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Gold/Mining/Energy : At a bottom now for gold? -- Ignore unavailable to you. Want to Upgrade?

To: Bobby Yellin who wrote (1692)	9/23/1998 10:59:00 PM
From: ahhaha	Read Replies (1) \| Respond to of 1911

It wouldn't matter if unions represented 1% of the work force. The point is that they and others however small set a precedent of envy. The attitude is, "if some grunt deserves a raise, so do I". It is exactly that which the FED must bust. The FED hasn't even perceived that that psychology is back in place much less taken steps to stop it. The foreign economy thing is the perfect cover under which the inflation machine can go into high gear. It's enough to keep the lessons of the past locked up and conveniently ignored. Oil prices don't cause inflation. Doesn't anyone study history? I lived it. If you constrain the world's ability to supply oil by government decree, price will be fixed. Eventually the pent up demand busts the law into pieces. World economy becomes adapted to the protected fixed price of oil. When the market raises the price to balance demand and supply, the world economies have to adjust most prices up proportionately. Once that process is complete, relative prices are the same as they were before government got into the protection business. The change upward in most prices isn't inflation because once the basis has stabilized at a new level, all other prices stabilize there too ceteris paribus. Inflation is the indefinite continuation of general price increases. That can only occur in the cost of labor because there is no inevitable free market in labor. Not even the FED can make people work or stop them from working. You can't push on a string and if you pull on it too much, it breaks and you loose control. The FED never stopped the inflation of the '70s. They quit before that goal was achieved when they threw in the towel and started fighting the free market again on 8/13/82. The only thing that constrained our labor rates from re-exploding during the '80s was foreign competition and a Republican administration which didn't hike trade barriers. In labor when the universe is open, you have the possibility of free market force constraining the greed of labor. In a closed universe, you don't. The world's workers have learned the game of non-negotiable inflationary wage demands. The universe has now closed. The only force preventing the complete inflationary collapse of the entire world is the will-busting central banks. They don't actually have the political will to do it, but they stand aside and don't interfere when the free market moves rates. The free market in money is the final arbiter in the war among people to steal from themselves. That means the lenders won't lend until the people stop the clandestine theft. A regime of no trust is a regime of no economic activity. When rates are rising it is the low end that will be laid off. That's the whole point of going to the university. To become privileged so that you aren't thrown into destitution when the world's best minds have made another imbecilic error. When people are losing high salary jobs, it means nothing. They are a small minority with no macro-economic effect. They always have the option of displacing the low end. That's another privilege. Why else do you think there is such a strong demand for college education? Has nothing to do with knowledge. Proof: NEW YORK, Sept 23 (Reuters) - Long-Term Capital Management,the once high-flying hedge fund run by a former Salomon Brothers bond whiz, teetered on the brink of collapse on Wednesday after losing billions of dollars in the recent global economic turmoil, bank officials said. But the future of the 6-year-old fund, run by John Meriwether, former head of the bond trading desk at Salomon Brothers, was in doubt Wednesday afternoon as bankers considered various options. The Federal Reserve Bank of New York was brought into the negotiations, bankers said, with liquidation of the firm a possibility. The bankers said the firm has lost nearly 80 percent of its capital, which was estimated at $4.8 billion at the start of the year. The fund makes its money through arbitrage, or exploiting tiny differences in prices of securities across various markets, and is managed by a superstar cast of financial professionals. Besides Meriwether, its partners include Nobel laureates Robert Merton and Myron Scholes, and former Fed Vice Chairman David Mullins. Smart guys. Superstars. FED vice chairtman. Guys that know all about it. Greenspan is in the same class. His testimony proved it. He hasn't a clue. It is amazing to see the way Wall Street interpreted what he said. I read the whole text and I sure couldn't see what that amateur, David Jones, saw. Guys are betting a deflation view on smart clever entitled university types. Gold is looking up.