http://rt.com/shows/breaking-set-summary/bitcoin-currency-hugo-chavez-myths-latin-american-socialism-941/ Here you'll see Max Keiser and Abby Martin give us an entertaining summary of some of our economic woes, but the worse is to come.

Our Central banks continue to create cyber money with gay abandon but the money mostly is being used to expand the derivative market which in turn steals real assets from us.The derivative market is 10 times the GDP of the planet.This is the leverage that distorts our markets.

During the Great Depression of the 1930's they brought in the Glass Steagall Act to separate the gambling derivative market from the real economy of productivity which most of us function in.Bill Clinton in the late 1990's scuttled the Glass Steagall Act and thus, most of us lost half our super in the 2008 debacle.We now have no protection from the financial Jackals.

Max Keiser,Gerald Celente and many others have noted how real markets are being manipulated.The price of gold for example has been falling even with increasing demand and falling production.According to Adrian Douglas,for every ounce of gold there are 45 pieces of paper laying claim to it's existance.Put options in my view are forcing down the real value of gold.China Russia and the Central Banks are buying gold aggressively,so the strategy is to artificially lower the price and buy up as much as you can surrepticially.

The world's total gold value is currently $8 trillion with a Global GDP of $ 70 trillion.What happens when the fiat money supply doubles? What happens when Govts cannot honour their bond commitments because ordinary people have not the jobs to pay the taxes?

Arjay, Nice to see someone else actually sees through what the main stream press would like us to believe.... Everything's AOK and and the green shoots are beginning to grow again. Fundamentals in the global economy haven't changed, in fact they are getting worse and pumping digital money into the system has only a limited effect and will not last as inflation gains the upper hand. The likes of JP Morgan and HSBC are naked shorting the silver market by over one hundred times the actual availability of the physical metal to suppress the price. This is actually illegal under the CFTC rules but an ongoing investigation has yet to report after over 4 years ! Too many sovereign banks and governments, (US particularly) are too interested in keeping gold prices low to protect their fiat currencies but at the same time buying as much as they possible can. The Chinese who are the biggest producers of Au in the world, bans all exports and at the same time imports at the rate of 1000 tonnes annually.

We are suffering from the sea of debt everyone has been floating on with absolutely no prospect of paying it back without debasing the fiat paper currency. When we "hit the wall" is any body's guess. It depends on how much "can Kicking" can delay it all.. It's far too big a subject to discuss in a couple of paragraphs. I just wish the whole thing was better understood by the general population.

Arjay, it's a little over my head, however, what I do know is that doing business under Howard was quite prosperous and enjoyable, free from too much interference from the government.

I can also remember that almost everyone was on a high, life was great for most and mining was something that happened out in the bush, unlike today where not only is it a way of life, but it's also about our only lifeline.

Nowadays, those days are gone, as simply employing someone has become a legal nightmare, one which often makes one think twice, confidence has been at an all time low, and labor is doing it's best to chase miners away.

On the other side of the coin, we have retail suffering badly from online shopping, automation of almost everything, both of which COST JOBS, meanwhile our population is growing, PLUS the new arrivals, most of which don't contribute.

A fitting saying may be that we are burning the candle from both ends.

We must also remember where we were five years ago, where we are today, a d where we are headed if nothing changes.

"""
Arjay, it's a little over my head, however, what I do know is that doing business under Howard was quite prosperous and enjoyable, free from too much interference from the government.
"""

Of course we were living in an illusion, rehctub. Everyone thought the game of monopoly was going to last forever and the banksters and governments were all being fair. But now the ponzi game is almost over and the peasants will have to give back all that fake money because no one will want it for real things.

The banksters and governments will keep on harping that all is ok and the money is real.
They'll keep kicking the can down the road filling the bankers tray with more monopoly money created out of thin air. And governments will keep paying for the debt created with stolen money they'll take from the people at the point of a gun via taxation.
The others in the fold, economists, investors, and snake oil salesmen will keep telling the rest to ignore the profits of doom; they're just jealous they weren't blessed with the rules of the ponzi game. Heaven forbid you should wake up to the fact that it's all rigged and start throwing a noose around all their necks!

So now you know why the bankers are to big to fail and now to big to jail.

How long before the gig is up? Looking at Europe and America, not too long!

Oops!

That should have been "So now you know why the bankers are too big to fail and now too big to jail."

Snake and Raw mustard Max Keiser has noted that the HSBC has been laundering $400 billion in Mexican Drug Cartel money but the British Govt won't prosecute them because they are too important to the economy?

The Citizens Electoral Council has asked the Commonwealth Bank to disclose their deivative exposure,but this year they have refused.Total Bank Derivative exposure in Australia is now $ 19 trillion.They are impossible to bail out.This is 16 times our GDP.If you have money with any institution,make sure it is capital guaranteed.

The RBA is building a fund which is currently about $ 500 million to bail out our banks but will not create money for infrastructure or our Govt.In other words they are going to depreciate our currency to bail the banks out.It seems that the US/European disease is coming here.

Derivatives are supposed to be a type of insurance but in fact are bets on market machinations.Not even those to play the game fully understand it.Keiser says they are bets upon bets.ie double or nothing if I lose.

I first mentioned BITCOIN 2 yrs ago on OLO and now it is taken off realising 1300% increase in value in just 12 months. BITCOIN is now a bank in France with over 100,000 participants.

My advice is to take control of your super and trust no bank.Put your super and savings in solid assets like land, commodities or precious metals.When our currencies collapse,precious metals and tangible objects of worth will increase in value many fold.

I'm really disappointed that OLO makes almost no effort to spell out these realities to its readers.

We need a proper constitution to give us a say and Govts banks like we used to have to create the credit to equal productivity debt free.Debt should only be attached to money that already exists.

The Private Banksters are counterfeiting our currencies for which we as individuals get long jail sentences.

"""
I just wish the whole thing was better understood by the general population.
"""

Ever wondered why they don't teach these things in school? Why are our kids not even taught how to fill out a tax return or even that they have to?

While everyone on this forum argues over spot fires (as in rehctub) the main front is about to wipe them out and if you try to tell them they attack you!

"The Matrix (Collaboration of governments, with business & banking interests) is a system, Neo. That system is our enemy. But when you're inside, you look around - what do you see? Businessmen, teachers, lawyers, carpenters. The very minds of the people we are trying to save. But until we do, these people are still part of that system, and that makes them our enemy. You have to understand - most of these people are not ready to be unplugged. And many of them are so inert, so hopelessly dependent on the system, that they will fight to protect it."

Never a truer word spoken!

I have a strange suspicion bitcoin is another scam, Arjay. Some things don't add up and too many of the peddlers are spreading false truths!

RM I tend to agree with you about BITCOIN.The founder has sold out already.Max Keiser has become a BITCOIN millionaire but he can afford such risks.

He who controls the internet unltimately controls BITCOIN.Having evidnece of BITCOIN transactions in an external hardrive will mean nothing to those who own and control the system.

Do your own homework and buy the precious metals since that is what the banksters who created this crisis are doing right now.

Here is the place and time I get to brand myself as a senile old fool.
My belief a financial breakdown will come is unshakable.
And that it is planed just as strong.
Not fear of paper money without true value as is arjays target.
Well not the whole, we may be lucky, most of us, if not all may not live long enough to see it.
But look just at our country,s housing market.
My home, transported from a Sydney near beach side suburb, rebuilt here cost less than $100.000 its value unchanged on its once block today?
Nothing less than$800.000.
It can not continue.
We are in a country so very proud of our classless life style are condemning some to never owning a home.
And playing monoply with investment property's that are overpriced.
The rug will be pulled from under us.
And with it new things maybe even one world government offered or forced as away out.

I know this will not get an answer, but I'll ask it anyway Arjay.

>>Do your own homework and buy the precious metals since that is what the banksters who created this crisis are doing right now<<

What will be the actual, tradeable value of those "precious metals" following the Mother of all Economic Collapses? Who will trade them, and what will they trade them for? If the price of gold, say, reaches $10,000 an ounce, what do you imagine will have happened to the price of a loaf of bread?

Imagine for a moment that you have invested $100,000 buying gold. In what form does it reach you? Can you touch it? If you can't, then the exercise is pointless, since you can simply be left holding a piece of paper. So you need to buy - what? Actual gold coins? Ok, let's assume you have bought gold in convenient coin form - say, in half-ounce denominations. What then? Try buying a loaf of bread with a coin with a face value of $800 - at today's value - and see what happens. As the price of gold increases, as you obviously hope that it will, the exercise becomes even more challenging.

Incidentally, you will have paid over the odds for the coin in the first place, since it has been manufactured.

Irrespective of what happens to the economy, investing today in precious metals is not going to help you much. If you genuinely hold the view that an economic apocalypse is at hand, your only responsible course of action is to buy a plot of land sufficient to sustain you and your family, and learn farming. Oh, and buy a gun.

Meanwhile - that is, until the Mother of all Economic Collapses comes about - I'll enjoy thinking about you out there in the bush, fighting for survival, as I order another coffee.

Which I pay for with a credit card that the proprietor is happy to accept.

Incidentally, on the topic of tradeable value...

>>I first mentioned BITCOIN 2 yrs ago on OLO and now it is taken off realising 1300% increase in value in just 12 months. BITCOIN is now a bank in France with over 100,000 participants.<<

As I suggested when you first raised the topic of Bitcoin, it is not the answer to any question that has yet been posed. The "1300% increase in value in just 12 months" is about as reliable an indicator of goodness as any other get-rich-quick scheme with the same magnitude of come-on growth numbers.

As Paul Krugman pointed out a couple of years ago:

"What we want from a monetary system isn’t to make people holding money rich; we want it to facilitate transactions and make the economy as a whole rich. And that’s not at all what is happening..."

Stick with the farm idea.

I've tried, but I still don't understand derivatives. Can anyone suggest a good definition?
I agree with Pericles about precious metals, like currency trading, the price of buying and selling is very different, add to that the 'brokerage' and most of the profit evaporates when you sell. However, there's no need to go totally bush, Pericles, a block of land well within coo-ee of a town with a coffee shop that accepts credit cards, is still a good idea, one can grow vegetables, become fit and healthy and create a reasonable buffer, if only psychological.
The USA reserve bank the other day said not to worry about the debt as they would print more money to cover it. And these are the guys who sneered at "Social Credit".
I wonder what will finally trigger the collapse of economies; social collapse due to Global warming, or the machinations of the banksters. [Nice word that, thanks to whoever invented it.] or

Pericles hit the mark with what will a hungry banker do while sitting
on a pile of gold ?
Starve !

Arjay has also made a point that money is all that gets considered,
but money is meaningless. Some economists are finally waking up to the
realisation that it is energy that drives the economy NOT money !
Money is what you use to buy your energy.
During inflation energy retains its value as money loses its value.
If Arjay is right about the derivities, even just partly right, then
we are in for real problems as the value of energy increases and its
availability decreases.

Pericles

I don't think you should buy gold to get rich. All it does is provide an insurance against the debasement of paper currency which has no intrinsic value. Gold cannot offer a dividend although banks get a small return when they hypothecate it. Like land or property or other hard assets it retains its value over time. It tends to buy the same amount, unlike paper which loses it value as it is printed in ever increasing volume (inflation) Gold has the advantage that it is fungible, is restricted in availability (cannot be manufactured) it has no counter party risk and is accepted in every country of the world. If you buy it, buy the physical in allocated form, not the exchange traded funds as they have counter part risk. Another option is to buy the company securities and have a portion of the mines. They are very cheap at the moment. I am sure if you wanted to buy a cup of coffee you would be able to on credit, and then it would be acceptable to pay off the larger amount with a gold coin !

A sovereign contains roughly one quarter of an ounce of gold so the content (disregarding collectors value) might be worth around $400 It wouldn't be hard to find someone to give you the value in kind.

The point of the original gold standard was that paper was backed by gold. Now it isn't.

Pericles, I hate to correct you, but there are only 12 Oz to a pound of gold, not 16.

On the subject of money, when are the powers to be going to wake up and realize that taxing transaction is the answer to many problems.

Under the current tax system, money gets taxed once, and that's if deductions don't make a supposed profit, into a loss, whereas money changes hands hundreds of times, so can collect a VERY SMALL tax, each and every time, for ever long as it is in circulation.

Now, the ting that puzzles me is that in the early/mid 80's, Japan was strong, our dollar was about 75US cents, I think, yet one of our dollars bought roughly 130 Japanese yen. JY.

So here's the puzzling bit, our dollar is now about 102US cents, about a 35% increase,Japan is broke, yet our high dollar buys less than 100 JY.

Why is this?

Snake, we are discussing the "Mother of all economic collapses".
The only thing of value will be food and or energy.
Gold will be useless during the collapse but may be of value after
a recovery of some form takes place.

I suggest that if you want to read some well informed and thought out
fiction on the subject read James Kunstlers World Made by Hand and then
his Witch of Hebron.
It is US orientated but still directly applicable after the collapse.
I found both in my local library, so they are likely to be widely
available or they can get them in for you.

Rechub, it is the inflation from all the US money printing.

I am sure Arjay will enjoy this link and it does show what a nonsense
the US financial system has become.

http://kunstler.com/blog/2013/03/fortress-of-lies.html

We still produce a lot of cheap food in this country.The price may well increase but not to the extent in more populated countries.

It is better to have some hedge against inflation like metals or real estate than have nothing.I don't think the share market can be trusted at all.

They are making noises in the USA of taxing Wall St but it will be too little too late.Once the inflationary money is out there,it cannot be taken back easily.

As in the USA bankers here are not loaning to businesses or farmers.So the Share market is gaining value with industry closing down and unemployment rising.The share market is just reflecting an icrease in inflationary money.So the bankers are fueling speculation rather than production.

Bazz

I agree with you that food and energy are wealth, but what do you buy them with ? The only times in history that the value of gold has gone down is when there are other "investments" that are are more lucrative at the time. There has to be a medium of exchange and all I am maintaining is that Gold has always been the best. Governments can't manipulate gold as a currency traditionally (except by using naked derivatives as they are at the moment or by confiscating it, which Roosevelt did in 1933)The Romans even tried to inflate their metal coinage by scraping the edges of their gold coins which was the birth of modern day milled edges which could not be tampered with. Why do you think that every central bank in the world is accumulating bullion ? My question is why all the secrecy by the sovereign banks about their trading and how much they have. The USA refuse to have an audit and maybe this is because they don't have the gold they say they have. Perhaps It has been leased out and become a case of a fractional reserve gold banking. If so,It is probably on the books of whoever they lent it to as well. Germany demands their lot back but why does it take seven years for it to be repatriated to Europe? The only sensible thing that Chavez did was get his back to Venezuela from London before he died. The university of Texas has recently bought one billion worth of gold for its endowment fund.....no dividend, just insurance. Turkey is using gold to buy oil from Iran. It is becoming insidious although not harmful in the usual meaning of the word.

continued

If we want to purchase things from overseas, hopefully our paper will still be acceptable in the future. Gold and silver always will, and has been for the last 2000 years. Unless we go back to a time of exchange barter, Bullion will always be in demand.

I suggest you read James Rickard's recent best seller "Currency Wars" Published a couple of years ago which was very prescient.

Snake, In the case of a major collapse, you might walk out to your
local vegetable farmer and offer him a 1/100 of an ounce of gold for as
much food as you could put in your wheelbarrow.
But is that gold of any value to him ?
A litre bottle of diesel might be, but you don't have any.
Remember in Arjay's scenario the financial system has collapsed and
there is no way to value the gold.

However he might ask you to do a few days of labour on his farm.
However if you had some electrical knowledge you may be able to get
his defunct wind generator going instead.

If Arjays predictions come true that is what we would face.

However I don't think that is the way it will go, I suspect it will be
a bit more gentle than that.
I think it will come on gradually as industries and individuals will
find that the cost of energy is devouring their profits.
You can already see that happening here in Australia where businesses
are having difficulty with electricity costs. Those costs get passed
down the line to the next customer. This where Tony Abbott's $150
roast lamb dinner will come in.
Coal will soon become more expensive and of lower quality.
This has a very bad effect on net energy and turns the screws a bit more.
When Ankeringa shale oil in Sth Australia gets going there will be a
instant upstep in fuel prices in Australia as it will have to be
shipped to Singapore to get it processed into petrol & diesel and then
shipped back. That is not expected till about 2018 at the earliest.

I keep remembering what I read about complex societies.
It seems that they start having some minor problems with supply of
various things, but the difficulties start accelerating.
Complex societies it appears collapse very suddenly.
I am reminded of the fuel tanker drivers strike in the UK.
Three days after it started most service stations were dry.
Also after three days people were fighting in the super market aisles over a can of beans.

Pericles wants to know how high the price of gold will go with a monumental collapse.Like everything Pericles,it all depends.Some people may store food ,alcohol also becomes a medium of exchange and store of wealth.Honey will store for years at room temperature.

Precious metals could easily treble in price.Some say gold $10,000 per Oz.Obama is now cutting Govt spending.It depends if it is wasteful spending or spending that adds to productivity.

When inflation really kicks in,interest rates will have to rise and that will cause massive unemployment.Unlike the the Great Depression we now have no manufacturing to create work. Most of our jobs are either in services,construction,retail Govt and finance.Many of these jobs are not crucial to our survival so they will go.Crucial to our survival is China.Will they continue to buy our resources? They are presently diversifying their sources of energy/resources.

We need a new Govt bank to replace the Commonwealth.

So it time to get prepared and creative.

Bazz

As you say I don't think TOTAL financial collapse is the scenario that Arjay was originally envisaging. If it was, we might as well go and live in a cave, because we would not be able to even barter. There would be no energy to even make the steel to make a common-a-garden hoe for the farmer to till his soil because there would be no common method of exchange let alone the energy to mine the ore Nothing like that happened in the last depression and it won't happen this time. What we are talking about is the collapse of the world currencies and eventual inflation. If you increase money supply, the inevitable result is inflation, unless it is saved and not spent and that is where the velocity of money comes in. At the moment people are cautious and not spending, but as the optimism rises and people dig into their pockets, as is beginning to happen around the world, the stock market rises. Fundamentals are the same and the amount owed is still the same and many countries have debts that exceed their annual GDP. The USA has an annual deficit of well over a trillion dollars and a total debt of some 16 trillion dollars. They can't even pay the interest on that let alone be able to cope with the unfunded liabilities of over 100 trillion dollars in the years ahead. Half of Italy's taxation income goes to pay interest on borrowed money and as for Japan - €11 trillion ($14.6 trillion). This corresponds to 230 percent of annual gross domestic product, a debt they have no way of paying back and is why their new Prime Minister Shinzo Abe is devaluing the Yen to the Yanks dismay. It is a race to the bottom because it is the only way to get rid of the debt bar default. Just debase it. I could go on but I think I have run out of space !

Snake,"Half of Italy's taxation goes towards interest on debt." 90% of that of that debt was created by private central banks with the click of a computer mouse.They were counterfeiting the Italian currency and loaning back to the people as debt.

I think the best precious metal is silver.Gold is 50 times the price of silver but silver is only 10 times more abundant than gold.The gold price is high because of tradition in jewelry and it looks really good on the hand of a woman.Gold in many ways is an emotional metal.

Silver is the best conductor below gold.48% of silver is used in electronics and is more expensive to retrive from electrical goods than just mining it out of the ground.By comparision to gold, silver should be trading at $280 per oz instead of $28 per oz.However this price ratio between gold and silver prices has been fairly constant for 100 yrs.Silver is far more unstable in price because far less is traded than gold,thus it is more easily manipulated.

However in a big crisis of currency depreciation, there will not be enough gold for people to use as a hedge against inflation,thus the price of silver must rise.

I've done my sums on dividing the price of gold into average weekly earnings.The ratio is much the same as in the Great Dpression and in 1950 as today.In 1950 gold was $ 35 per oz with average incomes of $1500.Ratio 43:1 Gold today $1550 per oz with average income of $65,000.Ratio 42:1.Looking at the todays ratios,precious metals are not over valued.However back in the 1950's gold was used as a backer for our paper money.

"""
There would be no energy to even make the steel to make a common-a-garden hoe for the farmer to till his soil because there would be no common method of exchange let alone the energy to mine the ore Nothing like that happened in the last depression and it won't happen this time.
"""

Snake, you're perhaps forgetting some of us have a greater knowledge than most when it comes to things like this. How many hoes do you want? And I wont even need a gas pipe or a refinery to make as many as you need. All I'll ask of you is that you give me spuds and tomatoes when in season. I'm sure we could come to an agreement that is mutually beneficial, no caves required :~)

The financial collapse will hit everyone when America descends into civil unrest. Americans are in this cyclic, paranoid, self defense mentality that is quite frightening. There's about 90 million of them that absolutely detest the attack on their constitution and the rights it affords them by what they perceive to be a treasonous, despotic, tyrannical leader, a lot that think he's an illegitimate one at that. A bit like our Juliar :)

Then you have a government hell bent on attacking their constitution, eroding their bill of rights and acting like an enemy of the people.

Now here's where the fun begins. The people are arming themselves to the teeth as their forefathers have forewarned them they need to do and gave them permission to do so, to remove such government.

Then you have a Government pooing its pants because their statistics are telling them that Americans who hate their government are on the increase and are a threat to their existence. So they're trying to quell this dissension by further attacking their constitution and bill of rights. And the cycle repeats.

One spark now and it will be on for young and old.

So what happens to the world and more to the point, Australia, when that spark is ignited?

Interesting times ahead!

Snake said;
I agree with you that food and energy are wealth, but what do you buy them with ?

You buy them with your labour, or with other skills you may have.
We are talking here of very local business.
For instance in the middle ages there were blacksmiths, thatchers and
many other trades.
I doubt if there will be a regression back that far but I do think a
move back to the 18th or 19th century is on the cards.
I doubt very much I will see it, but my grandchildren may well see it.

Money will be reestablished but in what form I can only guess.

Arjay....

I think we also need to take into account how gold was extracted during the great depression ,compared to how it's extracted today.

I don't know the exact difference, however I assume what took a month to mine back then, takes a day now.

Not sure what the effect is, but food for thought, as if something is easier to replace, it's often less valuable.

Bazz, I liken our life cycles to a clock face.

My late dad was born in the late 20's, during the depression and from all accounts, it was pretty tough. I call that twelve o'clock.

My sister was born mid 50's, then my brother, me four years latter, still pretty tough times. Let's say three o'clock.

By the late 70's many families were starting to become better off, they started to buy gadgets, times were pretty ok. Call that four o'clock.

My kids were born late 80's, early 90's and we had it pretty good,, they enjoyed a good upbringing till the mid 2000's Call that six o'clock.

My point is that we are now on our way back to the tough old days of twelve o'clock again, but as to how long it takes to get there I have no idea.

What I do know is that we now have far less (per capita) working full time, we have far more hanger onners and we have the illegal,s problem that if not stopped will bring twelve o'clock around much faster than we would like.

We also have a very heavily relied upon mining sector that won't last forever.

Now back to gold again.

Gold will only be valuable as a batter tool, if the recipient can afford to hold on to the gold, otherwise it will be useless in most cases and may as well be in the form of a live chicken, or a few dozen eggs.

Rawmustard,yu're right about a possible revolution ion the USA.There is now a concerted effort to disarm the US people.This is why Obama has distanced himeself from Israel who want to take Iran and Syria down.The USA cannot fight wars simultaneoulsy at home and abroad. They have to disarm the US people first and will take years.However will be really ineffective? They have not ruled out using drones on their own people.FEMA is amassing billions of rounds of amunition with thousands of armed vehicles at their disposal.There are also 800 empty FEMA camps that ar supposed to house illegal immigrants.There are over 15 million illegal immigrants in the USA but none are in these camps.

If a really big collapse happens,they'll probably go to war with Russia/China.

Note the RBA is building a fund to bail out our banks.Presently it is about half a billion $.How do they bail out $ 19 trillion worth of derivatives? Even the housing loans counted as assets but the land is 50% over valued.Bank shares are supported by money printing.So the RBA like the other central banks are going to depreciate our currency to bail out bankers.

Arjay

I totally agree with you and why I have said all along that eventually we will probably revert to a kind of standard that will include gold and or silver because our existing form of currency based on the US dollar as a reserve currency is fading. As you say the gold/silver ratio is well out of whack in historical terms and every day silver is becoming more of an industrial metal.

Raw mustard

My point about reverting to "living in a cave" was probably an exaggeration but certainly going back to the Middle ages. Even then they had gold as money and we have always had a form of exchange based on it. Sure we could sell our labour as a form of exchange, but there has to be some form of manufacturing otherwise we would all be living like Eskimos and have to be totally self sufficient. I think that is drawing an extremely long bow.
I agree that as we descend into a currency decline and inflation, there will be civil unrest and anarchy as there was in Germany before WW. History has a habit of repeating itself.

Bazz

I don't think we will go back to the Middle Ages, but I do think all this debt will have an immediate affect on our standard of living and a different form of currency will develop with more controls on how it will be used.

.

Rehctub

I am not sure what you mean about Gold being a barter tool, but if it is a commonly used form of currency that everyone accepts, it will automatically become a universal currency..... but that has never changed over 2000 years. It is already accepted world wide. Paper is just a little more convenient and fits into a wallet and now as a one or zero in a computer. This make is so much easier to manipulate by banksters and governments

Basically I think we are all on the same page here, we just have slightly differing views on the extent it will take. Meanwhile I see bullion rising to compete with paper as it inflates. How much is anyone's guess.

Arjay, I think you have most of it correct except I don't think there
will be the uprising that you predict.
The financial crash will mean that the army will disband because of
lack of pay and the troops will go home to support their families.
All the unemployed financial office workers will be more of a problem
than the troops.
FEMA likewise will not be able to pay its employees, except perhaps
with $Million notes, or Euros.
No, I think your revolution scenario is a bridge too far.

My reason is that everyone will be more centred on their local community.
Remember unlike Australia the US is a country of small towns.
They will not have any interest in national affairs, and indeed what
would a bankrupt US government be able to do anyway ?
Still no one knows just what will happen.
All we can talk about is possible scenarios.

The one thing I don't understand is just who owns the derivatives and
how their failure can bring the house down.

Rehctub & Snake, Your posts about gold and its use as a currency got
me wondering. Like all resources it must follow the Hubbard curve so I
went and had a look for Peak Gold.
It was first believed to have happened about 2000 but some refining of
techniques extended peak gold a few years.
There does not seem to be any firm opinion. It is different to other
resources because it is not destroyed by use.

With a permanently fixed amount of gold currency and a rising
population that would make for a complex economy I would think.
Arjay, there is a nice research project that would be right up your alley.

Bazz

I understand there is a fair bit around, it's just like everything else, we have mined the easy stuff so now it is more expensive to obtain like oil. This is one reason the miners are in the doldrums because they are finding it much more expensive to get out of the ground and smelt. If and when the price of gold escalates, as I believe it will, the gold miners will take off as their overheads remain the same but profits go up exponentially. It might be a year or two before that happens though! In the same way the new discovery of getting oil from shale will be influencing energy & economies.

If fellow contributors here are still interested in the subject we have been discussing, this article that I have just come across might be of interest

http://news.goldseek.com/GoldSeek/1363021883.php

You know the more I think about it, the more I think you guys are right, it's about energy, not money/gold that will matter.

The cost of energy will be the key factor in how we proceed from here on in.

If we look at the carbon tax, there are many saying it has had little effect, and they are to some extent right, except where business's relying heavily on energy are concerned, as they are doing it tough,as almost every business that uses high volumes of energy have passed the costs on.

So perhaps the answer lies in finding an affordable way to not only produce energy, but to store and deliver it as well.

I guess one day we may well buy a nuclear tube of energy from the ON LINE supplier and simply plug it in to either the home, car, boat, what ever. It's real Jetsens stuff when you think about it.

But then again, how many 50 year olds expected to one day have a phone that talks to you, that is small enough to fit in you pocket, amd can connect you to the world at a press of a button.

Rehctub, I think the problem with the carbon tax is that you do not see
its effect after the compensation because it trickles down like a fine
shower, but you can still get soaking wet.

You are right about storage, that would change everything.
Just like if we could build 20 nuclear power plants in the next ten years.
All our worries would mostly be over.
The problem is we cannot afford them. The greenies won't be a problem
they will just be shoved aside by the public demand for the govt to do something.

Wow, reading this it sounds like there are some of you who DON"T have a couple of gold bars buried under a hibiscus down the back yard.

If not, why not. At the current interest rate we receive, it is earning better returns than money in the bank, just sitting there, doing nothing.

Rehctub I'm not all that enthused with all this miniatured technology. For me the old stuff, well moderately old, stuff was better.

No instant connection to the rest of the world for me. First I have to go find my glasses. That can take a while, & with out them, I can barely see those bloody buttons, let alone find the right one to push.

Then I have to find the phone. It could be on a table, covered by a couple of flecks of dust, hung in the wardrobe, in the pants I wore to town, or on the clothes line, after yet another trip through the washing machine.

Nah, phones were better hung on the wall, with a handle to wind, to get the operator, & they were more fun.

One of the best nights I ever had was because of one of them. When I was doing my flying training at Uranquinty, I rang the PMG operator to put a trunk call through to my mum. Long story short, after some difficulty with a lousy line, I ended up with a date with the operator, & long suffering mum missed out again.

At least I didn't, OAWH, those Wagga Wagga switch girls were something else. Once you knew one, you knew them all,---sort of, like, you know, hay.

Congratulation on a very interesting post. I've followed it with great interest and I would like to congratulate you all on the fact that so far it hasn't deteriorated into a child-like spat of "I'm right!" "No, I'm right!"

I rarely ever post here these days because I got sick of the arguing, however I do still read through posts that catch my eye.

I do agree with the supposition that worldly affairs will eventually take a serious nose dive. It's all a giant ponzi scheme propped up by dubious financial manipulations, however as a poster pointed out, our entire future is dependent on energy reserves. I'm convinced that the power brokers will keep the ponzi scheme going until the cost of energy tips the balance and the whole rotten lot will come crashing down. It's all about the energy! It's been argued that the cost of energy was the main cause of the 2008 GFC and for good reason.

As a side note, as someone mentioned, the US Government forbade the holding of gold during the Great Depression. I'm sure our Governments have learned this lesson from history too, so what's to stop them from forcing you to hand it over? Every tried to buy gold or silver without leaving a paper trail? Even an Ebay transaction leaves a paper trail through Pay Pal. If you go out and dig the stuff yourself, it has to be assayed prior to the conversion to cash and it's an expensive process!

Good post. Food for thought!
Aime.

We disagree on most things, Arjay, so this will not come as news to you. I think you are looking through the wrong end of the telescope here:

>>I think the best precious metal is silver... By comparision to gold, silver should be trading at $280 per oz instead of $28 per oz.<<

Once again, you are measuring the price of a commodity and confusing it with the use of that commodity as a means of exchange.

By all means, invest in silver. Or gold. Just like any other investment - stocks, shares, pork belly futures - there is a market that reflects the value placed on that investment by its participants. But the attractiveness of that investment does not automatically qualify it as a basis for value exchange. Or "buying stuff", as we like to call it.

The goldseek.com link that snake provides tells exactly that story, describing the mineral in terms of its investment performance, but deceptively promoting it, via its headline, as "currency". That is a sales trick, designed to give it a legitimacy it does not have.

All you have to do is compare the size of the world economy to the amount of gold in circulation, to conclude that never the twain shall meet.

@ Bazz
"""
and indeed what
would a bankrupt US government be able to do anyway ?
"""

Print money out of thin air just like they do now. It worked for Lincoln!

@ snake
"""
My point about reverting to "living in a cave" was probably an exaggeration
"""

I knew what you meant :) In the event of a total collapse, things would be very different this time around. More than 50% of people would be dead in the first few months. Bankers, lawyers, Public Servants, anyone that really doesn't have a productive bone in their body. There are so many resources laying around unused all over the world at the moment, the remaining people wouldn't need to transport, mine, or build anything for years.

@ Arjay
"""
If a really big collapse happens,they'll probably go to war with Russia/China.
"""

The collapse will come after America descends into civil unrest. It's my belief there are forces within and outside of America trying to force America into civil unrest to remove the last vestige of a truly free society. If America goes down, it's the end of Western civilization as we know it.

About Gold:

I don't know why everyone thinks gold is the answer? It's always been subject to manipulation and has been inflated throughout history by fractional reserve banking.

Fractional reserve banking is the problem. It should be outlawed throughout the world. It gives too many an unfair advantage and allows the ones with that advantage to manipulate everyone else.

As one very rich fellow once said:
Give me control of a country's money and I care not who makes its laws!

Hasbeen

OAWH ? I'm too old for all those texting acronyms. I presume that it represents something unrepeatable ? I tried to to work it out, but gave up - WTF

"""
I tried to to work it out, but gave up - WTF
"""

http://www.acronymfinder.com/

HTH!

That's what Google is for RawMustard

>>I tried to to work it out, but gave up - WTF<<

http://memegenerator.net/instance/28400751

Did you not see or follow my link, Pericles?

I was trying to help snake :~)

Thanks for the link. Actually I had a look but couldn't find the acronym, but not to worry, time is short and I have 101 things to do. In fact I feel I shall have to leave this thread..... Too many other priorities. I shall just leave you with this URL. There is just so much information on the web that never reaches the main stream press.

http://www.silverseek.com/commentary/moment-clarity-10196

"""
except I don't think there
will be the uprising that you predict.
"""

I don't think you're fully aware of how far down the rabbit hole the Americans are, Bazz.

These kinds of conversations are increasing all over the country at an alarming rate.
http://www.youtube.com/watch?feature=player_embedded&v=TlFPLFdfeEw

The snowball is so big now I wonder if it can be stopped?

Someone made a comment about globalisation.
Here is an article that criticises globalisation.

http://www.theoildrum.com/node/9871#more

Raw Mustard, in reply to my statement the US govt won't be able to do
anything you replied;
Print money out of thin air just like they do now. It worked for Lincoln!

That is what the US & others have been doing, it has made their economy
worse and they have been complaining that it is not working !

I had a look at that link you gave. The US does seem to be going
"nutty" and there has been a proliferation of nutty web sites.
When it hits the fan they will be more interested inmaking sure they have food.
That I think is where there would be significant criminality problems.

BTW, there was doco on SBS about those who buy very large food supply
fortify their houses, even one who bought a decommissioned ballistic
missile silo and made it their underground castle.
Some people went to amazing trouble to ensure their survival.

I don't think this country has gone "nutty" like the US and even there
the vast majority will not join any insurrection.

I have just started to read this, but I think the posters here will
find it of interest.

http://ourfiniteworld.com/2013/01/06/2013-beginning-of-long-term-recession/

Hi Bazz.

Yes, Bazz. Taking money from the little people and giving it to the filthy rich was never going to win over the plebs. You can see the sentiment all over the world what the little people think of trickle down economics.
http://dailybail.com/storage/banzai-jamie-dimon-trickle-down.JPG

English MP, Daniel Hannan describes pretty well what should have happened.
http://www.youtube.com/watch?v=7ZpJeHN0_gw

Now take that resentment and add it to all the other resentments the little people in America are experiencing under their present government (There are a lot of them) and it's not hard to see the pot is almost at boiling point.

While everyone is watching the worlds financial and energy problems (all legitimate concerns), a much more pressing issue is coming to light that most I feel are not seeing.

Think of America as the Alpha male of the world.
If America descends into civil unrest and or civil war, all the other beta males are going to start punching on for top spot. We don't have any chance in hell of protecting ourselves while all this is happening.
Even if we're left alone, the rest of the world slugging it out will make life here pretty miserable I'd reckon. And it certainly won't help the worlds financial problems. Unless you're a bankster of course!

"""
even there
the vast majority will not join any insurrection
"""

It only took less than a third of the population to start their revolutionary war for less reasons than now. There are enough disgruntled people in America to start another one, don't you worry about that. They are a nation of rednecks, after all. Can you give me an alternative reason why both sides are arming to the teeth and all the ammo shops are bare?

Another link for you, Bazz.

1.6 Billion Rounds Of Ammo For Homeland Security?
http://www.forbes.com/sites/ralphbenko/2013/03/11/1-6-billion-rounds-of-ammo-for-homeland-security-its-time-for-a-national-conversation/

There is to be an Australian Association Society for Study of Peak Oil conference
and forum in Brisbane. It is a free event open for all..

http://www.aspo-australia.org.au/References/ASPO-Brisbane/Flyer_6.docx

Would like to be there myself, but cannot make it.