Tuesday, March 13, 2012
Look at gold tank. Isn't it beautiful!!
Gold is tanking and the dollar is rallying sharply following the Fed meeting. This comes even though the Fed said it would continue its asset purchases and keep rates low for an extended period of time.
All the "debt-doomsday" people and "Fed debasing the dollar/causing inflation blah, blah, blah" people are wrong. Totally wrong.
Best of all is gold, which is getting crushed. This comes mainly on the news that JP Morgan is raising its dividend. Companes raising dividends (financial companies, to boot!), what's the reason for owning gold? There is none. Gold is a non-investment.
Next stop...$1200. Don't worry gold bugs, maybe it will stop there. If you're lucky. ;)
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13 comments:
Listening to a radio and an advert just came on for a company selling gold to investors. I wonder whether adds for "selling" will become more numerous in the months ahead. The companies advertising "buying" seem to be quieter for some reason.
Good post.
It's time someone showed sense on gold. It's obviously been just as much a bubble as real estate was in the 2000s.
All those Austrian gold bugs are due for a lesson in reality.
It's a lovely thing to watch!
Ron Paul's campaign funding may take a hit!
Hey Mike maybe you should replace that hand painted flag with some other backdrop. I like the flag but it comes across as a teeny bit amateurish. Maybe one of the reasons people take Schiff seriously even though he talks a lot of nonsense most of the time is because he always *looks* absolutely believeable. He always has that euro-pacific goldbug background thing. Maybe if he popped up in front of a hand painted flag people would be like "hang on a minute...". It's mad because he's a fool and you're (almost) always on the money.
Working on it. Those are old videos anyway. Thanks.
Mike,
Your last "gold is falling" warning was March 6, when gold closed around 1675.
From that point, it rose non-stop till March 9, closing at 1715.
From there, it started falling once more. It is currently back aruond 1675.
You only seem to post on drops and never on increases. Aren't you just a reflexive perma-bear?
Don't get me wrong. I'd like gold to go down to $100 per ounce. Then I could buy some.
Hi again Mike,
I have four really basic questions regarding MMT. Any response would be much appreciated:
1. Do you think that MMT might be compatible with small government and low taxes, or is it inherently biased towards big government and high taxes? (I’m assuming that MMT would involve some form of the JG if it were to be fully implemented).
2. Do you reckon that MMT would require a degree of nationalisation (i.e. of banks) and strict regulation, or is it compatible with no nationalisation and a more hands-off approach to regulation?
3. Would you say that MMT economists have different political and ideological positions, or are you all more or less the same?
4. Do MMT economists have different understandings of what MMT is or of how it could be implemented as policy?
Thanks.
If you bump into Scott Fullwiler online I'd like to ask him the same questions by the way.
1. Do you think that MMT might be compatible with small government and low taxes, or is it inherently biased towards big government and high taxes? (I’m assuming that MMT would involve some form of the JG if it were to be fully implemented).
The size of government is determined by the political conception of public purpose. MMT macro can be used to achieve a more prosocial agenda or a more private sector agenda. A prosocial agenda is likely to have more spending on social programs, and also most likely lower expenditure on security and military, while a more private agenda is likely to emphasize lower social spending and perhaps high military and security spending, most of which is prosocial spending in protection of private property and to promote a world conducive to US business interests.
At any rate, according to MMT the size of the deficit determined by non-government propensity to save, regardless of whether the agenda is chiefly prosocial or primarily oriented toward the private sector. Commitments to prosocial programs reduce the fiscal space for security/military and private interests, and vice versa. The budget and tax policy are political choices. MMT just provides alternative options and also identifies options that are either ruled out or are inefficient in comparison with others.
2. Do you reckon that MMT would require a degree of nationalisation (i.e. of banks) and strict regulation, or is it compatible with no nationalisation and a more hands-off approach to regulation?
MMT economists are institutionalists. For them institutional arrangements are key in economic policy. Warren Mosler is probably the most conservative MMT economist. See his proposals for financial reform for the outer limit. Bill Black provides good documentation for why the big banks should have been put into resolution if current law had been applied.
3. Would you say that MMT economists have different political and ideological positions, or are you all more or less the same?
I would say that generally speaking they are left libertarians trying to balance government and private sector within the existing context. They tend to accept the general outline of the existing economy and suggest how it can work more effectively and more efficiently.
4. Do MMT economists have different understandings of what MMT is or of how it could be implemented as policy?
They have worked in concert for some time and agree on the core. Their differences are at the margin.
thanks Tom
"While gold prices are swiftly shedding any premium ascribed to the likelihood of a third round of monetary stimulus, they "may be nearing price levels that will encourage emerging-market demand, which should help stabilize prices," said said James Steel, precious metals analyst with HSBC Securities."
http://online.wsj.com/article/SB10001424052702304692804577281234039521086.html?mod=googlenews_wsj
Mike,
Agreed that gold is taking a whoopin' at the moment, but then again, so are T-bonds which I believe you are a big bull on.
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