Sunday, March 30, 2014

Keiser Report: No Planet for Young People

From RT

Published on Mar 29, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss no country, no planet for young people as they are forced to flee their own austerity or bubble hit countries for more affordable places abroad.

In the second half, Max interviews Telegraph journalist, Liam Halligan, about the cost of Russian sanctions to European and American corporations; the lobbying war between the Defense Lobby and the Retail Lobby and, finally, Liam actually has some nice words to say about George Osborne's budget!

SD Metals & Markets

From SilverDoctors

Get REAL with Jan Skoyles: REAL Crypto!

From MaxKeiserTV

Jan Skoyles talks to Hakim Mamoni of Seedco.in about bitcoin, cryptos and gold.

Friday, March 28, 2014

Weekend Chillout - Were have been here before

With Gold falling to below $1300 it seems that $100 of the fear trade has been bled out of the market (not that the situation on the ground in Ukraine has changed any). We have been here many times before and no doubt will be again.

PEAK GOLD: How The Romans Lost Their Empire

By Ugo Bardi


A Roman “Aureus” minted by Emperor Septimius Severus in 193 CE. At nearly 8 grams, the Aureus was truly an imperial coin – the embodiment of Rome’s wealth and power. (image from Wikipedia).

In this post, I argue that precious metal currency was a fundamental factor that kept together the Roman empire and gave to the Romans their military power. But the Roman mines producing gold and silver peaked in the first century CE and the Romans gradually lost the capability of controlling their resources. In a way, they were doomed by “peak gold.”

When I heard for the first time that the Roman Empire fell because of the depletion of its silver and gold mines, I was skeptical. Compared to our situation, where we are facing the depletion of fossil fuels, the Roman case seemed to me to be completely different. Gold and silver don’t produce energy, they don’t produce anything useful. So, why should the Roman Empire have fallen because of something we might call “peak gold”?

Read more

Keiser Report: Money out of Thin Debt Air

From RT

Published on Mar 27, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss the paper fist ruling the Empire of Debt. They look at the poor people being financially strip searched, stopped and frisked and then choked while standing in an X-Factor like line in order to get a low paying job at a supermarket.

In the second half, Max interviews entrepreneur and investor, Matthew Mellon, about bitcoin and the blockchain, luxury shoes and Hanley-Mellon.


Boom Bust - Peter Schiff: It's not the weather, the economy is headed towards recession

From Boom Bust

David Seaman Hour with Abby Martin

Listen to the chat between David and RT host Abby Martin here

Why the Australian dollar is on a roll

Three factors fueling gold's rally

Wednesday, March 26, 2014

Keiser Report on Real Estate Gold and Markets

Brilliant commentary in today's report by Stacy Herbert.

From RT

Published on Mar 25, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss how wrong the minister for universities in the UK got his maths so, so wrong. The tripling of student fees has, in fact, cost the government more in defaults than had the government kept fees at £3000. They also discuss house prices earning more in a month than one of these university educated graduates earns in a two years.

In the second half, Max puts lipstick on a pig with Mitch Feierstein, author of Planet Ponzi. They discuss the UK, Spanish and Chinese debt stories and what it would take Mitch to become bullish on the S&P.

Sunday, March 23, 2014

Keiser Report: Bingo Lingo of Economics

From RT

Published on Mar 22, 2014 In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss bingo lingo and Fedspeak. When the markets tumbled when Janet Yellen said, "six months," perhaps she should have said "Chopping Sticks" instead? They also discuss qualitative guidance and productivity gains.

In the second half, Max interviews Egon von Greyerz of Matterhorn Asset Management in Switzerland about wealth preservation and gold.

Jim Rickards and Simon Black - The coming collapse of the International Monetary System

Jim Rickards and Simon Black discuss the GFC and the potential for a coming collapse of the current international monetary system. Listen to the conversation here

Jim Rickards & Mike Maloney: Gold Revaluation & The Death of Money

From whygoldandsilver

Jim's new book is available here

Never Say No to a Panda

For all the cheese lovers out there.

Friday, March 21, 2014

Weekend Chillout - Go Your Own Way

As this week saw the US and Russia placing sanctions on each other's prominent people it seems both sides are still going their own way.

Friday afternoon funnies

Well it is Friday afternoon in this part of the world so we can start to go a bit funny.


U.S. Condemned For Pre-Emptive Use Of Hillary Clinton Against Pakistan

Keiser Report: People Power Age

From RT

Published on Mar 20, 2014 In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss the Potemkin factories that may create a manufacturing renaissance in America, or at least the perception of one. They also discuss a version of the future where elite-guided drones end the Age of the Gun and the Age of People Power and return us to another dark Age of the Elite. In the second half, Max interviews Elizabeth Rossiello of Bitpesa.co about the Silicon Savannah in East Africa where mobile currencies and now digital ones bring in greater remittances and new spending power.

Boom Bust - Bitcoin is maturing: Patrick Byrne & Jinyoung Lee Englund on the cryptocurrency

From Boom Bust

Obama extends Russia sanctions over Crimea

From Al Jazeera English

Published on Mar 20, 2014

US President Barack Obama has announced additional sanctions on senior officials in the Russian government in response to Moscow's seizure of the Crimea region from Ukraine. The US president, speaking at the White House on Thursday, also said Russia's threats to southern and eastern Ukraine posed a serious risk of escalation of the crisis in the region.

Thursday, March 20, 2014

Denis Gartman - This will send gold soaring

Tue 18 Mar 14 | 01:00 PM ET

Gold tumbles as the crisis in Crimea eases. Dennis Gartman, The Gartman Letter, discusses gold's next move, with CNBC's Jackie DeAngelis and the Futures Now Traders, Rich Ilczyszyn and Jim Iuorio, both at the CME.

 

Yellen signals Fed nearer to rate rise

Um yeah whatever Janet, just keep printing.

From Reuters

International Happiness Day

Hoping all my blog followers are staying cool and happy on International Happiness Day

Wednesday, March 19, 2014

Diamonds of the Earth

March 19 (Bloomberg) –- Affectionately known as "The Truffle Lady of New York," Francesca Sparvoli's company, Done4NY, supplies rare truffles to high-end New York City restaurants. Truffles are one of the most expensive perishable food items in the world, a pound cost upwards of $750. Francesca takes Bloomberg behind kitchen doors and into the secretive world of the truffle trade.

Putin - Khrushchev’s transfer of Crimea to Ukraine was unconstitutional

From rapsinews.com

An interesting come back on the unconstitutional vote in Crimea argument.

Article link

MOSCOW, March 18 (RAPSI) – The 1954 decision by leader Nikita Khrushchev to hand over the Crimean peninsula to Ukraine was unconstitutional, President Vladimir Putin said in an official address to federal and regional officials Tuesday.

Crimea, a largely Russian-speaking republic within Ukraine, was part of Russia until it was gifted to Ukraine by Khrushchev in 1954. President Putin said in his address that the decision was made with evident violations of the constitutional norms prevailing at the time.

The Russian President added that Sunday’s referendum, which resulted in Crimea professing its independence from Ukraine, was conducted in full accord with democratic principles and international law.

Putin added that one must be familiar with Crimean history to understand the desire of its people to reunite with Russia.

The president further added that Ukraine appealed to the UN Charter when declaring independence from USSR, and pointed out that Crimea acted similarly.

Read more

Tuesday, March 18, 2014

Marc Faber: China's Unwind 'Will Be a Disaster'

March 17 (Bloomberg) –- Marc Faber, managing director and founder of Marc Faber Ltd., comments on the state of the Chinese economy. He speaks with Trish Regan and Matt Miller on Bloomberg Television's "Street Smart."

Jim Sinclair on Russia Gold and Silver

From Greg Hunter

Rap News - Crimea: Media War Games with Abby Martin

From thejuicemedia

Monday, March 17, 2014

The Truth About Markets

Max and Stacy's The Truth About Markets show on Resonance 104.4 FM


The World’s First Whisky Fund to Launch in HK

I wonder how liquid this fund will be?

March 17 (Bloomberg) –- Platinum Whisky Investment Fund CEO Rickesh Kishnani and Platinum Whisky Investment Fund CIO David Robertson discuss the private equity fund they are launching in Hong Kong. They speak to Rishaad Salamat on Bloomberg Television’s “On The Move Asia.”

Kiev denounces Crimea referendum

From Al Jazeera English

 

George Galloway on the Ukraine

From RT

Peter Schiff and Simon Black discuss Gold

Interesting podcast chat with Peter Schiff and Simon Black of Sovereign Man. Listen to the podcast here

Gold spikes higher on Crimean Vote

Gold has spiked almost $10 higher on the Sydney open off the back of an overwhelming vote by the Crimean people to re-join the Russian Federation. No doubt the EU, UK and USA will be ringing their hands, threatening sanctions and drawing red lines all this coming week as they protest against people daring to choose their own destiny.

 

Saturday, March 15, 2014

SD Metals and Markets with David Morgan

From SilverDoctors

100 Years of War Lies Debunked

* Highly recommended viewing *

From corbettreport

Weekend Chillout - You Won't Forget Tonight

With the Crimean region voting on Sunday whether to join Russia it would appear the Sunday night's polling results will a night we will not forget in a hurry. Although hopefully it won't be a date burned into the history books for all time.

My favourite DJ, Jessie Andrews had her first major commercial release this week. She created the mix and stars in the music video (for obvious reasons).

* Warning * Whilst the song's lyrics are tame the music video is a bit racy and best not viewed at work (well not in the Western world at least).

Scissors Beat Paper


Friday, March 14, 2014

Global Precious Metal Roundtable

From ABC Bullion

Streamed live on Mar 13, 2014

The latest monthly instalment featuring some of the brightest young precious metals minds on the planet - including Jan Skoyles of the Real Asset Company and Ronald Stoeferele of Incrementum AG.

The slide deck that they mention can be viewed at the following link here

Keiser Report: Ghostbusters of Financial Fraud

From RT

Published on Mar 13, 2014

Max Keiser and Stacy Herbert discuss bashing the markets with metal pipes in order to save the markets. As a result - Libor fraud, gold fix fraud, ISDA fix fraud and now forex market fraud - each fraud is a whack, bam, bash to the market; trying to defraud the market to save the market. In the second half, Max interviews Kyle Torpey about MtGox, Dorian 'Satoshi; Nakamoto and sovereign cryptocoins.

Martin Armstrong on the Ukraine and Cycles of War

Listen to the This Week in Money interview here

Marc Faber predicts a fall in Chinese growth to 4% this year


Mining Created the Modern World

From the Ontario Mining Association. Link


Thursday, March 13, 2014

Art of the Week

More brilliant artwork from William Banzai7

Nigel Farage - The European Dream is Crumbling

From UKIP MEPs

Rare Double Sea Horse in Gold

In an almost a tick for tick pattern the Sydney and Hong Kong markets have traded at a $10 - $15 increase on yesterday's prices. One might even think that the chance of such a similar pattern would occur out of the interactions of thousands of unrelated individuals during this period would be remote, but this is the precious metals market and seemingly bell curve distribution and standard deviations do not apply. 


Ron Paul and Jan Skyoles on Gold, Bitcoin and the Monetary System

Ron talks to Jan Skoyles of The Real Asset Company about why gold is great for the international monetary system and how our whole concept of what money is and how we use money is rapidly changing.

http://www.ronpaulchannel.com/video/gold-bitcoin-monetary-system/
click on the image to access the video

Nothing to see here just wait for the train to pass and move along

Russian troops on the move near the border with Ukraine in the Belgorod Oblast, about 20 kilometers from the border with Ukraine near Kharkiv:

Wednesday, March 12, 2014

Rick Rule - $2 Billion in Cash Could Make Silver Short Positions Unrecoverable

From SGTreport.com

Gold Sea Horses

Has someone in Hong Kong just realized Russia has effectively "captured" Crimea and now can focus on annexation of Eastern Ukraine?


Crimea's parliament votes to split from Ukraine before referendum

Read more: http://www.smh.com.au/world/crimeas-parliament-votes-to-split-from-ukraine-before-referendum-20140312-hvhjv.html#ixzz2viJtwhsQ

Boom Bust - Jim Rickards: Monetary Solutions Can't Solve Structural Problems

From Boom Bust

The Drone That Shoots Stun Darts at People

And you thought it was a crappy being an unpaid intern, at least at most places they don't stun gun you as well.

Jeremy Liew on bitcoin

High Tech Assay on Wheels

From Kitco NEWS

Jim Rickards - Chinese Miracle Slows

 

Tuesday, March 11, 2014

Hidden Riches: Inside the Fort Knox of Copper

March 6 (Bloomberg) -- Bloomberg’s Alix Steel takes you past the barbed wire fence and guard dogs and inside the highly secure Southwest Commodity Storage in Tucson, AZ to see why millions of dollars of copper is sitting in this CME approved storage warehouse.

Snowden Makes a Profound Point

March 10 (Bloomberg) –- Elevation Partners Co-Founder Roger McNamee and Bloomberg Contributing editor Paul Kedrosky discuss Edward Snowden’s address to SXSW. He speaks to Cory Johnson and Emily Chang on Bloomberg Television’s “Bloomberg West.”

 

Gerald Celente on Ukraine, US, China and Gold Manipulation

A tremendous interview with Gerald Celente; Gerald discusses the situation in Ukraine, natural gas, the US economy, Chinese offshore investments and gold manipulation. Listen to the KWN interview here

Tweet of the Week


France - The next crisis point?

From CBN

http://www.cbn.com/tv/3255110732001
click on image to access video

The Five Elements To Understanding Truth

Master Kim take you on a journey of understanding yourself to allow you to seek the truth in all aspects of life.

From smartknowledgeu

Ron Paul: The Revolution continues after Congress

From RT America

Rhodium - The Forgotten Precious Metal

From Periodic Videos


Doug Casey: Europe will be the Petting Zoo of the Chinese

From Boom Bust

Published on Mar 9, 2014
(Note: loss of sound 0:16 - 0:45)

Boom Bust brings you our final segment of Doug Casey's interview. In this clip, Casey explains why the US is doing better than Europe, and he foresees Europe as being the petting zoo of the Chinese. Erin asks him about the NSA, and the state civil liberties in the USA. Casey argues that such programs are a waste of money and gives further thoughts about the Iraq and Afghanistan war. Finally, Casey tells us what he thinks about Bitcoin.

Young Turks on Abby Martin

From The Young Turks

Gold protects savers in the UK

From 1973 Gold has proved itself as effective protection against the ravages of UK inflation, more than even real estate.


Inflation history table: How the price of everyday items changed over 40 years - (Lloyds Private Banking via Daily Telegraph)

Monday, March 10, 2014

Keiser Report: Live by Fraud, Die by Fraud

From RT

Published on Mar 8, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss those who live by the fraud, dying by the fraud as fraud is deployed to cover up fraud thus causing more fraud.

In the second half, Max interviews precious metals expert, Ned Naylor-Leyland of QuilterCheviot.com about how the harmonisation of law across Europe has ironically driven the manipulation of the gold fix out into the open and how the rigged gold fix has meant that gold was not able to be classified as tier one capital.

Bonus Chillout

Just noticed my favourite DJ @jessieslife had a mix of her's played on BBC Radio One, go Jessie!


Sunday, March 9, 2014

Rand Paul at CPAC 2014

A seminal speech from a future US President?  Probably not, the average American most likely has no idea what he is talking about.

http://www.mediaite.com/tv/rand-pauls-starkly-libertarian-cpac-speech-we-must-defend-the-rights-of-all/#ooid=p1ajIybDr_WcLuQzYHxypbnW19nN2nDC
click on the image to access video

Tweet of the Week


SD Metals and Markets with Bill Murphy

From SilverDoctors

Boom Bust - Jim Rickards on Dollar Debasement and Gold

From Boom Bust

 

Boom Bust - James Turk on Gold and Silver are money, and Ukraine's fiscal woes

From Boom Bust

Saturday, March 8, 2014

Weekend Chillout - Baby come back

All the talk this week was about Russia tightening control over the Crimea and the proposed vote for the Crimean people to re-join mother Russia. Although I thought the story of Russia sinking a scrapped ship to block part of the Ukrainian Navy from accessing the Black Sea was the highlight of the week. 




For those who prefer a dubstep version

Friday, March 7, 2014

Keiser Report: EU Membership Market

From RT

Published on Mar 6, 2014

Max Keiser and Stacy Herbert discuss an EU membership market on which the more than 50% euroskeptic populations of France, Spain, Greece and UK can dump their membership burdens on to those in Ukraine and beyond who want it. They also discuss the 'sick joke' that is home ownership in Troika occupied Greece.

In the second half, Max interviews Dmitry Orlov of cluborlov.blogspot.com about his opinions on Ukraine and about the failed EU trade deal that led to the crisis and what the future holds for the economy.

Of Paper Money, Digital Money And Gold

Long time friend of this blog Hugo Salinas Price weighs in on bitcoin. Whilst I agree with Hugo on the role of gold and silver as money and that bitcoin is not money. I still believe bitcoin has value as a currency as it enables one to move value over distance which then can be converted into money, gold and silver, at that distant location.

By Hugo Salinas Price

Article link

The digital “Bitcoin” has bit the dust at Mt. Gox Bitcoin Exchange; over $400 million US has evaporated, or perhaps moved into someone’s pocket. The news is all over the Internet these days.

“Digital money” is accepted world-wide. There exists only a remnant of fiat paper money which is increasingly and deliberately made more difficult to use and transport physically. The reason being, that digital transactions leave a trail of information which governments use to control the behavior of their subjects (we can hardly call them “citizens” any longer) whereas citizens using paper money in their dealings leave no trail.

A bank in Mexico, of which I have personal knowledge, receives millions in dollar bills every week in thousands of individual money-exchange transactions. This presents a problem for the bank. Why? Because not one bank in the US will accept these dollar bills (mostly twenties) for credit to the Mexican bank’s account.

Apparently, it would be necessary to present a lifetime resumé of each of the individuals exchanging their dollar bills for pesos, in order to prove that there is no money-laundering going on. Impossible to do, what with the tens of thousands of transactions.

Only the long-established Mexican banks can remit their dollar bills for credit to the US, and then, only to Bank of America. The bank of which I speak is relatively new – though it has well over 12 million individual account holders - and Bank of America will not receive dollar bills from it. Other Mexican banks of recent creation are in the same fix.

All countries are engaged in hampering the use of paper money. Mexico is engaged in this process; otherwise, the Mexican monetary authority – the Bank of Mexico – would have intervened to assist the Mexican bank of which I speak, to remit its dollar bills to the US for credit to its account.

But, to return to the Bitcoin:

Bitcoin has received a great deal of media attention both in the US and around the world. This is quite suspicious, in my view. Of course, there is no way to prove that the Bitcoin has support in the higher circles of politics.

An interesting point about the Bitcoin is that it is so important for it to have a price in dollars; it has had various prices, all totally speculative.

I should like to point out that when real money – gold – was in use in the world, it had no price. All national currencies were only certain various amounts of gold, with various national names.

The Bitcoin as a “digital currency” is an example of the enormous confusion which reigns in the world, regarding what money is and must be.

Money – authentic money – must be the most marketable of all commodities. This is why gold is money! See here. Silver follows in second place.

The Bitcoin cannot be money because it is digital. Since it is merely a digit, which is as close to nothing as one can get, it cannot settle any debt.

The fact is that the world today is not in the least concerned with settlement. Enormous amounts of digital Bonds which promise to deliver digits, but with an interest rate attached, have accumulated as reserves in Central Banks of exporting countries. The Bonds, which are evidences of debt, are proof that payment – that is to say settlement of trade imbalances – has not taken place.

Settlement of international trade imbalances requires that something be delivered in payment, and that something can only be gold. (Silver has lesser value, but might conceivably be fit into settlement of world trade.)

Suppose that China should come into open conflict with its neighbor, Japan. Japan is an ally of the US. In such a conflict, the US might decide to freeze all Chinese dollar reserve “assets” for the duration.

With a few computer clicks in New York, China would find itself deprived of the use of some $1.3 Trillion dollars of its reserves, which are invested in digital Dollar Bonds.

This is a simple explanation of why the Chinese – among the most intelligent people on the planet – are buying gold hand over fist. Gold in the Chinese Treasury cannot be “frozen” in New York.

On March 4 we read that an advisor to Putin has recommended that Russia dump US Bonds in case of US sanctions against Russia, related to the Ukrainian affair. However, if Russia should attempt to dump US Bonds, it would discover that they had already been “frozen” in New York.

The Bitcoin must have a price, but cannot find it and will not be able to find it, for the following reason:

All digital currencies in use today have derived values. The fiat digital Dollar, for instance, has a value that derives, historically, from the time when the Dollar was 1/20.67th of an ounce of gold, and later 1/35th of an ounce of gold, and from that time to the present, a series of falling values which have each derived from a prior value by a series of devaluations.

The Bitcoin has no history, which is the essential element which makes all digital currencies acceptable, utterly false though they are.

The Bitcoin is simply a childish distraction for a childlike world population incapable of discerning falsity, much to the satisfaction of all the crooks, big and small, who prosper by scamming the public.

I remit to Von Mises, who stated that no fiat currency has ever been successfully introduced into circulation without a monetary value ultimately derived from when that currency was gold or silver money. Bitcoin does not fill the bill; it cannot circulate along with the established fiat currencies of the world because it has no history, no ancestry reaching back to its parent, gold or silver.

Thursday, March 6, 2014

Gold Exports Drove The Huge Rise In Australia's Trade Surplus


From businessinsider.com

Article link

Australia’s trade data for January is out and printed a surplus of $1.433 billion – more than 5 times the market expectation of a $270 million surplus. The ABS said that this is a 142% increase on the surplus recorded in December.

The data looks solid across the board but the huge 44% or $425 million increase in non-monetary gold exports is a stand-out feature of this result. Equally the 27% or $95 million fall in non-monetary gold imports is an additional positive for the trade balance.

Read more

Andy Hoffman on Ukraine, Metals and Global Madness

From SGTreport.com

TSA stops man after "seeing Bitcoin" in bag

From RT America

Keiser Report: The FUBAR World Economy

From RT

Published on Mar 4, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss the $400 million papaya milkshake at MtGox and the $400 million transaction malleability issue at Citigroup's subsidiary in Mexico. In the second half, Max talks to Tuur Demeester about the benign virus that is bitcoin and the cloud that hit earth. They also talk about creating an instant Hong Kong in a box and establishing proof of reserves.

Wednesday, March 5, 2014

Caution

More brilliant artwork from William Banzai7
 

Du Bist Supergeil?

This German supermarket ad was just too super not to share.

Mike Maloney - Is Money The Root Of All Evil?

From whygoldandsilver

Jeff Christian on Precious Metal Manipulation

Another classic "Nothing to see hear, move along" piece from Jeff. Is it me or is he looking and now sounding more like Gollum every time we see him?

From Kitco NEWS



Tuesday, March 4, 2014

Ukraine Tensions Push Investors to Gold

March 4 (Bloomberg) –- In today’s “Global Outlook,” Bloomberg’s Mia Saini takes a look at gold prices on Bloomberg Television’s “On The Move Asia.”

John Brady - Gold Poised to Challenge $1,400

March 3 - Bloomberg's Olivia Sterns, Bloomberg Tradebook’s Greg Bender and John Brady, managing director of interest rate products at R.J. O’Brien & Associates put gold futures in focus in "On The Markets" on Bloomberg Television's "In The Loop."

Marc Faber and Tekoa Da Silva discuss Asian Gold demand and regional conflicts

From SprottGlobal

Why gold acts as a timeless insurance policy

Boom Bust - Insolvency Crisis in Ukraine

From Boom Bust

Paul Craig Roberts on the US funded Ukrainian Coup

Paul Craig Roberts discusses the secret work he conducted for President Regan to end the Cold War and the current US involvement in the recent Ukrainian revolution. Listen to the tremendous interview here

Ukrainian troops pledge allegiance to Crimean government

From RT America

Is Silver the investment of this decade?

Financial journalist Lars Schall met up with David Morgan, one of the world's best known silver market analysts. Morgan reflects in this video interview on the rigging of the silver price and tells why he's still optimistic about silver in the long run.



Egon von Greyerz on Gold vs Short Term Thinking

Egon discusses gold's long term performance versus short term investing and thinking. A interesting interview reviewing the reasons why you should own gold and the reasons going forward. Listen to the KWN interview here

Eric Sprott on Ukraine Russia War: Capital Controls, Bank Runs, Gold and Silver Forecast

From Greg Hunter

Monday, March 3, 2014

Bitcoin Is Cryptographic Gold

By Detlev Schlichter via DetlevSchlichter.com,

The Bitcoin phenomenon has now reached the mainstream media where it met with a reception that ranged from sceptical to outright hostile. The recent volatility in the price of bitcoins and the issues surrounding Bitcoin-exchange Mt. Gox have led to additional negative publicity. In my view, Bitcoin as a monetary concept is potentially a work of genius, and even if Bitcoin were to fail in its present incarnation – a scenario that I cannot exclude but that I consider exceedingly unlikely – the concept itself is too powerful to be ignored or even suppressed in the long run. While scepticism towards anything so fundamentally new is maybe understandable, most of the tirades against Bitcoin as a form of money are ill-conceived, terribly confused, and frequently factually wrong. Central bankers of the world, be afraid, be very afraid!

Finding perspective


Any proper analysis has to distinguish clearly between the following layers of the Bitcoin phenomenon: 1) the concept itself, that is, the idea of a hard crypto-currency (digital currency) with no issuing authority behind it, 2) the core technology behind Bitcoin, in particular its specific algorithm and the ‘mining process’ by which bitcoins get created and by which the system is maintained, and 3) the support-infrastructure that makes up the wider Bitcoin economy. This includes the various service providers, such as organised exchanges of bitcoins and fiat currency (Mt. Gox, Bitstamp, Coinbase, and many others), bitcoin ‘wallet’ providers, payment services, etc, etc.

Before we look at recent events and recent newspaper attacks on Bitcoin, we should be clear about a few things upfront: If 1) does not hold, that is, if the underlying theoretical concept of an inelastic, nation-less, apolitical, and international medium of exchange is baseless, or, as some propose, structurally inferior to established state-fiat money, then the whole thing has no future. It would then not matter how clever the algorithm is or how smart the use of cryptographic technology. If you do not believe in 1) – and evidently many economists don’t (wrongly, in my view) – then you can forget about Bitcoin and ignore it.

If 2) does not hold, that is, if there is a terminal flaw in the specific Bitcoin algorithm, this would not by itself repudiate 1). It is then to be expected that a superior crypto-currency will sooner or later take Bitcoin’s place. That is all. The basic idea would survive.

If there are issues with 3), that is, if there are glitches and failures in the new and rapidly growing infra-structure around Bitcoin, then this does neither repudiate 1), the crypto-currency concept itself, nor 2), the core Bitcoin technology, but may simply be down to specific failures by some of the service providers, and may reflect to-be-expected growing pains of a new industry. As much as I feel for those losing money/bitcoin in the Mt Gox debacle (and I could have been one of them), it is probably to be expected that a new technology will be subject to setbacks. There will probably be more losses and bankruptcies along the way. This is capitalism at work, folks. But reading the commentary in the papers it appears that, all those Sunday speeches in praise of innovation and creativity notwithstanding, people can really deal only with ‘markets’ that have already been neatly regulated into stagnation or are carefully ‘managed’ by the central bank.

Those who are lamenting the new – and yet tiny – currency’s volatility and occasional hic-ups are either naïve or malicious. Do they expect a new currency to spring up fully formed, liquid, stable, with a fully developed infrastructure overnight?

Recent events surrounding Mt Gox and stories of raids by hackers would, in my opinion, only pose a meaningful long-term challenge for Bitcoin if it could be shown that they were linked to irreparable flaws in the core Bitcoin technology itself. There were indeed some allegations that this was the case but so far they do not sound very convincing. At present it still seems reasonable to me to assume that most of Bitcoin’s recent problems are problems in layer 3) – supporting infrastructure – and that none of this has so far undermined confidence in layer 2), the core Bitcoin technology. If that is indeed the case, it is also reasonable to assume that these issues can be overcome. In fact, the stronger the concept, layer 1), the more compelling the long-term advantages and benefits of a fully decentralized, no-authority, nationless global and inelastic digital currency are, the more likely it is that any weaknesses in the present infrastructure will quickly get ironed out. One does not have to be a cryptographer to believe this. One simply has to understand how human ingenuity, rational self-interest, and competition combine to make superior decentralized systems work. Everybody who understands the power of markets, human creativity, and voluntary cooperation should have confidence in the future of digital money.

None of what happened recently – the struggle at Mt. Gox, raids by hackers, market volatility – has undermined in the slightest layer 1), the core concept. However, it is precisely the concept itself that gets many fiat money advocates all exited and agitated. In their attempts to discredit the Bitcoin concept, some writers do not shy away from even the most ludicrous and factually absurd statements. One particular example is Mark T. Williams, a finance professor at Boston University’s School of Management who has recently attacked Bitcoin in the Financial Times and in this article on Business Insider.

Money and the state: Fact and fiction

Apart from all the scare-mongering in William’s article – such as his likening Bitcoin to an alien or zombie attack on our established financial system, stressing its volatility and instability – the author makes the truly bizarre claim that history shows the importance of a close link between currency and sovereignty. Good money, according to Williams, is state-controlled money. Here are some of his statements.

“Every sovereignty uses currency.”

“Trust and faith that a sovereign is firmly standing behind its currency is critical.”

“Sovereigns understand that without consistent economic growth and stability, the standard of living for its citizens will fall, and discontentment will grow. Nation-state treasuries print currency but the vital role of currency management– needed to spur economic growth — is reserved for central bankers.”

Williams reveals a striking lack of historical perspective here. Money-printing, central banking and any form of what Williams calls “currency management” are very recent phenomena, certainly on the scale that they are practiced today. Professor Williams seems to not have heard of Zimbabwe, or of any of the other, 30-odd hyperinflations that occurred over the past 100 years, all of which, of course, in state-managed fiat money systems.

Williams stresses what a long standing concept central banking is, citing the Swedish central bank that was founded in 1668, and the Bank of England, 1694. Yet, human society has made use of indirect exchange – of trading with the help of money – for more than 2,500 years. And through most of history – up to very recently – money was gold and silver, and the supply of money thus practically outside the control of the sovereign.

The early central banks were also very different animals from what their modern namesakes have become in recent years. Their degrees of freedom were strictly limited by a gold or silver standard. In fact, the idea that they would “manage” the currency to “spur” economic growth would have sounded positively ridiculous to most central bankers in history.

Additionally, by starting their own central banks, the sovereigns did not put “trust and faith” behind their currencies – after all, their currencies were nothing but units of gold and silver, and those enjoyed the public’s trust and faith on their own merit, thank you very much – the sovereigns rather had their own self-interest at heart, a possibility that does not even seem to cross William’s mind: The Bank of England was founded specifically to lend money to the Crown against the issuance of IOUs, meaning the Bank of England was founded to monetize state-debt. The Bank of England, from its earliest days, was repeatedly given the legal privilege – given, of course, by its sovereign – to ignore (default on) its promise to repay in gold and still remain a going concern, and this occurred precisely whenever the state needed extra money, usually to finance a war.

Bitcoin is cryptographic gold

“Gold is money and nothing else.” This is what John Pierpont Morgan said back in 1913. At the time, not only was he a powerful and influential banker, his home country, the United States of America, had become one of the richest and most dynamic countries in the world, yet it had no central bank. The history of the 19th century US – even if told by historians such as Milton Friedman and Anna Schwarz who were no gold-bugs but sympathetic to central banking – illustrates that monetary systems based on a hard monetary commodity (in this case gold), the supply of which is outside government control, is no hindrance to vibrant economic growth and rising prosperity. Furthermore, economic theory can show that hard and inelastic money is not only no hindrance to growth but that it is indeed the superior foundation of a market economy. This is precisely what I try to show with Paper Money Collapse. I do not think that this was even a very contentious notion through most of the history of economics. Good money is inelastic, outside of political control, international (“nationless”, as Williams puts it), and thus the perfect basis for international cooperation across borders.

Money was gold and that meant money was not a tool of politics but an essential constraint on the power of the state.

As Democritus said “Gold is the sovereign of all sovereigns”.

It is clear that on a conceptual level, Bitcoin has much more in common with a gold and silver as monetary assets than with state fiat money. The supply of gold, silver and Bitcoin, is not under the control of any issuing authority. It is money of no authority – and this is precisely why such assets were chosen as money for thousands of years. Gold, silver and Bitcoin do not require trust and faith in a powerful and privileged institution, such as a central bank bureaucracy (here is the awestruck Williams not seeing a problem: “These financial stewards have immense power and responsibility.”) Under a gold standard you have to trust Mother Nature and the spontaneous market order that employs gold as money. Under Bitcoin you have to trust the algorithm and the spontaneous market order that employs bitcoins as money (if the public so chooses). Under the fiat money system you have to trust Ben Bernanke, Janet Yellen, and their hordes of economics PhDs and statisticians.

Hey, give me the algorithm any day!

Money of no authority

But Professor Williams does seem unable to even grasp the possibility of money without an issuing and controlling central authority: “Under the Bitcoin model, those who create the software protocol and mine virtual currencies would become the new central bankers, controlling a monetary base.” This is simply nonsense. It is factually incorrect. Bitcoin – just like a proper gold standard – does not allow for discretionary manipulation of the monetary base. There was no ‘monetary policy’ under a gold standard, and there is no ‘monetary policy’ in the Bitcoin economy. That is precisely the strength of these concepts, and this is why they will ultimately succeed, and replace fiat money.

Williams would, of course, be correct if he stated that sovereigns had always tried to control money and manipulate it for their own ends. And that history is a legacy of failure.

The first paper money systems date back to 11th century China. All of those ended in inflation and currency disaster. Only the Ming Dynasty survived an experiment with paper money – by voluntarily ending it and returning to hard commodity money.

The first experiments with full paper money systems in the West date back to the 17th century, and all of those failed, too. The outcome – through all of history – has always been the same: either the paper money system collapsed in hyperinflation, or, before that happened, the system was returned to hard commodity money. We presently live with the most ambitious experiment with unconstrained fiat money ever, as the entire world is now on a paper standard – or, as James Grant put it, a PhD-standard – and money production has been made entirely flexible everywhere. This, however does not reflect a “longstanding bond between sovereign and its currency”, as Williams believes, but is a very recent phenomenon, dating precisely to the 15th of August 1971, when President Nixon closed the gold window, ended Bretton Woods, and defaulted on the obligation to exchange dollars for gold at a fixed price.

The new system – or non-system – has brought us persistent inflation and budget deficits, ever more bizarre asset bubbles, bloated and unstable banking systems, rising mountains of debt that will never be repaid, stagnating real incomes and rising income disparities. This system is now in its endgame.

But maybe Williams is right with one thing: “If not controlled and tightly regulated, Bitcoin — a decentralized, untraceable, highly volatile and nationless currency — has the potential to undermine this longstanding bond between sovereign and its currency.”

Three cheers to that!

NATO calls on Russia to de-escalate tensions in Ukraine

From Reuters

 

Gold spikes on the Sydney open

Gold has spiked over $15/oz on the open in Sydney. Being the first market to open weekly gold trading this is the first chance gold has had to react to the Russian intervention in Ukraine's Crimean peninsula over the weekend. No doubt the rally will continue when Japan, Hong Kong and China open in the coming hours. 


What Is Real Money?

From McalvanyFinancial

Who says US Politicians have no sense of humour?

Yes, best not mention SE Asia, Afghanistan, Iraq, Libya and the regular drone missile attacks in Pakistan and Yemen.

From RT

Sunday, March 2, 2014

Rap News - The Energy Crisis

The worlds greatest news show is back!

From thejuicemedia

Keiser Report: New Crypto Phenomenon Ethereum

From RT

Published on Mar 1, 2014

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss the Jon Corzine of bitcoin trying to concern troll his way into a bailout and failing. And while 6 percent of all bitcoins allegedly went missing via MtGox, every year 3 percent of China's GDP goes missing into property and bank accounts in the US, Canada and Australia. They also look at a recent study that friends of Timothy Geithner were rewarded by the stock market as much as friends of Suharto were in Indonesia.

In the second half, Max interviews Charles Hoskinson, a cryptographer and one of the people behind a new crypto start up called Ethereum. They also discuss cryptography, bitcoin and maxcoin.

Update on the escalating crisis in Ukraine

From Al Jazeera English

Tweet of the Week


Ukraine's Crimea falls to Putin, without a shot fired

From Haaretz.com

Article link

Russian President Vladimir Putin called on Saturday for the “stabilization” of Ukraine, but it no longer matters what the events of the past three days in the Crimean peninsula are called. It’s an invasion in every sense. The soldiers without identifying insignia who took control of government buildings, airports, television stations and central junctions in Crimea have been reinforced by extremely identifiable Russian armored convoys, cargo aircraft and combat helicopters. There is nothing left to hide.

According to the website of the Russian Marine Corps, “There is no better way to rest after Sochi than coming to Crimea.” The afternoon vote by the Russian Duma authorizing the Kremlin to deploy the army throughout all of Ukraine simply confirmed the status quo.

Business people in Moscow are already preparing a $5-billion package to purchase Crimean infrastructure and set up new industries. The oligarchs owe the Kremlin their fortunes and are putting them now at Putin’s disposal.

Read in full

Dictators and their Golden Thrones


The AK-47 the goat herders best friend

From Al Jazeera English

 

Counting the Cost : Ukraine

From Al Jazeera English



Saturday, March 1, 2014

Media Roots Radio – Ukraine Meddling, Cold War 2.0 and Fighting the Police State

Robbie and Abby Martin talk about Ukraine’s uprising, the hubris of America advocating regime change abroad and the establishment ramping up another Cold War on Media Roots Radio.

Help @Skoylesy make more episodes of Get Real

If you loved the first two episodes of Get Real hosted by Jan Skoylesy well now you can help Jan make another two, or more, episodes. Just go over to StartJoin to find out more. If you missed the first two episodes you can watch them here and here

New Crimean War looming?

From Al Jazeera English

Published on Feb 28, 2014

Russian aircraft carrying nearly 2,000 suspected troops have landed at a military airbase near the regional capital of the restive Crimean peninsula, a top Ukrainian official has said, accusing Moscow of an "armed invasion".Al Jazeera's laurence Lee reports from Simferopol.