Audio: The Invisible Revolution -Part 1, 2, 3

[RedMahna]

i wonder if CNBC's Jim Cramer is gonna be a cheerleader like when he was pumping solar stocks right before they crashed...

red

[dragonfly]

Hi Hawk, I'll see if I can add a reply to your question in this post I was working on. FreeGolders are uniformly convinced of the ultimate denouement of paper-gold. Cash-settled in the final conflagration. I tend to agree, but also keep an eye on cooperation of giants that might change that scenario. Paper-gold is expanding with recent moves in China and India re: ETF's and futures. So that kind of throws a spanner into the works. I could see the boyz winding it down on the leverage side, just like they're trying to do with netting-out derivatives in general.

Maybe the supposed allocation of the right amount of gold into the right hands that was presumed to already have occurred re:FreeGold theory, has not happened to the satisfaction of all parties concerned. Maybe Asia is ready to play the paper-gold, price-discovery game too. Maybe this buys some time and creates some arbitrage opportunities. Physical may be the end-game, but where on the time-line are we?

My post was going to start with this news item, and I guess it sort of dovetails with the above.

http://www.bloomberg.com/news/2013-02-07/carney-says-boe-policy-exit-must-be-smooth-when-time-comes.html

>>>When a recovery is in place, the central bank “will need to design, implement and ultimately exit from unconventional monetary policy measures in a manner that reinforces public confidence,” Carney said in his written testimony. “The exit needs to be achieved without disrupting the gilts market. Such disruption could lead to sharp movements in a range of other asset prices, or possibly threatens to financial stability.”

Carney said in his written testimony that there are three main sources of risk to the U.K.: the world economy, the pace of recovery that the economy is able to sustain, and the extent of deleveraging in the banking system, households and companies. <<<

my comments: UK interest rate derivatives are off the charts. Mark Carney chairs the Financial Stability Board at the BIS. Point-man for managing that UK nightmare? If those derivatives are among what he's referring to as "... other asset prices," it's NewSpeak to a new level. With the BIS playing such a central role in FreeGold theory, one must wonder at what level actual individuals like Mark Carney are clued in to Plan B. Just a useful technocrat? One of his white papers at BIS spoke to the concern of establishing central counter-party clearing to reduce risk, with a deadline of end 2012 for the infrastructure to be in place. Wonder how that's all working out for them. I've referenced that paper often and have noted the vagueness of it. http://www.bis.org/publ/cgfs46.htm Haven't seen any updates since then.

Some FreeGolder opinion is that BIS is just buying time for the great surprise. That all of their derivative planning is just smoke and mirrors. Other opinion is that it doesn't matter, the market will drive it if the BIS or one of the giants doesn't. You can have your cake and eat it too!!!

Anyway, in light of the BIS vs $IMFS theory, it's interesting to watch all of the cross-overs which complicate that perspective. For instance, William C. Dudley chairing the CGFS. http://www.bis.org/cgfs/index.htm I think Mark Carney held that position for a spell.

While many see gold derivatives as the short fuse, I'm not so sure about that. Relative to the land-mines in the FX markets, it seems like small potatoes. FreeGold theory has/had the Europeans feeding the gold-paper markets, with the strategy of feeding rope to the dollar, and ultimately converting a certain amount of those into "European Good" paper, with their faction understanding whose paper had to be honored. It's all very fascinating, and I'm nowhere near being competent to do the kind of analysis that VTC does on his site. But, then, I don't accept anybody's numbers at this point. I'm like everybody else out there in the sense that I'm just watching shadows on the cave walls and trying to visualize how and why they're being projected.

I noticed one poster at FOFOA's site question a scenario where paper-gold and physical rose together. I don't see why with the trillions in play, that side-betting on the price can't continue. And if Black Gold is being laundered back into the system, who's to say the physical market can't be managed in the same way it has been thus far. It must be exquisite torture for those in gold, waiting for the big transition, not satisfied with keeping up with inflation.

If it does come to a cash-settlement, I don't think anyone's going to have a choice in the matter. I guess all I can say is that I can see this playing out longer, and in different configurations, than what folks are generally expecting. Robert Mundell was recently pointing at a fixed exchange-rate model that linked the Euro/Dollar/Yuan. It's pretty hard to say what kind of quid pro quo we have with China. It's readily apparent that our guys are collaborating intensively with the Europeans. So who knows?

[dragonfly]

I'd love to hear Nicole Foss debate FOA. She presents a very convincing case for how this is going to play out. Highly recommended audio.

http://kunstlercast.com/shows/kunstlercast-215-jhk-is-back-nicole-foss-interview.html

I guess her and FOA would butt heads on the "ball of twine" issue. The idea that the Fed and Co. can throw enough paper at this decline.

Or, perhaps on the idea that we don't have to experience a crash of the financial "operating system" (blue screen of death), because the central banks can simply absorb all those bad promises with gold at some high price. Guess we'll see about that. Her timeline is 3 - 5 years of credit collapse and brutal deflation. Then perhaps some inflation on the rebound.

FreeGolders have the theory that a hyperinflation will play out via the government "saving" itself. But numerically it just doesn't figure. Add up all jobs dependent on tax dollars and it looks like 40 million people according to this guys analysis. Triple that for good measure and ask what are the almost 200 million of the rest of us going to do? Starve, as they bid everything out of our reach? And I thought the theory was about how to get the world off the dollar standard without war.

http://markstoval.wordpress.com/2012/04/10/how-many-people-work-for-government/

FOA, if you're still out there, I'll organize a big debate venue for you and Nicole here in Austin, TX, and guarantee a very large audience. I'll rent the One World Theater and have it catered by Whole Foods. C'mon out to play, we miss ya. I'll even have your hotel room decked out with some magnificent Bonsai trees. Your blog heirs are apparently sliding into the gambling and gun culture lately, so a re-visit and clarification of your ideas might be just the ticket to keep them on track.

[hawkwind]

Thanks dragonfly ... I kinda figured that cash settlement is the only realistic way out of the imbalance. But after reading your post and follow up, it dawned on me that there is also the possibility that the price of gold will be allowed to meet the demand of settlements at least for the short term, as unlikely as that may sound. You have given me much food for thought ... keep posting and buy gold all you peoples!!!

- Hawk

[James D]

The jobs are coming back - but only if you're a robot!

http://dangerousminds.net/comments/how_much_longer_can_capitalism_last_when_robots_will_do_all_the_work#disqus_thread

[Fintan]

[dragonfly]

Nice audio Fintan.

Here's today's post by the Acting Man - Pater Tenebrarum

http://www.acting-man.com/?p=21728#more-21728

[Fintan]

Ah! Thanks. So we see from Tenebrarum that 'ol Martin Wolf
has jumped right into the fray in the pages of the FTimes.

Idealogical war in progress! (A plague on all ideology.)

Tenebrarum has a lot of partisan Austrian skin in that war game.

He says:

[James D]

The jobs are coming back - but only if you're a slave!

Slavery, not horse meat, is the real scandal on our doorstep
http://www.telegraph.co.uk/foodanddrink/foodanddrinknews/9870692/Slavery-not-horse-meat-is-the-real-scandal-on-our-doorstep.html

[Fintan]

Max Keiser has just touched on the issues
covered in the last couple of audios in an
interview with Jan Skoyles.

Some thoughts....

- They downplay the OMFIF gold report, because it does not see
a gold-standard coming - and miss that Freegold may be the objective.

- They mention Mark Careny but miss the significance of the battle
between Careny and Lord Turner's Non-borrowed Gov money.

- They mention a new generation of free-spending central bankers,
and the Platinum coin - but don't realize that the former means that
something akin to the latter will be deployed.

Hmmmmmmmm...

This link jumps to the right place in the video:

Max Keiser interview with Jan Skoyles.
http://youtu.be/ewA8KU9PJgs?t=17m31s

[RedMahna]

Fintan - Okay, i finally re-listened to your latest audio and got my head wrapped around it better. (The show's theme-song "Walking into the Sun" really helped - I think you always put that at the end, Fintan, to help us let everything sink in... and it works beautifully!!)

Re: Future of money... It seems everything sounds great on paper. Add humans who would be handling it and poof! Nothing like people in charge of a great idea. That's politics, and that itself knows no limits in insanity when it comes to power. In a global economy, in our super modern times, with 7 billion peeps, we can get the factories churning... but we still have the problem of over-consumerism, dirty waste into the enviroment, water shortage (i can't see how that cannot be fixed, but there you go... we need a major clusterfuck on the horizon at all times). i have no doubt our energy riddle will be solved, but perhaps with an on-going carbon tax boom-bust cycle for Wall Street to be pacified with.

I like the idea of aletrnate currencies. A national version of community money??

Eddie T -

[Plato]

These 3 articles give a good idea of what has been going on in the (paper) gold markets lately, and why manipulation of the gold price might be coming to an end. Basically, there's 100 times as much "paper" gold out there as there is actual physical gold; most smart investors are starting to realize that their paper contracts are not worth the paper it is written on and are getting out; dragging the gold price of both paper and physical downward. This might be coming to an end as the owners of the physical are no longer willing to part with their metal at these prices. I don't really think we'll have a managed upward goldprice, as the "authorities" are beginning to lose control and more and more people can see through their BS. The authors know what they're talking about!

http://www.zerohedge.com/news/2012-11-09/gold-and-potential-dollar-endgame
http://www.zerohedge.com/news/2012-11-30/gold-and-potential-dollar-endgame-part-2-paper-gold-what-it-good
http://www.zerohedge.com/news/2013-02-22/gold-and-potential-dollar-endgame-part-3-backwardation-and-gold