Gold floats above $1k

In general, Gold, like Fiat money does poorly when economic conditions are generally rosy, credit worries are non-existent, and interest rates are falling. In simple terms, cash (and gold) are trash, and assets are where you want to be. Free to float, gold is apt to do worse as Prechter notes.

In 2002 when Greenspan stepped on the gas to fight deflation. Gold started reacting in advance to the pending credit event, an event that blew sky high in 2008. Gold's reaction now suggests the crisis is still not over.

© Mike Shedlock; So What's Behind Moves In Gold?

Хороший анализ и оценка тренда в Записках Управляющего:

• 09-08-06 Золото - на пороге большого пробоя
• 09-09-02 Золото - апдейт
• 09-09-10 Золото - последний барьер

Мое мнение сейчас такое: золото - не инструмент спекуляции, а хороший прогнозный индикатор. Если мы имеем дело с U-shape рецессией, такой динамики в золоте не было бы. Потому не стоит расслабляться: вполне вероятно какое-то принципиальное изменение монетарной системы. Например: сначала краткий период дефляции, а потом аргентинский сценарий в мировом масштабе.

Вот заговорщик-теоретик вдумчиво рассматривает этот вопрос (немного моего стайлинга для удобочитаемости):

What you need to do is send your best Wall St. salesmen and diplomats to China and sell them a bill of goods about how they can “modernize” with our help. The Cold War is over. Capitalism reins. You know us Wall St. types! It's all about the dollar! Have the radio scream the President sold out and sign them up to the WTO as you suck Asia into massive overcapacity and a deep, unbreakable reliance on the US and G-8 as customers while paving over the national independence of their life-giving water and farmland.

Then, once they've tasted freedom and affluence, once they're unable to support themselves independently, you pull the plug not on them but YOURSELF. Implode your own middle class as above. Kill the bond markets, cause a run on your own currency, and default on the debts you owe them.

Hey, it's the only thing you could do, right? Americans are just stupid, right? Wall Street is just greedy. It's all an accident, an act of God really. No one's to blame. It's classic Judo.

In a single stroke you:

• lose the burden of external debt
• by devaluation lose your internal debt
• make the nation competitive as a manufacturing power
• scare the people back into compliance, even exultation with their low wages.
• with the renewal of manufacturing, re-cast the power that your military rests on
• during a time of Peak Oil, radically reduce unnecessary consumption while insuring strategic (military) supply
• by doing that, suck in the oil powers of Russia, Iran, and Venezuela enough to knock them off-base, first with high prices, then low prices
• club China into submission to the G-8 money powers again

and best of all:

• enrich insiders beyond their wildest dreams, insuring their dominance for a generation to come

All the right people win, all the wrong people lose.

Seeing the monetary parabola looming dead ahead after the near-miss of the Tech collapse, what do you need to insure this happens on a very tight schedule?

First, knowing this will happen, you suck in your own people by demanding—straight from the top—that bankers loosen lending standards so low even the dumbest financier couldn't believe it was prudent, then refuse to prosecute even the most blatant corruptions by mortgage originators, fraudulent borrowers, and other “outsiders”. Suspecting this will all blow up, pay yourself today in bonuses instead of later in investments.

Then, knowing you'll never repay, you jack up national spending beyond anything anybody's ever seen and go do what you want all over the world, in any country you want, with impunity.

Then you have a scare that gives you cover to set up conduits that insure all the right people have lifeboats, even if it costs $23-30 Trillion, and even if the Hoi Polloi scream bloody murder. It'll all be over soon anyway.

It was only a 3% GDP deficit that sank Argentina. But the US$ is not the Peso. You need to make sure it goes down on demand. You aim straight for $2+ Trillion yearly deficits for 70 years and threaten more if necessary. Hey, is this (12% of GDP deficit) enough to insure a collapse, even of the world’s reserve currency?

Is this enough to force China to cut us off and play the role of the bad guy we have planned for them? Funny how convenient that is, no? When every economist is screaming, “Mr. President, don’t do this, why are you doing this?” Why indeed.

© Charles Smith; The Royal Scam