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cbs7

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Everything posted by cbs7

  1. Thanks for all the great info and links Steve, do you have any links you can recommend for emigration in general? I am particularly fascinated about South America, but have no idea what it might be like to live there
  2. Excellent analysis from Tom Szabo on why he thinks Jim is wrong on silver http://silveraxis.com/todayinsilver/2008/1...ir-is-mistaken/ To my mind, silver is in many ways a leveraged form of gold, it will rocket up faster than gold often and othertimes will collapse faster than gold on corrections. There is of course some difference in that gold will perform better in a contraction than silver which of course includes some correlation with the broad economy
  3. thanks guys for the further explanations. I have to say I'm still not 100% convinced by any single argument (no offence intended). I do wonder how easy it is to navigate the current environment with an open mind - I have in my own mind certain expectations (both inflation and deflation) and it's very hard to find accurate information on what is going on. Perhaps this is simply the market, to me there seem to be very strong delfationary forces and powerful attempts at reflation too. The final outcome to me is still unclear at this point, but I would hazard that physical gold (and probably silver) will be good what ever happens, although I'm certainly not "100% in"
  4. On the face of it government deposit guarantees would seem to be inflationary. e.g a bank goes under taking say £10bn of deposits with it. The government steps in and has to increase its debt by £10bn to repay the depositors. However isn't the effect technically neutral in terms of money supply? Didn't £10bn get destroyed when the bank went under and hasn't the government simply replaced that destroyed money? The difference being that the government's debt has ballooned by £10bn. Is this right or am I missing something?
  5. Thanks Zitnik for the very detailed reply. I am going to have think it through a bit, but i have a few questions about your scneario if you don't mind To be clear, do you mean £18.6bn is being held as reserves against the loans or £18.6bn has actually been loaned out (as well as another £21.4bn to make up the £40bn loan book) Has this happened yet? And at what rate of interest is HMG loaning to Abbey? Also given HMG is broke, are they simply printing the money or as I heard claimed today "borrowing it on the markets" (if so, from who and at what rate of interest?) Also it seems that the crucial point about whether the immediate effects are inflationary (in terms of prices) or continuning deflation would rest on whether banks actually start to make loans again or whether they hoard the cash. On the news today commentators were even alluding to this. They mentioned that the government was going to try and force the banks to lend out mortgages again and to small businesses but the commentator himself said it didn't seem like a very good idea when house prices were falling. The deflationary psychology seems to be taking hold and things just seem to be looking more and more like a deflationary bust. We will have to see whether inflationary phsychology can reverse this.
  6. cbs7

    Silver down over 18%!

    If you expect hyperinflation you should also expect triple digit interest rates and upwards, so your debt would expand in multiples at the same time your gold and silver are soaring. With the volatility you would end up getting "margin calls" and you would have to scrabble about trying to sell some gold and silver to repay the soaring debt. I wouldn't recommend it, unless you can get a fixed rate of interest, unfortunately that's not very easy unless you buy a property...
  7. I would like to get hold of some OHLC historical data for gold and silver futures contracts between 2003 and 2008. Can anyone recommend a good source? I need the raw data, not charts.
  8. There is manipulation in the markets but intervention never ever works in the long term, otherwise gold wouldn't be nearly 4 times higher now than in 2001. Also look at gold in GBP - it has been reaching new highs. Gold is an anti-fiat currency, not just an anti-dollar. The dollar index measures the USD against other free-floating currencies, which the world is waking up to discover are also just as worthless as the USD, so the dollar could easily rise together with gold or not. It doesn't really matter so much anymore. A price explosion will happen at some point unfortunately it is more likely to be when most people aren't looking/expecting it.
  9. I found a good live source at http://kcast.kitco.com No backwardation at present Gold Spot 904.7 Comex Dec 08 908.8
  10. I get the futures prices from my Interactive Brokers brokerage account however I can't seem to get spot gold. I simply do a visual check on the spot gold price on Kitco's chart, but ideally I would like to get hold of a proper feed for spot prices - does anyone know where this might be available?
  11. I would have to defend Peter. He has a very unique way of very clearly communicating complex ideas in very simple manner that anyone can understand. He does promote his firm very heavily, but I really like the way he describes things. He has some classic quotes, such as a recent one... "sure Greenspan talks about the 100-year flood, he should know because he set the dynamite in the dam"
  12. yes that is true, in which case he is suggesting that we would have more deflation until we reach the point where people go out and spend the money they have been hoarding.
  13. OK this is going to get me some flack, but I'm quoting from an article I downloaded from Silveraxis about gold leasing Now, I think we all know that LIBOR has been spiking higher lately, so it seems likely that the higher lease rates are at least partly a result of high LIBOR. This MAY be bearish for gold or it may not, in this environment I am inclined to feel it will be neutral. If lease rates remain high after LIBOR comes down (assuming succesful central bank intervention in the money markets over the next few days), then this would be extremely bullish for gold, but it doesn't seem to be the case YET. Also the gold market is not yet fully in backwardation, there is some contango in just the futures prices below (around 5.15pm New York) Comex Gold Oct 2008 875.5 Comex Gold Dec 2008 890.5 Comex Gold Feb 2009 894.1 Comex Gold Dec 2009 905.5 However spot gold seemed to be around 885 (from a visual check on a chart) so some evidence of backwardation. If it continues it could be very bullish for gold
  14. Given it’s not possible to know the future, I am considering various scenarios which I think could play out, and how to potentially profit/protect myself and my family. Some of the potential scenarios I think are likely: (Continuing) deflation Hyperinflation Currency devaluation (USD and/or GBP/EUR) Capital controls Stock exchange shutdown I personally think we are at an inflection point, where the outcome is unclear and I’m trying to get to grips with what the key signals would be to indicate which of the above could be about to happen and then what actions to take with respect to assets and investments before they get fully underway and the rush is on. For example for Hyperinflation I am considering these: Signals 1. Treasury / Gilt / Government Bond interest rates start to move rapidly higher 2. Gold and Silver prices move rapidly higher and prices start to go into backwardation (spot price moves higher than futures prices, as premiums increase for immediate delivery) 3. Money supply figures increase and remain high (not just temporary increases for example due to liquidation) Possible Action 1. Sell government bonds immediately, consider reinvesting proceeds into precious metals, property/land or basic foodstuffs depending on prices of these at the time 2. Purchase physical gold and silver coins immediately with any spare cash 3. Sell any non-commodity related stocks and reinvest proceeds into commodity producers 4. Pay down any floating rate loans e.g. margined accounts, keep funds in short-term stronger currency (are there any?) government bonds to repay any fixed-rate loans 5. Move funds / precious metals / stocks offshore – to where? Switzerland? I’m still working the others out yet, but would be interested to know if anyone has a similar plan or would recommend different actions or disagrees with what the signals would be. By the way, yes I do already hold gold and silver so I believe I am protected to some extent. However I do have other investments and cash too so I would prefer to be in control when the time comes and be ready with a plan. This would avoid the paralysis and sickening inertia you get when a chain of events starts quickly. Another point is that IMO there is a technical difference between a currency devaluation and hyperinflation even though the outcome is similar in some ways. Hyperinflation must happen through the money supply whereas currency devaluation could occur simply because of a collapse in confidence in a particular country. In fact Iceland would be a very good example to consider. Does anyone have a timeline or charts which would show key turning points in the collapse of the Icelandic Krone? It might be useful to us to see how much time there is before the collapse is signalled and the collapse actually happens.
  15. The idea is to look for signals ahead of time. Gold is still available at the moment, just the premiums are higher. For larger amounts you can use Goldmony or Bullionvault to buy nearer to spot prices. Remember the big smart money will be trying to move but it will be generating some signals which if you are astute enough you will be able to pick up on ahead of the next crisis. Iceland's currency didn't collapse overnight, I'm sure that there were lots of changes in the bond market and it's currency exchange rates months or at least a few weeks before today. If we can see examples, it might help to see what to look for if something similar happens for the USD / GBP / EUR.
  16. nice post on your blog, I would disagree about credit being easy in a hyperinflation. I don't think this would be the case, I think credit would be very difficult to come by and would be at huge levels of interest. The lender wouldn't want to be repaid in the fiat currency, you might have loans payable in some hard asset/currency.
  17. It's a great article, it's worth checking Tom Szabo's blog daily at www.silveraxis.com I am rereading it as I don't think I fully digested it the first time round yesterday One quote which stands out to me as one of the cruxes of the inflation/deflation issue is Is this not one of the key points? If the banks merely keep the cash to themselves or people hold back and don't take out further loans, is this not just "pushing on a string"? The money is there but unless it is loaned or spent into circulation then there cannot be hyperinflation. Sure if the Treasury sends money directly to people either via an envelope stuffed full of dollar bills or electronic credits in their bank account, this would be very inflationary, and people would immediately sense this and spend the money as fast as possible, kicking off the inflationary death spiral. But they aren't doing this (yet) are they? The money is still going via the banks so how on earth will the banks recover their appetite for reckless lending after what they have just been through? I'll carry on with the rest of the article, but this is a flaw in the argument for me at least for now.
  18. yes my family said to me today that I am the only one who was right all along. However I would take this as a contrary indicator at this point. Maybe I am insane, but I'm starting to look for buying opportunities. The market also "feels" a lot like a bottom - intense pain when looking at some of my mining stocks, maybe there is a bit more downside, but we could be looking at a big rally if the central banks announce yet an even bigger bailout. If these lows of today don't hold through the week, then this could all be rubbish.
  19. cbs7

    Gold Lease Rate 101

    spoon whereaouts can lease rates be found? Is there any historical data available? I read on Silveraxis that the LBMA was temporarily suspending lease rate publication due to problems with LIBOR
  20. yes i think this is very sensible. I see ongoing deflation for at least a bit longer. The problem I have with defaltion is that eventually it will completely destroy the system, so what value will cash have at that point? In effect is this not the same result as hyperinflation (i.e. complete destruction of the value of cash)?
  21. indeed, it also looks like a continuation gap which in my understanding often isn't filled
  22. Hi Bubb You can get Dow Jones index data from Yahoo (ticker ^DJI) going back to around 1928. I have it downloaded into my charting app here and on the daily chart there is a tiny gap between the high on 20 Apr 1933 at 75.2 and the nearest low of 75.61 on 9 May 1933. It doesn't appear to have ever been filled.... If you think it's going to get filled, looks like Prechter was right all along...
  23. It doesn't surprise me, in the same way Tony Blair wants to be the Middle East Peace Envoy, the man who sent in an army to invade a sovereign country in the Middle East, blew the place to pieces and is still occupying the place. Bit like Gordo's management of the UK economy, pump it up with huge amounts of debt and leverage, push it to breaking point and now that the whole thing has collapsed annouce yourself as the economic saviour... George Orwell was depressingly right. War is Peace Freedom is Slavery Ignorance is Strength
  24. cbs7

    Can an currency be backed by land?

    The value of land varies hugely depending on its location, utility, and nearby infrastructure. This makes it impractical to to use to back a currency, because its value can change - it can be destroyed, e.g. if it becomes permanently flooded or the value can be enormous, e.g. the land under a skycraper. What land will back the currency? Would the government just buy up all the land in order to back the new currency, and what would it buy it with? A promise or piece of paper which is backed by the land it has just purchased? It doesn't make any sense (to me at least) Land of course has value and implicitly backs the strength and power of a country (not the currency), but it is madness to suggest that it can back a currency successfully. Something much more uniform and universal such as gold, silver and other metals are much more sesible options to back a currency as their value is recognised absolutely anywhere in the world and has been throughout history. That's just the way it is.
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