Jim Grant's "Requiem for the Dollar"

[BigBagel]

http://online.wsj.com/article/SB1000...html#printMode

Grant on the dollar past and present.

[due_indigence]

Re: Jim Grant's "Requiem for the Dollar"

Lesson of history? We should be marvelling at the USD's longevity, rather than bemoaning its inexorable decline. The forces that prey on fiat currencies are too numerous and too insidious to allow any other outcome.

[goadam1]

Re: Jim Grant's "Requiem for the Dollar"

Grant is not only spot on, he is a fabulous writer. Hilarious and accurate.

[sishya]

Re: Jim Grant's "Requiem for the Dollar"

Good article unlike the acidic ones we elsewhere

[oddlots]

Re: Jim Grant's "Requiem for the Dollar"

Fantastic piece. I particularly appreciated this observation:

"Let me interrupt myself to say that I am not now making a bullish investment case for gold (I happen to be bullish, but it's only an opinion). The trouble with 0% interest rates is that they instigate speculation in almost every asset that moves (and when such an immense market as that in Treasury securities isn't allowed to move, the suppressed volatility finds different outlets). By practicing price, or interest-rate, control, the Bank of Bernanke fosters a kind of alternative financial reality. Let the buyer beware—of just about everything."

Good to remind ourselves that central banking as currently practiced perverts all values. Thinking that gold is somehow above this fray could be a costly mis-step.

It occurs to me that this may be the most effective testament to the power of central bankers: there is nowhere to hide, at least in any more than temporary fashion.

[raja]

Re: Jim Grant's "Requiem for the Dollar"

It occurs to me that this may be the most effective testament to the power of central bankers: there is nowhere to hide, at least in any more than temporary fashion.

The solution is not to hide, but to stop the Financial Elite and their politician enablers now.



In the US, we fortunately live in a society with a Constitution that can protect us from the rapacious Financial Elite IF we simply take the power that it guarantees us. The solution is to use the political process and throw out the politicians who are supporting the Financial Elite, and elect those who will work in the interest of the People.

One thing that give me confidence in this outcome is "this time it's different".
Often used in the past as tools of the rich, the ultimate enforcers in society are the military and police. While there are corrupt elements in both groups, I believe the vast majority are patriotic. In the coming years, they will experience things such as aging parents who are evicted from their homes, and friends and relatives who are forced into poverty . . . and they won't like it a bit. They also have access to information through the global internet -- something that has never existed before -- and they will know who is to blame for this misfortune. If it comes to a struggle, they will be on our side. The Financial Elite will learn this, if they don't know it already.



It's up to people like us, who are more well-informed than the average, to educate the population at large and teach them who caused the economic catastrophe and how to exact justice. If not us, who? This will have to be a grass-roots movement, because TPTB control the media, and will attempt to quash any dissent that threatens their undeserved power and ill-gotten gains.

EJ has said that in the coming crisis, everyone will have to "share", meaning we're all going to take a hit in our quality of life. The extent of that loss can be reduced IF we stop this "greatest theft in history" that continues unabated. If we do nothing but try to hide our assets, then I can guarantee that we will each pay a bigger price . . . . .

I may be wrong . . . so I'm also ready to hide out with my gold, short-term Treasuries, and whatever else EJ suggests, plus a tractor, farmland, plenty of chickens, a big garden and suitable security measures. But my preferred solution would be a systemic change in the way this country is run, brought about through peaceful political change . . . then I could enjoy my retirement in this beautiful country setting without having to become a "real" farmer.

[goadam1]

Re: Jim Grant's "Requiem for the Dollar"

Excellent rant and wonderfully illustrated. Cheered me up.

Bunker wall paper.

The solution is not to hide, but to stop the Financial Elite and their politician enablers now.



In the US, we fortunately live in a society with a Constitution that can protect us from the rapacious Financial Elite IF we simply take the power that it guarantees us. The solution is to use the political process and throw out the politicians who are supporting the Financial Elite, and elect those who will work in the interest of the People.

One thing that give me confidence in this outcome is "this time it's different".
Often used in the past as tools of the rich, the ultimate enforcers in society are the military and police. While there are corrupt elements in both groups, I believe the vast majority are patriotic. In the coming years, they will experience things such as aging parents who are evicted from their homes, and friends and relatives who are forced into poverty . . . and they won't like it a bit. They also have access to information through the global internet -- something that has never existed before -- and they will know who is to blame for this misfortune. If it comes to a struggle, they will be on our side. The Financial Elite will learn this, if they don't know it already.



It's up to people like us, who are more well-informed than the average, to educate the population at large and teach them who caused the economic catastrophe and how to exact justice. If not us, who? This will have to be a grass-roots movement, because TPTB control the media, and will attempt to quash any dissent that threatens their undeserved power and ill-gotten gains.

EJ has said that in the coming crisis, everyone will have to "share", meaning we're all going to take a hit in our quality of life. The extent of that loss can be reduced IF we stop this "greatest theft in history" that continues unabated. If we do nothing but try to hide our assets, then I can guarantee that we will each pay a bigger price . . . . .

I may be wrong . . . so I'm also ready to hide out with my gold, short-term Treasuries, and whatever else EJ suggests, plus a tractor, farmland, plenty of chickens, a big garden and suitable security measures. But my preferred solution would be a systemic change in the way this country is run, brought about through peaceful political change . . . then I could enjoy my retirement in this beautiful country setting without having to become a "real" farmer.

[snakela]

Re: Jim Grant's "Requiem for the Dollar"

Often used in the past as tools of the rich, the ultimate enforcers in society are the military and police. While there are corrupt elements in both groups, I believe the vast majority are patriotic. In the coming years, they will experience things such as aging parents who are evicted from their homes, and friends and relatives who are forced into poverty . . . and they won't like it a bit. They also have access to information through the global internet -- something that has never existed before -- and they will know who is to blame for this misfortune. If it comes to a struggle, they will be on our side. The Financial Elite will learn this, if they don't know it already.

What do British soldiers have to do with it?

From my personal experiences, many US soldiers may take that flower but others will blow your head off for the hell of it. Especially since TPTB would have been using the media bull horn to tell us that anyone who isn't a good little debt slave is a traitor/racist/unamerican etc.

The cops? My money is on beating heads for fun.

Remember that it takes one extra effort and intellectual honesty to look bast the BS machine.

[due_indigence]

Re: Jim Grant's "Requiem for the Dollar"

"Often used in the past as tools of the rich, the ultimate enforcers in society are the military and police. While there are corrupt elements in both groups, I believe the vast majority are patriotic."

Interesting raja. By patriotic, I assume you mean in a populist sense. Presumably, soldiers in third-world military juntas have families too. Maybe they use their better-than-average incomes, status and privileges to subsidize their loved ones. Of course this comes at the expense of doing the State's bidding against the larger population.

I'm less convinced US military personnel would resist wholesale domestic persecution. Americans love their military paraphenalia! Remember the stormtrooper images that frightened the world at the Seattle WTO confab a few years ago? I read the obituaries here in the US: "little Johnny wanted to be a Seal or a Ranger ever since he was seven". Military mesmerism is in the water here! Where else in the world do little boys want to grow up to be professional warriors? Take away college as a practical option (without veteran assistance of course) and you have 'McDonalds or the Few and the Proud' conundrum. The American heartland is rigged for the military.

Hasn't the military industrial complex done a wonderful job of building a proto-fascist state? And what other than large-scale war will 'rescue' us from the overproduction cul de sac, just as Marx predicted?

[lsa420]

Re: Jim Grant's "Requiem for the Dollar"

From my personal experiences, many US soldiers may take that flower but others will blow your head off for the hell of it. Especially since TPTB would have been using the media bull horn to tell us that anyone who isn't a good little debt slave is a traitor/racist/unamerican etc.

The cops? My money is on beating heads for fun.

Remember that it takes one extra effort and intellectual honesty to look bast the BS machine.

As a US military vet, I would disagree that many US soldiers would blow off your head for the hell of it. On the contrary, the US military is full of extremely smart and well informed individuals who love their country and simply want to serve because they feel it is a moral duty. Many are also independent thinkers who understand exactly what is going on as they have been affected first hand by the crisis in numerous ways.

My many contacts on the inside (we should talk to jtabeb as well) are not only fed up with the perpetual warfare in the middle east, but are also sickened by the current state of the Union that they have pledged to defend. I wouldn't assume that the military is a bunch of idiots who only join because they have no other options and are too stupid to go to college.

Also, Ron Paul received the most donations from military personnel in the 2008 Presidential campaign. Why? Freedom and peace.

[Raz]

Re: Jim Grant's "Requiem for the Dollar"

Fantastic piece. I particularly appreciated this observation:

"Let me interrupt myself to say that I am not now making a bullish investment case for gold (I happen to be bullish, but it's only an opinion). The trouble with 0% interest rates is that they instigate speculation in almost every asset that moves (and when such an immense market as that in Treasury securities isn't allowed to move, the suppressed volatility finds different outlets). By practicing price, or interest-rate, control, the Bank of Bernanke fosters a kind of alternative financial reality. Let the buyer beware—of just about everything."

Good to remind ourselves that central banking as currently practiced perverts all values. Thinking that gold is somehow above this fray could be a costly mis-step.

It occurs to me that this may be the most effective testament to the power of central bankers: there is nowhere to hide, at least in any more than temporary fashion.

You overlooked something else Jim Grant said: " Gold was money - is, in fact, still money - ..."

As long as interest rates remain at ZERO - and below any honest calculation of the rate of consumer price inflation - the biggest risk will be in holding Bonars, not gold. (However, that doesn't mean that paying any price in Bonars for gold is a sensible thing to do.)

By any clear observation we are near the end of the 38-year experiment with Fiat Money in the United States, and probably the world. Today I transfered another 4.0 % of my liquid net worth from Bonars into GTU.

I plan to "sweat out" Mr. Bernanke's alternative financial reality by holding 1/3rd of my liquid assets in precious metals,
ninety percent of which is gold. :cool:

[jiimbergin]

Re: Jim Grant's "Requiem for the Dollar"

You overlooked something else Jim Grant said: " Gold was money - is, in fact, still money - ..."

As long as interest rates remain at ZERO - and below any honest calculation of the rate of consumer price inflation - the biggest risk will be in holding Bonars, not gold. (However, that doesn't mean that paying any price in Bonars for gold is a sensible thing to do.)

By any clear observation we are near the end of the 38-year experiment with Fiat Money in the United States, and probably the world. Today I transfered another 4.0 % of my liquid net worth from Bonars into GTU.

I plan to "sweat out" Mr. Bernanke's alternative financial reality by holding 1/3rd of my liquid assets in precious metals,
ninety percent of which is gold. :cool:

I too added to both CEF and GTU and also physical. I am now at about 50%, but 20% of that is for trading purposes and for selling coverred calls.

[flintlock]

Re: Jim Grant's "Requiem for the Dollar"

My many contacts on the inside (we should talk to jtabeb as well) are not only fed up with the perpetual warfare in the middle east, but are also sickened by the current state of the Union that they have pledged to defend. I wouldn't assume that the military is a bunch of idiots who only join because they have no other options and are too stupid to go to college.

Also, Ron Paul received the most donations from military personnel in the 2008 Presidential campaign. Why? Freedom and peace.

I find it reassuring to hear this. Thanks for posting.

[LargoWinch]

Re: Jim Grant's "Requiem for the Dollar"

I plan to "sweat out" Mr. Bernanke's alternative financial reality by holding 1/3rd of my liquid assets in precious metals,
ninety percent of which is gold. :cool:

Actually I have close to 50% of my total net worth in PMs.

Jim once call me "balls-y" while JT called me is "budd-y" ;)

[oddlots]

Re: Jim Grant's "Requiem for the Dollar"

In response to Raja above:

I appreciate the "game face" , share the enthusiasm but I'm honestly a bit perplexed as to the question of what is to be done. And I mean perplexed.

Here's some cognitive dissonance for you. I've been reading Martin Armstrong's stuff for a while. He knows his market and financial history and I've gained something from that. He also happened to have a good primer on the "Bank Wars" of the 19th century - Jackson's defeat of the second Second Bank of America right up through J.P. Morgan's role in the panics of the 1890s and 1907. Basically, he lionizes Morgan and rails endlessly against Marxists and Keynsians. Bit of a disappointment really. Not much gained overall.

I've also been researching the idea of monetary reform which has been raised here on many threads, conspicuously those of Rajiv. The idea is basically that there is an alternative to debt-based money. The most relevant antecedents would be colonial scrip and Lincoln's greenbacks.

The idea is tantalising and at least adresses the problem that most worries me: the economy as it is structured now features a moon-shot of financial claims on future revenue and a conspicuous inability to service them out of the gate, so to speak. (I suspect this the root of E.J.'s inflation forecast though I don't want to caricature the argument.)

There is no future in that so I agree change will come. But... what is that change?

Some of the advocates of Monetary Reform blame the "money changers" (I suspect some biblical authority is being cashed in here) and demonise the financiers (Rothschilds, Morgan etc) that Armstrong defends. The example I have in mind is this series:

http://www.themoneymasters.com/

... but I don't buy it. It's radical enough in the sense of at least providing a root cause of the problem, but the historical analysis just strikes me as way too tidy. (I don't at all endorse the video, as if anyone was hanging on that.)

So... what change do we need?

There are some "second string" changes that I can easily get behind, e.g.,
re-instating Glass Steagall and ring-fencing the "public utility" function of banking.... but I fear this is yesterday's battle.

In contrast, consider the insane-looking explosion in OTC derivative trading. If Steve Keen's debt to GDP charts make your eyes water what to make of this? I remember watching a recent round table with Joe Stiglitz, Naomi Klein and some Peruvian based scholar who's name escapes me where the subject of the on-going explosion of derivatives came up. They had nothing of substance to say about it. Nothing.

So my point is, I seem unable to make sense of where the problems really lie and I'd really like to know: what's the platform? What is the change you're arguing for?