has only been around for 14 years, yet how many billions have already been stolen?

[Locke]

On 20/12/2022 at 22:29, warpig said:

Anything you can source and trade means it has value. Therefore value is intrinsic to the natural world.

What is the value of a sealed bottle 1 litre of potable water?

On 21/12/2022 at 11:57, nero120 said:

But the centralized nature of crypto exchanges means you can steal far larger amounts far more easily. Crypto has only been around for 14 years, yet how many billions have already been stolen?

The vast silver and gold hoards people keep digging up which did their original owners no good shows that precious metals have no merits as a currency.

See? I can do it too.

[Arpeggio]

7 hours ago, Locke said:

What is the value of a sealed bottle 1 litre of potable water?

A drink or watering some plants.

[nero120]

8 hours ago, Locke said:

The vast silver and gold hoards people keep digging up which did their original owners no good shows that precious metals have no merits as a currency.

Well s***, if you didn't just disprove the effectiveness of thousands of years of metallic currency standards across most civilizations in history in a single paragraph!

I don't know about anyone else, but I certainly feel privelaged to have witnessed this moment! Incredible!

Anyways... Merry Christmas and good luck with your bitcoin in 2023!

[Dreamcasting]

Bitcoin, gold, silver, classic cars, paintings etc etc only have a perceived value. People were selling plastic supemarket carrier bags from foreign countries on eBay UK a few years back as "rare collectibles" and people were buying them for stupid amounts of money.

[bodgittandscarper]

40 minutes ago, Dreamcasting said:

Bitcoin, gold, silver, classic cars, paintings etc etc only have a perceived value. People were selling plastic supemarket carrier bags from foreign countries on eBay UK a few years back as "rare collectibles" and people were buying them for stupid amounts of money.

Everything used as currency only has a perceived value.  You won't find out it's true value until you need to trade a unit of it to buy life saving medicine or even food to keep you family alive.

My money is still on gold and silver.

[Arpeggio]

On 20/12/2022 at 22:18, warpig said:

I meant to reply to this. The Western monetary system has been sacrificed in the pursuit of crude oil.

Wonder who this guy is?

(full vid on YouTube linked below on there too)

On 20/12/2022 at 22:18, warpig said:

For Western dominance to continue, it has to instill trust in the new CBDCs and so it has to be back-stopped with something, because our trust in Western governments is close to collapse. It's an open secret the East can smell Western blood and are vying for global financial dominance. It's also clear the East has been buying gold hand-over-fist for at least 15 years. China are estimated to have 30,000 tons of gold Vs the US's 8,000 tons and that's if the US hasn't leased it into oblivion... If Western financial powers are to compete with the BRICS on an international financial stage, it will have to be backed by gold, although I'm pretty sure it will be backed by other physical assets too. Domestically I don't believe it has to be backed by gold... but internationally... do Western powers have a choice?

I suppose it's how gold plays a role in exchange for things that are of usage value, like technology, IP, oil, labour etc. As you say if Gold plays a role / advantage, then other approaches might be needed for countries that have little.

https://www.aljazeera.com/economy/2022/11/24/ghana-plans-to-buy-oil-with-gold-instead-of-dollars

11 hours ago, Dreamcasting said:

Bitcoin, gold, silver, classic cars, paintings etc etc only have a perceived value. People were selling plastic supemarket carrier bags from foreign countries on eBay UK a few years back as "rare collectibles" and people were buying them for stupid amounts of money.

Like gold then but with a much narrower market?

A difference with collectibles might also be the time window for whichever generation it has value to, or in this case maybe a fad. I would assume Comic books would have less of a problem maintaining that window, whereas plastic supermarket carrier bags would be yet to prove themselves in such a way. Gold & PMs said to be timeless.

10 hours ago, bodgittandscarper said:

My money is still on gold and silver.

If you keep it in a plastic supemarket carrier bag from a foreign country you got from eBay, but there is a fire you can just pick up your melted blob.

Edited December 24, 2022 by Arpeggio

[warpig]

On 23/12/2022 at 15:13, Locke said:

What is the value of a sealed bottle 1 litre of potable water?

I would need a mountain of information that you can't provide, so it's a bit of a meaningless question.

Edited December 25, 2022 by warpig

[warpig]

3 hours ago, Arpeggio said:

Wonder who this guy is?

(full vid on YouTube linked below on there too)

In the 80's when that video was made, they thought "crude" oil would last forever or so far into the future that we didn't need to think about it in our lifetimes... well apart from one person - Marion Hubbert. You will find a mountain of propaganda that says peak oil isn't real or it's so far into the future we shouldn't concern ourselves, I would even describe it as a global conspiracy to conceal how quickly we're running out. The 2 German and US military reports in 2010 that were leaked onto the web, described the potential collapse of western civilisation once the point of peak oil was reached, because we're then in a period of decline. We're now 12-17 years passed the peak of "crude" oil (depending how you measure it) and the effects have largely been offset with low IRs for tar sands/shale oil and synthetics, but even making up that shortfall is becoming difficult. Hubbert will be vindicated, but not before they destroy his reputation for revealing the frightening truth of the situation. It's staggering that we're in "crude" oil decline at exactly the same time as there's a CO2 crisis... and we're going to be encouraged not to drive or fly. What are the odds of those 2 events colliding I wonder.

[Arpeggio]

On 25/12/2022 at 01:15, warpig said:

In the 80's when that video was made, they thought "crude" oil would last forever or so far into the future that we didn't need to think about it in our lifetimes... well apart from one person - Marion Hubbert. You will find a mountain of propaganda that says peak oil isn't real or it's so far into the future we shouldn't concern ourselves, I would even describe it as a global conspiracy to conceal how quickly we're running out.

The interesting part for me, was at the 2 minute mark where he said the basis of oil being a fossil fuel was that it is made of Hydrogen, Oxygen and Carbon.

It is very fortuitous that the oil industry said this at the time and that banana cake is a fossil fuel, as are most cakes.

On 25/12/2022 at 01:15, warpig said:

The 2 German and US military reports in 2010 that were leaked onto the web, described the potential collapse of western civilisation once the point of peak oil was reached, because we're then in a period of decline.

It gives you a warm feeling to know that industries that protect the petro-dollar and wage war over it, kill and blow chit up, making a lot of money in the process & leaving countries a wreck, are always looking out for you, and always leak you the truth.

On 25/12/2022 at 01:15, warpig said:

It's staggering that we're in "crude" oil decline at exactly the same time as there's a CO2 crisis... and we're going to be encouraged not to drive or fly. What are the odds of those 2 events colliding I wonder.

100% chance, seeing as both foreboding catastrophes over oil and environment in various forms, have been going on for decades. It was just a matter of the time being right for alignment. Nothing to do with the financial system of course.

Edited December 26, 2022 by Arpeggio

[warpig]

Gold looking healthy... the USDX index looks like it has topped (for now at least...) Silver is leading gold, which is a good sign... The rumour Russia are about to unleash shock and awe on Ukraine as the ground freezes and this will fire up gold are possibly true. Rumour is gold will now rise until mid 2023.

[warpig]

On 26/12/2022 at 19:52, Arpeggio said:

100% chance, seeing as both foreboding catastrophes over oil and environment in various forms, have been going on for decades. It was just a matter of the time being right for alignment. Nothing to do with the financial system of course.

The bit people fail to understand about peak oil "production"... is how critical the halfway point is. They falsely assume we've got half left, "so what's the problem?" What they fail to consider is the global population doesn't stop increasing at the peak of the crude oil bell curve and the peak is an extremely short period of time. After this point, we're in terminal decline... someone somewhere is going without oil, because scarcity prices them out of the market and that decline compounds, because its exponential on the way up and on the way down. It's axiomatic that if our rapid western dominance was a function of oil, that our decline will be equally as rapid. They say 1 barrel of crude oil is the equivalent to 2 years of 1 man's manual labour. Others estimate it at 12.5 years of 1 man's labour.

The world isn't talking about running out of crude oil at all, the silence is deafening... and paradoxically to blame CO2 just as they fire up old coal power stations... is somewhat contradictory. A cynic might deduce the CO2 problem is Orwellian doublespeak to get the world to find commercial alternatives to crude as an energy source. The odds of the world being focused on CO2 levels from [coal|oil], just as we pass the peak of the crude oil bell curve, is 0% in my humble opinion.

In an emerging definancialised analogue world, it isn't a leap of faith to consider the resurgence of gold as a financial asset - an unlikely outcome. Gold, silver and crude oil are surely the investments of a lifetime from here.

Edited December 30, 2022 by warpig