GB,Why are the Chinese buying so much Gold?
Rector
My father-in-law is 70, retired, out of shape, totally unprepared, and lives in a megaplex. Worse, after looking at a 7 figure brokerage account invested 75% in "equities", we had the conversation. Everyone is in agreement about the fundamentals and what should be done to prepare, but no action has ever been taken. I'm just tolerated when it comes to this topic and will not repeat myself.I made him pinky swear not to come looking for help when it all evaporates. He just laughed.
Rector
I hear you Wendy and I've made the same observations. In my work I deal with everything from the wealthy and highly intelligent to the dirt poor and mentally challenged; the good, righteous people and the vicious, vile predators. I'd like to be more "positive" but many people from across the human spectrum are at this very moment simply marked for extinction by Nature (physically, financially, and/or psychologically). Even many of the people who have already shown themselves in life to be successful and resilient are way behind the curve in our current predicament, and they aren't going to "make it" (whatever that turns out to be in our time). So of course the foolish and brittle people are going to be absolutely slaughtered (figuratively or literally, depending on how bad things get). This "extinction event" is in progress already and will only grow from here to monstrous dimensions. I don't know which ones in particular are doomed, so I can't write anyone off as hopeless. Some unprepared people are going to be amazingly lucky and survive by the skin of their teeth. Some highly prepared people are going to be equally unlucky and succumb to something they couldn't have expected or been prepared enough for.For me, my survival and future "prosperity" is no more than my third highest priority, and that helps me be at peace. I don't have to be anxious about my survival or prosperity because it's not my highest priority. Focusing on those higher priorities brings peace.
Higher than my survival is my ability to contribute to the survival and prosperity of my loved ones, especially my children.
Higher than contributing to my loved ones' survival is my desire to live a life of honor, courage and adherence to the value system of the One I worship. Survive or die, win or lose, these are things I can accomplish, come what may. Like Noah, I want to be found faithful in the midst of the storm.
I imagine many people here at PP have similar attitudes toward these things.
"Welcome to the Hunger Games. May the odds be ever in your favor."
Tom
This post really rings true for me. Here we/I am at another prosperity party and I am wrong or the wet blanket. My side of the family and my husband's side are totally in the business as usual camp. This year has been hard for me. I have been the outsider from my family all of my life but this year I am especially struggling. I am also the outsider in my husband's family. With all the business as usual prosperity, I am seen and feel especially as alone. The compass inside of myself knows that what I am doing is right but I have a hard time pushing up against family/society/my childhood wounds.
Karen
Adam
Thanks for the admonition to keep the tiller steady as she goes. I was reminded this last weekend of the power of crowds. While returning from Thanksgiving with family my wife and I got stuck in a 25 mile long interstate clog up. No wreck, just a construction zone. After 10 minutes of being in the backup I took the first exit. The only truck stop at the exit looked like a Times Square crowd on New Year's Eve. I was glad that I had not slipped up on my 'never get below 1/2 full" rule. In these situations going home by another route is always the better option.
Most of my family thinks I have been going somewhere by another route for the last five years. I got caught in the crowd in 2008 and don't want to experience the stampede of fleeing 'bulls' and other cattle again. Personally I plan to stay on the less traveled route as I head for home.
[quote=Jim H]Long live Gold!
GBCM said,
So, please explain why gold wont continue to depreciate and what will re-ignite the gold bull market other than the ranting of Peter Schiff ? Advocating buying PMS is 'investment advice' and should come with a soundly based investment argument -- still waiting. The mainstream rejection of gold is complete !China said, Gold is only being rejected by the crowd who bases their views of the future on the price of Gold today... who needs it right? The price is telling them everything is OK! Party on! And this is why TPTB will do their best make Gold an untouchable asset class... and to make you look like an idiot for buying it or for telling your friends to do so. [/quote] I figure I might as well commit fully to being an idiot. I bought more silver and gold yesterday and even some platinum and palladium. Even if it skips my generation and I can't redeem it, it'll still be there for my kids. I doubt the paper or electronic stuff will be.
[quote=thc0655]In 1999 these experts chose to be idiots later.
http://www.youtube.com/watch?v=Q5R0j75BZ0U#t=81
[/quote]
Liz Ann Sonders, lol. My favorite resident Schwab shill. She's a fairly good contrarian indicator. If she's recommending, I'm selling.
[quote=sand_puppy]I love Robbie's description of the story of Noah. And the movie is coming out and looks really good.
https://www.youtube.com/watch?v=FRTlT3DEydU
[/quote]
http://abcnews.go.com/blogs/headlines/2013/12/cook-survives-3-days-in-air-pocket-of-sunken-ship-off-nigerian-coast/
Guess what he and Noah had in common? It's the ultimate prepping tool, no matter what happens.
I wish more than anything that everything we are doing will end well. I don't want any of it to fall apart - I like my life and would prefer it not to change.
I love the book Fiat Money Inflation in France - By Andrew Dickson White, written over 100 years ago (quick read & freely available in PDF). The party will end - all parties do, they know this and history tells us this.
Whenever I encounter any scoffers, I just tell them that I think we all need our own little money printers in our kitchens, so that anytime we want currency we can just print it like the Fed does. Letting them know that we don't need productivity and we don't need to make stuff anymore because all it takes is little bits of paper.
I will continue to be the ant…Go to the ant, you sluggard! Consider her ways and be wise which having no captain, overseer or ruler, provides her supplies in the summer, and gathers her food in the harvest" (6.6-9)
Keep up the support everyone!! - VC
I have to confess, I have been impressed by the points that gb has made,especially his technical analysis argument, not that I know much about it. He seems to have a comprehensive grasp of issues, such as the US Iran trade agreement excluding gold as a means of payment and the possibility of China printing.
Anyhow, as the graph continued to decline I told my broker to get me out of gold - I've got to manage my personal risk and I was excessively, 80%, in physical. I could say I was selling to buy again in Singapore as
Jim Sinclair recommends, (it had been in Switzerland, too subject to European, US, pressure imho) but I'm
going to stay in cash and see what transpires. I value this site and Chris's and Adams commitment but as somebody just said, we've all got to make our individual investment calls.
PS I'd like to say thanks GB for your cautionary, and by me at least, valued comments on gold ,.at this state of play. As for the valium, I have been known to resort to the odd one, but not at the moment thankfully.
The logical side of my brain tells me that we are in a precarious place. Things cannot go on as they have been. The emotional side of my mind wants to believe that everything will turn out fine. That even if the present paradigm must end, it will somehow glide slowly down to landing, not crash with us all as passengers. The logical side of me knows the happy outcome is quite improbable.
My wife and I are considered oddly out of touch by family. Since we have long been non-conformists this is seen as just another phase in our quirkiness. We have friends who think we are crazy. We have friends who are ardent preppers and who support us along the way. This is very encouraging, especially when you begin to doubt yourself and your motives. Most amazing are the friends and family who absolutely agree with us about where the economy is headed but who deliberately choose to do nothing. It is like a real life playing out of a “B” disaster movie where the extras just stand still in the face of disaster waiting to be destroyed.
I agree with thc0655. My own survival is not the primary focus of my life, if it were I would be terrified of what is ahead. To serve the One who has guided me safely through sixty years of good times and bad times is most important. Of next importance is to attempt to protect, teach, lead my children, grandchildren and siblings to be as prepared as they can be. Finally, I believe it is necessary to be as helpful and supportive of those around you, family, friends, co-workers, neighbors as you have the power to be. They are caught in all of this, just as much as we are, only many of them have no way to express, understand, or find solace from the unease and fear they sense about where we are and where we are going.
Great post. Wonderful comments. All of you are one of my important support mechanisms.
JT
Wonderful comments in this thread, and thanks Adam for the timely article. For the last many years now, I've had a foot in both camps: working and earning income in the system as a self-employed IT contractor, while building up my own sustainable household in a downtown section of a new england town, and starting a couple of side businesses related to this. Everything we choose to place our attention on is an investment of sorts, so here's how I've been thinking of my investment returns over the years:
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Best return has come from building skills, physical fitness, closeness to nature, a sense of confidence in my independence and emotional/spiritual resilience. Starting to step away from the system was very difficult at first, but it is very liberating once you realize how much you can do outside of it. Confidence and realizations and spiritual health snowball once you get going. I suppose some people think we're nuts with all the gardening and chickens and bees and brewing and herbalism and stuff, but most people we know are showing more interest in it than are sneering. Or maybe that's just because we are tending to hang-out with more like-minded people now. So, into this pot, we've also yielded great returns in friends and community.
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We've also built out a good amount of urban homestead infrastructure. Gardens, alternate heat/water, food processing and storage, tools, some solar. All things physical are impermanent, though, so I suppose it is our skills and abilities in these areas that are worth more than the infrastructure. But it's certainly nice to have it while it is there. From a financial perspective, I don't really know what it is worth. We had our house valued last year, and the realtor just couldn't see the financial value in this stuff, although she did admire the chicken coop and helped herself to a bunch of kale. Maybe the financial value will grow, maybe not. We've certainly crossed the line between regular home and urban homestead some time ago, so it will be interesting to see what happens if we ever decide to sell. But I'm guessing that the longer we wait, the more desirable all of this might be. We'll see.
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From the skills and experience, have come opportunities to earn income in other ways. We have started a small herbal products business, which is taking off locally. It's small, but it could source 20% of our income needs in a couple of years. And we can expand to do some teaching and demonstrations and who knows what in future. We are literally "getting into the market" with this since I spend a couple of afternoons a week at farmers markets selling stuff now. Ideally, in a few years we'll be paying the bills from a handful of different things, real diversified income.
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We've also cut our living expenses by close to 50%. So that's a great ror right there. No more tv, smart phones, crap food, oil heat, pointless stuff. Which in itself is a good thing.
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In terms of regular investments of our savings, we've basically been sitting on cash, sticking it in the bank, tbills and such. Sure, I would have made some money if I had left it in the stock market a few years ago. But even with those returns I wouldn't seriously expect to be able to retire for a long-time. I've changed my expectations to think of retirement in the same way that 99.99% of humans thought about it until maybe the 1950s - work to generate income of some sort until you are really too old to do so, stay as health as you can, then put your feet up for a few years before the big sleep. Getting myself reconciled, happily, back to this reality is a good thing, I'm at peace with it. And if I had inflated my 401K to the stratosphere by putting it all on blue, it could have sapped my motivation on the other things. My Dad always said that a good dose of financial reality focuses the mind on what's really important, and on the value of work. I understand what he meant now.
So, freedom+skills+health+infrastructure+reduced expenses easily outweigh the potential doubling of my savings that I could have made in the market these last 5 years. So, overall, I'm happy with my returns.
Everyone at PP has been there, is there, and likely to make another visit or twenty. From time to time I've had similar thoughts as many of my friends are very, very well to do farmers. If you want to feel bad about yourself, compare your financials with that crowd… However, when I do get in that frame of mind - I just remind myself that I'm just getting my pain out of the way, choosing to feel some discomfort now versus the excruciating burn that's headed our way. Then I make a Noah joke to myself and 'return to course'.
Soma,
I want to congratulate you on having the courage to stick to your convictions, morals and ethics.
The system is designed to harvest the most amount of money from the most people and deliver it relatively few hands. As long as the pie was expanding nicely, there was 'enough' for this to happen more or less unnoticed by the general public. Now that the pie is no longer expanding, there just isn't enough for Wall Street (et al) to take their cut and leave enough for everyone else.
And yet the great marketing machine churns on seeking to convince people to 'invest' their hard earned capital into the very system that was specifically designed to funnel money from the public and into private hands.
It could not be more clear that the system is utterly rigged against even highly sophisticated individual speculators, or investors if you prefer, and yet many seem not to have noticed.
I am perfectly happy sticking to my own convictions, which are simply that our current monetary and financial systems are deeply flawed, and they will someday 'revert to the mean' in horrendous fashion, by which I mean balance all the outstanding claims (currency, equities and bonds) against an all-too-small pile of real wealth.
I see nothing, anywhere, to convince me that the Fed has got this right and that we should just follow along. The world is obviously in need of our very best efforts and entirely new approaches, and the desperate (c)ramming of financial markets into higher territory proves little and means even less to me.
It is the larger sweep of this story that catches my attention…
In CM's article "None of this makes any sense"
I wrote a commentary which included this on gold
" But in this post apocalyptic world with its new normal , what of gold — nothing I suspect. In the not too distant future, the memory of the Ron Pauls of the world will fade, but Bernanke will be seen historically as the slayer of the gold myth, as well as the one who's finger in the financial dyke saved the day for a long time , till financial evolution created a new way, that will by necessity and design be complex, volatile and grossly unfair to non core members, but can there be any other way. Central planners hold all the reins of power as the NSA imbroglio has clearly shown, and alternatives to fiat currency cant and wont be allowed. Gold will controlled, manipulated, taxed and if necessary confiscated for the greater good, and its time CM admitted this is logically so and warn his followers that things have changed and if you must have gold rings, so be it, but hoarding PMS and investing in gold miners is a sure path to wealth destruction. "
as well as a gold commentary on the recent "Off the Cuff" as well as my above piece , which seems to have resonated with Cornelius999 , BUT STILL NO REPLY FROM CM ???
Chris powers of persuasion make him an effective advocate of many issues not the least his advocacy of gold ownership, based on the store of value, Fed printing leading to hyperinflation , debasement of the US$ etc. Now that this thesis has been shown to have not materialized those who followed his investment advice , which he crucially defended with his conspiratorial analysis during the shorting action, which lead to people being convinced that things that aren't real will reverse - they were real, the are not , nor will they reverse, and those who bough gold 12months ago are sitting on 50% losses of a non-essential asset which has an extremely low value as insurance.
Deflation is established not inflation, the US$ is and will remain the worlds strongest currency, the US government will never default on its debt, there will never be a return to the gold standard, and trading in gold may be banned or heavily restricted or taxed - call it the FDR solutions — Nicole Foss correctly says that what one will need in a true shortage is real cash, because credit cards wont work — etc
When will CM stop hiding on this issue and admit that his gold thesis needs heavy a restatement ?? Please read all my recent posts and tell us all where I'm wrong, so we can all move on from this gold angst — we know the rest about balance, harmony , simple life and all the other stuff - thats a given - gold remains a hot issue for many in the PPC, and CM just wont respond in detail to this burning question - Cornelius999 with 80% in gold would have saved a lot of money if he had been made aware that the ground had shifted some time ago — those who respond to my comments with puzzlement obviously don't own significant amounts of gold or gold shares , so please wait for CM response.
Cheers, GB
PS I know the Grant Williams gold thesis chapter and verse, and his You Tube lectures on the gold pyramid and gold rehypothecation are fascinating but a theory that seems not to be evolving, and his (superb) latest presentation reinforces CM position on the unreality of the current markets, and Grants main recommendation is to go to cash and wait !
Yes, you are absolutely right! Somebody should tell the Chinese, they are on target to purchase over 900 metric tons of physical gold this year.
I’m always amazed at how irrational the rationality is of our logos.
My father pointed me in the direction of Matthew Fox, who puts it this way:
The two primary spiritual questions of the 21st Century are:
1. Are we destroying the planet?
- Are we honoring the souls of our youth?
How can we wake up and educate ourselves and our youth?
He has wonderful things to say about how:
http://www.youtube.com/watch?v=9cYwo664QU4&list=PL2B780B60B5957951
I’m honored to be in dialogue with all of you as we try to move toward a wiser path of living. To me, it really is that simple, and yet so difficult.
Peace!
And who does this kid think he is fooling? I'm sure not one of his reasons will stand up to scrutiny:
"
Top 14 Reasons To Buy Silver YouTube
"
http://www.youtube.com/watch?v=D6rv41eAQMM
P.S. I only buy silver because, it is shiny and I can use it for Xmas ornaments…