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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Zardoz who wrote (69221)	5/15/2001 7:16:54 PM
From: marek_wojna	Respond to of 117113

<<How about 5%, maybe 2.5% where do you want ME to draw the line so that you can be happy. And if 1/12 why not zero. The efficient market hypothesis suggests that given a fair market, the rates between currencies will balance to offset advantages in other countries. Therefore the best solution is for NO currency to have a backing in gold.>> BUY gold, SELL Cisco, take a long trip, come back, I can give you written warranty you won't loose money on this deal even if trip will last 2 years. Think please about benefits you can enjoy knowing the value be there intact, chances of growth better than on any stock or currency. Maybe you know a better growth oriented index, please share with us, but no risks please. This is the time everybody should get ready to relax, not watching the screens with currencies and equities ticker. Floating currencies are OK as long as they can avoid a whirlpool. MONEY is peaceful exchange form of GREED between humans, but money is not a CREDIT.

To: Zardoz who wrote (69221)	5/16/2001 2:12:50 PM
From: E. Charters	Respond to of 117113

E->So why is this gold not tradeable for stuff? You also don't need 100% convertibility. Even 12 to one is alright. h->How about 5%, maybe 2.5% where do you want ME to draw the line so that you can be happy. E-># where it works. H-->And if 1/12 why not zero? E-># numbers are what bankers play at. In the old days they started with 4 to one, or 25% backing of deposits. (the goldsmiths.) By the late 1600's they were at 12 to one because of foreign wars. We are now at 20 to one and they value deposits that are not long term holdings too and even the bank's buildings. I am placing the number where a society that did not crash could get by, at about 8.5%. Even if the dollar currency was backed by gold 100% you would not want a run on it. It would be impractical. But you never would get a run, would you? If x=y at all times why exchange it? This is why it is a kind of folly for banks to even sell gold. All they are doing is trying to cheapen it. Divesting liquid assets for another more doubtful one makes no sense. In a way, propping up a currency by this means is a desperate measure. What do banks gain by getting their money back? Their asset value increases not one whit. If they cannot loan money on the gold they have on deposit then I see their strategy. But that is a bad attempt at money creation. You could probably back all money by gold but in practice you would only have to redeem printed currency by gold. The idea is to have an easy index. Otherwise there is no touchstone of worth that can be at arms length, so to speak verified. Paper is just too easy to fudge. And we have to argue we have loads of fudgers around. That is why the Swiss constitutionally went to gold holdings. H-->The efficient market hypothesis suggests that given a fair market, the rates between currencies will balance to offset advantages in other countries. Therefore the best solution is for NO currency to have a backing in gold. E-># Well that is what happens today. Sort of. But market efficiency argues that markets are things that are not real. In fact market work outs kill whole industries and reduce nations to poverty. In the 1870's Canada lost its whole Linen industry to free trade and the towns that were in milling then never did come back. Some efficiency. What looks good in a math formula works only for a few barons. We are not talking about smooth trading for the largest mercantile nation, we are talking a good standard of living for small countries and large. All nations that did well in the past modern history had tariffs and traded in gold. Did not do deficits and limited cash. Jefferson's US. England's Empire. Phonecian traders, etc.. H->Once again, you talk currency and not money: E-->Currency in circulation needed at most is perhaps one 100th of GDP. (Everything else is cheques, drafts and deposit entries.) That is 180 billion. Backed by 12 to one gold that is 15 billion. What is hard about that? Of course 18 trillion in GDP could not be equaled to gold in existence which at 300 bucks/oz is worth 2 trillion dollars. H-->You need to monetarized all the money to effectively hedge against currency outflows.{Otherwise you set yourself up as a hedge inflection point} What if everyone wants the GOLD and not the currency? E-># This has always been a problem, but if the currency is backed by gold why would they? Gold is an index of the currency. Only if you print too much will the currency be trashed and gold desired. You are arguing crash mentality. I will admit it has to be guarded against but the States did that for 38 years. I would not think it necesary to outlaw gold ownership though. I want the gov't out of gold and money control entirely. This is a truly efficient money market. Remember this was the point of the federal reserve in the first place. A private banking institution to control money. It was like a chancellor to the exchequer but private. But now it is completely co-opted. The gov't asks and they do. They "print" what the gov't wants and loan the US whatever it asks for. A gov't should not be able to loan more than it can produce and make return on, or payback in reasonable time. Remember we are the ones paying it back. I think a 50% or better tax rate on wage earners by now has demonstrated that. I don't mean the income rate but all taxes. In fact if you add all taxes up in Canada it almost 75% as everything bought contains wage and corporate taxes as well as direct and VAT taxes. It cannot go on. 65% of the GDP in Canada is the civil service and they think nothing is wrong with that. At least in Japan Inc. they make cars and TV's. Canada Inc makes nothing but red tape. The logic is that any backing of currency with gold is destined to fail. This is why the Japanese instituted the holding of US Bonds. The derivative holdings act to ensure that they can control the YEN and Dollar via action at a distance. Their holdings are small, as is Canada's. The recent drop of the Canadian Dollar against the US has served the Canadian economy well. E--> # it' a raw material exporter. Sure you want a holiday in USA you pay. Yet relative to the remaining world the effect is mooted. People will always say you are selling you industries, companies, real estates to the foreigners.... yet the same was said in '80's when the Japanese where buying New York. Now where are they? Hutch --> Without currencies allowed to float based on economics, you are destined to repeat the Swiss world. #E->They will anyway. Not everyone can back with gold. Others will use foreign currency that is backed with gold. As Europe did with the US Buck for 40 years since the end of the war. EC<:-} I do not want Swiss Francs... #E--> youre mad. H-->give me 2 pounds of gold dust, and I'll accept it after the Assayer values it and processes it. With me you pay the price... fully! E--># but when you take gold what is the full price? It depends on how you value - real against supposed. E--># Gold seems a barbarous relic until you try to substitute it for a system of other eschange. Paper indexing of worth is much, much more risky. What you try to do there is maintain a money supply against some kind of theory of what trade and production is worth. It works fine if the printers know exactly how to limit credit. But natural greed is not to be trusted except to err. If you balance the credit outflow with the production of something that is constant in society, say sewage at gallons per minute out of NYC you would have better index than what we are using today. As people work and make more money, they drink more and sewage volume increases. Time to print more money so people can buy what is produced. E--># On the other hand if we had some commodity of ultimate stability and long lastingness, that is rare and never thrown away, so it total amount can always be relied on, we would have magic yardstick to say within a good margin what the money was worth. E->#Till hell freezes over farmer in Schleswig-Holstein will always trade about 10 cows for one car. Things may change a bit but 10 cows is about it. Why that price should go from ten cows to 50 in 20 years is beyond me. Is that an efficient market? Perhaps for the person with cars. I want the cow-stamp of my money to be there. You may have yen for gold but I demand cows. EC-Moo<;-}