Oil's energy contribution has declined by about 12% since 1999. The world's economies have also declined by about 12%. (Using conventional metrics, which are time delayed determinations, this will only be seen in hind sight). The massive destruction of asset values now occurring testifies to it happening.
Peak is well behind us, world economies have peaked and will continue to decline.
Joined: Oct 23, 2004 Posts: 5928 Location: New Jersey
Posted: Sun Aug 24, 2008 9:20 pm Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
From the 1930s until 1963, we in the US had a silver based coinage and even silver certificate dollar - which could be cashed for silver up until that time.
Silver worked fine for small transactions in the US for 200 years. Why wouldn't it work in the future?
I don't get comments that silver and gold coins will be useless in the future. How will large transactions be conducted then? With a case of Red Fox Fur Mittens - or some US gold coins? _________________ It's already over, now it's just a matter of adjusting.
Joined: Sep 14, 2004 Posts: 6625 Location: Rural Virginia
Posted: Sun Aug 24, 2008 9:32 pm Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
Needless to say, I agree with Dante.
Engineer, you haven't really engaged my argument about gold being highly valued for 20,000 years. To me that argument is powerful, overwhelming even. Especially if you believe, as I do, that the future is more likely to resemble the past than the Jetsons.
I'm not as rich as you might think, but I do believe in diversifying. Not just the commodities you list, but something that has in the past and could in the future serve as money. Money of some sort will be needed even in a severely "reversed" society.
Also, I believe that even if you have only a very small monthly surplus, you'd be wise to direct a modest part of it into gold or silver. I think that a savings program still makes sense in a doomed world. As long as you're not saving paper rectangles, that is.
Incidentally, I appreciate your gentlemanliness in this debate. That always scores points with me. _________________ "Actually, humans died out long ago."
---Abused, abandoned hunting dog
"Things have entered a stage where the only change that is possible is for things to get worse."
---Me and my brother
Posted: Sun Aug 24, 2008 10:13 pm Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
DantesPeak wrote:
From the 1930s until 1963, we in the US had a silver based coinage and even silver certificate dollar - which could be cashed for silver up until that time.
Silver worked fine for small transactions in the US for 200 years. Why wouldn't it work in the future?
I don't get comments that silver and gold coins will be useless in the future. How will large transactions be conducted then? With a case of Red Fox Fur Mittens - or some US gold coins?
Well, this is complicated and requires you think outside the box some. Silver based coinage, the Gold Standard etc all in themselves depend on a growing economy, an economy with a surplus of wealth beyond what it takes to live from day to day. Prior to the Agricultural Revolution in Biblical times in the Western Hemisphere, no society had such surplus of wealth. Hunter Gatherers never had a surplus beyond the yearly cycle of nature. Agriculture enabled such surplus to develop, and then Currency came in the wake of that. Numerically speaking, you could count up the number of bushels of grain in your warehouse, and then you could place a value on that against some other commodity like gold or silver, but that is predicated on their being a fixed amount of that commodity in circulation. Which for most of history was pretty true, only at certain times and in certain places was the world economy put awash in Silver and Gold to seriously devalue those commodities against the food commodities.
What you see in a world awash with people who all need food is that though the comodities of silver and gold are scarce, relative to their actual value in survival they are not as scarce as the food is. You are very hard pressed to place a trade value on silver and gold against the trade value of commodities in such a situation, and its really quite a new one historically speaking.
In any event, with 6 Billion people on the planet, there just is no way to divide up the Wealth and represent it by Slips of Silver or in Gold Coins. I don't know about Trout's Grandad's story of seeing the Vault at Fort Knox being EMPTY, but its not the first time I have heard this Grandfather story. I would say though that if even a fraction of the people holding a large amount of paper wealth in the world made themselves busy buying tangible gold, that this would quickly run itself out in supply. There is only so much of the stuff available to buy, and if you are buying Certificates which SAY you own some Gold in the Vault in the Federal Reserve Bank in NY, I would question the validity of that. BILLIONS of dollars, no TRILLIONS are evacuating the Equities market, and Gold is one of the commodities they are all trying to buy as a Hedge against loss of wealth. Problem being, there just is not enough gold around to uptake all those trillions, not at its current valuation. Upping its valuation ten fold or hundred fold does no good, because as currency in such a situation its worthless. The coinage would be MICROSCOPIC in size to function as a currency for 6 Billion people, you would have to represent it on paper somehow, which gets you back to paper currency problems.
So OK, a few of the current 6 Billion on the planet scarf up all the Gold available, figuring I suppose to trade this Gold for food when TSHTF. Except here, first of all there is not enough Gold to make coinage practical for so many, second you can't even easily establish the percentage of gold in any given coin or gold ring. I will tell you its WAY easier to counterfeit a coin than it is a paper note these days. Making a mold out of a current coin is easy, and blending up some metals to pour into the mold also easy. Counterfeit coinage was always a problem when this was typical currency.
Buying a lot of Gold or Silver as a repository for your wealth might seem like a good idea based on history, but we are not faced with an event that really has good historical precedent here. The wealth of the world no longer really resides in the precious metals, its mostly a bookeeping system. There is no "outside" culture anymore, all the economies worldwide are intertwined in the same bookeeping system. If/When it fails, Gold is no better bet than anything else, and Gold Coins won't buy Twinkies, because there isn't enough gold to make such a currency effective for trade.
It has to go local for at least a while in the aftermath of a crash, and it has to go mostly barter as well. Long term, if society does survive in some fashion past local boundaries, some form of currency will develop, but the likelihood of it being gold or silver based I think is small. Short term, while you might poo-poo the idea of Red Fox Mittens as currency, I can assure you in my community where it drops to 30 Below Zero in the winter, these things will hold their value well. I actually own 2 pair (well the spare pair is Rabbit, but they are nice also). So I'll trade that pair out when I run out of food. Obviously said mittens would be valueless in Florida. I doubt I will be trading with any Floridians though. They will be cooked.
Joined: Sep 14, 2004 Posts: 6625 Location: Rural Virginia
Posted: Mon Aug 25, 2008 6:47 am Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
ReverseEngineer wrote:
DantesPeak wrote:
From the 1930s until 1963, we in the US had a silver based coinage and even silver certificate dollar - which could be cashed for silver up until that time.
Silver worked fine for small transactions in the US for 200 years. Why wouldn't it work in the future?
I don't get comments that silver and gold coins will be useless in the future. How will large transactions be conducted then? With a case of Red Fox Fur Mittens - or some US gold coins?
Well, this is complicated and requires you think outside the box some. Silver based coinage, the Gold Standard etc all in themselves depend on a growing economy, an economy with a surplus of wealth beyond what it takes to live from day to day. Prior to the Agricultural Revolution in Biblical times in the Western Hemisphere, no society had such surplus of wealth. Hunter Gatherers never had a surplus beyond the yearly cycle of nature. Agriculture enabled such surplus to develop, and then Currency came in the wake of that. Numerically speaking, you could count up the number of bushels of grain in your warehouse, and then you could place a value on that against some other commodity like gold or silver, but that is predicated on their being a fixed amount of that commodity in circulation. Which for most of history was pretty true, only at certain times and in certain places was the world economy put awash in Silver and Gold to seriously devalue those commodities against the food commodities.
What you see in a world awash with people who all need food is that though the comodities of silver and gold are scarce, relative to their actual value in survival they are not as scarce as the food is. You are very hard pressed to place a trade value on silver and gold against the trade value of commodities in such a situation, and its really quite a new one historically speaking.
In any event, with 6 Billion people on the planet, there just is no way to divide up the Wealth and represent it by Slips of Silver or in Gold Coins. I don't know about Trout's Grandad's story of seeing the Vault at Fort Knox being EMPTY, but its not the first time I have heard this Grandfather story. I would say though that if even a fraction of the people holding a large amount of paper wealth in the world made themselves busy buying tangible gold, that this would quickly run itself out in supply. There is only so much of the stuff available to buy, and if you are buying Certificates which SAY you own some Gold in the Vault in the Federal Reserve Bank in NY, I would question the validity of that. BILLIONS of dollars, no TRILLIONS are evacuating the Equities market, and Gold is one of the commodities they are all trying to buy as a Hedge against loss of wealth. Problem being, there just is not enough gold around to uptake all those trillions, not at its current valuation. Upping its valuation ten fold or hundred fold does no good, because as currency in such a situation its worthless. The coinage would be MICROSCOPIC in size to function as a currency for 6 Billion people, you would have to represent it on paper somehow, which gets you back to paper currency problems.
So OK, a few of the current 6 Billion on the planet scarf up all the Gold available, figuring I suppose to trade this Gold for food when TSHTF. Except here, first of all there is not enough Gold to make coinage practical for so many, second you can't even easily establish the percentage of gold in any given coin or gold ring. I will tell you its WAY easier to counterfeit a coin than it is a paper note these days. Making a mold out of a current coin is easy, and blending up some metals to pour into the mold also easy. Counterfeit coinage was always a problem when this was typical currency.
Buying a lot of Gold or Silver as a repository for your wealth might seem like a good idea based on history, but we are not faced with an event that really has good historical precedent here. The wealth of the world no longer really resides in the precious metals, its mostly a bookeeping system. There is no "outside" culture anymore, all the economies worldwide are intertwined in the same bookeeping system. If/When it fails, Gold is no better bet than anything else, and Gold Coins won't buy Twinkies, because there isn't enough gold to make such a currency effective for trade.
It has to go local for at least a while in the aftermath of a crash, and it has to go mostly barter as well. Long term, if society does survive in some fashion past local boundaries, some form of currency will develop, but the likelihood of it being gold or silver based I think is small. Short term, while you might poo-poo the idea of Red Fox Mittens as currency, I can assure you in my community where it drops to 30 Below Zero in the winter, these things will hold their value well. I actually own 2 pair (well the spare pair is Rabbit, but they are nice also). So I'll trade that pair out when I run out of food. Obviously said mittens would be valueless in Florida. I doubt I will be trading with any Floridians though. They will be cooked.
Reverse Engineer
There is enormous historical precedent for economic and civilizational collapses. Gold's high valuation survived all of them and was indeed the salvation of many individuals with the foresight to own some.
The world's population is likely to fall in a major general collapse of the sort you're discussing, so there'll be more gold and silver to go around. The coins could be alloyed with base metals, as was the case in the past.
There is a great deal of silver out there and it could serve as money right now, even with 6.7 billion people.
Some of your comments just don't make sense to me, Engineer, but you're entitled to your opinions, and if they make you feel better about not owning any gold, so much the better.
To me the practical debate here isn't gold versus red fox mittens, it's gold versus our inflating and unbacked paper money. In that debate at least, gold wins hands down. _________________ "Actually, humans died out long ago."
---Abused, abandoned hunting dog
"Things have entered a stage where the only change that is possible is for things to get worse."
---Me and my brother
Joined: Dec 07, 2005 Posts: 2025 Location: Australia
Posted: Mon Aug 25, 2008 7:38 am Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
Just a couple of loose thoughts for the above posts.
First of all, gold coin may be easy to counterfeit but should also be relatively easy to test. Ensure the measurements are right and then weigh the coin. It is mixed with base metals the size/weight shouldn't match up.
I've also heard you can do a drop sound test comparing the sound with an authentic dropped gold coin. Not sure what surface it should be, but apparently a the gold coin makes a distinct sound compared to one that has been coated.
Secondly, most of the silver ever mined has been used up and central banks no longer have it in their reserves.
So should the central banks find themselves in a situation where they need to back the currency with precious metal, it is likely to be just gold.
Exceptions to this may be central/south american countries like Mexico, that already expressed some interest in reinstating silverbased money.
But it is because Silver and Gold have different fundamentals that it is important to hold some of both. Althought one often moves with the other it is not far fetched to have a decoupling at some stage.
For example; Silver may appreciate better if the shortages continue
Or Gold may do better if it regains a monetary role and silver doesn't. (As suggested by Jim Sinclair in his Gold Certificate standard theory.)
Personally I buy more physical silver than gold.
Why?
-Supply deficit in a long term trend is one reason. (I want to have the physical as that is what is in deficit)
-Cheaper price per ounce is another (don't have to purchase for a large amount to get a handful)
-Industrial use for electronics etc should ensure continued demand in a peak oil scenario
- Potential of being monetary metal (safehaven), industrial and consumer discretionary (jewlery etc) makes it slightly more versitile than gold.
- Gold is easier to get exposure to in other ways. i.e. limited pure Silver plays among shares (especially in Australia I have only found a few companies and none of them are convincing me to give up purchase of physical) _________________ It's not a bailout, it's a buy-in" - Nancy Pelosi
Posted: Mon Aug 25, 2008 9:21 am Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
joeltrout wrote:
There is no way to prove it but in WWII my grandfather was with a tank battalion which helped guard Fort Knox. He was invited to view the vaults and he claims they were completely empty. He does not know if the gold had been moved or was gone completely.
I know there are many conspiracy theories out there like this story but my grandfather is a very strict christian and don't know why he would lie. But like I said I have no proof.
joeltrout
Didn't Ron Paul (or some other guy) say the last audit on the gold in Ft. Knox was done during the Eisenhower administration?
Posted: Mon Aug 25, 2008 11:28 am Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
Why don't people like the Gold Buffalo ??
That is the next coin on my list to get, but the price is to high.
I got a couple more pounds of silver last week ,,, feels Good.
And I don't intend to trade my gold for a twinkie. FYI, for me the gold is for WAY WAY after TSHTF. when things start to get back to some normal life. After the smell of dead zoombies fade away.
THEN the Gold comes out I trade it for some Amero's, and then I buy some twinkies
Posted: Mon Aug 25, 2008 2:04 pm Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
Heineken wrote:
Some of your comments just don't make sense to me, Engineer, but you're entitled to your opinions, and if they make you feel better about not owning any gold, so much the better.
Your comments don't make sense to me either Heineken, but you are entitled to your opinion as well. Feel free to buy as much Gold as you can afford, if it makes you feel better its money well spent. You bought as much of everything else you might really NEED already, so one place to drop the excess is as good as the next.
I keep remembering that story about the guy who jumped off the Titanic wearing a backpack full of Gold though Becoming too attached to your money is a mistake.
Reverse Engineer
Joined: Sep 14, 2004 Posts: 6625 Location: Rural Virginia
Posted: Mon Aug 25, 2008 7:11 pm Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
sittinguy wrote:
Why don't people like the Gold Buffalo ??
That is the next coin on my list to get, but the price is to high.
I got a couple more pounds of silver last week ,,, feels Good.
And I don't intend to trade my gold for a twinkie. FYI, for me the gold is for WAY WAY after TSHTF. when things start to get back to some normal life. After the smell of dead zoombies fade away.
THEN the Gold comes out I trade it for some Amero's, and then I buy some twinkies
The Buffalo coin is a poor choice, because its premium is so high. It is a very handsome coin, however.
You'll find that if the time comes that you want to sell it back to the dealer, he won't pay hardly any more for the Buffalo than he would for an ugly Kruggerand or a plain-Jane Maple Leaf.
When you are buying bullion coins, check the prices the dealers are paying to buy them back; then make your choice accordingly. _________________ "Actually, humans died out long ago."
---Abused, abandoned hunting dog
"Things have entered a stage where the only change that is possible is for things to get worse."
---Me and my brother
Joined: Sep 14, 2004 Posts: 6625 Location: Rural Virginia
Posted: Mon Aug 25, 2008 7:20 pm Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
Micki wrote:
Just a couple of loose thoughts for the above posts.
First of all, gold coin may be easy to counterfeit but should also be relatively easy to test. Ensure the measurements are right and then weigh the coin. It is mixed with base metals the size/weight shouldn't match up.
I've also heard you can do a drop sound test comparing the sound with an authentic dropped gold coin. Not sure what surface it should be, but apparently a the gold coin makes a distinct sound compared to one that has been coated.
Secondly, most of the silver ever mined has been used up and central banks no longer have it in their reserves.
So should the central banks find themselves in a situation where they need to back the currency with precious metal, it is likely to be just gold.
Exceptions to this may be central/south american countries like Mexico, that already expressed some interest in reinstating silverbased money.
But it is because Silver and Gold have different fundamentals that it is important to hold some of both. Althought one often moves with the other it is not far fetched to have a decoupling at some stage.
For example; Silver may appreciate better if the shortages continue
Or Gold may do better if it regains a monetary role and silver doesn't. (As suggested by Jim Sinclair in his Gold Certificate standard theory.)
Personally I buy more physical silver than gold.
Why?
-Supply deficit in a long term trend is one reason. (I want to have the physical as that is what is in deficit)
-Cheaper price per ounce is another (don't have to purchase for a large amount to get a handful)
-Industrial use for electronics etc should ensure continued demand in a peak oil scenario
- Potential of being monetary metal (safehaven), industrial and consumer discretionary (jewlery etc) makes it slightly more versitile than gold.
- Gold is easier to get exposure to in other ways. i.e. limited pure Silver plays among shares (especially in Australia I have only found a few companies and none of them are convincing me to give up purchase of physical)
I've heard that bullion coins are relatively difficult to counterfeit, and that a good counterfeit "bullion" coin is expensive to make (which reduces the appeal of counterfeiting them). Cases of counterfeiting of bullion coins are fairly rare. Naturally, you should examine carefully anything you buy---as will a good, dependable dealer. A good dealer knows his stock and doesn't sell fakes, although mistakes can happen of course.
I like silver too, Micki, but it is terribly bulky. That is its downside, along with the tarnishing problem. _________________ "Actually, humans died out long ago."
---Abused, abandoned hunting dog
"Things have entered a stage where the only change that is possible is for things to get worse."
---Me and my brother
Joined: Mar 18, 2008 Posts: 468 Location: Upstate New York
Posted: Mon Aug 25, 2008 7:57 pm Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
Any PM whether it be gold or silver is NOT for when TSHTF!! You will not get any worth out of it then. Better to have food, ammo, whiskey, clothes, and junk silver to barter with. After things settle down there will still be a need to purchase/store wealth in something other than tradable items. Thus silver and gold!! You want 20 cows.. That will be one gold coin or XXX bushels of corn.
So the order of things should be.
1. Food/Water/Seeds
2. Shelter
3. Guns/Ammo
4. Tools
5. Gold and Silver (junk and bullion)
6. Alcohol/cigarettes
Just my 2 dollars (comment adjusted for inflation).
Joined: Aug 03, 2006 Posts: 4338 Location: Graceland
Posted: Mon Aug 25, 2008 9:52 pm Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
To me, physical gold and silver shouldn't be considered investments, but more like diversifying your cash holdings. It's a good idea to invest in income producing assets as well, of course, but from a historical perspective there are many shades of hard times, and in many of those shades having cash and precious metals on hand would have been a good part of an overall wealth protection strategy.
As Harry Browne explained, the "permanent portfolio" of 25% each in cash, gold, stocks and long term U.S. Treasuries is about as close to bulletproof as you can get. (Average annual return since 1972: 9.5%)
This is the only portfolio of which I am aware that has provided a positive inflation adjusted return during every period since we went off the gold standard.
Gold belongs in every portfolio, it's just a question of what percentage. For me, about 15%-35% is my comfort zone. For others, it's higher.
The only thing I hate to see is when NONE of a person's wealth is in income producing assets. You miss out on a lot of gains by staying on the sidelines from both stocks and longer term bonds. _________________
Posted: Mon Aug 25, 2008 10:11 pm Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
If you're worried about fake bullion, get one of these: http://www.fisch.co.za/ _________________ "We were standing on the edges
Of a thousand burning bridges
Sifting through the ashes every day
What we thought would never end
Now is nothing more than a memory
The way things were before
I lost my way" - OCMS
Posted: Tue Aug 26, 2008 3:24 am Post subject: Re: The Eagle Has Been Grounded (US Gold Coins)
Generally speaking, it appears to me that this thread is for people who have way too much surplus wealth and are looking for ways to protect their wealth. If you have soooo much money you are trying to figure out how much of the extra you should drop into Gold coins, you are a BIG part of the problem we have in the world. You obviously have scarfed up way more of the wealth of the world than you really needed to survive, and now you are trying to figure out how best to stay rich. This is the fundamental underpinning of greed.
I find it entertaining listening to this stuff, just it is kind of pathetic by my estimation. I wonder why people feel it necessary to accumulate so much wealth they have to agonize over how to protect it? Do I buy Commodities? Equities? Real Estate? Ammo? What? LOL.
I never felt the need to accumulate so much wealth, though I had many opportunities to do so. Any person who takes more than what they actually NEED, with some surplus to insure against a rainy day is just too greedy to be a really GOOD person. I take just what I need from the world, I always have. If I kill a Moose, I eat all of that Moose, though gotta admit I haven't boiled out hooves to make glue yet.
I wish you guys luck figuring out how to protect your wealth. I'll stick to the Red Fox Mittens, and bow out of this thread.
You cannot post new topics in this forum You cannot reply to topics in this forum You cannot edit your posts in this forum You cannot delete your posts in this forum You cannot vote in polls in this forum
News
Discussions
Resources
Members
Forum FAQ
Search
Usergroups
Profile
Log in to check your private messages
Log in
Becoming too attached to your money is a mistake.
