Podcast

James Dines: Owning 'Wealth in the Ground' Is Your Best Bet to Surviving the Coming 'Supernova of Inflations'

Saturday, February 4, 2012, 1:52 AM

James Dines has been in the business of making bold calls for over 50 years. In this deep-diving interview, he minces no words about the dire risks the U.S. economy and the world at large faces at this juncture.

Simply put, he sees the excessive credit in the financial system as having placed the global economy on a collision course with hyperinflation.

Unlike past periods of turmoil, there are no truly 'safe' places for investment capital to hide. Geographic markets and almost all asset classes are positively correlated these days. They share many of the same risks, and if a systemic crash occurs, they will crash together.

At this point, says Mr. Dines, you want to invest in assets that can't be printed away by government desperation. You want to hold hard assets: "wealth in the ground," as Dines says (physical commodities, mining companies, etc.). They're your best best to make money at a rate faster than inflation is going to happen. 

On Government's Odds of 'Saving' the Economy

They are borrowing money with no intention of paying it off. Politicians hope to be safely dead by the time it hits the fan. This year alone America is going to be running a deficit of 1.3 trillion dollars. Most people do not really even grasp how much a trillion dollars is. One trillion dollars. If you spend one million dollars each and every day from now back to the time of Jesus’ birth, you could not spend one trillion dollars. Right now America’s debt is approaching 15 trillion dollars, which are numbers used for astronomy. How is America going to earn that? With Facebook and Twitter corporations? Our industrial base is gone. Entitlements of fixed forced payments are a large and growing section of it.

On Resource Scarcity 

Energy is, of course, extremely important. We have been writing in recent years about the coming resource imperialism. I founded the neo-Malthusian school of economics, which says that the planet is limited and the population is soaring. By brute logic, it is obviously unsustainable. You cannot just keep having more and more people on the same planet without, someday, sooner or later, running out. The nations that perceive this would start buying assets with that in mind. The primary example, of course, is China. 

So there will come a time in the not-too-distant future where the last new copper mine on the planet will be found. Hard to believe – because there has always been more – but with the world’s population soaring into the billions on an accelerating uptrend, something is going to break. Along with the currency going to break, things are going to be happening here from out of nowhere. Because when you are going at high speeds toward a brick wall in the dark, things can happen very quickly.

On Peak Oil

So the rapidly increasing demand and the shrinking supply of oil, despite any short-term oversupply, which is probably true now… is going to lead to a stratospherically higher oil prices. As soon as the military grasps that they will start needing to put windmills on airplanes, they will seize the remaining supplies, and you will not be able to drive your car until the last drop. At some point there are some very disruptive changes coming to society.

On Gold

The price of gold and silver did not go up. It is the paper money that went down. Gold and silver are the ultimate money, coins of which are good anywhere in the world, no matter what is stamped on them, and that is the money. Depending on the amount of paper each nation prints is the price of gold in that particular country, or in that particular currency.

That is one way we were protected by the price of gold. Gold is the only investable asset in the world that has gone up the last 11 years without interruption, and that is because they are just running the printing presses. The more they do, the more value builds into gold and silver. Now of course, it will have its fluctuations. It went down in the 2008 crash, but came right back up and made new highs. We tend to ride those out, and it is very important understanding what the main trend is. When you are really clear what is happening in the world, you know how to place your bets, instead of doing it blindly or just following casual recommendations from people.

Click the play button below to listen to Chris' interview with James Dines (runtime 56m:21s): 

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James Dines has become legendary for having made correct forecasts that were in complete contradiction to the rest of the financial community.

In an industry where it takes courage and conviction to go against the crowd, Mr. Dines defiantly warned investors of the "invisible crash" that would bring down stocks in 1966, the unexpected gold boom of 1974, the Internet revolution of 1996, and the market top in 2000. And now, he warns of "The Coming Uranium Boom" that is steadily approaching.

His subscribers to The Dines Letter have profited so much that subscriptions are handed down to second generations.


Our series of podcast interviews with notable minds includes:

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46 Comments

Arthur Robey's picture
Arthur Robey
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The next big thing.

I am only in the market because the government forces me to "invest" a portion of my wages on Superannuation. I assume that this is a tax.

On oil: What advice would you give to a shareholder in a whaling ship just before the collapse of whaling? Get out, sit on the sidelines and wait for the next big thing.   Who would have thought it would be mineral oil?

We still have whaling (unfortunately) even as oil passes it's zenith. But I would not advise anyone to buy and hold whaling shares.

My next move is to plant Date Palm trees. This is in recognition of climate change and the conclusions of the Business as Usual scenario of the Limits to Growth Report. Meadow and Meadows concluded that capital would have to be moved from industry into agriculture in order to feed a starving planet.

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rodneyrimes
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James Dines full of BS?

First, thanks for the interview Chris.

First off, Dines states in the interview that he somewhat 'discovered' the complex synchronized motion of starlings in 1995 and used it as his book cover. He mentions this unknown force and that scientist are baffled to this day. And that recently, some girl's videos/pics have been popular.

Bird flocking behavior has been well understood for decades now and first simulated on computers by Craig Reynolds in 1986 (Boids). It's a classic computer scientist programming project. This is my first hint that Dines might not be all he seems.

Dines stated he didn't do advertising all whilst giving an interview to Chris and pushing his books at every occasion: "I have a whole chapter about this in my book" "my latest book" "not enough time to talk about it here" etc... His website is also plastered with "the best investor ever" statements and "I made $1 million thanks to Dines"... Ok sure, but how about all the wrong calls Dines made over the year? Also, this doesn't strike me as a website from someone who is not outcome dependent. Dines doesn't advertise but does interviews all over the place pushing his books? 

He also does not elaborate on the High States idea in the interview eventhough he had time to elaborate. His books are $90 each incidently. Not cheap hey?

To summarize, take some of his advice but be weary the guy is just pushing his newsletter/books. Of course, everyone has to make a living, but don't just listen to what he says but to what he does.

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RJE
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Chris, your interview with

Chris, your interview with Mr. Dines was as complete and thrilling a Podcast as I've ever heard.

I am self taught in this new career I have chosen, and have been electrified by all things global in scope, and commodities in nature. Geography, geology, psychology, mass psychology, trends,,...etc. Everything turns me on. I read everybody. I cannot get enough. This is the first I have herd of Mr. Dines but I assure you his books will be purchased, and I will read them very soon. He will be someone I will come to know well. My next Mr. Matt Simmons. 

You were  dropped into my lap (why?) by fate perhaps, back in late 2007 or early 2008 when I started, and I have worked hard to just come to understand your broad scope of intellect. This may sound strange to you but I vsualize everything in the contexts of a baseball game. I see my future as the manager but first I go play the game as the players do. Hoping to get better by the veterans on the field, and learning by observations the intracacies from the manager, and how the game is played.  Mickey Mantle once said, "every day I learn something new in the game of baseball". He was top 5 of the greatest who ever played, and he always attained more.

I am no where near close to the experience, schooling or forward thinking visuals you present each and every day Chris. However, a great achievement for me is that I even understand you now. That is thrilling to me. Amazingly, I am having more and more epiphany's as more and more information is bonding, giving me my next step up the clarity of information gained, and understood, ladder. Rapidly now (relative of course). 

It took me a long time just to understand terms and information, and try then to not think of yesterday, today, but the future. It's the future that must be visualized, to prepare for properly. Forward thinking is abstract, and is why I probably enjoy this so much. I want desperately to separate from the herd, and reach the next pond before most of the others. Not so much for the benefits, or the greed of it all but for the knowledge accumulated (first) on the way. It's a quest, and I delight in it, I do.

Mr. Dines delights in his life, and I relate to him very strongly. Probably why I feel this towards you too.

I want nothing more out of life now than to sit with my Lady, my dog, in a chair, at Yellowstone, and mentally drift through time. I want visuals more than things now. I just need to be able to afford to get there, and that requires I hold onto what my wife and I have modestly accumulated, so it doesn't lose value but maintains its value. Nothing more and nothing less.

My lap top and radio are nice too. Tigers games are a simple pleasure that encompasses my entire life, the ebbs and flows. Very delightful because I visit with all that have come, and gone plus I get to share with the new, as in grandsons.

As I conclude this, I just have a need to express to anyone who attempt to bring clarity, and understanding, that it is lonely sometimes with your own thoughts because the people in your lives haven't moved from their spots yet. Be patient, we all are still moving forward, it's just that some have separated, attained the knowledge, and thankfully are willing to teach you as you/they catch up. If and when their ready, they will hear you. I will hear you. All I will say Chris, is I am committed to catching up, and appreciate so much that you have kindness enough in your life to wait on me. A truly GREAT PODCAST. Frankly, it meant so much to me, and perhaps not so much to others but it is where I am at right now, that I needed to hear, and am quite satisfied that it came to me this morning. Regards BOB 

PS: Chris, your respect towards Mr. Dines resonated with me, you are a fine young man, and you have done your parents proud. Nice

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Betting on the Ghost in The Machine

I've always found Dines to be a blowhard salesman of snake oil, but I'm glad I listened to this podcast anyways.

Dr. M's question regarding high frquency trading and market sentiment indicators has been something I've been pondering for awhile. 

I've made a descent living in the past from a trading strategy that uses market sentiment data exclusively, but it simply hasn't worked since 2008. For example, there was a fantastic sentiment setup in the market at the begining of this year that I really wanted to play, but it never materialized. 

A failure of this sort usually means one thing; too many traders are using the same strategy. I can only think that market sentiment analysis must be a major component of the algorithms used by the bot-traders these days. 

I still believe that markets are an expression of human nature, however, and it will be interesting to watch how the bots distort the expression of  human nature in a major market decline. 

I'm trading in my keyboard for a bowl of popcorn...this sheeple just can hang with the digital big boys anymore. Now if that doesn't scream "Short the Market Now!", I don't know what does.

Best....Jeff

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Wendy S. Delmater
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interesting...

You DO realize that all of the talk toward the end of podcast about "the more you try and convince people the worse it works" and "people are where they need to be" and--although you did not use the terms--emotional "detachment" from those who 'do not get it' are all very core concepts of AA and Al-Anon. They are standard tactics for dealing with drunks and addicts.  I suppose what works with ethanol addicts might work with petroleum addicts. Right?

What you're suggesting is standard Al-Annon tactics: lead by example and do the right thing, because trying to convince dysfuctional people that they have a problem is counterproductive and a waste of time and resources.

And by extension, you're calling the average investor (and peak oil denier) dysfunctional.

As I said, innnnteresting. And please be aware that, statistically, only one in ten who needs the message of Al-Annon recovers. If the comparison with oil addicts holds - ouch.

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A really great podcast...

Chris... I have to agree with my fellow Tigers fan Robert Essian that this is amongst your best work, on so many levels.  Just WOW.

I want to especially point folks to what Chris says just before the 49 minute mark... from the transcript;

end of Dines comment  "......Unless you have a true understanding of your relationship to money and who you are as a person, in high states, even if you have the other three disciplines nailed down, this one will deceive you into getting to talk yourself into going against what you know you should be doing and then miss-stepping. Does any of that make sense?"

Chris Martenson: It does. It says that during the first part of our lives we go out into the world and we collect information from around us. And that at some point you have to understand that the next journey is inward, and the true mastery of the world involves mastering yourself more than facts and figures and data and information from outside. Is that right?

This is absolute Gold folks... wisdom distilled.  For me, the simplest way to explain the journey Chris refers to is this;

We evolve into the person we are through many influences, and without knowing it or realizing it, we create a "me" that is not always in harmony with our true spirit.  We may have taken a particular career path more to please our parents than to please ourselves, or we may not be aware of our own tendencies to fall into a victim mentality.. because we think that is the only way we can get others to care about us... many permutations... but the net is that on some levels, or many levels, we are living a life that is a lie... and that lack of integrity with our core can manifest itself in many less than positive ways.

I am sure there are many ways to take the journey... and like most journeys, the first step is to become aware that this possibility exists.  It does!  As Chris says... "mastering yourself" ... or as I like to say, getting a better grip on the controls of spaceship Jim H, can pay off huge dividends.  For me, it has meant becoming much more comfortable with myself, in my own skin so to speak... such that I can take criticism much better than I used to.  It has also made all the difference in my work as a manager of people, where the integrity and authenticity of my relationships with my team has allowed me to recruit from within the company through the word of mouth of my existing employees.   

My own journey included weekend immersion classes taught by the Excellence foundation in the Seattle area;

http://www.excellenceseminars.com/

The second in the series is called, "The Wall"   www.excellenceseminars.com/programs/the-wall

To me, the most beneficial aspect was this;

"Position Release: Learn how to let go of attitudes, habits, and patterns that do not support full participation and success in life and replace them with workable positions."

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I interpreted "Wealth In The Ground" differently...

Dines seems to be hot on non-renewable resources, and his "wealth in the ground" seems to be mainly about non-renewable things you dig up and sell to other people.

However, I think a more realistic target for the indicators he tracks is productive farmland. We all eat for a living.

(And yes, I have a vested interest -- we're looking for hands-on partners in small-scale sustainable agriculture and energy production.)

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Rodneyrimes... your criticism of Dines is non-constructive

Your logic in knocking Dines with regard to Dines' discussion of bird behavior is quite tortured, if not completely specious.  Dines does not seem to me to be implying that he discovered this behavior in Starlings... rather he is commenting on his insights into the nature of the mechanism by which they move.  My own intuition is that they move through a very rapid version of the "stadium wave" ... but Dines is saying that it's something beyond this, and that the coordination is simply too fast, and across too long a length scale to work this way.  Whether you agree with Dines or not, I don't think this is comparable to Al Gore's invention of the internet, as you seem to suggest.

Secondly, it's not new news that EVERYBODY TALKS THEIR BOOK.  What I look for is whether a person is speaking from conviction, and passion... or whether they are just out for a buck.  I can assure you that Dines doesn't need the money anymore.  

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Ditto

I've found that people cluster into several groups when confronted with such facts. These roughly correspond with the Kubler-Ross stages of grief:

Deniers. If they bother to look at facts at all, they can tell you all about abiotic oil. But more likely, they are so hypnotized at the dazzle of the mass media that they don't even care. As George W. Bush said, "How will this look in 50 years? Who cares! We'll all be dead then!"

The "yeabuts." My father is one of these. "Yea, but they've got new stuff in the labs just waiting for the price of oil to get high enough."

Talkers. They can quote the latest story on The Oil Drum, can tell you the date of Peak Oil from three different points-of-view, and have read all about the best survival strategy. Then they hop in their SUV and drive 30 minutes to an office job.

Everything will be alright if we only just... These are the people who have changed their light bulbs and own a Prius -- and think everything would be just fine if everyone else did what they did! The difference between these and commercial developers is that developers want to build little houses in the woods -- but these folk already have their little house in the woods, and don't think anyone else should be allowed to.

Investors. How can we protect our capital while making a killing off the stuff that everyone is going to want? There seems to be a lot of those in this list, and who knows? Maybe they're on to something? But then, maybe their bodies will be found someday with gold coins in their mouths...

Doers. They actually grow some of their own food, and if they aren't there yet, at least they're working on food self-sufficiency.

I agree with safewrite. There ain't more than about one in ten in the last group.

But no one's crystal ball is perfect, and perhaps A Miracle Will Occur, and one or more of the other clusters will thrive. All I know is that the last group has the best chance in the widest range of scenarios.

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WOW!!! Indeed.

Chris Martenson: It does. It says that during the first part of our lives we go out into the world and we collect information from around us. And that at some point you have to understand that the next journey is inward, and the true mastery of the world involves mastering yourself more than facts and figures and data and information from outside. Is that right?

"This is absolute Gold folks... wisdom distilled." (From J.H.)

A slam dunk, and I don't even drink. I never look at a man's wealth personally, I seek the content of his character. My Pops used to tell me as I was awed by something someone had, and he would just say: "Strip it all away, remove him from his comfort zone, and get to know him. Then admire him if you like." I know allot of truly uninspiring rich people, and to die for individuals who have less but way more. It was the combination, and presentation of this podcast from Mr. Dines, and Professor Martenson, that gave me my comfort with it. Good Stuff...Grandsons are here, and I am over joyed, no cash can replace every minute spent with them. Hell, they can't make change for a quarter yet. Perspective folks. Peace

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Jim H wrote:Your logic in

Jim H wrote:

Your logic in knocking Dines with regard to Dines' discussion of bird behavior is quite tortured, if not completely specious.  Dines does not seem to me to be implying that he discovered this behavior in Starlings... rather he is commenting on his insights into the nature of the mechanism by which they move.  My own intuition is that they move through a very rapid version of the "stadium wave" ... but Dines is saying that it's something beyond this, and that the coordination is simply too fast, and across too long a length scale to work this way.  Whether you agree with Dines or not, I don't think this is comparable to Al Gore's invention of the internet, as you seem to suggest.

Secondly, it's not new news that EVERYBODY TALKS THEIR BOOK.  What I look for is whether a person is speaking from conviction, and passion... or whether they are just out for a buck.  I can assure you that Dines doesn't need the money anymore.  

At some point in the past I had read a article about a computer scientist who had modeled the swarming behavior of flights of starlings.  Perhaps the guy mentioned above.  As I recall, the model began to work when he was able to model an individual birds relationship to several other birds around him.  As that changed minutely, the individual changed as well.  Magnified to the group, it appears to turn on a dime en mass.  The Wave is probably a good analog.

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my perceptions

The starling videos, to me, look like what JH suggested, a wave.  IOW, they don't all turn on a dime.  That leaves room for a signal being passed between birds that they respond to quickly, but not simultaneously.  OTOH, I have also seen videos of schools of fish, in which they do appear to turn on a dime.  My eyes do not detect a time lapse in movement of the school.  They all turn simultantaneously.

This suggests that different mechanisms may be at work.  But what do I know?  I'm just a bird watcher.

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safewrite wrote: You

safewrite wrote:

You DO realize that all of the talk toward the end of podcast about "the more you try and convince people the worse it works" and "people are where they need to be" and--although you did not use the terms--emotional "detachment" from those who 'do not get it' are all very core concepts of AA and Al-Anon. They are standard tactics for dealing with drunks and addicts.  I suppose what works with ethanol addicts might work with petroleum addicts. Right?

What you're suggesting is standard Al-Annon tactics: lead by example and do the right thing, because trying to convince dysfuctional people that they have a problem is counterproductive and a waste of time and resources.

And by extension, you're calling the average investor (and peak oil denier) dysfunctional.

As I said, innnnteresting. And please be aware that, statistically, only one in ten who needs the message of Al-Annon recovers. If the comparison with oil addicts holds - ouch.

The original Transition writings openly acknowledged the similarity of "addiction" work to what needed to happen with respect to Peak Oil descent.  ... dons

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Doug wrote: The starling

Doug wrote:

The starling videos, to me, look like what JH suggested, a wave.  IOW, they don't all turn on a dime.  That leaves room for a signal being passed between birds that they respond to quickly, but not simultaneously.  OTOH, I have also seen videos of schools of fish, in which they do appear to turn on a dime.  My eyes do not detect a time lapse in movement of the school.  They all turn simultantaneously.

This suggests that different mechanisms may be at work.  But what do I know?  I'm just a bird watcher.

The human eye cannot detect sub 100 millisecond differences, however, there are a lot of milliseconds in that range ... room for a lot of things to happen.  ... dons

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Jim H wrote: Your logic in

Jim H wrote:

Your logic in knocking Dines with regard to Dines' discussion of bird behavior is quite tortured, if not completely specious.  Dines does not seem to me to be implying that he discovered this behavior in Starlings... rather he is commenting on his insights into the nature of the mechanism by which they move.

From the interview it (see 41:00 mark), he states that the starlings are being controlled by an unseen force and that there is no work in psychology about this. That scientist as recently as last month have no understanding of it. This is not the case. Scientist know exactly why these complex behaviors in bird flocking happen. They can repeat them in simulation. Immergent behavior is due to every bird operating under a set of simple rules and considering behaviors of its direct neighbors. Check the link I provided.

Jim H wrote:
My own intuition is that they move through a very rapid version of the "stadium wave" ... but Dines is saying that it's something beyond this, and that the coordination is simply too fast, and across too long a length scale to work this way.  Whether you agree with Dines or not, I don't think this is comparable to Al Gore's invention of the internet, as you seem to suggest.

Again, there is no global force at work here - just local decision making. This is a well understood phenomena. If Dines cannot comprehend this for the simple case of bird flocking, then I can only come to the conclusion his model for financial markets under the influence of an unseen force is bunk.

Jim H wrote:
Secondly, it's not new news that EVERYBODY TALKS THEIR BOOK.  What I look for is whether a person is speaking from conviction, and passion... or whether they are just out for a buck.  I can assure you that Dines doesn't need the money anymore. 

Maybe, but then he shouldn't be preaching how he doesn't do any advertising when he is blatantly adversing in this very same interview.

If he didn't need the money anymore, why charge $90 a book? I don't recall many books costing $90 in my local bookstore...

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Following the conversations

Following the conversations it seems to me that people are arguing from different positions on Maslows hierarchy of needs.

from wiki

Those who approve are talking from the top. I am addressing the bottom. I guess that puts me down there with the plankton.

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Sorry, but .......

Maybe I'm just getting too old.  But, I remember Jim Dines touting this same doom and gloom stuff back in 1981 and 1982, just as the market and economy was in the ignition phase of a 30 year tear.  He was a big deal back then, and he had a lot of his readers scared.   I don't know about the success of any of his predictions after that; as the folks who followed his advice were left standing in the station as the train pulled out.  He lost a lot of credibility and his following dropped to almost nothing.

I especially like the hype that  "James Dines has become legendary for having made correct forecasts that were in complete contradiction to the rest of the financial community."  Considering that almost everything economic I read these days is negative, I have to laugh that Dines claims he is contrarian.  He is all about selling fear, and there's always a market for that.

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osb272646, I agree that

osb272646, I agree that there's money in selling fear and sometimes it's important to step back and take a deep breath. An interesting exercise is to scroll through the headlines from all the previous articles on this site for the last 2 years or so predicting imminent collapse. Well TPTB have managed to keep things together every single time. I'm not criticizing this site at all, far from it, becasue I don't disagree that the whole system will collapse at some point, the question is how long will that take. I am beginning to think that we might want to consider that things may continue on as they are now for a while longer than we might think because the whole sytem is faith-based and people's unwillingness to accept the truth of the fundamentals may well be able to keep it alive for a while longer, especially at 0% interest. Or maybe it will fall apart this year, who knows. We tend to make our predictions here based on fundamentals but there are still enough resources available I think for the manipulators to be able to hold those fundamentals off for a while.

And I can't comment on Dine's track record in the 80's but things are quite different now than back then. In the 80's the fear was from going from a gold backed currency to a fiat currency, and then jacking interests rates up to offset the stagflation. Well we are now out of natural resources and we have no similar options left other than currency devaluation which would be a cataastrophic event. Back then we were not at the peak of a ponzi scheme whereas now we are.

Regarding China buying up all the world's resources right now, well that is hitting close to home here in western Canada. Canada used to own the largest single petroleum deposit in the world. I think China now owns most of it. Here we are seeing a massive campaign to get a pipeline built to the west coast to ship our resources to China. The politics are geting very slimy, and when 4000 Canadians signed up to speak at the National Energy Board's review process (me included), we were all branded by our very own prime minister as "foreign radicals". The irony is disheartenting because it's China behind the push to get Canadians to willingly give up our resources in return for worthless pieces of paper $$$ and some jobs.

This ties into the theme at the end of the interview about not being able to convince people of the facts no matter how they are presented, because China is somewhat successfully convincing many here to sell out their own futures and ship our resources overseas. And talk by me of the fact that the world is running out of resources, is at Peak Oil, and that we should instead keep them here because there is nothing of value that Canada could be paid for in return for its oil just falls on deaf ears. It is very sad and incredibly frustrating to watch, as our political system is quickly becoming corrupted, not too far behind the US now in its incompetence and complete disregard for its duty to its own citizens.

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Birds, alcoholics, booksellers oh my!

Thank you Rodneyrimes and all, this is the most entertaining discussion thread I have seen on this site.

I notice that the world is so complex and that there has been so much science developed it is almost impossible to synthesize what has been done before and come up with a new  force of nature.  But a science as seriously untethered from reality as psychology seems to do this on a regular basis. I wonder if the new bird theory of nature took into account the fact that a bird senses and responds to information much faster than a human (partly because the nerve paths are so much shorter from eyes  to brain and to muscle how many times compared to a human) and the metabolic rate is much higher etc.  In the 50 milliseconds it takes my eye to even perceive a change, the bird has seen and responded to a stimulus. same for the fish. Did the psychologist account for this fact or maybe my fact is wrong?  I dont have time to get into this but the posts from everyone are very interesting thanks.

Safewrite: thanks for your very interesting observations about drug dependents and its relationship to fossil fuel dependents and the inability to deal with the addictions.  CM's comments and yours are great nuggets to me.  Whatever helps me prepare (in particular your insights) is most interesting and also most valuable because of the overriding need to prepare for the Reset.

To my knowledge, every person interviewed by CM is selling something.  Yet, the most interesting and useful aspects of these often are the discussions that follow. Just as Adam Smith discovered or observed for society in general, lets accept the self promotion as a good thing. Since we are not paying each interviewee for his time, I accept this in the spirit that I accept public radio or public internet news.

In my opinion the best "wealth in the ground" for preparation is buried gold, silver, seeds guns and ammo.

best wishes everyone

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Mark_BC
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Well if I may wade into the

Well if I may wade into the Starling issue, like jturbo68 I also remember recently reading something about scientists studying this group dynamic and discovering that millisecond pressure differentials can be transmitted across flocks of birds or schools of fish and can explain the amazing flock behavior. Or something to that effect.

So the physics of the motion probably has a "logical" explanation but I don't see the reason for all the disagreement here because the consciousness that exists in all of our brains to be able to process that information is indeed "incomprehensible" to science. Same with our mass psychology. I will go out on a limb here and argue that technology / science will never be able to construct artificial biological intelligence, and be able to figure out how thoughts emerge from electrical signals, because it is a nonlinear phenomenon originating at the quatum level where cause-and-effect are no longer predictable. I think this is what James Dines was alluding to.

That's the miracle of life. A true scientist, far from trivializing and reducing life to logical bits and bytes, is amazed by it and stands in wonder at how complex everything is and how it could possibly all come together in such perfect unison to culminate in what we see on Earth right now -- the very same Earth we are quickly destroying with our maladapted mass stupidity psychopathic behavior. But this behavior is not totally unjustifiable because our brains simply did not evolve in an environment to be able to comprehend and responsibly interact with the information and stimuli we are now facing. We evolved in small groups of a few dozen or hundred individuals, and fought with our neighbours out of necessity, and our populations were kept in check by predators or other natural constraints. Our "growth" psychology was a necessary strategy of counteracting the natural constraints and hardships that tended to "decline" us. In all natural poluations a balance is struck between growth and reduction.

That's where we came from and that's how we are wired. I interpret what Chris says of the "journey inward and mastering yourself" to be in effect, moving your consciousness beyond those tribal involuntary and predictable knee jerk reactions that are "programmed" into us (both genetically and socially). Of course that can get into the topic of religion etc. which is a no-no on this site so let's leave it at that.

But we haven't been able to escape those natural constraints that used to keep us in check, which we also used to and continue to constantly fight in order to survive. But now the consequences of those behaviors are of the scale that could easily destroy the world, and based on our current trajectory, likely will, at least the world as we know it.

As I like to say, "If you aren't amazed then you aren't paying attention". If I wanted to take a more philosophical stance, I'd say we should take a step back in order to contemplate our rare opportunity to be able witness a historic period in the history of life on earth and contemplate why we are here right now armed with the knowledge to be able to make sense of it. There will be a lot of pain going forward but ife on earth will continue on regardless, we still have a few hundred million years left before the sun envelops us. We are just right in the center of all the action.

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Nate
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Absolute Gold

Jim H wrote:

Chris Martenson: It does. It says that during the first part of our lives we go out into the world and we collect information from around us. And that at some point you have to understand that the next journey is inward, and the true mastery of the world involves mastering yourself more than facts and figures and data and information from outside. Is that right?

This is absolute Gold folks... wisdom distilled. 

Chris's ablility to distill wisdom is why I am and will continue to be a subscriber. 

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RJE
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Folks, I have enjoyed every

Folks, I have enjoyed every word here.

Honestly, I never honed in on the starling thing, not even a little bit. Frankly, all I gathered from that bit of news from the podcast was that's surely a flock of chit if I walked under them (a stab at humor). They are beautiful to watch though, and if pondering herd mentality would be a visual example of how to use it in explaining to others what that looks like.

What I took away was completely different. I heard a gentlemen discuss his rather unique story, places (mental exercises) he's been to, and still looking to stay ahead of the herd.

All his visualizing ,he did when slide rules, compasses, graph paper, and # 2 pencils were the tools, and intuition, and observations his Internet source. The logic, the mental pathways Mr. Dines took just had to be gifted. 

Mr. Dines has my more than casual respect, and I have never talked to him. I have no clue who this Man really is. Just my gut is telling me that I would really enjoy spending a day with him. I trust my gut. I will work to get a glimmer more of his thoughts but I won't be deceived that I will REALLY know him. I'm guessing though that he will add to my knowledge base , and that's all I seek.

Mr. Dines is more than he represented in our podcast (it was terrific), we just don't know how much. Never will really. Respectfully given...BOB

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A(nother) Great Conversation...

This is an excellent comment section.  I am happy that the contents of this podcast resonated here.  Mr. Dines has been paying attention and gathered wisdom along the way and seems to be living life according to an internal guidance system that I perceive as coming from a place of authenticity and integrity.

Whether it happens to utilize the same set of operating principles that you or I hold dear does not shift that perception for me.  I enjoy people who unapologetically live by their principles, often because the contrast helps to illuminate and call into question my own internal guidelines.

Either I am evolving and learning or I am stagnating.  Both have their places and times, but right now happens to be a period of rather robust evolution, which is why I rather enjoyed the discussion with Mr. Dines.

Regarding the murmurations, is there more there for science to learn?  Undoubtedly.  We still don't know how accurate migration guidance works (magnetic fields?  celestial navigation?) so there is certainly some form of sensory input which is yet to be understood.  Could there be other more subtle ones than the ability to fly 13,000 miles accurately in all weather acoss open water?  That's a pretty safe bet.

I like to remain open to the idea that magic and mystery surround us still, and that many surprises yet remain for us humans.  As a scientist that watched hundreds of hours of live cells doing their thing under high-powered microscopes, I consider myself to be more awed by the mystery of life than people who have never spent a single minute on the topic.  It simply boggles the mind.  Well, my mind at any rate.

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stream of consciousness...

I don't know why, but in rereading this thread, I picked up for the first time the footer in our good friend Arthur Robey's comment;

"Absolute certainty is a privilege of uneducated minds-and fanatics. It is, for scientific folk, an unattainable ideal." Cassius J. Keyser ."

And it struck me as saying much the same thing being presented on a very thought provoking ZH post today...;

http://www.zerohedge.com/news/failure-inflation-targeting-hubris-central-planning-lost-pilot-effect-and-economist-idiocy 

I was enamored with Feynman's intellect myself (I am at least smart enough to realize and appreciate that there a people way, way smarter than I), hence I thought it cool that the author of the ZH piece related it to our current state of affairs, described aptly I think by one Mr. Turd Ferguson as, "The end of the great Keynesian experiment".

from ZH;

Grice on exposing faux experts (virtually all of them) using the methodology of one Richard Feynman:

 
 

One of my favourite people of the 20th century is Richard Feynman, the Nobel Prize winning physicist who, among other things, pioneered the study of quantum electrodynamics. In a fantastic documentary about him for BBC's Horizon show called "The Pleasure of Finding Things Out" he said something I found moving and profound. He was talking about the "experts" he saw on TV and how although he didn't have any expertise in the area they claimed to have expertise in, he felt quite sure that they didn't know what they were talking about. He said this: 

"There are myths and pseudo-science all over the place. I might be quite wrong, maybe they do know all this ... but I don't think I'm wrong, you see I have the advantage of having found out how difficult it is to really know something. How careful you have to be about checking the experiments, how easy it is to make mistakes and fool yourself. I know what it means to know something. And therefore, I see how they get their information and I can't believe that they know it. They haven't done the work necessary, they haven't done the checks necessary, they haven't taken the care necessary. I have a great suspicion that they don't know and that they're intimidating people."

My take from the article:  If you believe the folks steering the economic/fiscal/monetary ship, sitting in places of power, Governmental, Corporate, and CB, really know what they are doing regarding the hugely complex, interactive system (aka house of cards) they/we have built... you have another thing coming.

Good sale this month on long shelf life spinach here if you are willing to buy 12 cans...

http://beprepared.com/product.asp_Q_pn_E_FN%20S150_A_name_E_Provident%20Pantry%C2%AE%20Freeze%20Dried%20Chopped%20Spinach%20-%205%20oz      

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speakcat
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Investing in gold

Well, I looked into investing in gold about 3 years ago.  I first decided that physical posession of gold was the only rational choice. I have read that there are more gold futures, etc. than there is gold and a fair amount of fraud is going on.  I checked with local pawn shops & jewelery stores.  No one local is dealing with gold as an investment.  I realize that any form of gold is an option but gold coins as in Eagles or Krugerands, etc. was the rational choice.  I drove to the next larger town (about 20 miles away) to a couple of shops that advertised the buying and selling of gold.  Their markup was 8% over the daily gold price.  I know someone in a larger, out of state town that has been buying gold coins for several years & he pays a 4% markup. I did not buy any gold. I rethought my gold investment strategy.

Now what happens if I pay 8% premium to buy?  Thats OK if gold goes up at least 8%. Obviously it has. But wait, if there is a premium to buy, I bet there is a premium to sell to a dealer.  Another 8%?..Maybe.  This is not a metropolitan area so buying and selling options are limited. AND I have to drive 20 miles one way.  If things get that bad, can I get there?  Can I get there safely? And back!  How much will gas cost?  Will there be any gas available?  If I am about the only vehicle on the road, do not I become a target?  If gas is $20 or more per gallon I must be rich if I am driving other than maybe VERY local.

Suppose I bought  a fair number of gold coins at $1,600 per ounce.  Suppose gold goes up to $5,000 per ounce.  I have made lots of money but my cash dollars will be worth nearly nothing. Not even considering the other major difficulties going on if things get that bad (WTSHTF) or (TEOTWAWKI). It may risk my life to go cash any coins in.  Can I show up at the grocery store to pay with a $5,000 Krugerand?  Will they run a credit balance for me? I am assuming that a $5.000 gold coin will buy more than a couple weeks worth of food.  If people know I have gold does not that make me a target?  I am sure that those times will be very dangerous.  I do not trust the "authorities" to keep me safe. Many of them are already part of the cause of problems and may become part of the danger.

Ultimately I decided that gold was not worth the risk. It may be better to have gold than have not, but I think that ultimately knowledge, skills, tools, rational preparations and dependable friends and family are assets more valuable than gold.

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Jim H
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Speakcat and Gold...

Well... you have tried pretty hard to rationalize your decision not to buy Gold... but it's really not as hard as you paint it.  First off, as long as the "system" is functioning, you can do all of your transactions via mail.. in fact, Tulving's buy/sell numbers are all published on his website, and no, the spread is not 16%;

http://www.tulving.com/goldbull.html

Although all of us who prep need to figure out our own balance of savings outside the system in Gold/Silver/other ... vs. preps like food, tools, guns, and seeds.... your juxtaposition of knowledge and friends vs. Gold, as if the two were somehow mutually exclusive, shows just how tortured (my word of the day) your effort to rationalize your own decision making is.  I am not saying this to be mean.. only to try and help others who read your post understand that this is actually a great time to buy Gold and Silver... right NOW.  The parabolic phase is yet to come.  I am still buying as I get free cash... have a small order in flight from Gainesville coins right now.  The last thing I am worrying about is whether I can manage to sell Gold in the midst of SHTF.. .that is not the point.       

If you have savings in dollars that you want to survive the coming debacle, say to pass along to another generation, you need some Gold and Silver.     

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/2/4_Pento_-_Bond_Bubble_to_Destroy_US_Dollar_%26_Restore_Gold.html   

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CalMom
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neo-Malthusian...NO

Sorry if any html tags are shown above, they show up in my "preview" and I can't figure out how to delete them. [Adam: issue corrected]

Regarding “Resource Scarcity” and the statement about neo-malthusianism:  “but with the world’s population soaring into the billions on an accelerating uptrend, something is going to break. “

I absolutely disagree.

Demographics tell a completely different story.  The population of the world, according to many studies, will drastically plummet around 2050; there is no avoiding it at this point.  The number of children born per couple/fertility rate is now below replacement rate even in what historically has been “large family” countries: South and Central America, Middle Eastern countries, even some African countries.   Most Western countries have had fertility rates below replacement rate for a long time.  Even Iran has a fertility rate below replacement rate now.

Population will continue to grow until around 2050, but it is not the number of births which are causing the high numbers, it is the decrease in mortality for the elderly.  Better hygiene, better health care, etc. is blessing many, many people with a very long life; this is not normal in the entire history of the world.  There are more people on earth because there are more people living much longer lives.  Because of the “birth dearth”, most current elderly and middel aged will have passed away by 2050, but after that there will be a rapid decline in the number of people.  To add to this upcoming disaster, China, India, and some other countries are creating a hug disproportion in the gender balance; they are slaughtering their baby girls.  Countries in history with many unattached young men…put them in the military and into wars to keep them off the streets.  Add post-cheap energy to this picture and industrial production will decline, current mega-agriculture practices will stop,  worldwide transportation of inexpensive "stuff" will stop,  tax revenues will drastically decline, and the landscape will be littered (more) with abandoned and decaying buildings.  You can throw economic growth right out the window and scarcity of many commodities that so many are currently concerned about won’t matter much anymore.  I see no alternative except that much of the world will go back to the historical “normal”, the “cheap energy blip” in time will be just that…a blip, and the world will/must go back to sane, more locally based economies and production, with the conservation of resources returned to the level of high priority it has historically held .

Below are just some easily found sources on this topic.  There are many studies in refereed journals around the world that back it up, too.

http://www.japantimes.co.jp/text/eo20110820a2.html
http://www.scielosp.org/scielo.php?script=sci_arttext&pid=S004296862012000100005&lng=en&nrm=iso&tlng=en
http://www.oecd.org/dataoecd/13/38/16587241.pdf
http://longevity-science.org/Population_Aging.htm
http://lake.k12.fl.us/1681201015121318897/lib/1681201015121318897/_files/iran_family_planning.pdf

 

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More on Murmurations....

For those who might not have seen this piece that relates to some of our discussion on this thread, and relates it to investing;

http://www.financialsense.com/contributors/cris-sheridan/markets-murmura...

"What makes possible the uncanny coordination of these murmurations, as starling flocks are so beautifully known? Until recently, it was hard to say. Scientists had to wait for the tools of high-powered video analysis and computational modeling. And when these were finally applied to starlings, they revealed patterns known less from biology than cutting-edge physics."1

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CalMom

Dear Calmom,

It probably doesn't matter how we get from point A to point B.  Most people looking at the situation will agree that at least by 2500A.D., the number of people on the planet will be less.

1).  It is likely that at seven billion we have already well overshot the earth's long-term carrying capacity.  Any society that uses any non-renewable resource is by definition not sustainable, no matter how it generates energy.  The phosphorous-based fertilizers without which modern high-yield agriculture would be impossible come to mind.  In terms of truly long term sustainable population (i.e., tens or hundreds of thousands of years), any more than one billion humans is probably pushing it.

2).  In the more near term, as resources become more scarce, birth rates can be expected to increase dramatically.

It has been known to scholars for centuries that birth rates are low in wealthy, fell-fed countries and more specifically, among individual families which are healthy and well-fed.  When scarcity or famine raises it's ugly head, the birth rate increases dramatically.  This phenomenon has been noted long before the advent of effective birth control, or even before a scientific understanding of the significance of the menstrual cycle.

In any event, it is a fact of biological life.

The following is a graphic representation of what the Neo-Malthusians might expect.  Notice the rise in births is coupled with an increase in the mortality, to create a situation more closely approximating what we had pre-19th century: high birth rate coupled with a high death rate.

The studies that you cite are misleading if they make their future projections by simply assuming that current trends in living standards and birth rate will continue into the future.  If we factor in increasing resource scarcity, there is every reason to believe that the birth rate will increase.

(Note that I have not researched the graph above, and therefore cannot subscribe to it; I mean it only as an illustration of the well-known principle relating to birth rates.)

I have never been very interested in discussing the Malthusian question, though, because it doesn't make much difference.  It doesn't lead to many actions that we can actually take to make things better.

There are some things that nature always will take care of on her own.  This is one of them.

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SagerXX
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Since we moved to the new place in November...

...I have been able to enjoy watching these fractal-manifesting megaflocks of birds.  Our back deck faces out towards a yuge acreage of lightly-wooded open space (a set of high-tension lines come through perhaps 1-1/2 miles from the house, so this open space is where the birds flock/fly [it's also where a lotta deer hunting goes on {I say "goes" because even though the deer-hunting season was over weeks ago, people are still out there hunting...I imagine some out-of-work machinist putting food on the table, game wardens bedamned}]).  If I sit outside long enough -- and it's been a very warm winter, such that reading a book out there on a Saturday afternoon is often pretty comfy, one of these megaflocks will arise and do their thing. 

Their gyrations and spontaneous dance leaves me in no doubt that there is something beyond human comprehension going on.  I have no particular opinion as to how exactly it works, and for the most part I don't care.  I've seen any number of "magic" things in my perambulations about this orb (the backside of Maui, watching a lone cloud trail rain down on poor ruined Kaho`olawe, the top of the Jungfrau, watching small hawks soar in the brutal frigid vertical gale, near Lake Toba [Sumatra], clambering up a cliff and finding a mango grove growing sideways out of the mountainside, here in the Hud Valley minding a fire till dawn near Giant Ledge and listening to the night speak, out in the middle of 10 acres of tall corn in Iowa as the wind stirs the stalks, etc.):  things that -- if one were to stack up one's rational straightline phenomenal explanations -- would laugh at one's pathetic attempt to subsume the sublime into the banality of our everyday framework;  indeed, things that -- near as I can tell -- exist primarily to smash our smug, crystalline certainty that we have it all figured out (and under control) into a thousand shining pieces...and to assert to us that while we are fine, fine creatures (and clever as all get-out), the sliver of our true understanding is tiny compared to the deep mystery and Truth of What It Is.

On a good day, maybe we dance with it as it dances.  On an average day, I believe we mostly plod.  But whenever I bump up against this ISness, I take heart.  I don't have to know why "Jesu Joy of Man's Desiring" or "Air on a G String" peels back the top of my head and dumps in a brace of smiling, dancing angels;  I just know I feel the lift.  That's enough.  

And in these terrible and wonderful days, I take my courage from whatever source offers me a ration.

Viva -- Sager

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Jim H
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SagerXX...

thank you for gracing us with your deep thoughts.... Post # 2000 is very special. 

I am still reading this sentence, over and over.. just rolling it around in my mouth and aspirating air through it, like a swig of great wine... to extract every nuance of flavor and scent.  

"if one were to stack up one's rational straightline phenomenal explanations -- would laugh at one's pathetic attempt to subsume the sublime into the banality of our everyday framework;  indeed, things that -- near as I can tell -- exist primarily to smash our smug, crystalline certainty that we have it all figured out (and under control) into a thousand shining pieces...and to assert to us that while we are fine, fine creatures (and clever as all get-out), the sliver of our true understanding is tiny compared to the deep mystery and Truth of What It Is."

There is so very much yet to learn about the quantum nature of our universe... the power of intention, the implications of entanglement, and the jostling sea of (zeropoint) energy hinted at by the Casimir force..  the sliver is indeed tiny.    

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guardia
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corruption in Canada

Mark_BC wrote:

This ties into the theme at the end of the interview about not being able to convince people of the facts no matter how they are presented, because China is somewhat successfully convincing many here to sell out their own futures and ship our resources overseas. And talk by me of the fact that the world is running out of resources, is at Peak Oil, and that we should instead keep them here because there is nothing of value that Canada could be paid for in return for its oil just falls on deaf ears. It is very sad and incredibly frustrating to watch, as our political system is quickly becoming corrupted, not too far behind the US now in its incompetence and complete disregard for its duty to its own citizens.

Woohoo! Glad to see you've realized our system isn't much better than in America... :)

And thanks for actually trying to do something about it!

Samuel

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Uranium

I sincerely hope that Mr Dines is wrong when he warns of The Coming Uranium Boom' - the emphasis being on the word 'Boom', of course.

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Sager, My Brother....

...that was some beautiful chizit you just threw down on your pages. You had me elevated, floating, dancing with ever exhale from the warming breeze that only a sunny spring day gives me from a frigid winters gone. Chills I had. Real nice.

Jim H., I have a wall of fame here in my Man cave that is reserved for simple statements that I use as truths for my movements forward. I respect words so I applied yours Saturday to this space, and thank you for the simplicity of them. I place them there so others can read,  internalize, and take what they want from them or to just stay the course myself. An example of another would be TEAM: Together Everyone Achieves More. No 'I' in TEAM, that sort of thing.

Jim H. wrote:... "and that lack of integrity with our core can manifest itself in many less than positive ways." Yeah Jim, truth is the center, it must be the core, from there we go wherever we want. Every day a good day. Chins up, unafraid, and respectful that beyond our spacial self others can add little nuggets that gives us just a little more gitty up with our steps moving forward. Everyone has value, adds value. I understand that lack of integrity is also at the core of some, and is why we have Banksters too. I choose truth, and suspect strongly that you do to, that most everyone, if not all here do.

Arthur, you have provided me with some jewels, and should know i enjoy every one of your threads. You say more to me with less words than anyone here. You create visuals that stick with me in 'aha' moments when I finally see what you are saying. That to is a gift. Arthur, I get more from a single snap shot (a visual) than a volume of words. You write all you want, and I'll hear you. If you ever feel as though you get writers remorse don't I'll hear you, and appreciate what you say. Just call me a fan.

Every single person here has my respect, and I hear you loud and clear. Absolutely!

Something I wanted to share today because we have discussed starlings, and the scientific research regarding the most amazing flights of these beautiful birds. I have a friend who is legally blind, I mean can't see a thing. We have been neighbors now for 10 years, and we watch the Super Bowl together most every year. He screams, shouts, gets pissed, and all the things we react to as full 5 sensed human beings. I crack up, amazed and delighted. My point, if it is lost on anyone here is: It is not enough to tell me that our other senses just take over. It has to be deeper than that. The thing is it doesn't really have to matter, you don't even have to seek the higher truth if you are as someone stated earlier, "what do I know, I'm just a bird watcher". My friend is a football fan, a baseball fan. Always a radio in his ear while we sit and watch a game together. All he sees is there's a line shot to left, it gets down, and Kaline (Tiger Hall of Famer, right fielder of the 50's and 60's) is now rounding third heading for home, the throw, the tag, and Kaline is safe. Crowd goes nuts, my friend goes nuts, and I am thrilled for my friend, and for myself. Why? Who cares, really...It's just nice to be a baseball fan... Peace

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maceves
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...dance with it as it dances...

Sager, I'm looking for a "like" button, but I don't see one....

One way for me to releive the stress of worry about a future out of my hands has been gardening.  I lose myself in it and stop worrying about the world's problems.  

Another one is kayaking.  Adrift in nature, as an observer, not an agent of change.....The more I get out and let it soak in, the better I feel about everything.  

There is a world out there that has been in balance for thousands of years, and it would do us good to find our place in it.

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shared consciousness - the FORCE!

Ha...  first time I've also heard of Mr Dines and I think it's CMs best interview.

Additional impressed by Chris' expertice in conducting the interview AND his insights.

I follow some impressive sites but consider this a the top of the list.

Loved the starling recognition... as my wife has always called them... BIRDBALLS.

we've always pulled to the side of the road to watch the shared motion and energy of these flocks.

Most people would drive right by, oblivious.  Some people would think about destroying the ball with a shotgun.

Thought to theorize:  where are we?

Bird balls or herds of impala on the African plains or stars in the milky way...where are we, the individual...

Oh, yeah, and who is the leader anyway????? 

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Adam Taggart
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Comment like button

Coming soon :) 

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Posts: 3
Golden Gate Bridge

I just started listening to this podcast but I'm already skeptical. I'm at 12'25" and Mr. Dines has just made the comment that 10 years ago the Golden Gate Bridge toll was $1 and now it's $6. This is absolute BS. I lived in SF until 2001 and the toll at that time was $3 and had been $3 since 1991. The toll was raised to $5 in 2002 (Ten years ago) and to $6 in 2008. It is still $6. So I hope the data in the rest of the talk is of better quality but if this is the way he starts out he has already lost credibility.

http://goldengatebridge.org/research/GGBTraffToll.php

SagerXX's picture
SagerXX
Status: Diamond Member (Offline)
Joined: Feb 11 2009
Posts: 2116
Thanks for the kind words, folks.

Always glad to know that something I offer has found a happy home. 

Viva -- Sager

sethinthebox's picture
sethinthebox
Status: Member (Offline)
Joined: May 9 2011
Posts: 1
Re: Dines BS

Regarding Boids, flocking and starling murmuration are not the same thing, and though the fundamentals of flocking are understood, how this relates to the emergent behavior of starlings has not yet been explained. From Wired

At the individual level, the rules guiding this are relatively simple. When a neighbor moves, so do you. Depending on the flock’s size and speed and its members’ flight physiologies, the large-scale pattern changes. What’s complicated, or at least unknown, is how criticality is created and maintained.

Having studied flocking briefly, when I first heard Mr. Dines speak I wondered about the same thing. I believe he is speaking about something beyond fundamentals, he's talking group intelligence or emergent behavior, a market zeitgiest which causes massive movements in extremely short timeframes.

To your other points, James Dines is not a new figure in the marketplace, and while described as "flamboyant" and clearly not above self-promotion, his insights seem pretty dead-on to me. Ultimately, I agree with you though, that at the end of the day you have to follow your own final analysis.

KugsCheese's picture
KugsCheese
Status: Platinum Member (Online)
Joined: Jan 2 2010
Posts: 673
JAG wrote: I've always found

JAG wrote:

I've always found Dines to be a blowhard salesman of snake oil, but I'm glad I listened to this podcast anyways.

Dr. M's question regarding high frquency trading and market sentiment indicators has been something I've been pondering for awhile. 

I've made a descent living in the past from a trading strategy that uses market sentiment data exclusively, but it simply hasn't worked since 2008. For example, there was a fantastic sentiment setup in the market at the begining of this year that I really wanted to play, but it never materialized. 

A failure of this sort usually means one thing; too many traders are using the same strategy. I can only think that market sentiment analysis must be a major component of the algorithms used by the bot-traders these days. 

I still believe that markets are an expression of human nature, however, and it will be interesting to watch how the bots distort the expression of  human nature in a major market decline. 

I'm trading in my keyboard for a bowl of popcorn...this sheeple just can hang with the digital big boys anymore. Now if that doesn't scream "Short the Market Now!", I don't know what does.

Best....Jeff

There is no sentiment in the market now since retail investor left and elites now coordinate a puppet show.   But one puppet my regain consciousness so the greater fool theory still applies. 

metametal's picture
metametal
Status: Bronze Member (Offline)
Joined: Jul 12 2011
Posts: 25
Ditto

Thanks for the great post, Bytesmith.  It's not often enough on this site that the PM Investor is contrasted with the Doer as in the above breakdown .

A question I think needs to be asked more on CM::

What market pressures will sustain gold's value when tje great majority of people are much more interested in bartering necessities like food than trying to amass a store of value they can't eat?  Or to put it differently, if you believe that currency systems as we know them must collapse into vapor, how can you also believe that a commodity as ultimately useless as gold will prosper when the most basic necessities have become very scarce?

timeandtide's picture
timeandtide
Status: Bronze Member (Offline)
Joined: Apr 3 2010
Posts: 53
gob-smacked

I am quite amazed that so many should think this one of the best interviews ever. To my mind James Dines was barely articulate - although he had more sales lines out than the Pacific Tuna fleet. Claiming to be one of the founders of Technical analysis - did he never hear of Charles Dow, Robert Rhea or R.N.Elliott and other early pioneers of chart based analysis? He also likes to give the impression that he is a pioneer in behavioural economics or mass psychology (as he calls it).

R.N.Elliott was on that case more than 70 years ago and the best modern work on herding behaviour in financial markets has been the follow up to Elliott's work by Robert Prechter. Prechter's work is far more useful than that of Kahneman and Tversky who won a Nobel prize in 2002 for their work on behavioural economics (Prospect Theory). Prechter explains his work articulately and logically and shows convincingly how cause and effect are so often seen back to front by financial commentators and analysts. Most financial writers attribute daily financial market activity/direction to the news. That is to say, it is an accepted wisdom that the news drives the market ad the market drives the mood. Prechter sees it in reverse - the mood drives the news and is reflected in the indexes because they respond far faster than the economy. It takes time for all those spending decisions in aggregate to be reflected in the economy. These are the decisions to expand a business/to borrow/to buy a new car/to eat out twice a week or conversely to rein in the expenditure/to put off hiring another employee/to pay off debt and so on.

Why do people en mass become optimistic or pessimistic? No one knows but it is a well recorded phenomenon which from time to time (1720 and 1929) can go into optimistic overdrive and result in a bubble followed by a crash and years of pessimism afterwards. The clearest example in my lifetime was the booming economy here in Australia in the early 1980s despite interest rates at 16% or more. People just came out of their 1970s hibernation, threw away the kaftans, the beads and the "summer of love" hippy magical thinking and started new businesses and began hiring. Real Estate took off - investors had no fear of high rates.

Then James Dines gets on to Higher States, whatever they are but clearly Hippy echoes here, and he clearly believes that he is in some exalted state - going so far as to patronise CM. It all sounds like magical thinking to me - something, ironically enough, that Robert Prechter predicted would emerge along with the downward trend in mood! 

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