Gold price manipulation is spelled out to CFTC

[mikedev10]

Re: Gold price manipulation is spelled out to CFTC

correlation does not imply causation - what are the reasons for each individual panics? was it the gold stanard or was it something else?

[LargoWinch]

Re: Gold price manipulation is spelled out to CFTC

But money was even more concentrated in the hands of the elite then.

Really? I need to do some research on this, but based on my limited knowledge of the subject, I believe that the gap between rich and poor is now at the highest since well...ever and that it is also widenning at an alarming rate.


I have to disagree with you regarding the fiat system. I think the gold standard or similar would greatly benefit us all.

We cannot in my view compare the standard of living in the 20s with the 2000s; of course it will be up. The question is, what would be the standard of living today under hard currency vs the fiat system? I believe that our standard of living today would be much higher given the gold standard...hands down.

After all, an increase in productivity should result in a decrease in prices provided all else remains the same.

The fact that we have inflation, indicates to me that the governments are taxing us for all the productivity gains and then some. They are taxing the savers, the low income and poorest members of the society the most by doing so. That is - pardon my French - repulsive, unfair and against the ideology of a great republic.

How can this situation not be in favor of the rich? I do not see a lot of single moms or low income workers getting ahead with double-digits increase in food and energy prices. On the flip side, the highest paid hedge fund manager recently earned more than the entire 80,000 teachers working for the state of New York.

Another problem I see with the fiat system (as pointed out by Marc Faber), is that real interest rates can be forced to be negative (like today's). This obligate people to speculate (Nasdaq, RE etc.). Why would someone invest at 2% before tax with inflation in the 7-8% range annually?

Oh and as for me; I am not a big fish anywhere.

[LargoWinch]

Re: Gold price manipulation is spelled out to CFTC

bart, do you mean in the case that inflation gets out of control? Such as the supply of money growing faster than the real and financial economy (like Germany after WWI)?

I think that governments are clearly benefiting from a modest and sustained level of inflation.

What I am unsure, is that at what level it becomes a liability even for governments? Over 10%? One thing for sure, it is not working too well at Zimbabwe levels...

Anyway, good point: you have me "spinning my wheels" here!

[bart]

Re: Gold price manipulation is spelled out to CFTC

bart, do you mean in the case that inflation gets out of control? Such as the supply of money growing faster than the real and financial economy (like Germany after WWI)?

I think that governments are clearly benefiting from a modest and sustained level of inflation.

What I am unsure, is that at what level it becomes a liability even for governments? Over 10%? One thing for sure, it is not working too well at Zimbabwe levels...

Anyway, good point: you have me "spinning my wheels" here!

No question that governments (and many others) do benefit from a modest and sustained level of inflation, especially if one doesn't take into account the insidious costs if how it affects peoples values. My basic point though is that eventually it bites almost everyone.

Here's the very long term picture of both US tax receipts and US expenditures, adjusted via both CPI and CPI w/o lies. You can easily see what's happening recently.







Log based charts are available on my site if desired, but the basic points of the CPI w/o lies data (the green line) is the key element of the charts, and can be more easily seen on linear charts.

[c1ue]

Re: Gold price manipulation is spelled out to CFTC

Really? I need to do some research on this, but based on my limited knowledge of the subject, I believe that the gap between rich and poor is now at the highest since well...ever and that it is also widenning at an alarming rate.

The official statistics simply ignore the fact that most people in the turn of the century had basically no cash.

For example:

http://query.nytimes.com/mem/archive...679C946095D6CF

Total money supply in 1921: $6.36B

Circulation per capita: $59.12

Worth of Rockefeller alone: around $1B (From Wiki)

In 1902, an audit showed Rockefeller was worth about $200 million—compared to the total national GDP of $101 billion then.^{[citation needed]} His wealth continued to grow significantly (in line with U.S. economic growth) after as the demand for gasoline soared, eventually reaching about $900 million on the eve of WWI, including significant interests in banking, shipping, mining, railroads, and other industries. By the time of his death in 1937, Rockefeller's remaining fortune, largely tied up in permanent family trusts, was estimated at $1.4 billion.

By the time you add up Carnegie, JP Morgan, and the other oligarchs of the early Industrial Age in the US, there isn't a whole lot of cash left over for the other 117M people living in the US (1920 US Census: 117,859,495)

Let's say $2B was held by Rockefeller, Carnegie, et al.

The remaining $4B going to the other 117M = $34 per person

Average income? In 1920, it was $1,500/year. Of course this was including Rockefeller et al.

http://www.oldstatehouse.com/educati...e_id=41&page=2

This is one of the consequences of a 'hard' currency - hardly anyone has any cash.

Saying a hard currency would benefit you is assuming you are one of those that would still have some hard currency afterwards.

Are you sure that will be what happens?

[LargoWinch]

Re: Gold price manipulation is spelled out to CFTC

By the time you add up Carnegie, JP Morgan, and the other oligarchs of the early Industrial Age in the US, there isn't a whole lot of cash left over for the other 117M people living in the US (1920 US Census: 117,859,495)

Well it seems that wealth inequality was not much better back then. But it does not mean that it is due to the gold standard. These are two different issues in my view. Taxation and regulation for example are probably much more to blame.

This is one of the consequences of a 'hard' currency - hardly anyone has any cash.

What counts is not how much cash you have but its purchasing power. Who cares if you earn $200 per week when gas is 10 cents a gallon and a meal is 25 cents?

[phirang]

Re: Gold price manipulation is spelled out to CFTC

I have little shame, and so I'll talk my book:

Sunridge Gold: high-grade Cu, decent Au play. I've visited these properties myself in Eritrea, and the management is solid. Lundin owns 14%. I own a LOT of this stock.

Nevsun Resources: Again, another Eritrean play, and likewise I've also done a site visit there. At $1.5x, you can't lose. Management solid. Own a ton of this, too. A very astute asset manager out of UK owns about 22% or so(met him out in the bush/sand).

Sanu Resources: AGAIN, another Lundin baby, with excellent exploration team. I also met them in Eritrea.

Rusoro: Sleazy russian gold operation in venezuela. Producing, cheap, and risky because, well, it's run by the mafia, basically. Have a toe dipped into this one. Haven't visited their deposits/mines yet. Good grades and great prospects assuming ceterius paribus etc.

MDN: AWESOME Tulawaka gold deposit. Producing gold mine, JV with barrick in tanzania. Holdings tied with NSU in my book. Waiting for assays from underground project. Currently exploiting a quartz vein.

IPR: relatively low-grade, yes, but management owns stock, isn't scum, and will build the mine. Credit risk low, and have ops team ready. Very illiquid, hence terrible SP history. Pretty much bottomed, but wtf do i know. Financing will become clearer in a few weeks. Sprott owns 4x%.

@Phirang

can you tellme some names of these "junior base metal stocks" you mention? I've been interested in researching a few of these. Thanks.....>

[phirang]

Re: Gold price manipulation is spelled out to CFTC

Gold is tanking because people are closing out EUR/USD because of weak euro economic data, and so the USD rallies, naturlich, nicht war?

Don't fret: today is definitely a buying day for bullion. I added some GLD myself!

[LargoWinch]

Re: Gold price manipulation is spelled out to CFTC

phirang, what is your view on Platinum?

It got beaten down badly this month, due to worries associated with the auto sector.

My personal view is that it is undervalued and should fly like silver the day gold takes off. At that time, Platinum will become a monetary metal in addition to its industrial uses and since there are no stockpile of the stuff...

[phirang]

Re: Gold price manipulation is spelled out to CFTC

phirang, what is your view on Platinum?

It got beaten down badly this month, due to worries associated with the auto sector.

My personal view is that it is undervalued and should fly like silver the day gold takes off. At that time, Platinum will become a monetary metal in addition to its industrial uses and since there are no stockpile of the stuff...

I don't know anything about the platinum market...:confused: Sorry!

[c1ue]

Re: Gold price manipulation is spelled out to CFTC

Well it seems that wealth inequality was not much better back then. But it does not mean that it is due to the gold standard. These are two different issues in my view. Taxation and regulation for example are probably much more to blame.

Teddy R was president at the turn of the (19th) century, and started a series of trust busting legislation and mindset in the politicians. Trust stood for monopoly back then.

So by 1920, the 'trusts' had been 'busted' for many years.

Furthermore the taxation rates at the high levels were confiscatory starting WWI, being 70% at the top rate.

Income taxes were only enacted in 1913 with starting rates at 7%, so the jump to 70% in 5 years is quite impressive.

The parallels between Coolidge prosperity and the early Bush years are also interesting - also including tax cuts which dropped the top rate from 70% to 24% in 1929. Supply side isn't a new concept.

The point is - sure, things were cheaper then. But they weren't free. Most people just survived without cash.

Certainly the economy today is different than the economy then.

But the whole point of representational currency is that you only need some number of units of currency to conduct commerce.

The notional numbers of currency, however, are exploitable. The greater the number of units of said currency, the more the banksters and financial types have to play with. In fact, it is to the financial institutions interest to ultimately increase the units of currency as currency supply is infinite while physical assets are finite - it is in the interaction between the two which profit can be made, as well as being the source of the currency.

But these two games can be played just as easily with fewer units as they can with large numbers of units; in the fewer case you get usury.

Think 'Fat Tony' loan sharking but on a national scale.