The coming Gold crash

[KDave]

If Wonga said he was Mark Carney what difference would it make.

Perhaps a bad example, if it was Mark Carney you would know without doubt that the prediction was wrong. 

 

[Wonger]

31 minutes ago, Oldun said:

What are your credentials ? Companies worked for, etc ? You are the fella making bold claims here.

What are your actual credentials ? 

Ok I give in, Im Ben Bernanke, happy now you can trust me? 😁

[Booky586]

I'm just about to Google Ben Bernanke, anyone else.....

[Wonger]

1 minute ago, Booky586 said:

I'm just about to Google Ben Bernanke, anyone else.....

I will google Mark Carney, he sounds a right one

[sixgun]

Just this week i took Wongo off ignore - now look what happened. 😖 
Back on ignore.

[Oldun]

38 minutes ago, Wonger said:

Ok I give in, Im Ben Bernanke, happy now you can trust me? 😁

No. I have seen wind up merchants like you a zillion times...borderline sociopath. Incapable of interacting or answering a simple well intentioned question.and acting like a badly behaved child, thinking it is funny.

Edited June 3, 2020 by Oldun

[Wonger]

13 minutes ago, sixgun said:

Just this week i took Wongo off ignore - now look what happened. 😖 
Back on ignore.

Something I said or the $75 drop in Gold?😁

[sixgun]

Hmmm the ignore system not working at the moment - i got notified of a reply from Mr Wong. 
i suppose it is your posts that do it Wonker - that is why i put you on ignore - then i took you off a couple of days ago b/c i thought you had calmed down but clearly you still aren't taking all your tablets.
 

[Wonger]

40 minutes ago, Oldun said:

No. I have seen wind up merchants like you a zillion times...borderline sociopath. Incapable of interacting or answering a simple well intentioned question.and acting like a badly behaved child, thinking it is funny.

Do not fret, Im back to work tomorrow, apparently the desk has a rather large offering of Gold Futures to unload, seems the fun is only just starting!

Edited June 3, 2020 by Wonger

[Cornishfarmer]

10 hours ago, sixgun said:

The wheat crop fails - there is only chaff. The price of wheat quadruples. The farmer increases the price b/c the supply of wheat decreases. 
Do farmers have to get permission from the banks to put up prices?

This is like gold.    The farmer doesn’t increase the price of wheat it’s computers and traders in Chicago that set price.    It’s like saying a gold miner sets the gold price higher because he hasn’t found much this year

[sixgun]

1 minute ago, Cornishfarmer said:

This is like gold.    The farmer doesn’t increase the price of wheat it’s computers and traders in Chicago that set price.    It’s like saying a gold miner sets the gold price higher because he hasn’t found much this year

So the farmer gets permission from keyboard warriors in Chicago but not bankers. That makes sense.

[Prophecy]

Please stop posting in this thread. it keeps distracting from the intelligent content on this forum.

Edited June 3, 2020 by Prophecy

[Cornishfarmer]

1 hour ago, sixgun said:

So the farmer gets permission from keyboard warriors in Chicago but not bankers. That makes sense.

No but that’s how the World price is set.

oil, gold, grain all the same.   If they have a drought in the mid west, floods in Russia but a great growing season in U.K. the price will go up even though there is plenty of grain in the U.K.      also works the other way round. This year will be a year that there will be a shortage of grain in the U.K. effecting brewing and bread this winter

[Oldun]

2 hours ago, Wonger said:

Do not fret, Im back to work tomorrow, apparently the desk has a rather large offering of Gold Futures to unload, seems the fun is only just starting!

Company name ?

[Prophecy]

Please stop posting in this thread. It keeps distracting from the intelligent content on this forum.

[Minimalist]

  

16 hours ago, Martlet said:

Too much weight is placed on the association with money supply, that can be a cause of, not the defining characteristic, deflation or inflation. 

Wrong @Martlet.

The correct definition of the money supply is characterised by the monetary aggregates of currency in circulation, period. Which is just the front face of it - the other side of the expansion is the mechanism to these notes (I will give the BoE and FedRes the example)

Its not a surprise this revisionism keeps appearing - I have heard from financial "professionals" and people who have a degree of financial aptitude possess that opposed ostensible view. Then received oppugnant reactions when I explain to them the correct way to define the money supply is defined by the above. The institutional deception is truly enforced in society leading to deliberate misunderstandings and confusion. In my experience I have been called "atavistic" from a "professional" because I focus on the currency in circulation (whatever thats supposed to f#cking mean).

Most of the money supply is deliberately held outside the financial system making the denominated small valued currencies local in lower classes hands.

Have you ever seen a high valued £ note? £1,000,000 note? Doubt you have. Do the Americans see regular $100 notes and higher valued notes? Doubt it.

Take a look at the Bank of England's (https://www.bankofengland.co.uk/statistics/banknote) denominated currency supply - look at the increase in supply - I do warn you though, despite the BoE's effort to put £1,000,000 and £100,000,000 bank notes which are found in [Other], ask yourself why millions in that mixed demonation section is deliberately inconspicuous and concealed?

Look further, what about the current worlds reserve currency ( https://www.federalreserve.gov/paymentsystems/coin_currcircvalue.htm ) notice how the denomination of $100 is the most printed? Around 80% of the Feds printing machine is concentrated to $100 notes.

Its peculiar isnt it?

The truth is the central banks mentioned issue denominated notes on request from the UK/US government and sub-commercial banks. BoE/FedRes obtain denominated notes (small and large value) from De La Rue (BoE)/Bureau of Engraving and Printing(FedRes), it pays these organisations for manufacturing them - which is accounted as liabilities of the BoE/FedRes and obligations to the United Kingdom gov/United States gov. Sounds fair? Here is the catch. The BoE and the FedRes deposits arent obligations to/for the United Kingom and the United States. Why? Printing bank notes is obligated to the United Kingdom and the United States governments when the currency supply is expanded - This gives the central banks first lein to assets; in the United States gold certificates. The United Kingdom securities/assets.

Most or nearly all high valued notes are outside the financial system, ask yourself why? The blame gets put on the most liquid participators of capitalism; international drug dealers. Although its truthful in some ways that both these hold a percentage of high valued notes but its vague and insane to assume that all the international drug dealers are indirect enablers of the central banking printing of higher valued notes.

Its usually wealthy private banking groups and individuals who are tied in with finance who hold these high valued notes. No different than gangster drug dealers. Both are highly dangerous in comparison to the ordinary person. Unfortunately, most of society thinks the ones who are wearing suits issuing the bank notes serve humanity and they care about the public while they used debt as a mechanism to collect assets aka the ponzi scheme. The other is an amateur who usually brings weapons to the table when negotiating a deal. The flick of a pen from a banker is more deadly. Society will deny it though.

Its also scary that we live in a time where normal citizens like ourselves cannot redeem our fiat issued currency for gold isnt it? But the central banks can from the mechanism I have explained. Incredible.

But hey, its just a cause as you put.

So, as a fundamental, the gold spot/futures price will increase to the expansion of currency in circulation, its elite manipulation, all of it, what the central banks do, I will do, particularly when central bankers buy up metals (we seen this with Russia and China - the prices moved accordingly after Xi and Trump trade truce). All the best to sub-commercial bank balances who arent stacking Gold because they see it as an "asset class" and focus on paper contracts/securities; they are finished. Usually @HawkHybrid is first on this forum to disapprove institutional manipulation/gangsterism/financial terrorism - that somehow the fiat and paper markets, its mechanism, its foundations, operations arent a force at work in our society that act against the best interest of the average citizen and it only applies to certain traders who get caught front running and throwing billions of shorts into metals paper markets - however the mechanism behind issuing fiat and its relation to Gold is unequivocal; that is the system - its a scam.

I will post it again, like I have in another thread - Future contracts are a scam; the existence of paper-to-gold is an illusion; a fraud; institutional financial terrorism.

Ill sit here like a dinosaur as I have been called in the past with my physical gold and silver protecting me from financial terrorists. If you dont hold it, you dont own it.

Im giving you the benefit of the doubt here @Wonger, you are correct in defining the money supply.

Edited June 4, 2020 by Minimalist
Congratulating Wonger

[sixgun]

The argument being put forward by the Wonger is that prices cannot rise until and unless there is more currency to support those higher prices. 

So if the amount of currency in circulation is fixed, if one price goes up, others must go down. 
He ignores money velocity.

Following the 2007/08 financial crisis the Fed went into several rounds of QE and dropped interest rates. 
Gold is real money and as such is a zero risk asset. Gold is gold - it has no liabilities. When you hold physical gold it cannot be defaulted on. A company might go bust and its shares become worthless, a government or corporation might default on their bonds - but gold is gold.

If you listen to Ned Naylor-Layland, who in my estimation is a proper gold/silver expert, he is at pains to point out that the price of gold is determined by what fiat and bonds are worth and what the market thinks they will be worth in the future. So what we are looking at is purchasing power and real interest rates - the difference between the headline interest rate and inflation.

The falling interest rates following the financial crisis and the spectre of massive QE indicated to the market that real interest rates would be very low - as a result the price of gold and silver went up.

As it was, the published inflation rates did not shoot up. What happened was this new currency from QE did not enter the general circulation. It sat on and propped up bank balance sheets - it did not appear on Main Street. There wasn't more cash in circulation and prices did not go up.
What happened in effect was this new money sat on balance sheets and was not lent out - it had zero velocity. If cash is hidden under the mattress and never comes out it might as well not exist. If people hoard and do not spend their cash, it might as well not exist. It has zero velocity, it cannot contribute to the economy or cause inflation. There is often an assumption that money velocity is a constant and so more cash pushed out will lead to more inflation and less cash will result in deflation. This is not necessarily the case. 

Currency that is circulating 10 x a day purchases 10 x as much as the same amount of currency that circulates once a day. 
Prices can go up with the same amount of currency if its velocity is higher.
When people stop spending, you may well see prices start to fall as sellers drop their prices. No-one is buying - their cash is under the mattress. This is not because there is less currency in the system, it is because the velocity of money has dropped. 

There is a view that there is a dollar shortage. That a large amount of debt held in the world is denominated in dollars. A lot of this is in the Euro-Dollar system. Dollars created outside the US, outside the control of the Fed - some people say this is what is the actual world reserve currency. How many Euro dollars there are is not clear but estimates i have heard are around $12 trillion. The thesis is there are not enough dollars to pay this off and as borrowers go chasing dollars, the value of the dollar will get bought up and up against other currencies. This is the Dollar Milk Shake Theory of Brent Johnson. 

Now it does seem there is a shortage of dollars - but what will happen is foreigners will sell dollar denominated assets such as Treasuries. The demand for Treasuries outside the US, which is low as it is, will evaporate. US stocks held by foreigners will get sold off. All to raise dollars. These dollars all end up back in the US - more currency in circulation which will likely end up causing inflation. US stocks and other bonds sold off. The world will divest dollar assets and de-dollarisation will accelerate. There is already increasing real world de-dollarisation going on, where trade does not involve US entities, payments will avoids the dollar. 
The outcome is not good for the US. Products and services in the US would become overpriced. As USD assets are divested and dollars come back home, inflation takes off. Steps would be needed to devalue the dollar. To fill the dollar shortage. The Fed is and would do currency swaps - putting dollars out into the world in exchange for other currencies. What is different from 2008 is that currency is not just sitting on bank balance sheets. It is being paid out to people. The US Treasury has a cash account at the Fed which normally had around $400 billion in - this balance recently grew to $1.45 billion - it is now being spent. It sits there to be spent into the circulation. It is likely this account will be topped up. This will cause inflation as we see the US economy rapidly shrinking - GDP falling heavily. The US government is splashing the cash in support cheques - a helicopter money - i expect there will be more splashing with the recent riots. More cash in circulation with falling GDP. This is by definition - inflation.

There are deflationary and inflationary forces in play. Central banks really, really hate deflation. In all this turmoil there is real money. i go with real money.

There is another factor which of course will not get officially discussed and that is the missing money - the money stolen away. The Missing $21 trillion that the US Department of Defence and the Department of Housing and Urban Development cannot account for. Catherine Austin Fitts talks about this a lot.  i have heard there is another $10 trillion missing. There is probably more cash that has been sequestered. At some point this will reappear - it will enter the system. When and how is anyone's guess. It is not going to sit in the Cayman Islands or Jersey or wherever forever. That is a lot of wongo to reappear. It would be hard for that not to be inflationary.  

Edited June 4, 2020 by sixgun

[Martlet]

3 hours ago, Minimalist said:

  

Wrong @Martlet.

The correct definition of the money supply is characterised by the monetary aggregates of currency in circulation, period. Which is just the front face of it - the other side of the expansion is the mechanism to these notes (I will give the BoE and FedRes the example)

...

Im giving you the benefit of the doubt here @Wonger, you are correct in defining the money supply.

We were talking about definition of inflation, not money supply. 

[Wonger]

In the Morning I get a Taxi to work and pay the driver £20, the Taxi driver goes for breakfast and tips £20 to the waitress, the waitress goes to the hairdresser lunch time and tips the hairdresser £20, the hairdresser goes out to lunch and tips the waiter £20, the waiter goes to the Barber's and tips the Barber £20, the Barber has the shop windows cleaned and pays £20, the window cleaner goes for dinner and tips the waiter £20, the waiter gets a Taxi home and pays the driver £20, there has been £160 of GDP created, there has been a velocity of x 8 on the £20, however there is still only the original Currency of £20, no additional Currency whatsoever has been created, therefore Inflation is exactly the same at the end of the Day as when the Day began because you simply can not have Inflation unless the Currency supply is increased because the Currency supply simply does not  exist to support any price increases whatsoever.    

Not only has no Inflation been created, no wealth has been created either, GDP is a complete Hoax, Currency Velocity is a Hoax, the entire World of financial Academia is a Hoax!

I notice there is a Farmer here, I bet he understands this far better than any Financial Academic who has been brain washed with complete and utter non sense from the Hoax financial Academic world of lies! 😁

Edited June 4, 2020 by Wonger

[sixgun]

https://thismatter.com/money/banking/money-growth-money-velocity-inflation.htm

The formulae are laid out in the referenced webpage article.

Quote

Hence, it can easily be seen that when either the quantity of money or the velocity of money or their combination increases faster than real GDP, then prices will increase in proportion............

Clearly for the Wanger it can[not] easily be seen....

[Oldun]

9 hours ago, Prophecy said:

Please stop posting in this thread. It keeps distracting from the intelligent content on this forum.

Ermmmm, no. How’s that ?

You need to go back through the whole thread before judging someone like that.

[Wonger]

Classic example of Academic lies, the Government can not create £100 of Currency it can only Borrow the £100 of Currency or Tax the £100 of Currency, both of these take the £100 of Currency from existing Currency supply unless the Central banks or Commercial Banks create this additional £100 of Currency supply!  

---

Added 0 minutes later...

15 minutes ago, sixgun said:

https://thismatter.com/money/banking/money-growth-money-velocity-inflation.htm

The formulae are laid out in the referenced webpage article.

Clearly for the Wanger it can[not] easily be seen....

Classic example of Academic lies, the Government can not create £100 of Currency it can only Borrow the £100 of Currency or Tax the £100 of Currency, both of these take the £100 of Currency from existing Currency supply unless the Central banks or Commercial Banks create this additional £100 of Currency supply!  

[sixgun]

4 minutes ago, Wonger said:

Classic example of Academic lies, the Government can not create £100 of Currency it can only Borrow the £100 of Currency or Tax the £100 of Currency, both of these take the £100 of Currency from existing Currency supply unless the Central banks or Commercial Banks create this additional £100 of Currency supply!  

What are you talking about Winger?
i thought you were busy this morning selling 100 quadrillion GC contracts and causing gold to crash
From The Fed itself:

https://fredblog.stlouisfed.org/2014/08/m2-velocity-and-inflation/

Quote

there is a slight upward slope, indicating that higher M2 velocity is associated with higher inflation,

 

[Wonger]

22 minutes ago, sixgun said:

https://thismatter.com/money/banking/money-growth-money-velocity-inflation.htm

The formulae are laid out in the referenced webpage article.

Clearly for the Wanger it can[not] easily be seen....

"Because low, stable inflation is necessary for optimal economic growth, it is one of the main economic objectives of the Central Banks"

Even the First line in the Article is lies, the economic objective of the Central Banks is to perpetuate never ending Inflation way above wage Inflation to keep the mass public from gaining Economic freedom, its should be quite clear to anyone that it would be in the mass public's interest to have Zero Inflation!    

[Wonger]

10 minutes ago, sixgun said:

What are you talking about Winger?
i thought you were busy this morning selling 100 quadrillion GC contracts and causing gold to crash
From The Fed itself:

https://fredblog.stlouisfed.org/2014/08/m2-velocity-and-inflation/

 

"there is a slight upward slope, indicating that higher M2 velocity is associated with higher inflation" 😁 Ok that made me laugh