Gold Update: The small trade within the big trade

[bart]

Re: Gold Update: The small trade within the big trade

Thanks Bart, for sharing your 2008 gold trade ideas with the rest of us "unwashed masses". Kudos to Jim Sinclair also for sketching out this 'notional' projection for gold's price action back in mid-2007? Guy wasn't born yesterday. I think he posted this chart back in 3QTR 2007.

My pleasure Lukester, and who knows if I'll be correct on that best guess timing for an upcoming bottom. All I can really say is that I won't fight the market.

Very true on the general record of James Sinclair too. As long as one pays very close attention to him, the calls are there... and its far from as easy as reading EJ's work.

[Starving Steve]

Re: Gold Update: The small trade within the big trade

I am still out of gold--- except for my survival gold hedge. Remember that I recommended going out of gold at $907?

Here is what makes me bullish for gold long-term:

Bernankee
Bush
the FOMC
the Sierra Club
Greenpeace
solar roofs
windmills
solar lights
Hummers
Islamo-fascists

I look to get back into gold under $750.

The long-run trend in gold is set in oil prices. It is hard not to be bullish on oil with the idiots in Greenpeace and the Sierra Club having the ear of government.

[Jim Nickerson]

Re: Gold Update: The small trade within the big trade

I got an email alert that babbitd has posted the following in this thread, but I do not find it?????

So here is what the email said he posted:

Forbes.com (http://www.forbes.com/markets/feeds/afx/2008/05/07/afx4980314.html):

'With our fundamental and technical (foreign exchange) strategists negative EUR/USD and our oil strategist unenthusiastic about the prospects for further gains in crude oil, we continue to favour the downside in gold, targeting $850/oz in one month and $800/oz in three months,' said *UBS* analyst John Reade.


After reading John William's report brought to our attention by atreyu42 here, that report has for the moment solidified my thinking about precious metals. If EJ and Williams are correct, and sure as shit I am not prepared to argue with them, then gold and silver for that matter appear to be very decently priced in here NOW.

I'm even shaken enough by William's report to go buy some physical PM's.

[metalman]

Re: Gold Update: The small trade within the big trade

I got an email alert that babbitd has posted the following in this thread, but I do not find it?????

So here is what the email said he posted:

Forbes.com (http://www.forbes.com/markets/feeds/afx/2008/05/07/afx4980314.html):

'With our fundamental and technical (foreign exchange) strategists negative EUR/USD and our oil strategist unenthusiastic about the prospects for further gains in crude oil, we continue to favour the downside in gold, targeting $850/oz in one month and $800/oz in three months,' said *UBS* analyst John Reade.


After reading John William's report brought to our attention by atreyu42 here, that report has for the moment solidified my thinking about precious metals. If EJ and Williams are correct, and sure as shit I am not prepared to argue with them, then gold and silver for that matter appear to be very decently priced in here NOW.

I'm even shaken enough by William's report to go buy some physical PM's.

there's a very comprehensive discussion about inflation and deflation Door Number Two, worth a reread, and The End of Money

also found this from my search...

Warning about a dollar hyperinflation makes good theater but has little value from an investment perspective. As we've pointed out many times and most recently here in How to make $301% in six years with low volatility, dollar hyperinflation is not in the cards.

For a nation to experience a hyperinflation, all four of the following conditions need to be met:

1. Large and growing external debt as a percentage of GDP with falling GDP (Yes, like the US.)
2. Politically and economically isolated and irrelevant (Not like the US. Think: Zimbabwe.)
3. No external demand for the currency (Not like the US dollar. Think: Iraqi Dinar.)
4. Political chaos (i.e., tanks rolling down the street, not like the US.)

The US meets only the first condition. The US is certainly more politically isolated than in the past but as the world's largest economy is hardly irrelevant. The dollar is still a reserve currency so hardly meets the third criteria. The US is arguably one of the most politically stable on earth so the 4th condition is out.

Hardly the stuff of hyperinflation. That said, the value of a common share of USA, Inc.–the US dollar–will continue to come under pressure.

We're working up the "Ka-Poom" update. In the process of researching it we came across a new way of thinking about the issues and it's taking us extra time to digest and process this but it'll be worth the added wait, we hope.

and... last but not least... from 2005

Inflation is Dead! Long Live Inflation!

Five-Year 100% Inflation Scenario

If a Ka-Poom event happens, the inflationary part of the cycle might evolve according to the model below. The model predicts an inflation that results in a 100% increase in the general price level over five years, not far short of Price Waterhouse's definition of a hyperinflation, which is defined as 100% or more over three years. But keep in mind that the difference between a major inflation and a hyperinflation is not a matter of degree. Both result in a rapid increase in the general price level, but while a major inflation is due to a surfeit of money, a hyperinflation is due to a loss of confidence in a currency. While they are related, the key difference is that inflation is mostly a monetary event, while hyperinflation is primarily a psychological event, the process of a currency losing its function as a store of value in a society.

A major inflation can lead to a hyperinflation, but does not need to. The 100% inflation total that I use in the model is more or less arbitrary, used primarily to make the math easier. But there's no reason why in reality the inflation could not be either less or more. I have seen convincing arguments for 1000% inflation over a ten-year period, but few that anticipate an inflation of less than 50%. The Vietnam War period resulted in a 35% inflation over six years; it's hard to imagine how the additional amount of debt that needs to be monetized in our current period will not lead to inflation in excess of 35%.

We're likely to experience a major inflation in the U.S. as an outcome of the bond, housing, and dollar bubbles that came about as a result of past monetary and fiscal policy errors. In fact, a political decision process that favors inflation, as evidenced by the housing bubble, started in the mid-1990s. The U.S. may muddle through an adjustment to less reliance on foreign debt, and households may regress to the mean in terms of savings and debt, as John Mauldin suggests. That is my hope. But highly leveraged nations and households are prone to crises, and with little savings and much debt, the opportunity to muddle through a crisis is limited.

[Slimprofits]

Re: Gold Update: The small trade within the big trade

I got an email alert that babbitd has posted the following in this thread, but I do not find it?????

So here is what the email said he posted:

Forbes.com (http://www.forbes.com/markets/feeds/afx/2008/05/07/afx4980314.html):

'With our fundamental and technical (foreign exchange) strategists negative EUR/USD and our oil strategist unenthusiastic about the prospects for further gains in crude oil, we continue to favour the downside in gold, targeting $850/oz in one month and $800/oz in three months,' said *UBS* analyst John Reade.


After reading John William's report brought to our attention by atreyu42 here, that report has for the moment solidified my thinking about precious metals. If EJ and Williams are correct, and sure as shit I am not prepared to argue with them, then gold and silver for that matter appear to be very decently priced in here NOW.

I'm even shaken enough by William's report to go buy some physical PM's.

It was me that deleted it. Does UBS have any credibility left after the subprime meltdown? I was unsure about that one.

*************

Jim Sinclair is not backing away from this:

Jim Sinclairs Commentary
(Originally Posted May 4th)
According to the talking heads, the ECB is going into a race with the US Fed for lower rates. This has been the spin basis for the gold decline based on the spin of lower interest rates in Euroland to produce a euro decline.

1. Whatever the gold price was to do on the downside will end by the first week of May.
2. The US dollar is going to trade at .5200.
3. The euro will trade at a minimum of USD$2
4. The gold price will trade at $1650 on or BEFORE January 14th, 2011.
5. $1024 was the first price block on the first move above $1000.
6. My job is bottom identification, not tops, because there is no top to the gold price for a long time to come. I gave you $1024, but that is as close as I will come to calling any top before the top.

I last purchased at $904 but have been sitting on the sidelines since waiting for it to stabilize.

[Jim Nickerson]

Re: Gold Update: The small trade within the big trade

It was me that deleted it. Does UBS have any credibility left after the subprime meltdown? I was unsure about that one.

*************

Jim Sinclair is not backing away from this:


I last purchased at $904 but have been sitting on the sidelines since waiting for it to stabilize.

The problem as I see it with all information regarding investment is the burden of determining its credibility. I think everyone is aware of lying that takes place with those who have vested interests, and the screwed up reporting in the MSM, yet there is no lack of most of us continuing to reference many of the reports. This is no answer to the dilemma.

[FRED]

Re: Gold Update: The small trade within the big trade

The problem as I see it with all information regarding investment is the burden of determining its credibility. I think everyone is aware of lying that takes place with those who have vested interests, and the screwed up reporting in the MSM, yet there is no lack of most of us continuing to reference many of the reports. This is no answer to the dilemma.

Track record is king.

Was looking over old itulip stuff. ran across this, reminded me of you:

"One of the best rules anybody can learn about investing is to do nothing, unless there's something to do. Most people always have to be playing; they always have to be doing something. They can't just sit there and wait for something new to develop. I wait until there is money lying in the corner, and all I have to do is go over and pick it up. I do nothing in the meantime. Even people who lose money in the market say, "I just lost my money, now I have to do something to make it back." No, you don't. You should just sit there until you find something." - Jim Rogers, 1999

Found it here with this recession forecast from 2001:

http://web.archive.org/web/200102010...lip.com/#Quick

Question is, after reading John Williams today, "sit there" in what? Cash? No way, Jose.

[Jim Nickerson]

Re: Gold Update: The small trade within the big trade

Track record is king.

Was looking over old itulip stuff. ran across this, reminded me of you:

"One of the best rules anybody can learn about investing is to do nothing, unless there's something to do. Most people always have to be playing; they always have to be doing something. They can't just sit there and wait for something new to develop. I wait until there is money lying in the corner, and all I have to do is go over and pick it up. I do nothing in the meantime. Even people who lose money in the market say, "I just lost my money, now I have to do something to make it back." No, you don't. You should just sit there until you find something." - Jim Rogers, 1999

Found it here with this recession forecast from 2001:

http://web.archive.org/web/200102010...lip.com/#Quick

Question is, after reading John Williams today, "sit there" in what? Cash? No way, Jose.

Rather scary, eh, FRED. It scared me out of 100K of cash today.

You, or one of you FRED's, made it somewhat clear that there would be some on-going censorship here from yesterday. As an aside that pains me, but pertinent to the moment is that I would like someone, if someone exists, to cast Williams' perceptions with a negative light, i.e. say that he is wrong in something he wrote. And I am not asking the iTulip staff or EJ to do that, but it seems someone here in the audience would see something wrong with what Williams wrote. And I sure would like to read something by someone smart enough to argue against his perceptions.

[FRED]

Re: Gold Update: The small trade within the big trade

Rather scary, eh, FRED. It scared me out of 100K of cash today.

You, or one of you FRED's, made it somewhat clear that there would be some on-going censorship here from yesterday. As an aside that pains me, but pertinent to the moment is that I would like someone, if someone exists, to cast Williams' perceptions with a negative light, i.e. say that he is wrong in something he wrote. And I am not asking the iTulip staff or EJ to do that, but it seems someone here in the audience would see something wrong with what Williams wrote. And I sure would like to read something by someone smart enough to argue against his perceptions.

The "censorship" is called "moderation" on other sites. Incredibly, we have until recently very, very rarely had to do any. The community pretty well "polices" itself.

If someone here wants to spend bandwidth and disk space to make the case that some other site or other is better than iTulip they can go use that site's bandwidth and disk space to do so, not ours.

That's common sense. You don't go to your local bar and grill every night and spend half the night trying to convince everyone there how much it sucks, not unless you want to get thrown out by your fellow patrons. Not everyone gets it. Some folks are a little thick.

As for criticizing iTulip or the Freds or EJ or anyone else, knock yourself out.

[Jim Nickerson]

Re: Gold Update: The small trade within the big trade

The "censorship" is called "moderation" on other sites. Incredibly, we have until recently very, very rarely had to do any. The community pretty well "polices" itself.

If someone here wants to spend bandwidth and disk space to make the case that some other site or other is better than iTulip they can go use that site's bandwidth and disk space to do so, not ours.

That's common sense. You don't go to your local bar and grill every night and spend half the night trying to convince everyone there how much it sucks, not unless you want to get thrown out by your fellow patrons. Not everyone gets it. Some folks are a little thick.

As for criticizing iTulip or the Freds or EJ or anyone else, knock yourself out.

I guess the "knock yourself out" was directed at the general audience and not me in particular, hope it was.

When I ran across the reference to the Williams' article last night, I wondered if it would be something that might be censored. The answer seems clear, or I hope it is clear now, to be 'No."

I am going to offer up a constructive criticism of EJ, since you put out the invitation.

Generally when I run across something like Williams' April 8 article that is relatively long (23 pages in PDF--shit, had I realized that last night before I started, I might not have read it) it has to lead me to believe it is something special for me to take the time to read it. Everything Eric puts up I am compelled to read despite whatever its length, i.e. I just grant him that what he writes will be something special.

Eric, even though as I understand studied to be some sort of a journalist--I hope I recollect that correctly--is a terrible writer, of course, that is just this ole boy's opinion. It is pure labor for me to get through a lot of what he puts up, and it is difficult for me to get as much information from what he writes as there probably is to be gotten.

Written communication is a difficult "art" as I see it, and I think Eric referenced the hardships or labor involved with submitting articles to editors and then making whatever necessary changes to improve readability and, of course, to get one's references and facts correct.

Anyone can correct me on this, but Williams article was not difficult to read or to comprehend--I say that because after reading it, I was impressed by the gravity it conveyed, and I didn't feel that I struggled to get his points.

I had the opportunity (and mental need) to write some papers that got published in professional journals and chapters in some books when I worked as an oral surgeon. I can remember how wrapped up I would become in trying to get my points onto paper (on into a file). Most fortunately the chairman of my department had published a ton of work and fortunately for him his earliest papers were done under a mentor who was a very good writer. I used to take my drafts into him--triple line spaced--for him to make comments and criticisms. As some time and learning from this went on, I did improve in my own abilities to better communicate whatever were the facts or ideas, always striving to achieve that what was written would be comprehensible by any interested reader. It was tough, tough task. Then one sends these things to the publisher and after their editors go over it, there are still things that are pointed out that are not clearly stated or that could be better stated.

I have no idea how big an outfit iTulip is or what are its capabilities, but I take it that EJ is fully serious about operating it on some on-going basis. Its value to us readers is its content which is a reflection of his thinking. This is important stuff, that is my impression, for the readers who subscribe or visit here. It is of prime importance that his thinking is conveyed is a manner that is comprehensible to all us readers.

To me the easiet answer to this--and for all I know you may already be doing this--is to have someone who is a capable editor proof read and ask EJ for clarification of things that are not as clear as they might better be, and finding such a person may not be easy.

It might also be hard for some individuals in a subordinate position to make strong recommendations to their boss, but my boss would give each of us underlings his manuscripts--triple lined spaced--for us to read and make comments that would improve other's understanding, and he took our advices more often than not. In our writings metaphors were never acceptable except in the rarest of instances, metaphors make reading important information more difficult, and should be relegated rather much to creative writing.

It is always easy for people to complain and it is not possible to rid the world of complainers, but what I am trying to get across here is totally intended as constructive criticism, and reading through William's paper shows how comprehensible things can be communicated even to those of my ilk.

One last thing, proofing and revising articles slows down their reaching the screen, but in the long run for important stuff that is not critical.

[bart]

Re: Gold Update: The small trade within the big trade

...pertinent to the moment is that I would like someone, if someone exists, to cast Williams' perceptions with a negative light, i.e. say that he is wrong in something he wrote. And I am not asking the iTulip staff or EJ to do that, but it seems someone here in the audience would see something wrong with what Williams wrote. And I sure would like to read something by someone smart enough to argue against his perceptions.

I'm not saying I'm smart enough but I'll take a shot at it anyhow.

First and as you've observed elsewhere, what he's saying is not all that different from KaPoom... except in degree, and even there Mr. Williams did not specify an actual eventual rate of hyperinflation although he did define it as 4 digit and that the currency would become worthless... and EJ has even made mention of 4 digit hyperinflation, although my take is that he thinks it to be unlikely, and that 3 digits is more likely over a period of years.

Even his statement about a 90% loss (net of inflation) in US stocks isn't terribly different from the return to the mean that EJ has noted many times... and even my own chart of the CPI+lies adjusted Dow supports a 90% hit. The CPI+lies inflation adjusted mean is 1000-2000. The CPI only inflation adjusted mean is very roughly 3000-4000. Just to be clear too - that does not mean that the Dow will get that low. It could go to 30,000 or even much higher on a nominal basis.

I also urge a second look at the chart in the article - the one showing government obligations vs. GDP. The data for the US shows US government *obligations* where the section for the rest of the world show government *debts*... and there's a huge difference between the two. US gov't debts (including state & local) total about $11.5 trillion now, not the $60+ trillion of total obligations.
Also consider that neither India nor China have anything like Social Security payments, and also that a large portion of the US Medicare obligation is very recent.


And then there's the 2nd to last paragraph (emphasis mine):

What has been discussed here still has not been a comprehensive overview of all possible issues, but rather at least has raised some questions and touched upon some likely consequences.

In other words, there are no guarantees. Likely does not mean assured.


He also mentions Howard Ruff's book which is an update of his best seller from the late '70s... and *many* folk misunderstood Mr. Ruff back then as meaning that the society would collapse... and it didn't.
Will it be rougher now than in the '70s? - yes, I think so.
Are there always consequences to actions? - yes, of course.
How much rougher? - I wish I knew.
Is it all "black"? - not only no, but hell no!


Is there a danger now just like there was a danger then? - of course. And prudent people do make preparations for unexpected or unlikely events - that's called insurance. Insurance takes many forms, tangible assets like precious metals being just one.


And from that same last paragraph in the article:

No one can figure out better than you the peculiarities of this circumstance and how you and/or your business might be affected. Using common sense is about the best advice I can give.

There are other things I could bring up about the article, but I hope that this has helped.

[Jim Nickerson]

Re: Gold Update: The small trade within the big trade

Thanks, bart, and you are definitely smart enough to perceive short-comings in such an article.

It's interesting your mentioning the chart of Government Obligations versus GDP--2007. Man, if there is any chart I can recollect seeing that I accept as reinforcing a point, it is that chart.

The GAAP-accounting is what a U.S. corporation would have to show. The Administration’s rationale as to why Social Security and Medicare should remain off balance sheet runs along the lines that the government always has the option of changing the Social Security and Medicare programs. That said, there clearly is no one in political Washington willing to go public with the concept of eliminating or substantially cutting those programs. Such includes the prospective presidential candidates.

Consider that given the current financial condition of the government, various politicians are pushing ever further for expensive cradle-to-grave programs for the electorate, ranging from national health insurance to bailouts of mortgaged homeowners at risk of foreclosure. With no full funding available for any new programs, the government again is showing its willingness to spend whatever money it has to create. The intent going forward is inflation — hyperinflation. This circumstance has evolved with the full knowledge of political Washington and the Federal Reserve.

I guess through some leads you and others have put up, it has been amazing to just how much data the US government makes available to those on the internet. I have to presume Williams is smart enough to get it correct when he states the liabilities (obligations) exceed 60 TRILLION BONARS, shit, that is what the accompanying table shows, but here is where readers must accept Williams' accounting, which personally I have no option but to accept. I really cannot fully comprehend a trillion dollars, much less 60 trillion. His chart shows 9 trillion federal debt which isn't that far off what you state as representing fed, state and local debt--if one considers in this conversation 2.5 trillion is chicken feed. Regardless of any understatement of what the rest of the world owes compared to its GDP, is it possible that with the current US GDP (which I presume will likely decline) to ultimately meet the current obligations?

The two parts I underlined are totally condemnatory of the elected officials of this country. I have often thought the dudes elected are too dumb to comprehend much about the criticality of the US debt burden, but perhaps Williams is correct and that makes all the bastards there feckless pieces of poop (I am particularly charitable when speaking out our elected representatives by choosing "poop.")

Thank you again, bart.

[Ann]

Re: Gold Update: The small trade within the big trade

I guess the "knock yourself out" was directed at the general audience and not me in particular, hope it was.

When I ran across the reference to the Williams' article last night, I wondered if it would be something that might be censored. The answer seems clear, or I hope it is clear now, to be 'No."

I am going to offer up a constructive criticism of EJ, since you put out the invitation.

Generally when I run across something like Williams' April 8 article that is relatively long (23 pages in PDF--shit, had I realized that last night before I started, I might not have read it) it has to lead me to believe it is something special for me to take the time to read it. Everything Eric puts up I am compelled to read despite whatever its length, i.e. I just grant him that what he writes will be something special.

Eric, even though as I understand studied to be some sort of a journalist--I hope I recollect that correctly--is a terrible writer, of course, that is just this ole boy's opinion. It is pure labor for me to get through a lot of what he puts up, and it is difficult for me to get as much information from what he writes as there probably is to be gotten.

Written communication is a difficult "art" as I see it, and I think Eric referenced the hardships or labor involved with submitting articles to editors and then making whatever necessary changes to improve readability and, of course, to get one's references and facts correct.

Anyone can correct me on this, but Williams article was not difficult to read or to comprehend--I say that because after reading it, I was impressed by the gravity it conveyed, and I didn't feel that I struggled to get his points.

I had the opportunity (and mental need) to write some papers that got published in professional journals and chapters in some books when I worked as an oral surgeon. I can remember how wrapped up I would become in trying to get my points onto paper (on into a file). Most fortunately the chairman of my department had published a ton of work and fortunately for him his earliest papers were done under a mentor who was a very good writer. I used to take my drafts into him--triple line spaced--for him to make comments and criticisms. As some time and learning from this went on, I did improve in my own abilities to better communicate whatever were the facts or ideas, always striving to achieve that what was written would be comprehensible by any interested reader. It was tough, tough task. Then one sends these things to the publisher and after their editors go over it, there are still things that are pointed out that are not clearly stated or that could be better stated.

I have no idea how big an outfit iTulip is or what are its capabilities, but I take it that EJ is fully serious about operating it on some on-going basis. Its value to us readers is its content which is a reflection of his thinking. This is important stuff, that is my impression, for the readers who subscribe or visit here. It is of prime importance that his thinking is conveyed is a manner that is comprehensible to all us readers.

To me the easiet answer to this--and for all I know you may already be doing this--is to have someone who is a capable editor proof read and ask EJ for clarification of things that are not as clear as they might better be, and finding such a person may not be easy.

It might also be hard for some individuals in a subordinate position to make strong recommendations to their boss, but my boss would give each of us underlings his manuscripts--triple lined spaced--for us to read and make comments that would improve other's understanding, and he took our advices more often than not. In our writings metaphors were never acceptable except in the rarest of instances, metaphors make reading important information more difficult, and should be relegated rather much to creative writing.

It is always easy for people to complain and it is not possible to rid the world of complainers, but what I am trying to get across here is totally intended as constructive criticism, and reading through William's paper shows how comprehensible things can be communicated even to those of my ilk.

One last thing, proofing and revising articles slows down their reaching the screen, but in the long run for important stuff that is not critical.

I'm a lurker but I have to reply to this one.

I find EJ's writing clear and concise, engaging and approachable. A rarity in this world.

What part of Inflation in America - Part I: Five signs of inflation for example is unclear? This is standard EJ fare.

Then there's the charts and images. My favorite image.



Hah! On target! Still makes me laugh.

This chart is a revelation like many others here.



What did you think of the Harper's article? Why do you think a publisher picked EJ out to write a book, because EJ's a lousy writer?

Really, I don't understand your comments at all. Maybe it's a matter of taste. Are you looking for a some kind of economics or finance manual versus actual writing? I sure hope EJ doesn't start writing that way.

[bart]

Re: Gold Update: The small trade within the big trade

It's interesting your mentioning the chart of Government Obligations versus GDP--2007. Man, if there is any chart I can recollect seeing that I accept as reinforcing a point, it is that chart.



I guess through some leads you and others have put up, it has been amazing to just how much data the US government makes available to those on the internet. I have to presume Williams is smart enough to get it correct when he states the liabilities (obligations) exceed 60 TRILLION BONARS, shit, that is what the accompanying table shows, but here is where readers must accept Williams' accounting, which personally I have no option but to accept. I really cannot fully comprehend a trillion dollars, much less 60 trillion. His chart shows 9 trillion federal debt which isn't that far off what you state as representing fed, state and local debt--if one considers in this conversation 2.5 trillion is chicken feed. Regardless of any understatement of what the rest of the world owes compared to its GDP, is it possible that with the current US GDP (which I presume will likely decline) to ultimately meet the current obligations?

The two parts I underlined are totally condemnatory of the elected officials of this country. I have often thought the dudes elected are too dumb to comprehend much about the criticality of the US debt burden, but perhaps Williams is correct and that makes all the bastards there feckless pieces of poop (I am particularly charitable when speaking out our elected representatives by choosing "poop.")

Thank you again, bart.

My pleasure Jim. Glad it was somewhat useful.

As to the data and what the gov't makes available, I very much agree. Barry at the Big Picture made a great observation last week:

Lastly, as to the conspiracy theories, I have my own take on it: The government doesn't respect you enough to lie. They actually put out all of the official statistics each month for anyone with the time and interest to plow through them. All of these data runs, adjustments, changes to CPI, historical data -- its all online, waiting for you to review it, and be mollified or outraged.


Most people don't bother . . .

On the $60+ trillion total obligations, its in the right ball park for sure and the data does come directly from a government source - Williams just did straight reporting. Total Fed debt is also about $9.4 trillion and state & local is about $2 trillion.

If nothing changes, it is indeed impossible for the US to meet the obligations... not unlike most other Western countries. Greenspan's comments from a few years ago also apply:

"We can guarantee cash benefits as far out and at whatever size you like, but we cannot guarantee their purchasing power."

- Alan Greenspan (Chairman of the Federal Reserve US Central Bank), appearing before the Senate Banking Committee on February 15, 2005, in response to Democratic Senator Jack Reed of Rhode Island on the topic of funding Social Security.

One thing that is seldom if ever mentioned about the long term Medicare obligations is that the laws can be changed or rolled back. Currently of course, that has the chance of the proverbial snowball in hell of happening but given enough of a crisis and the proper spin, it could happen. After all, there are a lot more taxpayers than Medicare recipients...


Agreed too on most politicians not having enough integrity to punch through toilet paper but I don't think they're stupid in the sense of unintelligent. Even Dumbya brought up the problems with Social Security a few years ago... and it was pushed back under the rug.... again.
In other words, its not just scummy politicians that are responsible - responsibility is frequently very much of a 4 letter word.

[metalman]

Re: Gold Update: The small trade within the big trade

My pleasure Jim. Glad it was somewhat useful.

As to the data and what the gov't makes available, I very much agree. Barry at the Big Picture made a great observation last week:



On the $60+ trillion total obligations, its in the right ball park for sure and the data does come directly from a government source - Williams just did straight reporting. Total Fed debt is also about $9.4 trillion and state & local is about $2 trillion.

If nothing changes, it is indeed impossible for the US to meet the obligations... not unlike most other Western countries. Greenspan's comments from a few years ago also apply:



One thing that is seldom if ever mentioned about the long term Medicare obligations is that the laws can be changed or rolled back. Currently of course, that has the chance of the proverbial snowball in hell of happening but given enough of a crisis and the proper spin, it could happen. After all, there are a lot more taxpayers than Medicare recipients...


Agreed too on most politicians not having enough integrity to punch through toilet paper but I don't think they're stupid in the sense of unintelligent. Even Dumbya brought up the problems with Social Security a few years ago... and it was pushed back under the rug.... again.
In other words, its not just scummy politicians that are responsible - responsibility is frequently very much of a 4 letter word.

you got it! lying to us in full public view for years... who needs to cover it up with these guys can count on the msm to not cover the story?

The Bubble Cycle is Replacing the Business Cycle

Maybe there's a New Economy after all

by Eric Janszen

Note: this article originally appeared on the AlwaysOn Network, March 13, 2005.

Let's put to rest the myth that the Fed is blind to asset bubbles and never intentionally acts to prick them. The truth can be obtained by anyone with an internet browser and a few hours on their hands to read the voluminous Fed Open Market Committee (FOMC) meeting minutes. In the FOMC meeting minutes from March 22, 1994 (pdf), Greenspan says (my emphasis in italics):