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How did gold become the foundation of everything until the banksters finally took over?

Gold is and hasn't been worth as much as we've made it for centuries. We based a system around it and that made it valuable. It has a silly jewelry value but that isn't what made it so expensive.

In a perfect world, the cost or value of anything represents all the costs needed to produce, process, and transport that item. Gold isn't that bad of a commodity to measure wealth- it does not rust or otherwise deteriorate (in typical conditions) over time, reasonable quantities can represent significant value, and the industrial demand (demand which is not jewelry related) is reasonably non-volatile. And you can actually use it as a low-resistance, non-corrodible coating. I am not a gold nut, but I would say that gold is on average better than a piece of paper which has intrinsic value far less than the actual valuation.

If the valuation of gold was significantly higher than the cost of mining it, mining companies would be making great profits. This does not appear to be the case- from 2003 to 2013, 3 of the largest gold mining companies had several years of losses, even when considering various different accounting methods. The stock price and dividends of these companies also are not particularly spectacular. I can't think of a great reason that such companies would cook the books or spend money unnecessarily so as to be less profitable than they could be. Therefore I would conclude that gold may be overvalued at times, but it is generally not unreasonably overvalued considering the cost of production.

The monopoly/cartel was broken years ago, and they had to liquidate their stockpile. There is enough competition that natural diamonds are more or less set at market price. Granted, the price is inflated by marketing that drives up demand, but that's no different from most industries.

Really?

I find it hard to believe considering oil and precious metals have risen so much:

Gold for example has moved from $400/oz in 2004 to $1300/oz in 2014

I'd question your government sourced numbers given that they have the same bias to provide you with lower inflation in these data as in the original data in question.

I googled "gold price currency", found this site, and selected a 5 year chart since I wanted to look at the period of the current economic crisis.
http://www.kitco.com/gold_curr...

I noted the peak price in late 2011.
From mid 2009 to late 2011 the price in USD went from roughly 900 to roughly 1900, about a 110% increase.
During that same time frame the price in AUD went from roughly 1500 to 1800, about a 20% increase.

I'm not sure where you are getting your numbers, it looks like the gdp dropped under Carter, and rose under Reagan. Maybe you forgot to adjust for inflation? You could probably give some credit to Carter because Reagen followed some of his economic policies (like keeping Volcker around), but strictly looking at the numbers, growth was higher during Reagan's presidency.

with the price of Copper continuing to rise, who will be able to afford copper based PCB's in the near future? Silver has been consistently in the 5-12 dollar per ounce range and copper demand has reached the point that it's starting to hit the same levels with the expectation that copper will eventually level out at 100 per ounce or 10x the historical price of silver.

Um...silver's been above $20 per troy ounce for a while now. Copper, OTOH, has been closer to $3-$4 per pound. Copper has had a run up in price, but not nearly enough for it to make silver cheaper for wiring/PCB fabrication/etc.

As I write this, silver is $21.29/ozt. Copper is about $3.25/lb. Copper would need to rise above $310/lb just to equal silver...a two-order-of-magnitude increase.

196 years?

First of all, investing is not the same thing as protecting your investment (savings) against inflation. For 100 years now the Fed is printing currency. Since 1971, the gold link is broken. For more than 40 years now USA is in an inflationary spiral caused by the government creating fake money out of thin air to grow government spending and to try and grow economy, while actually destroying economy with inflation.

Gold, aluminum, etc., these are inflation hedges. You buy these when you do not believe the economy is productive or can be productive based on government actions and you just want to protect yourself against theft.

In 2000 S&P500 was about 13000-14000 and today it's somewhere there as well, same level (set chart to max).

Gold was about 300 in 2000 and today it's about 1730 or so.

In terms of gold S&P lost plenty, 5-6 times. Same with DOW. Bonds were in a long secular bull market for a few decades, but not anymore. Now it's a bubble, it's irrational, people jump into bonds when they are afraid of inflation as well and that's irrational behavior because bonds are paid in those same dollars. As dollars go so do bonds. The only way to protect your money is either to be in very well positioned equities or other assets, such as commodities, monetary metals, etc.

Think about it, if you and 6 more of your friends all jump out of a window of a skyscraper without parachutes, and all of you are falling down, you are all OK 2 floors down, you are all OK 4 floors down, some of you fall a bit faster than others, some fall a bit slower, all of you are closing with the inevitable. When an outsider asks how you are doing, you tell him: Not bad, I am actually an entire floor above the other 6.

Do you understand what I am saying?

Here is the chart (you can put 1 over it for a more appropriate view) of how they are all progressing towards that pavement.

In the early 19 hundreds before, before any income taxes and without any unions, Ford was paying his assembly line workers $5/day.

From wikipedia:

Ford astonished the world in 1914 by offering a $5 per day wage ($110 today), which more than doubled the rate of most of his workers. ...
Ford announced his $5-per-day program on January 5, 1914, raising the minimum daily pay from $2.34 to $5 for qualifying workers. (Using the consumer price index, this was equivalent to $111.10 per day in 2008 dollars.) It also set a new, reduced workweek, although the details vary in different accounts. Ford and Crowther in 1922 described it as six 8-hour days, giving a 48-hour week

$5/day, 6 days a week. That's $30/week.

Google document viewer: Historic gold prices

1 ounce of gold was just under 19USD. With 30 dollars, that's 1.5 ounces of gold.

At current prices (over USD1700/ounce) that makes it USD2550

Assume 52 weeks in a year, that's USD132,600 a year.

That's take home pay, no unions, no government regulations, no income taxes.

What would be the equivalent pay today, if you take into account that there was no government involvement into health care or education or pension plans at that time, so people took care of their own health care, education and retirement, yet were able to do so on that salary and have a stay at home wife with a bunch of kids and they didn't have much credit, they paid out of pocket for all expenses? What would the equivalent salary be today?

BTW, a standard 4-seat open tourer Ford Model T cost 850USD.

-
My point is that you are blaming corporations for the failure of the system, I am pointing out that corporations are perfectly capable of building products that people want to buy, while creating good paying jobs without unions or regulations, and the real difference between that time and now? Government involvement into the economy with all the spending, regulations, laws, income taxes, SS, Medicare, tuition loans, subsidies to monopolies, etc.

I don't understand what your point is at all. On one hand you are saying: Ford was 'forced' to pay this because of market pressure, because he needed his workers. On the other hand you are saying: no way he could afford to pay his workers $104K year.

I am not saying he was paying $104K a year, I am saying he was paying 1.25 ounces of gold a week, which in current prices is $104K/year, and that's take home pay, and that's at time when people were paying for everything out of pocket and saving for their retirement themselves, so prices for insurance as well as for healthcare and education were extremely low, very affordable, because there was no government money in it, as it is today.

Just in case you start with your nonsense again, here is some data from Wikipedia:

Ford astonished the world in 1914 by offering a $5 per day wage ($110 today), which more than doubled the rate of most of his workers.

Now, they are saying it's $110 today, but that's not counting real inflation, because dollars were gold/silver. 25USD at the time was enough to buy 1.25 ounces, which is equivalent to over 2000USD today at 1700USD/ounce.

Ford announced his $5-per-day program on January 5, 1914, raising the minimum daily pay from $2.34 to $5 for qualifying workers. (Using the consumer price index, this was equivalent to $111.10 per day in 2008 dollars.) It also set a new, reduced workweek, although the details vary in different accounts. Ford and Crowther in 1922 described it as six 8-hour days, giving a 48-hour week,

In fact I was wrong, it wasn't 10 hour days, it was 8 hour days, 6 day weeks, and that's without any unions, and at the time income taxes were 1% and only for a limited number of wealthiest people.

So I don't know what is with "neoconservative bullshit here" comment, but your comment looks quite biased, flamebaiting and also wrong.

In my last comment I am not sure how, but the link in the last sentence got eaten by the angry gods of the intrawebs.

Let's try again:

Of-course moving value out of fiat and into this was always a good idea over the past decade and it's even a better idea today. That's how you keep the value and have savings. Then you can use it to invest.

Back to front:

And no, inflation is NOT possible without almost immediately rising wages. That's Macro 101.

- nonsense. There is inflation going on right now and wages are staying where they are or dropping. Inflation is expansion of monetary supply, not rising prices, as they teach you in your Keynesian schools of 'economics', (which it's not.)

Again, USA can only 'export' inflation if country's local currency is pegged to dollar. So USA cannot export inflation to Japan or Europe, for example.

- nonsense.

As USA export inflation to China, the subsequent rise in commodities prices push inflation to the rest of the world. China uses commodities to produce for most of the world, and the higher prices for the commodities then affect everybody, including Europe, Japan and the rest. Besides, Europe is doing its own rounds of inflation just fine, and Japan bought into using inflation to fight the 'evils' of deflation in the nineties and though they printed only enough for prices to fall a little or to stay where they were before, it still is inflation. They didn't print enough to cause massive price hikes, but they were supposed to have massive price drops, and they 'saved' their population from the 'evil' of having low prices, thank you very much, all to subsidize the Western consumer by stealing the purchasing power of the Japanese producer.

There's been no significant changes in the USD exchange rates recently. So this is also false.

- really, so CAD and AUD being above USD, the Swiss Franc being at near 1.20 (thank you, thank you), the Japanese yen staying where it is right now even with their insane policy of inflation and after their catastrophes of the late, the NZD at all times high, even Euro, with all the problems of Europe being at what, 1.41 to 1? I don't know what you consider significant, but to me, truly, the only significant thing is this. That's the only real money AFAIC. Not an investment. Not a commodity. Money.

Actually, it's close to 20%. And it's really real - China and India are growing that fast (China is almost back to double-digits growth).

- I calculate my numbers, I don't count on others to do it for me.

But let me explain something to you, that they don't teach you in your 'economics' classes apparently.

A growing economy with a growing demand GROWS SUPPLY. That means the prices go down, not up, in growing economies, because there is money to be made by increasing supply and selling more, and that happens because the market sends signals that more of whatever is required, so prices on that 'whatever' go up and then there is more supply. It's really that simple.

The demand is artificial, it comes from inflation, that's why the prices for commodities are in a 10 year bull market, not because there is more demand from China. If China produces more demand it also produces more supply. If China cannot produce more supply, others produce more supply.

The prices for oil are at an all time LOW today. All time low if counted in real money. 10 silver cents US per gallon. That's lower than in recorded history of USA ever, the lowest in history was 25cents, but of-course they also had people checking your oil at the gas pump, so maybe the comparison is just a little off by that amount.

That's what we call "a prediction" here in economic science. Can you make a corresponding prediction? What would happen if QE3 is not enacted (I know that you believe that it would)?

- economic science in universities of the world is a misnomer. I can make predictions, I made predictions and based my behavior on them, that's why I left that continent 2 years ago. That's why I sold properties and got gold. I make predictions.

QE3 will happen, so that's my prediction.

If Q

They are expensive because of the recession. It is common for people to move their money into "safer" investments like silver and gold during a recession. That leads to a precious metals bubble making these investments highly dangerous, which of course, attracts even more money.

True 'precious metals' or ones used by governments
and countries as an exchange medium for debt and
a hedge against inflation, cannot truly bubble. That
is why we use them.

An economic bubble (sometimes referred to as a speculative bubble, a market bubble, a price bubble, a financial bubble, a speculative mania or a balloon) is “trade in high volumes at prices that are considerably at variance with intrinsic values”.[1][2] It could also be described as a trade in products or assets with inflated values.
{snip}
Because it is often difficult to observe intrinsic values in real-life markets, bubbles are often conclusively identified only in retrospect, when a sudden drop in prices appears. Such a drop is known as a crash or a bubble burst. Both the boom and the burst phases of the bubble are examples of a positive feedback mechanism, in contrast to the negative feedback mechanism that determines the equilibrium price under normal market circumstances. Prices in an economic bubble can fluctuate erratically, and become impossible to predict from supply and demand alone.

If you look at the long term growth of gold,
http://www.kitco.com/LFgif/au3650nyb.gif
you'll see it is experiencing healthy overall
growth without having any "out of curve"
spikes.

If you were to use that chart in a program
that has indicators and signals you would
see that while you'll get an overbought signal,
it is far from being in a bubble state.

That is also not to say that at some point
it might not relax... maybe lose 20%. But
that is far from a bubble.

If you were alive long enough to remember
the problems with gasoline that the US had,
you'll see that gold saw a very healthy spike
as a hedge against the cost of the barrel of
oil in the 70's. As well as the US being taken
off the gold standard and presented with fiat
currency at the beginning of the 70's.

http://www.kitco.com/LFgif/au75-pres.gif

The slump in the late 90's was caused by
our leadership trimming the national (US)
debt.

And the explosion of a real bubble, plus the
start of a war in the Middle east, helped to
bring gold right back from its slump.

The hiccup at the end of 07 was in response
to the bank and real estate bubble bursting
and the economies becoming destabilized.

I'm sure we are at a higher than graphed level
now because of the depression but that too
will be absorbed and the price of gold will find
its level again.

-AI

They are expensive because of the recession. It is common for people to move their money into "safer" investments like silver and gold during a recession. That leads to a precious metals bubble making these investments highly dangerous, which of course, attracts even more money.

True 'precious metals' or ones used by governments
and countries as an exchange medium for debt and
a hedge against inflation, cannot truly bubble. That
is why we use them.

An economic bubble (sometimes referred to as a speculative bubble, a market bubble, a price bubble, a financial bubble, a speculative mania or a balloon) is “trade in high volumes at prices that are considerably at variance with intrinsic values”.[1][2] It could also be described as a trade in products or assets with inflated values.
{snip}
Because it is often difficult to observe intrinsic values in real-life markets, bubbles are often conclusively identified only in retrospect, when a sudden drop in prices appears. Such a drop is known as a crash or a bubble burst. Both the boom and the burst phases of the bubble are examples of a positive feedback mechanism, in contrast to the negative feedback mechanism that determines the equilibrium price under normal market circumstances. Prices in an economic bubble can fluctuate erratically, and become impossible to predict from supply and demand alone.

If you look at the long term growth of gold,
http://www.kitco.com/LFgif/au3650nyb.gif
you'll see it is experiencing healthy overall
growth without having any "out of curve"
spikes.

If you were to use that chart in a program
that has indicators and signals you would
see that while you'll get an overbought signal,
it is far from being in a bubble state.

That is also not to say that at some point
it might not relax... maybe lose 20%. But
that is far from a bubble.

If you were alive long enough to remember
the problems with gasoline that the US had,
you'll see that gold saw a very healthy spike
as a hedge against the cost of the barrel of
oil in the 70's. As well as the US being taken
off the gold standard and presented with fiat
currency at the beginning of the 70's.

http://www.kitco.com/LFgif/au75-pres.gif

The slump in the late 90's was caused by
our leadership trimming the national (US)
debt.

And the explosion of a real bubble, plus the
start of a war in the Middle east, helped to
bring gold right back from its slump.

The hiccup at the end of 07 was in response
to the bank and real estate bubble bursting
and the economies becoming destabilized.

I'm sure we are at a higher than graphed level
now because of the depression but that too
will be absorbed and the price of gold will find
its level again.

-AI

You are calling me delusional while you are denying the actual numbers added together from 2003 and compared to actual numbers added together in 2011, the numbers that are compared and percentage calculated with simple math, so while I am doing the actual calculations and actual math, showing that USD lost 76% of its value since 2003 to inflation in only 8 years, you are calling me a serial liar, while pointing to propaganda printed by government that has no bearing in reality, and you are calling that real?

I am serious, the irony is lost on you, but I think at this point you are not just delusional, you are a shill. Are you a shill? I think you are a shill, there is no explanation how the simple math of numbers, freely available in the history of prices over the years can be called 'lie', while the fake reports by government can be held as the real deal.

You are more than welcome to continue doing this nonsense, but all I am going to do from now on is just type in numbers. Like now. I am not even going to bother with any new numbers, I'll just repost the same ones over and over.

Here we go:

Here is coffee price chart it was between 60 and 72 USD per contract in 2003.

Here is coffee price chart now It's between 259 and 290.

In fact, if measured in coffee, the value of USD decreased at the lows by 76%.

select 27 May, 2003 - you will find out that gold closed at 367.20.

Select 27 May 2011, you will find out it closed at 1536.50.

In fact, if measured in gold, the value of USD decreased by 76%.

oil traded between 20 and 28 in 2003, May 27, 2011 it is 100 Do I need to do the math?

--

I am calling you a shill, not just a liar, a shill - a liar with an agenda. You can come back for more abuse, it's your business.

Cheers.

You are correct.

- I know.

Money does not store value.

- fiat does not store value.

That is not the purpose of money.

- that's not the purpose of fiat.

However, the U.S. dollar has not lost 75% of its value since 2003.

- it did.

Here is coffee price chart it was between 60 and 72 USD per contract in 2003.

Here is coffee price chart now. It's between 259 and 290.

In fact, if measured in coffee, the value of USD decreased at the lows by 76%.

select 27 May, 2003 - you will find out that gold closed at 367.20.

Select 27 May 2011, you will find out it closed at 1536.50.

In fact, if measured in gold, the value of USD decreased by 76%.

oil traded between 20 and 28 in 2003, May 27, 2011 it is 100 Do I need to do the math?

I can go on. My point is that when you say things like:

However, the U.S. dollar has not lost 75% of its value since 2003.

- you better be ready for a barrage of numbers.

If the USD had lost that much value, my grocery bill would have gone up by a lot more than it has.

- maybe you should go back to your old receipts and try and figure this out, but prices for food in USA went up by a factor of 2 easy since 2003. However there is a huge factor, which prevents the end user consumables from going off the charts in US (like by factors of 10) today, and that's the fact that US dollars are collecting dust in foreign central banks, who also destroy their currencies following the so called 'reserve'. They are waking up, they stopped buying almost all new US bonds, now Fed buys over 80% of all new bonds, and buys over 30% of bonds on the market, from those, who are dumping them, like Bill Gross and China, etc.

Things are not hunk dory and if something doesn't change very soon, the U.S. economy (and probably the world economy) will pass the point of no return.

- wrong again, bud, it will be US economy and some of the European economies that will go to hell and will have to rebuild from hell, but it's not going to be the world.

Again: wealth is production, not fiat or even gold, and there are plenty of countries today who do have enough production capacity, that they generate trade surpluses, not deficits, like USA does (with pretty much every country, though you only hear about the 50Billion/month deficit with China, but go ahead, look it up, USA has trade deficits even with Canada.)

As long as those countries keep their manufacturing base, they will be just fine. Their USD denominated holdings will be destroyed, but it won't matter, their own currencies will rise and will allow their own population finally to enjoy the fruits of their own labor, which until now USA had the privilege to.

Two examples:

http://charts.kitco.com/KitcoCharts/

http://www.quanetic.com/Regex

Criminal laws do no not require an injured party to claim damages. You are confusing them with civil laws and contracts.

True. However if the law is unjust - punishes people who did not do any reasonable harm - it is a moral imperative to struggle against such law.

But you are a "libertarian": a corporate anarchist. You don't understand government; you want to eliminate it and take your chances with corporate powers. But we have a government, because we've seen how those autocratic orgs abuse the rights and property of the people.

Baseless ad-hominem attack; also prescribing qualities and wantings for the person from thin air - he has not said anything about eliminating government in his post.

You also don't understand the most basic economics: the ounce of silver in those "dollars" was worth $10-19, averaging about $14, through 1999, but was sold for $20 (legitimate dollars). If the fake dollar's silver were worth "quite a bit more than the face value of US coin", this crook would have been losing money on every sale. Which qualifies him to be a "libertarian".

It's you who does not understand the (economics of the) situation. Those (liberty) dollars were not stamped with face value of 20 Dollar, they were stamped with face value of 1 Dollar (if I am not mistaken here; if I am - see the end of the argument) - and your argument above unravels because of this simple fact.

Think about it. The basic premise of grand-grand-parent (metlin) was that the man tried to deceive the users by making his liberty dollars (LD henceforth) very similar by design to the fed dollars (USD henceforth). So the supposed issue here is that somebody will be confused and accept LD instead of USD.
There are two cases:
EITHER the confusion/deception occurs during the original maker X-->initial buyer Y transaction.
OR the confusion/deception occurs during the intermediate holder Y -->another person Z transaction.
In the first case there can be no confusion: Y pays X a sum of 20USD (form you post - I am not sure for what price LDs were sold) and receives a coin of 1LD. He can not be confused to believe 1USD == 1LD because he would then demand 20LDs for his 20USD.
In the second case confusion may occur - the receiver Z may confuse 1LD for 1USD, but in this case Z obtains 1LD coin, silver content of which is valued "10-19 USD, averaging about 14 USD" (according to your post) instead of 1USD.

The fact that 1LD was sold above the spot silver price is normal. Coins always command some seigniorage (http://en.wikipedia.org/wiki/Seigniorage) above spot bullion prices - to cover expenses of the minter.

PS In the unlikely case that LDs were stamped with the face value of 20 Dollar, there again can be no deception. AFAIK there are no official, government issued coins of 20USD denomination .

silver and gold are money because, writ large, society treats them as money, and particularly as a store of value. there is nothing mystical about them. however, one might argue that their industrial uses detract from their utility as currency. look at the design goals of bitcoin: an ideal currency would be hard to produce, durable, easy to verify, and not useful for other purposes. historically, gold and silver have been hard to produce, durable (they don't corrode nearly as easily as other metals people had access to for all those millennia [copper, bronze, iron, steel, zinc, nickel]), easy to verify (it is soft and gives when bitten unless alloyed excessively), and industrially useless (until recent times). In the interior of the US, native americans used seashells as currency. again, the seashells were hard to produce (had to collect and transport them to the interior), durable (relatively), easy to verify, and not useful for other purposes.

One could say similar things about aluminum, but we only recently (1800s) discovered how to refine it and it is extremely useful in industry and fairly common.

and moreover, gold and silver are less vulnerable to political dilution. nearly every other paper currency in the history of the world has fallen to political dilution. we can easily see that process at work in our own politics given how little either party cares to pay for its spending, even in times of plenty (early-mid 2000s). monetarization of government debt is also a tax, and a particularly regressive one, punishing those on low and fixed incomes like retirees living off of savings.

and regarding your scaremongering about the guy you're badgering being foolish to invest in gold, you may be correct now, but not at any time in the past 10 years. but who knows, gold could still go up. it all depends on how much QE (expansion of M1) is done and how the markets react to it.

http://www.kitco.com/charts/popup/au3650nyb.html
http://www.google.com/finance?client=ob&q=INDEXDJX:DJI

set the google chart of the DJIA to 10 years. then ask yourself which you'd rather have invested in during the last decade.

Criminal laws do no not require an injured party to claim damages. You are confusing them with civil laws and contracts.

We have a government to protect the people even without specific people claiming damages after the fact. Instead we elect representatives who make laws that protect us from well understood past damages, to prevent and interrupt them.

But you are a "libertarian": a corporate anarchist. You don't understand government; you want to eliminate it and take your chances with corporate powers. But we have a government, because we've seen how those autocratic orgs abuse the rights and property of the people.

You also don't understand the most basic economics: the ounce of silver in those "dollars" was worth $10-19, averaging about $14, through 1999, but was sold for $20 (legitimate dollars). If the fake dollar's silver were worth "quite a bit more than the face value of US coin", this crook would have been losing money on every sale. Which qualifies him to be a "libertarian".

Well, since you are asking the questions on /. and not on his blog, I'll answer for him, though you may want to call his show and directly challenge him, wouldn't that make much more sense?

Where is the price of gold now Peter?

- http://www.kitco.com/ says:1373 in US dollars.

Gold is in a 10 year bull market, or more precisely the US dollar is falling and falling, charts are here. US dollar is being printed out of existence, other currencies are misguidedly following this, of-course US dollar is the reserve, so many feel they have to. They really don't.

But what exactly is your question? Is gold NOT going up, did it NOT go up and up and up for the last 10 years at least? All the other commodities: sugar, cotton, pork, wheat, rice, oil, metals, etc.

When you call the guy who correctly predicted the Internet and the Housing bubbles and traded on that correctly to be 'fringe', while you consider others to be 'mainstream', then you are doing one thing: you are displaying that mainstream is ridiculous, stupid and most importantly: wrong.

How come most of your clients lost 40%-70% of their worth in 2008,

- I got out of commodities just before that particular event, it was a hunch. However the people with Schiff have been making money for 10 years prior to that and ever since the end of 2008 and they have recovered and made another 50% on top.

Now, can you point out a 'mainstream' economist who has been as right as Schiff for as long as Schiff? They don't exist. There is Jim Rogers, but he is on the same side Peter is on. There is Marc Faber, he certainly tries to make predictions that are a bit more specific in terms of timing.

Schiff is not interested in specifics of timing - that's what separates his advice from advice of speculators. He is an investment adviser.

Do you know the difference, or should I explain further?

Seriously, don't listen to this guy or anyone who tells you to listen to him, they are attempting to engage in class war against you and redistribute your hard earned wealth to themselves

- I am not sure if you are giving this 'advice' to me, but if you are, then keep it. How much of your purchasing power have you lost over the past 15 years? Want to compare to how much I gained? Don't do it, you'll lose. And I am not what you call 'rich'.

I suppose this explains why the price of palladium has nearly doubled over the past six months. I wonder if this was public knowledge and Slashdot was just behind the curve as usual or not.

Obviously software cost depends on what you measure it in. For example Linux kernel is estimated to cost near 1.4 billion US dollars (at the bottom), but IF you measure this in chickens.... it could cost 35,008,752.2 chickens.

In ounces of gold it would be around 1,040,041.6 ounces. In DOW it would cost approximately 127,186

It is also possible to estimate its cost in terms of Libraries of Congress, man years and many such wonderful things, however note that many Keynesians say that gold has no value but what is 'speculated' to be value while they do not see the same thing about their cherished and printed fiat, so then we could argue that Linux kernel is worth nothing if 1,040,041 ounces of gold priced at current levels in USD are worth nothing.

It's all a matter of point of view.

Behold, the power of the internet: https://online.kitco.com/bullion/. Check the "pool accounts" at the bottom - the spread between sell and buy is $5 per ounce. Their pool accounts are kind of like day trading of precious metals, so while you're buying real gold the actual chunk of metal is in a vault somewhere. If you want to take physical possession of your gold, the spread is about $25 per ounce plus shipping charges if you deal with generic bars and rounds.

in the fake world of cash printing and market manipulation real money of-course is this, accept no substitutes (and by the way, it has the security features built right into the atomic structure.)

1) Have you noticed that the stock market is tanking lately? Invest in what?
Yeah, it's much better to invest when the market is high.

Ahh, but gold, it is at an all time high. Buy Now!!!

You would be amazed what you can hear on AM radio. By the way, it may not be exactly at an all-time high, but it is pretty high.

Just like how it has been working so well for oil, copper, gold, pretty much anything else we dig up from the ground or a mountain?

Aside from short-term fluctuations, things like the price of gold don't really go up, in real terms. Fake currencies certainly lose value relative to them, though.

See here: http://www.kitco.com/LFgif/au883-999.gif

Gold today sells for $1,192 per once, or more than $40,000 per kg. Sure gold is "heavy", but you need much less to hide a few thousand dollars.

From kitco.com:

Gold Bar 400 oz $378,440.00 = $946/oz
Gold Maple 1 oz $1,015.85 = $1015/oz
Gold Maple 1/2 oz $514.98 = $1030/oz
Gold Maple 1/4 oz $266.90 = $1068/oz
Gold Maple 1/10 oz $126.50 = $1265/oz
Gold Maple 1/20 oz $75.25 = $1505/oz

Now all you need is a smelter, minting facility, and a distribution model and you're ready to start making some easy money.

The problems I had with hydrogen is that electrolysis isn't efficient enough, you need expensive platinum or palladium catalysts in the fuel cells, and you either need some exotic storage/transport mechanism made of unobtainium, or you have individual users make their own hydrogen (which makes it even less efficient).

Looks like this solves most of those problems. As long as this nanoparticle catalyst is cheaper than platinum (not terribly difficult), the hydrogen economy might actually have a future.

Hea, I don't think your a bad guy or anything but your REALLY convinced that anyone who breaks a law is a bad, evil, monstrous, person. Are you a cop?

Close enough, I'm a programmer who has been hired by the state to replace bureaucrats with computer programs.

You didn't answer my question about marijuana.. what about alcohol? it was illegal once.. were the people drinking it when it was illegal bad and then when it was legal suddenly good again? Why did we need a law for that if people like it?

Personally, I think there should be a law against drinking in public- after all, that's where the problem arises. And no, I wouldn't do business with anybody who does marijuana OR alcohol to excess- it's proof of a lack of intelligence.

I would say the corruption of the Mexican Government has quite a bit to do with the sad state of Mexico. Again.. the problem is welfare.. if we get rid of it.. and if your right.. that they only want to be freeloaders.. then they won't come at all.

Same if we get rid of the cheap labor fraudsters who lure them here with jobs that don't pay enough to live on. No need to actually deport them- they'll deport themselves once the jobs are gone.

Lifelock is not an ID system. It is an Anti Identity Theft system. You wouldn't accept it at all because there is nothing to accept.. all they do is prevent identity theft and fraud.

Then they are an incomplete system for the later- the reason for a national ID card is to give us a way to trust people again.

And when are we going to get such a system.. because we don't have it now. People are not in control of this government. How many people voted for the Patriot Act? How many voted for the IRS? ---- actually.. how many vote? about 50%? and of that 50% about half win.. so your down to 25% of the population that matter.. and of those.. how many are informed??

Nobody votes right now because they know that we no longer have a democracy. Every politician is already bought and paid for- and the representative system only represents the rich. We need a new constitutional congress and a new deal.

Government bureaucrats are not held accountable.. if a government project fails.. (and most do) the reason is always that it didn't have enough money. they say "Our intentions were good." And keep failed programs running.

Actually, most don't. Fail that is. Most succeed and you never hear about them.

but again from above.. its not.. Did you know that the FDA wants to label vegetable juice as a drug? They want to do it because they conceder "May cure cancer" a drug claim. By law in the US the only thing that can "cure" something is a drug. How many people voted for vegetables being labeled drugs? NONE, it was a rule change by unelected bureaucrats.

And if we had NO anonymity and a direct vote system instead of a government, there would be no unelected bureaucrats- they'd be replaced with computer programs like the one I wrote which protects the earnings of 20,000 employeees of 4,000 contractors in Oregon working on the roads.

Besides this.. you don't even want to get me started on our money system in the US.. The Dollar is not backed by gold. Its backed by the US's ability to collect taxes. When the government wants money for a War, or a Project or a Hurricane.. they just print as much as they like! That causes the value of the dollar to drop.. do you think that gas is really going up? or is the dollar going down? Are companies making record profits.. or is the dollars amount worth a record low? What good is the DJIA being 13,000 if its actually *worth* half as much? 10 years ago the price of gold was $340 an ounce.. today its $690!! http://www.kitco.com/LFgif/au3650nyb.gif The value of gold did not change.. its the dollar that changed.. and the government is not doing a thing about it.. They like it because they can spend as much as they lik

Look at Mexico- if they could make OUR industry and economy strong, would they have started at home?

I would say the corruption of the Mexican Government has quite a bit to do with the sad state of Mexico. Again.. the problem is welfare.. if we get rid of it.. and if your right.. that they only want to be freeloaders.. then they won't come at all.

No, you misunderstand. What's my guarantee, as a business, that somebody possessing a lifelock ID is who they say they are? Is there a similar $1 million guarantee on the other side as well?

Lifelock is not an ID system. It is an Anti Identity Theft system. You wouldn't accept it at all because there is nothing to accept.. all they do is prevent identity theft and fraud.

I have no problem with a police state that responds to elections and where EVERY decision made by EVERY bureaucrat is public and actionable.

And when are we going to get such a system.. because we don't have it now. People are not in control of this government. How many people voted for the Patriot Act? How many voted for the IRS? ---- actually.. how many vote? about 50%? and of that 50% about half win.. so your down to 25% of the population that matter.. and of those.. how many are informed??

Government bureaucrats are not held accountable.. if a government project fails.. (and most do) the reason is always that it didn't have enough money. they say "Our intentions were good." And keep failed programs running.

A lack of anonymity is a sword that cuts both ways- tyranny and oppression are impossible where every second is watched by an informed electorate.

but again from above.. its not.. Did you know that the FDA wants to label vegetable juice as a drug? They want to do it because they conceder "May cure cancer" a drug claim. By law in the US the only thing that can "cure" something is a drug. How many people voted for vegetables being labeled drugs? NONE, it was a rule change by unelected bureaucrats.

Besides this.. you don't even want to get me started on our money system in the US.. The Dollar is not backed by gold. Its backed by the US's ability to collect taxes. When the government wants money for a War, or a Project or a Hurricane.. they just print as much as they like! That causes the value of the dollar to drop.. do you think that gas is really going up? or is the dollar going down? Are companies making record profits.. or is the dollars amount worth a record low? What good is the DJIA being 13,000 if its actually *worth* half as much? 10 years ago the price of gold was $340 an ounce.. today its $690!! http://www.kitco.com/LFgif/au3650nyb.gif The value of gold did not change.. its the dollar that changed.. and the government is not doing a thing about it.. They like it because they can spend as much as they like and they don't have to raise taxes. This is THEFT, right in blind eye of your so called "informed electorate".

I fail to understand the difference. If you're not afraid to be tracked, then you're not afraid to give *anybody* the authority to track you. Only if you have reason to hide something do you have reason not to be tracked.

I'm not afraid. Let me put it to you this way.. Would you allow cops into your home? Why? What gives them the right to do that? Is it your house or there's? Where did the authority come from? Who gave it from them? Would you let them install a camera in your bedroom to make sure you not having gay sex? You don't have gay sex.. so its ok right?

what point does your logic fall

The U.S.-China economic relationship is a highly unusual one between a First World and a Third World country. Moreover, the U.S. trade deficit with China in manufactured goods and advanced technology products is growing rapidly. What explains the U.S. dependence on a poor country for First World products?

The answer, and the key to China's rapid development, is that corporations in First World countries--American businesses chief among them--use China as an offshore location where they produce for their home markets. More than half of U.S. imports from China, and as much as 70 percent from some of China's coastal regions, represent offshore production by American firms for U.S. markets.

What economists overlook is that when we speak of the Chinese economy, we are speaking in large part of the relocation of American manufacturing to China. Those millions of lost domestic manufacturing jobs were not lost. They were moved. The jobs still exist, only they are not filled by Americans.

In a world where capital and technology are highly mobile internationally, these critical factors of production flow to countries with the lowest cost of labor. China has attracted manufacturing, and India has attracted professional services. This has left the American work force with job growth only in lower-paid domestic services, which provide no export earnings.

-Who Owns the Dollar? (emphasis added)

Most Americans live in a media-induced Never-Never Land, where the American economy, stockmarket and military machines are invincible because they always have been. Never mind that this is demonstrably false (great depresion, 1970's inflationary recession, Vietnam, Iraq, etc) - we're conditioned via compulsory government schooling and the idiot-box (television) to have a short memory.

More on the Screwing of average folk...

I gave people $1 (1 ounce) silver coins last Christmas. Think I traded around 10 or 11 "Feral Reserve Notes" for each one. Silver is now up to $13.75 or so, so I'm looking at having to put out about 50% more funny-money paper if I want to do the same thing this year (coin dealers typically charge spot + $2, iirc). Inflation at work.

If I had another $10k, I'd split it between metals and Euros... As it is, I'm sitting on a couple hundred ounces of silver and a couple ounces of gold. Not a sure thing, but the economy we know is doomed. The stock market is terminal too, but the big money will be sure to get out first, in keeping with the traditional screwing of the masses (that's 'us' - me, you, and everyone who reads this comment who doesn't pull in $1million/year).

Actually, I'd buy more Earthboxes, potting mix, and fertilizer (already have plenty of seed). $10k could get me two pallets worth (200), and all the potting mix and f

I've been following the stock market, and in my opinion we're not seeing a bubble. We're not even seeing a rise. In my opinion the value of the stock market has been reflecting inflation in the US dollar and in other currencies around the world. We aren't seeing all of it in the stores - yet - but it's coming. The prices of precious metals are a good indicator of what's going on.

http://www.kitco.com/market/
Transmutation of the Spallation Neutron Source Mercury target
is not alchemy. Have not seen published what will be done with
the "leftovers".

Unfortunately banks are no longer required to keep any meaningful amount of reserves. :( An excellent essay explaining how this is going to become a problem very soon can be found here: http://www.kitco.com/ind/Daughty/apr122006.html

http://www.kitco.com/charts/livegold.html

Look at the 10 year chart. Only gained ~27% over 10 years. My mutual funds did that in under a year and a half. You obviously have only been paying attention to the very near term and not the long term. Gold is rising very quickly now, yes, but over the long term it is a very unwise investment.

Contrary to popular belief, politicians and large businesses are not leaders but followers. If we force change, then sooner or later they will come arround.

Unfortunately, in the next few years, at least, things will get a lot worse and I mean A LOT. As in ALL FREAKIN HELL.

Copyrights are not the only information people are trying to controll. There is a thing called money that stores information about value and relative transaction costs. Right now, the government and central banks are trying to controll it via monitary policy. IMHO the consequences will be ugly. Don't be supprised if gold is re-monatized and explodes to $3000 per ounce or more. The price action of precious metals since the dot.com crash is screaming the message loud and clear http://www.kitco.com/LFgif/au1825nyb.gif I'm really worried about a huge economic collapse.

I get much of my stuff from http://mwhodges.home.att.net/ you may need to recalculate it for being percapita though.

I'm seeing 100k per citizen. Are 3 out of 4 people not working? Mind you, that also includes corporate debt... a debt with doesn't get counted against individual citizens.

I would be vary wary of that, real-estate lost 90% of it's value during the great depression, and to tell you the truth - we are more overleveraged now then we were then.

Oh yes, it's a dumb investment right now. But if you have a morgage, and most people do, you probably got one at a more reasonable time. On average, your house has as much or more real-world value now as it did when you bought it. The real-world value doesn't matter to the people who bought track housing off of a google IPO at 7 million dollars, but that actual value is increasing as more people come online.

nfortunately most debt is foriegn owned nowdays, Japan alone has some 650bln of us bonds.

According to the site you linked, only 20% of debt is foreign owned. Not that is a particularly reassuring figure, mind you.

The problem with debt isn't who it's owned to, it's that it pre-obligates money that would otherwise be spent in more productive ways...I think debt for things other than investments that increase productivity are a bad idea.

I agree wholeheartedly. However, remember that certain things require debt to get off the ground. My small business (still around somewhere, BTW) required an outlay in costs to start. It wasn't much, but it did require an outlay, and without that the business wouldn't have started. I've also done a little work in the past for a realtor who would generally look for unsecured investors but who would also take out loans on certain properties. He'd get other people's money, buy burnt-out, broken down properties, fix them up, and sell them at quite a profit (good gig, but lots more work than you would think). His business relied on debt to generate value.

And sure, at the end of a project he would have 500,000 dollars pre-obligated to his creditors, but he also walked away with an extra 100 grand for himself that he wouldn't otherwise have. And society got a three-floor condo to house three families that it otherwise wouldn't have.

Also from what I understand, 90% of society are debtors and 10% creditors. Yup. 90% are also workers and 10% bosses. Society is pretty pyramid shaped. But societies are generally like that.

There is a difference between investing and loaning, with a loan money is owed no matter how good or poorly it does. With investment in things like stock, that is not the case.

With investments, though, there is still the assumption that value will return. If a project collapses and your investors lose all of their money, your investors are still getting screwed. I'd count investments as important in the equation as well. Likewise, investing debts are not necessarily as bad as it could be.

The global economy is teetering on the edge of a cliff, I would peronally and strongly recommend having some precious metals on hand. Apparently I'm not the only one who thinks this as gold is at an 18 year high now (http://www.kitco.com/)

Sounds like a gold bubble :). Don't forget, gold also only has value because of accepted norms. Sure, you can use a little bit of it in electronics, but ultimately it has value for jewelry... and if the global economy collapses, who needs that?

A bit more on-topic, the collapse or not of society will depend largely upon the details of how much that debt load is, and how much of that debt is "good," and how much would need to be absorbed through dillution of the currency or defaulting. But neither of those spell the end of civilization as we know it... just a downgrade in our quality of life relative to other areas of the world. And likewise

Not that I disagree with your post, but can you cite sources for this?

I get much of my stuff from http://mwhodges.home.att.net/ you may need to recalculate it for being percapita though.

The numbers I've seen are closer to 40K.

sounds like just the federal percapita.

I would guess that a disproportionate amount of that number is in morgages. Shouldn't morgage debt count separatley, as an investment, being secured by a tangible property which can be resold and which usually accrues value (unless there are too many speculators)?

I would be vary wary of that, real-estate lost 90% of it's value during the great depression, and to tell you the truth - we are more overleveraged now then we were then. IMHO, going into debt for a home today is not only not a secure investment, it is very dangerous.

The difference between that and credit card (or federal) debt is pretty significant.
....
Isn't a lot of that debt also to ourselves? I owe rent to the owner, my roommate owes rent to me, her company owes her salary to her, etc. A more realistic example would be a car company who owes money to it's creditors, but who also is owed money by the people who buy cars from it. Isn't that debt being counted twice?

Unfortunately most debt is foriegn owned nowdays, Japan alone has some 650bln of us bonds. The problem with debt isn't who it's owned to, it's that it pre-obligates money that would otherwise be spent in more productive ways. Plus, long "chains" of debtors are as strong as the weakest link, if someone in the middle defaults - everyone else still owes and must make it up somewhere or default too. That's why over debted societies usually have a cascading collapse.

I'm not convinced that zero debt is the overall goal. All investments are debt to someone.

I think debt for things other than investments that increase productivity are a bad idea. Also from what I understand, 90% of society are debtors and 10% creditors.

If I invest 1,000 dollars in a local company so that they can re-tool their factory, that's 1,000 dollars in debt that basically guarantees a return to society much larger than the expense.

There is a difference between investing and loaning, with a loan money is owed no matter how good or poorly it does. With investment in things like stock, that is not the case.

Corporate debt is how the buying power of money is shifted from institutions that have it, to upstarts that need it. Sure, Sony may go a half-billion dollars in debt to create a new fab plant for the Cell chip that powers the Playstation 3, but they'll make it back.

I agree, that is good debt. Millions of people re-financing their home and spending the extra on consumption is not.

If not all debts are necessarily bad, we have to figure what kinds are bad and what kinds aren't. Student Loans are as annoying as hell, but the benefit to society (and a single worker's earning potential) greatly outweighs the cost of being in debt. Credit card debts are always bad, and are basically the work of the devil. Sometimes you need to go into a little debt to buy a used car to get to work on time... That's much better than not working. But buying a 25k new SUV is a bad investment.

Sometimes credit card debt can be better because it's not secured. Anyhow, on no uncertain terms the US is overleveraged in debt, and the fed has loaned out way way way too much money. Even the fed said that the economy is super efficient because of new technology, but what they didn't say is that efficient economies make fluctuations to excessive monitary policies more extreme, not less extreme. The global economy is teetering on the edge of a cliff, I would peronally and strongly recommend having some precious metals on hand. Apparently I'm not the only one who thinks this as gold is at an 18 year high now ( http://www.kitco.com/)

I believe, and I dont have proof, that Japan is the largest holder of US nation debt with China being the second largest. On second thought here is an article: http://www.kitco.com/weekly/paulvaneeden/feb112005 .html

"Japan owns roughly seven hundred billion dollars worth of US Treasury securities and China has in the order of two hundred billion dollars."

Anyhow makes me wonder why everyone is so paranoid about China buying up our money when Japan has more than double.

After all, what else of value besides land is left?

Oil, coal, steel and gold

Sure, everyone needs a place to live, so real estate will never go to 0. However if everyone with a 100% mortgage on their 50ft lot sells, and moves in to a 2 bedroom apartment, there's going to be major pain.

If the pyramid starts to fall, real estate will take out oil coal and steel, and there will be a rush to gold as the only remaining store of wealth. I think it's premature to load up on gold, but keep your finger on the trigger.

This is amateur advice so heed it at your own risk.

I do not think that word means what you think it means.

The 'gold standard' means a currency that is pegged to a fixed exchange rate with gold. Until 1971, you could redeem U.S. dollars for a set quantity of gold. In other words, you still have paper money in everyday circulation, and it's still vulnerable to counterfeiting.

Replacing all currency with gold coins (which seems to be what the parent means) is utterly impossible.

First, you have to carry highly-accurate balances (scales) with you to carry out financial transactions. A pack of gum costs about one three-hundredth of an ounce (about a tenth of a gram) of gold. Do you trust every store you visit not to put a thumb on the scales, as it were?

Of course, you could introduce gold coins of standardized weights and denominations. Gold would get shaved from the edges of these coins...you could probably take a dollar's worth off of every hundred-dollar coin and nobody would know by looking. (Even with those little ridges around the edge that are supposed to prevent shaving.) Regular wear and tear would also reduce the value of your cash. You still have the problem of awkwardly small weights for most transactions--I suppose you could introduce coins of other metals like silver, but then there would be a variable exchange rate between your small and large denomination coins....

In lieu of counterfeiting, people would instead alloy the gold with less expensive metals. A coin that was 95% gold and 5% other metals would look and feel an awful lot like the real thing.

Oh, and the United States has about $700 billion in circulating notes and coins at the moment. A total of about 3.4 billion troy ounces of gold have ever been mined in the world, with a current market value of about 400 USD per ounce. In other words, switching over to gold as a medium of exchange would require the United States to acquire more than half of all the gold ever mined anywhere in the world and cast it as coins. (Fine, I admit that's a simplification. Trying to acquire enough gold to replace all U.S. currency would screw up the world's markets--currency and commodity--so badly that it's hard to say precisely how much gold would be required, or what its value would be. Regardless, it would be ruinous.)

The real reason for this announcement, and its timing, is to put downward pressure on the current rally in silver prices. Every time silver prices jump up, Kodak puts out a press release talking about how film photography is dying and they are transitioning their focus to digital photography (which, by the way, causes consumption of silver as well, via electronics manufacture, CD manufacture, and silver-based paper for photo prints that won't fade after a few years).

And, sure enough, the price of silver was pushed down today as a result of the announcement. Market price manipulation in action...

I have a hard time believing this. On December 16 2002 the price of an ounce of gold was US$333, while as of today, December 16 2003, the price is US$408. I can't believe that the cost of labor and other materials went down enough to compensate for this.

I have a hard time believing this. On December 16 2002 the price of an ounce of gold was US$333, while as of today, December 16 2003, the price is US$408. I can't believe that the cost of labor and other materials went down enough to compensate for this.

As a jeweller, I'd like to know how they did that! At 72.25 each, that's dirt cheap. I know that they cost me more than that wholesale. Let's see... assume three pennyweights per ring(20dwt=1 Oz)...at 406.50/oz, that's 60.98 dollars each for the gold bought as 24K bullion. by the time it's refined to 18K sheet, and made into a ring, assume it's double the price. call it $122. That leaves no room for the retailer to make a profit.

I know it's a joke, but it would be funnier if it was accurate

DOW HAS BEST WEEK SINCE 1982...

DOLLAR HITS MULTI-MONTH HIGHS..."

OIL PRICES PLUNGE... with US crude at $26.30. This puts it at about the same price back during the heating oil crunch of 2000. Business Week figures that even the recent spike in oil prices will not lead to a recession, because of usage cutbacks & OPEC surplus.

GOLD DROPS BELOW $330... where it was back in december. And even at the recent peak, it's lower than it was in 1995, the start of the boom.

In about a month, the war will be over. Not only will we have thrown out a bloody dictator (freeing his citizens from harm), but we open up their nation for economic progress. Not only will we rebuild what we've destroyed (which if you've noticed, a strong effort is being made to keep this minimal), but we will upgrade them to modern technology. Power plants, water systems, industry, hospitals, roads... all of this means american jobs & products. With embargos removed, Iraq can produce at it's true output, flooding the oil market (destroying whatever little power OPEC & the saudi's have left) and the free markets win. Everyone benefits, the economies boom, and life goes on!

(On a personal note as an Electrical Engineer, my company's 2002 average was a 3.5% pay raise plus a 4% bonus)

Gold will always have resale value because it is an exchange traded commodity. If worse comes to worse you can always melt it down and sell it for $310 an ounce or more, if the price goes up. If you want to see the live price of gold you can go to Kitco and watch the value of your jewelry go up and down.

historical gold prices