Daily Digest

Daily Digest - July 7

Wednesday, July 7, 2010, 9:53 AM
  • Stocks and Bonds Are Now Hazardous to Your Wealth
  • Cash-Strapped Post Office Announces Plans For 2-Cent Rate Increase In January
  • LPS' May Mortgage Monitor Report: Increase in Rate of New Delinquencies; Decline in Number of Delinquent Loans Becoming Current
  • EU Suggests Raising Retirement Age To 70
  • Funding Ratios Of Corporate Plans Fall 15 Points In Quarter
  • S&P 500 Pensions Funding Improves Slightly in 2009; OPEB Remains Severely Underfunded
  • June 2010 US Mint Silver Eagle Sales Hit Record, Proofs Jeopardized
  • US Mint Sells 151,500 Gold Eagles in June 2010, Second Highest Since 1999
  • Oil's Creep Brings Sheen, Tar Balls To Lake Pontchartrain North Of New Orleans
  • Fishermen Worried Latest Closures May Shut Them Down

Economy

Stocks and Bonds Are Now Hazardous to Your Wealth (cmartenson)

If my thesis and data are correct, corporate earnings will falter in the coming years. The vital ingredients needed for economic growth will be in short supply, and stocks will fail to grow. Similarly, bonds require repayment of both the principal and the interest components, which means that, in aggregate, bond values are explicitly dependent on growth. Yet Peak Oil looms in the near distance.

Cash-Strapped Post Office Announces Plans For 2-Cent Rate Increase In January

The post office wants to increase the price of a stamp by 2 cents to 46 cents starting in January. The agency has been battered by massive losses and declining mail volume and faces a financial crisis......"The Postal Service faces a serious risk of financial insolvency," postal vice president Stephen M. Kearney said. Kearney said the agency is facing a $7 billion loss in 2011. The rate increase will bring in an extra $2.5 billion, meaning it still faces a $4.7 billion loss.

LPS' May Mortgage Monitor Report: Increase in Rate of New Delinquencies; Decline in Number of Delinquent Loans Becoming Current

This report includes data as of May 31, 2010. According to the Mortgage Monitor report, the percentage of mortgage loans in default beyond 90 days increased slightly, while both delinquency and foreclosure rates continue to remain relatively stable at historically high levels. There are currently more than 7.3 million loans currently in some stage of delinquency or REO.

EU Suggests Raising Retirement Age To 70

The growing number of older people would require the average retirement age to rise to 67 in 2040 and 70 by 2060 to maintain the current pension system, it says. Lower birth rates and longer life expectancy mean that retiring earlier will not be sustainable. Germany will raise the retirement age to 67 in 2029. Spain is considering a similar hike and Britain is discussing increasing it to 68. But other countries are moving far more slowly. French President Nicolas Sarkozy is facing fierce opposition to his plans for people to retire at 62, instead of 60.

Funding Ratios Of Corporate Plans Fall 15 Points In Quarter

Funded ratios of the typical U.S. corporate pension fund dropped 15 percentage points in the second quarter to roughly 70%, the third largest drop in 20 years, according to a report by Legal & General Investment Management America. LGIMA's Pensions Fiscal Fitness Monitor report assumes a typical liability profile and an asset mix of 65% equities, 35 fixed income.



Aaron Meder, LGIMA's head of U.S. pension solutions, said the worst drop was in the fourth quarter of 2008. The latest drop resulted from equity market losses — the S&P was down 11% for the quarter — and lower bond yields, with pension discount rates falling 50 basis points to 5.6%.

S&P 500 Pensions Funding Improves Slightly in 2009; OPEB Remains Severely Underfunded

According to the report, estimated pension return rates continued to decline to 7.83% from 7.95% in 2008, posting their ninth consecutive year of decreases (in 1999, the rate was 9.17%). Discount rates declined 58 basis points (bps), to 5.81% from 6.29%, significantly adding to projected obligations

June 2010 US Mint Silver Eagle Sales Hit Record, Proofs Jeopardized

The United States Mint sold more American Silver Eagle bullion coins last month than in any other June since the series launched in 1986. Demand continues to soar during a time of year in which buying historically eases, further jeopardizing the possibility of 2010 proof and uncirculated eagle production. Mint authorized buyers ordered 3,001,000 Silver Eagles in June, easily surpassing the prior 2,245,000 record set in June 2009.

US Mint Sells 151,500 Gold Eagles in June 2010, Second Highest Since 1999

The United States Mint sold 151,500 ounces of 2010 America Gold Eagles in June, marking the second highest monthly level since 1999 and despite June’s reputation as historically one of the slowest months of the year for bullion coin sales. June sales trailed behind May’s milestone of 190,000, but the month easily ranked as the second highest of 2010 and, more meaningful, the second best since the sizzling months in 1999 when eagles were purchased at record levels prior to Y2K.

Environment

Oil's Creep Brings Sheen, Tar Balls To Lake Pontchartrain North Of New Orleans

An oil spill that was previously a problem for coastal Louisiana was trickling deeper inland Tuesday and toward the shores of New Orleans. Oil sheen and tar balls from the Deepwater Horizon gusher have been spotted in Lake Pontchartrain, the huge lake forming the northern boundary of the city that was rescued in the 1990s from rampant pollution.

Fishermen Worried Latest Closures May Shut Them Down

Because of strong easterly winds and higher than normal tides moving oil inland, health officials are closing more fishing areas, including parts of Lake Pontchartrain. The news of the extended fishing closures was tough to take for many fishermen. Some fishermen we talked with say they realize they'll now probably have to try to get a cleanup job with BP. ..."When I pulled up over here I could actually smell the oil," said Fred Zuviceh, a commercial fisherman. "That's devastating, it really truly is.

Please send article submissions to: [email protected]

85 Comments

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Re: Daily Digest - July 7

"BEIJING, July 7 – China on Wednesday ruled out the “nuclear” option of dumping its vast holdings of US Treasury securities but called on Washington to be a responsible guardian of the dollar."

"The agency acknowledged that financial markets were very concerned at one point that massive US government borrowing would drive the US currency lower.

But it said economic conditions elsewhere were also a factor in determining the dollar’s trend. The eurozone, for instance, was struggling with high government debt levels. "

"One of the prime concerns of Chinese internet commentators is that a long-term decline in the dollar or euro will erode the value of Safe’s portfolio.

To that end, Safe called on the US and other major countries to take “responsible measures” to maintain the value of their currencies. This meant withdrawing monetary stimulus in a reasonable manner and relying less on deficit spending.

Safe was lukewarm about gold as an investment.

“It cannot become a main channel for investing our foreign exchange reserves,” the agency said, noting that the size of the gold market was limited and prices were volatile.

Buying more gold would also not help much in diversifying China’s reserves.

China has increased its gold holdings by more than 400 tonnes in the past few years to 1,054 tonnes. Even if it doubled that amount, gold’s share of Safe’s portfolio would increase by only one or two percentage points. "

"July 7 (Bloomberg) -- Gold demand in China, the world’s second-largest consumer, gained in the first half as government measures to cool the property market and falling equities spurred investment demand, the Shanghai Gold Exchange said.

The total volume of gold traded on the exchange jumped 59 percent in the first six months from a year earlier to the equivalent of 3,174.5 metric tons, said Song Yuqin, vice general manager at the exchange. Silver turnover soared more than fivefold, Song told a conference in Beijing today.

Gold surged to a record last month as investors sought to protect their wealth against the market turmoil caused by the European sovereign debt crisis, including declining currencies. Song’s remarks add to signs that investors worldwide are boosting holdings of the commodity.

“Gold- and silver-trading volume expanded sharply in the first half of this year because a declining stock market, the government’s efforts to cool the property market and the general volatility in the global financial market have all fueled the investors’ enthusiasm,” Song said."

"Central banks are pawning their gold to the Bank for International Settlements at a record rate, taking advantage of the precious metal's historically high value to raise cash.

A little-noticed data point at the back of a 216-page report released last week by the BIS shows the international agency has taken 349 metric tons of gold since December—allowing central banks to raise a record $14 billion.

The number surprised the market, which had assumed most central banks had retained their holdings of gold. Instead, the BIS data show that they have been entering these gold swaps—exchanging their gold with the BIS in return for cash, agreeing to repurchase the gold at a later date. "

[COMMOD]

 

"The Public Sector Pensions Commission accuses successive governments of hiding the true cost of public sector pensions and raised fresh concerns about the state's £1 trillion of retirement promises.

In a comprehensive report it calls for urgent reform of the civil servants' gold-plated benefits. According to its analysis, public sector employees must save more than 40pc of their salary each year to fund their benefits but the amount actually being set aside is just 20pc – of which employees are providing only 6pc themselves.

The shortfall has left taxpayers with a growing bill to plug the gap. In 2008, the top-up was £2.29bn. By 2011, it is expected to be £4.6bn. Including employer contributions made by Government departments, the cost to taxpayers in 2011 is forecast to be £18bn– or £700 per household. However, the Commission claimed that "properly measured, the current service cost is actually over £35bn a year". "

"July 7 (Bloomberg) -- Vacancies at U.S. neighborhood and community shopping centers moved closer to the highest on record in the second quarter amid signs the economic recovery is losing steam and consumer confidence remains subdued, Reis Inc. said.

The vacancy rate at shopping centers rose to 10.9 percent from 10 percent a year earlier and 10.8 percent in the first quarter, the New York-based real estate research firm said in a report today. It was the highest since 1991’s 11 percent. The record for shopping center vacancies since Reis began tracking the data 30 years ago was 11.1 percent in 1990. "

 

  • Other news and headlines:

Debt May Sink Stocks to Crisis Lows, Says First State

Dow Could Hit 1000: Elliot Wave's Prechter (CNBC)

Kudrin sees govt's debt servicing costs doubling 2010–2012 (Russia)

Maryland's Largest County Seeks $325 Million as Downgrade Looms (Montgomery County)

Merkel's Cabinet Backs $103 Billion German Budget-Cutting Plan

Spanish Bond Yields Rise Amid 6 Billion-Euro Issue

Greece's Rundown Railroads Creak Under Heavy Debt Burden (Video)

Greek June Consumer Prices Rise Annual 5.2% on Taxes

CMBS Delinquencies Rise Another $2.9 Billion and CMBS Delinquency Rate Triples From a Year Ago, Passes 7%: Realpoint

Ukraine May Abandon Eurobond Sale If Too-High Yield Demanded, Tigipko Says

Bankruptcy filings up 14% in 2010

State bankruptcy levels highest in decade (Minnesota)

United Space Alliance announces shuttle layoffs (800 to 1,000 jobs)

LA Medicaid providers faces rate cuts

Indiana's bad bridges focus of a new public campaign

Bernanke Created Half of 234 Years' Worth of Money Supply (Opinion)

BP, bleeding billions, plans asset sales to fund oil spill compensation

Allstate CEO Says US State, Local Borrowing 'Out of Control'

State Budget Slashes Harrisburg Fire Department Funding by 50-Percent (Video)

Pensacola Beach Daily Oil Spill Report July 7 2010 (Video)

OIL ON EAST COAST!!! Tar Balls Wash Ashore At Cocoa Beach (Video)

Update from Jessica in Gulf Port, Mississippi (Video...No fishing, but people still swimming)

Bush tax cuts up in the air (CNN Money) and How the Expiring Bush Tax Cuts Affect You (Smartmoney.com)

Vancouver home sales drop sharply (Sales of 2,972 houses in June down 30 per cent from a year ago)

Oil slick map

Talk of double dip grows in U.S.  (Reuters video)

Auto sales put on the brakes ("Industry analysts trim forecasts for 2010 as fewer shoppers show up at dealerships")

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Re: Daily Digest - July 7

 

I think this bit of news in the NY Times really bothers me. The title itself is misleading. It's about a college grad sponging off his parents, who sends out only 4 or 5 resumes per week, and turned down a job offer for $40,000 year because it's not in a field he thinks he can grow in.

American Dream Is Elusive for New Generation
http://finance.yahoo.com/news/American-Dream-Is-Elusive-for-nytimes-1858628195.html?x=0

I thnk the title should be, American Dreamer Too Elusive To Want To Work Hard.

Poet

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Two Beers with Steve and Stoneleigh

In this week's episode, Steve interviews Nicole Foss (Stoneleigh) from The Automatic Earth. I did the following video showcasing the highlights of this interview, but the whole interview was a fascinating listen. Great job Steve (Kemosavy)!

Listen to this podcast here.

Subscribe to this podcast in iTunes.

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Re: Two Beers with Steve and Stoneleigh
JAG wrote:

In this week's episode, Steve interviews Nicole Foss (Stoneleigh) from The Automatic Earth. I did the following video showcasing the highlights of this interview, but the whole interview was a fascinating listen. Great job Steve (Kemosavy)!

Listen to this podcast here.

Subscribe to this podcast in iTunes.

Great job Steve.

I think Stoneleigh is clueless. I can't stand that website AT ALL. I despise it. Right up there with CNBBS.

The deficit won't "deflate".

People can look at the private sector or the banking sector all they want but they should get a clue that their dollar is tied to sovereign debt. And in a big way.

When asset prices tank - like housing tanked - taxes from the asset in the tank also tank. That disparity puts more stress on the deficit, heats up the amount of QE needed (read: bonds purchased from the BS "Other Household Column" (you know the ones with the 22% unemployment and 13% bread lines/30 million on food stamps)).

"Deflation" in that sense is nothing but fuel for a currency crisis or default. Either #ugly date will equate to a worthLESS dollar.

Most of these morons advocate holding treasuries. Good luck with that.

Amazing the 4-6 minute point before I clicked off on this. First of all, just how the #&$* does she think the government is paying for that little difference between what it takes in, what it borrows and what it pays out?????????

Second of all, the bond "vigilantes" can stand up all they want to and wine that they aren't buying all they want, and Ben will just buy the above difference I point out and what ever the bond %&[email protected]$ don't buy. He will bring them to their Monica knees like Bill wanted to but couldn't. 

Ron Paul goes off on this ALL the time. He faults the Fed for whining about the government having to get a handle on the deficit - the very one he enables them to blow through and service. If Ben didn't then the bond vigilantes could grow some backbone. Ben can't allow that - our debt service would take us down.

Holding dollars. Good luck with that.

Some people are bright but not having common sense will bight them. 

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Re: Daily Digest - July 7

Davos,

Is that emotional language that I detect in your post regarding Stoneleigh? LOL

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Re: Daily Digest - July 7
JAG wrote:

Davos,

Is that emotional language that I detect in your post regarding Stoneleigh? LOL

NO. I have 0 respect for stupidity. 0.

I'd be kicked off this blog if I used the first words that came to mind. I could dig it up, but if I'm not mistaken I've had some email correspondence and I know I at least told them they were morons.

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Re: Daily Digest - July 7

JAG,

Where can I find the podcast of the conference that Steve references in which Stoneliegh blew him away?  I looked on the site but haven't been able to find it. 

I've listened to the 2beers and found it interesting.  I don't know much about her or her thoughts but was thinking if I could start back a bit, I'd understand a bit better.

Thanks in advance!

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Re: Daily Digest - July 7

I highly recommend listening to Nicole Foss (Stoneleigh) of the Automatic Earth.  In my opinion, she is the number one thinker/forecaster out there.  Her thoughts on preperation are very similar to CM, and her logic regarding financial and energy issues is top notch.

Davos - whats funny to me is how similar you and her are in much of your thinking.  She too thinks there will be massive debt default.  In an environment where 95% (her number) of the money out there is in the form of credit - that is deflationary.  IF you are debt free and self sufficient she thinks gold is a good place to be - but warns that you should be very prepared for the price of gold, in dollars, to be down significantly because the vast majority of gold holders will have to sell in order to raise the money needed to survive.  She believes that prices will go way down, but affordability go down even further.

In short, your views are much more common than opposed.  I

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Re: Daily Digest - July 7
rickets wrote:

I highly recommend listening to Nicole Foss (Stoneleigh) of the Automatic Earth.  In my opinion, she is the number one thinker/forecaster out there.  Her thoughts on preperation are very similar to CM, and her logic regarding financial and energy issues is top notch.

Davos - whats funny to me is how similar you and her are in much of your thinking.  She too thinks there will be massive debt default.  In an environment where 95% (her number) of the money out there is in the form of credit - that is deflationary.  IF you are debt free and self sufficient she thinks gold is a good place to be - but warns that you should be very prepared for the price of gold, in dollars, to be down significantly because the vast majority of gold holders will have to sell in order to raise the money needed to survive.  She believes that prices will go way down, but affordability go down even further.

In short, your views are much more common than opposed.  I

Perhaps. 

Default comes in 2 flavors that I am familiar with:

  1. I ain't paying you - go to h*ll
  2. Bring me 1,000 old dollars and I'll give you one new dollar, if your mortgage was a grand a month 1 new dollar pays that service

Putting myself in either of the two tells me the last thing I want to hold is her baby - the dollar. I'm sure she has a VERY high IQ but as I mentioned in the later part of this write: There is a penalty for lack of common sense.

I've concluded that 1 measure of commonsense is the equivalent of an IQ of 120. So, a genius with an IQ of 140, and NO common would subtract the 120 penalty and fall into the lowest category.

 

IQ Ratings Over 140 - Genius 

IQ Ratings 120 to 140 Highly intelligent 

IQ Ratings 110 to 119 Very intelligent

IQ Rating 90 to 109 Average intelligence 

IQ Ratings 80 to 89 Deficient 

IQ Rating 70-79 Very deficiency 

IQ Ratings Under 70 Moron

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Re: Daily Digest - July 7
LogansRun wrote:

Where can I find the podcast of the conference that Steve references in which Stoneliegh blew him away?  

LR,

Ruhh originally posted the link to that speech here in this thread:

http://www.peakprosperity.com/forum/making-sense-financial-crisis-era-peak-oil/40609

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Re: Daily Digest - July 7

Davos - I am responding only to be fair to Stonleigh.  She thinks any guarantee from the government wont be worth the paper its printed on.  She thinks you should get fully out of debt because in the future it will be much harder to service that debt.  She thinks you should build community and self sufficiency and put all your money toward tools, farming, etc.  She is forecasting that money/cash in the banks is not safe, and to be creative in hiding your cash.  In short, she says no asset is safe and that the road ahead is bleak.

That is a far cry from her saying the dollar is great.  She is saying the top places to use your money right now are the exact same as CM - - -and from what I understand from reading your comments over time is the same as you.  Where you differ is in the extra left over money - do you keep it in dollars/t-bill/gold?  She thinks cash held in physical form - -but acknowledged holding too much (say under the matress) is not realistic/safe.  Therefore, after full preperation, she says cash, t-bills, and gold.

Really, after becoming debt free, buying tools and perhaps freeze dried food....starting a farm and getting clean water and solar....really we are splitting hairs and guessing at what happens when 100 trillion in credit disappears. 

And, in that end, while she leans toward cash and you lean toward gold (both of you in both cases like physical form).  Are you really different enough to justify you calling her a moron?  I would hate to turn anyone off to her lectures/writings based on such a nit picky difference thats number 20 on the list and only applies to those with lots of extra money lying around after full preps are in place.

 

 

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World Toilet Crisis

I wonder if most of us have given much thought to sanitation issues beyond "buy a lot of toilet paper".

Vanguard does fascinating documentaries on all sorts of issues across the globe. This documentary on sewage and defecation issues is enlightening. It made me think of how sanitation was in large urban (or even suburban) areas before the advent of sewage treatment plants, etc.

Early in the documentary, Adam asks a sanitation engineer in Los Angeles what would happen if the sewage treatment plant that handles sewage for 4 million people suddenly stopped working. The answer was that flow from toilets and bathrooms would be backed up...

This made me realize how much we take modern toilets and sewage systems for granted. And how things can get really nasty and ugly really quickly in a civilization collapse unless you live upstream and away from most other people.

Warning: I DO NOT recommend this to those who are sensitive or are eating or just had lunch.

http://www.hulu.com/watch/154282/vanguard-worlds-toilet-crisis

Poet

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Re: Daily Digest - July 7
rickets wrote:

She is forecasting that money/cash in the banks is not safe, and to be creative in hiding your cash. 

Then, where is there ANY common sense - so much as 1% of common sense - in holding dollars and or treasuries?

I'm not so sure we say the same things her and I. If Uncle Buck gets devalued and or re-issued - in that period of a worthless dollar we will have Zimbabwe inflation.

So far as the rest of her stuff - community building an all that - I agree. But people will still need money to live once we come out the other side.

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Re: Daily Digest - July 7

She recommends holding cash outside the bank - so there is not a disconnect or loss of common sense there. 

Should the dollar get devalued or re-issued there will still be a huge shortage of dollars as 95% of the money out there is in the form of credit.  Therefore, dollars even after a devaluation will be a valuable place to be.  Thats the context she is coming from. 

Based on your last comments, my guess is that you have not listened to one of her 1hr+ lectures or read one of her more in depth pieces.  On the surface, I can see why you would disagree....but I think your agruments take her stance out of context.  I encourage you to take an hour or two to listen to her.  She may be the only one out there that connects the dots better than CM...and that says a lot.

ok...this horse has been beaten to death! 

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Re: Daily Digest - July 7
rickets wrote:

And, in that end, while she leans toward cash and you lean toward gold (both of you in both cases like physical form).

I have to agree with Davos, cash does not equal gold.  Gold is a physical asset (rare, tough to obtain, etc).  Cash is paper.  Hmm I seem to have lots of paper lying around - doesn't appear to be rare and certainly can't use it to write on since it has all those pictures of dead people on it.  I guess it might work as toilet paper since it is soft. CoolHuge difference.

Now, the only question is gold going to be worth anything or will is just be treated as a shinny metal?  Perhaps, but there is a lot of history that shows other wise and as Chris says in the Crash Course:

cmartenson wrote:

Money is an essential human creation, and, were all money to disappear, a new form of money would spontaneously arise in its place, such as cows, tobacco, bread, a certain type of nut husk, perhaps, or even nautilus shells.

Without money, the complex job specializations that we have today would not exist, because barter is so cumbersome and constraining.

So if sudenly the dollar is no longer viewed as valuable, what will become money?  I suspect gold and silver simply because they have been currency in the past and there are few other materials too choose from (see money section of crash course that discusses what makes good money).

rickets wrote:

She is forecasting that money/cash in the banks is not safe, and to be creative in hiding your cash.

This seems exceptionally stupid, if you think the government guarantees aren't worth anything, then how can holding cash in or out of a bank be worth anything?

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Re: Daily Digest - July 7

Rhare:  "This seems exceptionally stupid, if you think the government guarantees aren't worth anything, then how can holding cash in or out of a bank be worth anything?"

What seems exceptionally stupid is imagining the end of modern banking and having you show up at my door step with gold coins and asking if you can buy my food with them.  What seems exceptionally stupid is being so stubborn and certain in a beliefs of what might be used for transactions after a world wide economic collapse. 

Seriously folks - there are infinite variables that come with a collapse.  Lets not sit here and pound the table on whether gold or cash will be better.  No one has that knowledge....its all opinion and speculation.  If the banks start folding the fdic will have to back away from their promise.  That might create a run on the banks, and then system shut down and anyone with cash in their matress might win.  That sounds every bit as likely as gold being used by a 25 year old who has never heard that gold ever had anything to do with the dollar.  Lets get real, lets admit there is huge risk to both and thats that.  No matter how much research and thinking anyone does, there is no way we can attribute more than an average chance that their prediction will come true.

Lets not dismiss very important observations and predictions of very intellegent thinkers because of these ticky tack differences in predicting mayhem.  Especially when these thinkers themselves put these petty differences way at the bottom of their lists (after getting debt free, self sufficient, building community, etc)

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Re: Daily Digest - July 7

Rickets

Quote:

Should the dollar get devalued or re-issued there will still be a huge shortage of dollars as 95% of the money out there is in the form of credit.  Therefore, dollars even after a devaluation will be a valuable place to be.  Thats the context she is coming from. 

I recently read (can't cite the source right now) that 97% of US money is in the form of digital entries.  What happens in the case of internet melt down?  Is everything so well backed up that we could just reboot and proceed as if nothing has happened?  Doubt it.  If US cash is still considered cash in such a circumstance, it would be particularly valuable, thereby, I think, supporting your and Stoneleigh's thesis.  CM also recommends having cash stashed.

Personally, I'm not comfortable betting all my liquid assets on either gold or currency going to zero.  Both will likely have some value, probably with some inverse relationship.  So, prudence suggests that balancing liquid resources between the two makes sense.  CM has also said that about half his assets are in PMs.  That sounds like a reasonable balance.

Doug

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Re: Daily Digest - July 7

Rickets: You are right, I should listen to her more. I've read a LOT of her stuff and stuff some moron whose name begins with an Ro posted. I had some very heated emails. They or the R moron called John Williams a bean counter and then a few names.

The bottom line is we are in 2 different camps. I'm working on another write about the deflationist being totally wrong about deflation.

Look at it this way:

1.5 trillion in subprime blows up. The housing market and the stock market tank. Everyone runs around yelling "deflation, deflation, deflation the sky is falling, deflation is here."

BS!

What they fail to comprehend is that little 700 billion dollar bailout was 10.4 trillion and we are on the hook for another 7+++++ trillion. The money that came out was put back. The money that was put back in a different place was borrowed money. Therefore (because of the deficit that can't be paid with taxes or borrowed money) :That money isn't parked.

1.5 trillioncorrupt

NO DEFLATION

We have asset demand destruction that was caused by a lack of buyers (2006 30% were subprime origniations, that tossed 7-10 million buyers in a market cap of about 70 million homes, when that went it took out prime borrowers ---- no buyers now means prices will tank).

Deflation would mean food and gas would be CHEAP, so would cable and insurance.

Money got sucked out of the bubble and Moron Ben is blowing it back into a ripped bubble.

In Summary: My point is that money wasn't destroyed. If the 10.4 trillion with a hook for another 7+ trillion didn't come into the picture I'd be singing a different tune.

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Re: Daily Digest - July 7

All these criticisms of Stoneleigh's  work could be extinguished by simply listening to what she has to say. Her ability to articulate her position is second to none. If you are experiencing difficulty in understanding what she is saying, then may I suggest that your "ears" are being occluded by your belief system. (The ear canal is not a great place to hide gold coins btw, lol)

Its not like Stoneleigh is trying to sell you anything, she is just trying to raise awareness of the situation. Calling her a moron for that effort reflects badly on the character of this site and community.

 

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Re: Daily Digest - July 7
rickets wrote:

What seems exceptionally stupid is imagining the end of modern banking and having you show up at my door step with gold coins and asking if you can buy my food with them.  What seems exceptionally stupid is being so stubborn and certain in a beliefs of what might be used for transactions after a world wide economic collapse.

Note - what I pointed out what was that if you think cash is going to valuable, then it doesn't matter if it's in or out of a bank.  That making that distiction was stupid.  It's only your trust in the banking system and the government that gives any fiat currency (dollar in particular)  it's value.

I certainly did not say you should not take care of food, water, shelter, energy, tools, transportation, community, etc first.  But if you have assets left, gold or cash seems like a pretty simple choice.  Gold and silver has a pretty long history of always having value.  You have always been able to trade it for some amount of currency (euro, dollars, zimbabwean dollars).  However, the reverse is not true. Past experience with the dollar has not been so great, 98% loss in 100 years? 70% loss in the last 30?  Why would you think keeping any large quantity of dollars  in a matteress is a good idea.  Yes, I keep some cash, but mainly because if things go berserk, I think their will be a small window to buy up supplies when ATM/Banks shutdown, stores still have stuff, and the realization that the cash is about to be worth zero hasn't been realized by the majority.

The only thing that makes the dollar valuable is that people think it's valuable because the US government will back it up somehow.  It has no intrinsic value because it is a sheet of paper with pretty printing. It costs essentially 0 to produce.  Gold or Silver on the other hand are difficult to produce, expensive, and are rare. Just look at how rare and valuable those zimbawean dollars, or agentina pre-1983 peso are?

So, your right I have no idea how this could fall apart, but I'm pretty sure, if there is still a currency left standing, I can find someone who will take my gold or silver for some of it and I'm also pretty sure the reverse is much more questionable.

In the end you have to do what you think is in your best interest.  At any rate I know if I come knocking on your door to bring my dollars.  Do you also take Zimbabwae money for food?  I might need to stock up on some of it as well. Smile

 

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Re: Daily Digest - July 7
rickets wrote:

Seriously folks - there are infinite variables that come with a collapse.  Lets not sit here and pound the table on whether gold or cash will be better.  No one has that knowledge....its all opinion and speculation.  If the banks start folding the fdic will have to back away from their promise.  That might create a run on the banks, and then system shut down and anyone with cash in their matress might win.  That sounds every bit as likely as gold being used by a 25 year old who has never heard that gold ever had anything to do with the dollar.  Lets get real, lets admit there is huge risk to both and thats that.  No matter how much research and thinking anyone does, there is no way we can attribute more than an average chance that their prediction will come true.

Lets not dismiss very important observations and predictions of very intelligent thinkers because of these ticky tack differences in predicting mayhem.  Especially when these thinkers themselves put these petty differences way at the bottom of their lists (after getting debt free, self sufficient, building community, etc)

I completely agree with Rickets here, except that I don't think either outcome is equally likely - I am split 70/30 in favor of the electronic printing press beating out a deflationary collapse.  But I remain roughly intellectually neutral, am always considering all the sides on an ongoing basis (except for the Keynesians like Krugman who seem to have nothing new to say), and I follow the data very, very closely.  Last week the data was screaming deflation, these past two days is is euphoric inflation.  The score is far from settled.

I notice that emotions are running high on this topic, particularly in Davos, which means that a belief has been touched.  Personally, I think beliefs are dangerous to hold here because we are, largely, flying blind.  Good data is hard to come by, it is a complex, non-linear situation, and we have no maps to guide us.  Perhaps the ire comes from a past encounter with someone over at TAE, which means it is not a question of belief but of being rubbed wrong, but regardless I would very much prefer to eliminate the name calling, especially of a fellow blogger and thinker like Stoneleigh. 

{For the record I was attacked somewhat at a moment or two in the past by Ilargi on TAE and chose to neither rise to the bait nor defend myself.  I think it was around the piece I wrote called The Sound of One Hand Clapping where I questioned whether deflation could simp[ly be ignored.  My 'psych 101' interpretation was that this person was operating out an emotional/belief state (an easy guess) that was reliant on deflation happening.  I tend to dodge such confrontations because I find them to have a very bad ROI unless I know the person well.  The unfortunate outcome of that was that I stayed away from TAE neither endorsing nor detracting from their work, so we each missed an opportunity to learn from the other because of an ill-advised tirade.} 

Relationships are important here and I want to be crystal clear that I very much respect the work that's been done at TAE, even though I disagree with their certainty (belief?) over a deflationary outcome.   I am not certain about anything except that I am probably going to be surprised.

So let me reiterate my strongest plea for fact-based critiques whenever possible.  We'll all live longer and learn more.

TIA

Chris M.

 

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Re: World Toilet Crisis
Poet wrote:

I wonder if most of us have given much thought to sanitation issues beyond "buy a lot of toilet paper".

Vanguard does fascinating documentaries on all sorts of issues across the globe. This documentary on sewage and defecation issues is enlightening. It made me think of how sanitation was in large urban (or even suburban) areas before the advent of sewage treatment plants, etc.

Early in the documentary, Adam asks a sanitation engineer in Los Angeles what would happen if the sewage treatment plant that handles sewage for 4 million people suddenly stopped working. The answer was that flow from toilets and bathrooms would be backed up...

This made me realize how much we take modern toilets and sewage systems for granted. And how things can get really nasty and ugly really quickly in a civilization collapse unless you live upstream and away from most other people.

Warning: I DO NOT recommend this to those who are sensitive or are eating or just had lunch.

http://www.hulu.com/watch/154282/vanguard-worlds-toilet-crisis

Poet

Sometimes I read a post and think "That's a bunch of crap." This time this post actually is---, literallyWink

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Gold vs Cash

If anyone really thinks cash (currency as in the American dollar) is going to win over gold, you seriously need to read the following blog.  Enjoy the gold trail to enlightenment.

 

http://fofoa.blogspot.com/

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Re: World Toilet Crisis

Poet

Quote:

I wonder if most of us have given much thought to sanitation issues beyond "buy a lot of toilet paper".

Actually, that's about the first thing I think about when I consider societal collapse.  I have been to places where sanitation is not up to western standards.  I suppose its a comment on my sensibilities that I cannot even conceive of living around the constant stench that permeates such places.  That's why I consider a $6,000 septic system to be my best investment in years.  Of course, that's probably not an option in more densely populated areas.

Actually, that brings up a question to those who are septic savvy.  There is a product advertised on TV that claims to minimize pumping out the tank if flushed down the system once a month.  Does anyone know whether the stuff works or if there are drawbacks?

Doug

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Re: World Toilet Crisis
Doug wrote:

There is a product advertised on TV that claims to minimize pumping out the tank if flushed down the system once a month.  Does anyone know whether the stuff works or if there are drawbacks?

I was told by the company that pumps our tank and another never to use the stuff that looks like sawdust.  It is apparently mostly just filler and does more harm.  One company sold a liquid that was moderately expensive that didn't use fillers.  However, the most reasonable thing I heard was from our guy.  He said don't buy any of that stuff, instead just dump a packet or two of yeast down the system if you use something like a harsh chemical.

After reading a bit on the internet, it looks like the best advice is to not add anything, and to be careful not to use harsh chemicals that will kill off the bacteria you need in the tank.

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Re: Two Beers with Steve and Stoneleigh
JAG wrote:

In this week's episode, Steve interviews Nicole Foss (Stoneleigh) from The Automatic Earth. I did the following video showcasing the highlights of this interview, but the whole interview was a fascinating listen. Great job Steve (Kemosavy)!

Ooo!  Hot dawg!  I'm halfway through one of her lectures/Q&As from her current world tour.  There's some big honkin' brain on that lady.  Thanks for the heads up!

 

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Re: Two Beers with Steve and Stoneleigh

Uff, maybe my english knowledge is too less to understand fully what you mean... But what I read from you, Davos, in this case I don't like it at all!!!

The automatic earth and Stoneleigh are as well as Sharon Astyk and Chris Martenson the three sources from the US that I trust fully. Maybe there are in some cases different opionions, but all of these three persons a fully trustable in my opinion. I think & feel, that it is not only not good but contraproductive to give these people not the respect that all of them are fully earning! And I think & feel that it is NOT GOOD to divide those truly trustable people!!!

Regina from Germany

PS: When I'm emotional, I sometimes lost my english knowledge. Sorry. I hope for understanding.

 

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Re: Two Beers with Steve and Stoneleigh

Uff, maybe my english knowledge is too less to understand fully what you mean... But what I read from you, Davos, in this case I don't like it at all!!!

The automatic earth and Stoneleigh are as well as Sharon Astyk and Chris Martenson the three sources from the US that I trust fully. Maybe there are in some cases different opionions, but all of these three persons a fully trustable in my opinion. I think & feel, that it is not only not good but contraproductive to give these people not the respect that all of them are fully earning! And I think & feel that it is NOT GOOD to divide those truly trustable people!!!

Regina from Germany

PS: When I'm emotional, I sometimes lost my english knowledge. Sorry. I hope for understanding.

 

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Re: Two Beers with Steve and Stoneleigh

Uff, maybe my english knowledge is too less to understand fully what you mean... But what I read from you, Davos, in this case I don't like it at all!!!

The automatic earth and Stoneleigh are as well as Sharon Astyk and Chris Martenson the three sources from the US that I trust fully. Maybe there are in some cases different opionions, but all of these three persons a fully trustable in my opinion. I think & feel, that it is not only not good but contraproductive to give these people not the respect that all of them are fully earning! And I think & feel that it is NOT GOOD to divide those truly trustable people!!!

Regina from Germany

PS: When I'm emotional, I sometimes lost my english knowledge. Sorry. I hope for understanding.

 

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Re: World Toilet Crisis

Poet, thanks for posting the Vanguard documentary.  If this isn't enough to make people realize that over population is a huge problem, I don't know what will.

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Re: Daily Digest - July 7
Davos wrote:
rickets wrote:

She is forecasting that money/cash in the banks is not safe, and to be creative in hiding your cash. 

Then, where is there ANY common sense - so much as 1% of common sense - in holding dollars and or treasuries?

I'm not so sure we say the same things her and I. If Uncle Buck gets devalued and or re-issued - in that period of a worthless dollar we will have Zimbabwe inflation.

In listening to the lecture being discussed here (I'm 99% certain I'm listening to the same one, or that her basic lecture is 99% similar to what other folks are listening to [i.e., she says "petrol" when she's giving a speech in Yorkshire and "gas" when she's talking in Albany]), I believe that her opinion vis-a-vis "hold cash" comes out of her belief that there will be a significant period of time, perhaps years, between the crash of the greater financial system/economy and the onset of inflation/hyperinflation.  And during that period, cash will be -- as she says -- "king".  And subsequent to that timeframe she talks about Weimar/Zimbabwe-style inflation being possible.  But then at that point, the savvy listener (and taker of the advice) would of course be out of cash, having purchased real (useful) goods while prices were at rock bottom.

 

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deflation

Dr. Martenson

I think it would be nice to hear an inflation/deflation discussion (not a debate)  between you and Nicole Foss from TAE.  (She seems like a reasonable person, or at least she did on the Two beers with steve interview).  I've been in the inflation camp for a long time now, but I think it is always good to have someone challenging ones views.

To anyone who can answer my questions: Nicole foss stated that credit acts like money in the credit expansion phase, but disappears during the contraction phase.  Is this always true?  For example, I take out a loan to run my medical practice.  I then use that loan to purchase medical equipment.  The vendor for the the medical equipment takes a profit and in turn goes a buys food, electronic equipment, etc.  I then default on my loan because of lost revenue.  Has that credit (money) been destroyed or has it already been circulated through the economy?

Is govt spending a reliable mechanism for creating inflation (in a deflationary collapse)?  When you work for a government agency, and you receive funding, it is not your money, so there is no incentive to save or conserve it for a rainy day.  I've known plenty of people working off of federal govt grants and at the end of every calendar year, they would rush to spend all of their grant money.  The rationale was that any money you didn't spend this year is going to be taken away from you the following year.  So it seems to work almost like a positive feedback loop potentially pushing more and more currency through the economy.... and the size of the fed govt seems to grow and grow and grow.

Nicole Foss (like others such as Bob Prechter) suggest that it would be impossible to stop the deflation associated with a credit collapse.  What if the Treasury decided to write stimulus checks to everyone one in the country just like they did 6 or 7 years ago.  I think it was a $200 check and I remember going out and buying a DVD player.  Suppose they instead of writing a $200 check, write every citizen a $1 million check.  Great, now I can completely pay off my mortgage and school loans...and I have plenty of money to buy land, food, or whatever.  I no longer have to carefully hold on to every penny and dollar.  I know this is a ridiculous example, but couldn't it be done if they really wanted to..

thanks

Brian

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Re: Gold vs Cash

alcatwize,

If you think the issue here is Gold -vs- Cash, you obviously didn't listen to the podcast. The problem with owning gold is that every issue becomes a gold-versus-X dispute, which brings up the question; do you own gold, or does gold own you?

I'm familiar with the friend-of-a-friend-of a secret-gold-market-insider blog that you posted, and while the writing is excellent and very entertaining, its really just another goldbug marketing site. Personally I find reading it enjoyable, but I would never bet the survival of my family on it's content.

Just my 2 cents...

 

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Re: Daily Digest - July 7

Interesting how confusing the times are at the moment. Deflation or inflation, Gold or Cash or stocks or bonds or properties or whatever?? I wouldn't bet all or get fixed on any one fix to fix it all LOL. No one knows which way or when something will break so being flexible & diversified might not be too bad.

I just had a great day in the market after selling my shorts on Friday & adding longs only to sell half those longs today. This worked out much better than my Gold & cash but I play them all. I just have to hold my nose when I buy in this type of market.

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Re: Daily Digest - July 7

Jag, I've listened to ALL of Bob Prechter. In full. I don't agree but I like to hear another view.

I can NOT listen to someone who has 0 faith in a currency and then advocates holding that for protection.

Rickets: In the bank or out of the bank.

Chris, last year I posted Roulle's work (not sure if that is his name or how he spells it) and he had a conniption that I linked to too much of it)) About 8 months later he did a piece on Stoneleigh about John Williams. I emailed the site not recognizing his name and he was beyond disrespectful towards a guy I hold in as high esteem as I hold you. Williams uncovered the GAAP net pres. value actual deficit and it was astonishing.

I'll refrain from the M word, but saying the dollar is toast and then advocating it for protection isn't in my book smart. People can think and do what they want.

Lastly, to any history buff, if anyone can show me a Fiat that went to 0 and holding it saved someones back-end I'm all ears.

 

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Re: Daily Digest - July 7

Hi Chris and all,

I'm curious (if you have a moment) about your thoughts about one of Stoneliegh's points. I'll try to paraphrase her point as I understand it - and I'm briefly paraphrasing based on the the Two Beers interview around minutes 17 through 24 roughly.

Her point is that you can't print your way of of deflation.  As I understand it, her main reason for not being able to do this is that the coming credit collapse is just too big. The amount of QE or money printing or stimulus that would be necessary to even make a dent in the credit collapse would send bond interest rates through the roof. These  quickly rising interest rates would create a huge wave of debt default which (as she says) is the definition of deflation. She says that if you try to print your way out of it you get there even faster. 

She points to the huge derivitives market, fractional reserve banking that creates money through loans, and she makes a big point of there being multiple claims on the same underlying real asset - all of these being reasons that the credit collapse is just too large to get out of.  She says elsewhere, I believe, that there may be significant inflation after a period of huge deflation, but not before.

So my question is: what are your thoughts about her point that any attempt to print, QE, or stimulate ourselves out of this mess will increase interest rates to the point where there is widespread debt default which is deflation?

Thanks in advance for your - and anyone's - reply.  This is a great site!

thelorax

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Re: World Toilet Crisis
Doug wrote:

Poet

Quote:

I wonder if most of us have given much thought to sanitation issues beyond "buy a lot of toilet paper".

Actually, that's about the first thing I think about when I consider societal collapse.  I have been to places where sanitation is not up to western standards.  I suppose its a comment on my sensibilities that I cannot even conceive of living around the constant stench that permeates such places.  That's why I consider a $6,000 septic system to be my best investment in years.  Of course, that's probably not an option in more densely populated areas.

Actually, that brings up a question to those who are septic savvy.  There is a product advertised on TV that claims to minimize pumping out the tank if flushed down the system once a month.  Does anyone know whether the stuff works or if there are drawbacks?

Doug

A properly designed and used septic system never needs pumping. If it is not waste from your body, TP, and water, it does not go in the tank. The bacterium that digest your food in your body continues to work in the septic system. If you have healthy intestinal flora, so does your system.

Too much water in a septic system can be a problem. If your system is undersized for the family utilizing it, it will not work properly.

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Re: World Toilet Crisis

Tycer,

Thanks for the reply.  I guess I assumed that all of them had to be pumped periodically.  I'll have to look further into the question.  Our system is intentionally over sized to exceed the codes and accomodate numbers larger than our family.  I've always believed in overengineering.

Thanks again,

Doug

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Re: Daily Digest - July 7
thelorax wrote:

Hi Chris and all,

I'm curious (if you have a moment) about your thoughts about one of Stoneliegh's points. I'll try to paraphrase her point as I understand it - and I'm briefly paraphrasing based on the the Two Beers interview around minutes 17 through 24 roughly.

Her point is that you can't print your way of of deflation.  As I understand it, her main reason for not being able to do this is that the coming credit collapse is just too big. The amount of QE or money printing or stimulus that would be necessary to even make a dent in the credit collapse would send bond interest rates through the roof. These  quickly rising interest rates would create a huge wave of debt default which (as she says) is the definition of deflation. She says that if you try to print your way out of it you get there even faster. 

I'd be interested in CM's and everyone else's opinion but here are the facts as I see it:

  1. We had a credit collapse. A 1.5 trillion dollar subprime collapse. People who should have rented were extended credit, and that would have worked save for the little fact that 93% of said subprime loans had rate resets.
  2. The bailout was NOT 770 billion it was 10.4 trillion and counting. NO DEFLATION (See that link to see where the money went) Sure credit was destroyed, buyers are now renters (if they are lucky). BUT, and this is a big BUT, 10.4 trillion dollars came out of nowhere and went back into the "system", it went in backwards, but it went into the insolvent banks. We are paying for that loan.
  3. If the fed is sopping up what the in-directs and the directs don't take down then how does she explain no failed auctions which would be what they need a few of for the bond vigilantes to come in and raise rates. The fed is holding interest down.
  4. Also, we have a deficit which we can NO longer service with borrowed money and tax revenue. QE is covering that difference. 

How this is going to sustain or make a currency anything but worthless I can't get.

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Re: Daily Digest - July 7

Thanks JAG and Rhuh!

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Re: World Toilet Crisis

rhare

Thanks for your reply, it tends to confirm Tycer's reply.  We don't put anything in but human waste, TP and such.  Good to know about the 'enhancers' if you will.  No chemicals.  What about human hair?  I've heard that it doesn't break down easily and its accumulation is inevitable.

Doug

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Re: Daily Digest - July 7
thelorax wrote:

Her point is that you can't print your way of of deflation.  As I understand it, her main reason for not being able to do this is that the coming credit collapse is just too big. The amount of QE or money printing or stimulus that would be necessary to even make a dent in the credit collapse would send bond interest rates through the roof. These  quickly rising interest rates would create a huge wave of debt default which (as she says) is the definition of deflation. She says that if you try to print your way out of it you get there even faster.

I guess I would say, we have done QE (overt or secretive)  and massive stimulus and massive borrowing.  Interest rates at all time low.  Bond rates all time low.

Also, when you have default, the money is already spent.  If the depositors are saved via FDIC bailing them out, then the default didn't really occur as the money is still completely in the system, just not paid back.

Ultimately if the US defaults on it's debt, that will be the end game.  What will happen?  I suspect a mass panic and rush for the exits.  I mean do you want to be hold bonds or other asset that is backed by the government that has shown it will default?  Hell no, you will be out spending everything as quickly as possible to get real assets - ie. hyperinflation takes over.   So my best guess is we will wallow along in about the state we are in with people going poor slowly, then all at once.

I would suggest reading the links imbedded above, Chris has nicely put a lot of pieces together already.  Peter Schiff, John Williams, and Daniel Amerman all seem to talk about the same basic scenarios in some way or another.

 

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Re: Daily Digest - July 7

 

I have some thoughts. I know they may be tangents, really. Hope I can share them here:

I can see what Dr. Martenson is doing with his 70/30 hedge where he's partly in gold and partly in cash, weighted towards inflation. We really don't know how it might go and there's some smart thinkers on both sides weighing in. (Reminds me of the complexities with biflation, stagflation, banks getting lots of money but not lending it, people having jobs with income but cutting back on spending, businesses amassing cash but not spending while other go bankrupt, etc.)

If commodities go down in value because we're in a commodities bubble built up by hype and futures contracts and black box trading and hedge fund gambling (like where oil or natural gas was a few years ago) and true demand is low, then we may see a collapse. Also, if electronic records of paper contract on gold are worthless if there's a market collapse, or we find out there's way too much paper for the actual amount of physical gold there is, then a certificate on physical gold held in a vault in Canada or Perth or Zurich could be confiscated or stolen or be what software folks call "vaporware".

Then again, a quarter-ounce gold coin that you buy at mark-up from a dealer, have shipped to you with insurance and freight costs, that you keep in your home or closely on your person could be useless for buying a bag of corn worth only a tiny fraction of that coin.

And yet I suspect even if the price of gold fluctuates and goes back down to $300 per ounce for some reason, I suspect Dr. Martenson will still hold some because it remains a hedge for risk and a real store of wealth/value. Maybe it can buy a good horse or a working solar/ammonia refrigerator one day. I'm thinking of a farmer who stores grain because it is a form of sustenance that CAN be stored (as oppose to a banana) - knowing that while some (maybe most) of it WILL be lost due to mold or rats or fire or flood, enough may remain to see him and his family through a bad year.

End of the world survival situation? Water, food, shelter, survival basics, family, friends. (Notice no gold mentioned - but I think a working septic system will be golden: near the end of the Vanguard video on The Toilet Crisis, there's a segment on making valuable fertilizer for organic vegetables from human excrement collected by "manure entrepreneurs".)

I think we're all trying to figure out what's going to happen, how bad it's gonna be, and how we have to prepare. That's the bottom line.

Poet

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Re: Daily Digest - July 7
thelorax wrote:

So my question is: what are your thoughts about her point that any attempt to print, QE, or stimulate ourselves out of this mess will increase interest rates to the point where there is widespread debt default which is deflation?

Her logic is sound, but IMO it seems like it is just part of a bigger puzzle.  The Fed's and government's ability to obfuscate the true amount of QE, and their ability to convince other central banks and financial institutions to play along, should also be considered.  This was one of the points that Chris made in his The Sound of One Hand Clapping article.  The sneaky tricks squad at the Fed and their counterparts should not be underestimated, and for a time after March 09 we did in fact see some stimulation effects without a massive rise in interest rates.  That's not to say they will always succeed at doing so (I have a hunch that they will fail spectacularly at some point but that's just my opinion), but we should acknowledge they have some ability to hide their actions.  In a largely transparent market and monetary system I think she'd be totally spot on, but that doesn't seem to be the case with us.  FWIW I think she'll ultimately be correct, but I won't discount the possibility that those running the show can't keep the stimulation game going a little longer.  Sadly, I think if they are successful in stimulating the economy for another year or more we'll ultimately see a more dramatic and painful series of defaults and deflations.  More opportunity for people, businesses, and governments to increase overall debt gives the economies a greater height to fall from.  Though with the EU's new commitment to austerity (we'll still have to see if it's genuine or not) I think this possibility may be smaller now.

- Nick

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Which would you invest in?

Which would you invest in - just looking at the charts?

This?

Last 10 years on the x axis

Or this?

 

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Re: Which would you invest in?
Davos wrote:

Which would you invest in - just looking at the charts?

This?

Last 10 years on the x axis

Or this?

 

No question there Davos, I would short gold and go long the dollar, as the big money always migrates the market towards the opportunity with the most profit potential . Goldman Sachs has funded many billions of bonuses on Joe investor looking at the past and extrapolating it into the future, its the oldest game in the market. 

If you were to take these charts back another decade or two, you would see that the market action in the 80s and 90s created the massive profit  opportunity from the long gold/short dollar trade that your charts show so clearly. Cherry picking timeframes like you did with these charts only feeds the game in which the little guys like us always lose. 

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Posts: 2237
Re: World Toilet Crisis

Hey Doug-

   I think I remember Damnthematrix writing, in the past, about some kind of special toilet...I forget exactly what it is and hate to guess for fear I'll misinform you.  But you may want to try doing a search on the site for something he's written on toilets, or send him PM to find out more.  I have to run, but if I get a chance, I'll see if I can find an old reference (I think I printed some of the info out he discussed with the same concerns you have in mind!). 

   -pinecarr

Damnthematrix's picture
Damnthematrix
Status: Diamond Member (Offline)
Joined: Aug 10 2008
Posts: 3998
Re: World Toilet Crisis
pinecarr wrote:

Hey Doug-

   I think I remember Damnthematrix writing, in the past, about some kind of special toilet...I forget exactly what it is and hate to guess for fear I'll misinform you.  But you may want to try doing a search on the site for something he's written on toilets, or send him PM to find out more.  I have to run, but if I get a chance, I'll see if I can find an old reference (I think I printed some of the info out he discussed with the same concerns you have in mind!). 

   -pinecarr

http://damnthematrix.wordpress.com/2009/11/16/composting-the-permacultur...

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jimbergin
Status: Member (Offline)
Joined: Apr 22 2010
Posts: 6
Re: Daily Digest - July 7

If he were my son I would suggest he start looking for an apartment and a job at McDonalds. 

jim

 

pinecarr's picture
pinecarr
Status: Diamond Member (Offline)
Joined: Apr 13 2008
Posts: 2237
Re: World Toilet Crisis
Damnthematrix wrote:
pinecarr wrote:

Hey Doug-

   I think I remember Damnthematrix writing, in the past, about some kind of special toilet...I forget exactly what it is and hate to guess for fear I'll misinform you.  But you may want to try doing a search on the site for something he's written on toilets, or send him PM to find out more.  I have to run, but if I get a chance, I'll see if I can find an old reference (I think I printed some of the info out he discussed with the same concerns you have in mind!). 

   -pinecarr

http://damnthematrix.wordpress.com/2009/..

Thanks Damnthmatrix (Mike); you beat me to it!  "Composting toilet" was the search term/phrase that I was trying to remember.  And I'm very glad to get your article on how you built yours, and your experience with it!

-pinecarr

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