Weekend Show – Sat 14 Dec, 2013

Considering the serious nature of our situation

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We really had some fun this week considering the serious nature of  our situation.

Hour 1:

Hour 2:

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Featuring:
Al KorelinAlex LetourneauCory FleckGary SavageGlen DownsJeff Deist
Mark ThorntonRichard PostmaRick Ackerman

Comments:
  1. On December 14, 2013 at 3:36 am,
    Andrew de Berry (Rev) says:

    Thanks as always guys for a very informative weekend show.

    Presumably Al there are a good few thousand visiting your site who are essential non-technies like myself. So how’s this for a parallel as to what’s happening in today’s global markets:

    Many will be familiar with that iconic movie ‘The Poseidon Adventure’ released in 1972, starring Gene Hackman and other well knowns. The film was based on Paul Gallico’s book, but which in turn was inspired by an earlier original film made in 1911 on the same theme.

    What is less well known is that the original film was being shown aboard the Titanic at the precise time (the evening of April 14th 1912) when the ship went down! It seemed that the owners of the Titanic (The Blues Star Shipping line) wished to pamper their passengers with every latest gizmo, with the original film made up on ten minute one-reelers lasting a remarkable 53 minutes.

    It’s believed that so absorbed by the film were those Titanic passengers viewing it that a number didn’t even notice the impact of when the ship struck the iceberg!

    In the later film we have further illustrations of what happens to people in a crisis. The Poseidon gets hit by a tidal wave turning the whole vessel upside down. All the passengers find themselves in the dining hall when the wave strikes, Amidst a scene of chaos and shattered glass with a number already injured most of the passengers aboard survive. But only a few decide on a course of action that will save them longterm. Of the handful who get out led by Hackman (the chaplain on that ship), they are obliged to face all manner of hazards and obstacles before making their way up to the ship’s hull – the only part of the Poseidon floating above the sea surface. Eventually the handful of survivors get rescued by those on the outside using acetylene torches. We’re not told what happens to the mass of passengers still languishing in the dining hall below and who’ve done so on the advice of the ship’s purser, offering his near-futile advice that ‘help is on its way’!! But we’re left to assume that what happens to those left in the bowels of the ship is not good.

    The Fed Reserve chairman and his successor are not unlike that ship’s purser, failing to speak the truth that only those who take appropriate action will before long have their heads above water.

    • On December 14, 2013 at 6:49 am,
      SILVER MAN says:

      ANDREW,
      I REMEMBER “THE POSEIDON ADVENTURE” THAT WAS A GOOD MOVIE. YOUR ANALOGY WAS VERY GOOD. I DIDN’T KNOW THEY WERE WATCHING THAT FILM ON THE TITANIC!

    • On December 14, 2013 at 9:05 am,
      Big Al says:

      What a great comment Reverend.

      First of all I did not see The Poseidon Adventure, but your analogy is really great. Let me throw another psychological factor in. Survival and the accompanying characteristic of not admitting reality is a very strong aspect of the defense mechanism of a human being.

      I used to spend a lot of time jogging with a pathologist who was also the county coroner. I asked him once what went through the minds of those folks who were terminal and new it.

      His answer was very interesting.

      He said it was his experience that they lived life to the fullest as long as they possibly could shielding their impending death from their psyche. Their rationale was that “something would/could change”.

      I see that happening in society today and I am certainly part of that universe.

      Why do I say that?

      Simple, I am preparing (as I am sure are those in the terminal state mentioned above) but I shield what could very well be reality in the future from some of my psyche.

      Why do I do that?

      Simple, I am preparing as best as I can but I need to be able to stay sane and sleep at night.

      • On December 14, 2013 at 9:25 am,
        Andrew de Berry (Rev) says:

        Absolutely Al. Being in denial or something akin to it is a very natural instinct. I don’t like knowing that the world’s currencies are living on borrowed time, anymore than I like thinking of those in power being charlatans or self-deceived. Rather, I prefer being entertained in what I believe to be an indestructible Titanic, even as I push all thought of my mortality into the far reaches of my mind!

        But then seeing the behaviour of so many poor darlings doing their utmost to enjoy the festive season once more, my mind turns to Christ and to the scriptural caveat that ‘all is vanity’. Sure, I want to make money and sure I want to live until at least ninety, well maybe 85 should Alzheimer’s catch me out sooner.

        What I don’t want is to be blind-sided by fools who would make my life and that of my loved ones into all-out misery.

        Thanks yet again Al for all that you offer to this site, the ‘Reverend’!

        • On December 14, 2013 at 9:55 am,
          Big Al says:

          Want to know what Kathy and I are doing to make all of this better?

          Of course we are doing our level best to stay secure financially. That goes without saying after all, “God helps those who help themselves”.

          We continue to help others through our charity work up here. I AM NOT SAYING THIS FOR PERSONAL GLORIFICATION! I AM SAYING IT BECAUSE EVEREYONE NEEDS TO DO THE SAME!

          Most importantly, we started a bible study group a number of months ago in our neighborhood. The folks in this group are within the same demographic that we and, I would assume, all the people on this site are. As you are aware, I am sure, this fellowship and the ensuing increase in knowledge, has done more for us that I ever imagined. And this coming from a Catholic who rarely misses Mass. (By the way, our Bible Study is definitely not of a strictly Catholic bent!)

          • On December 14, 2013 at 10:01 am,
            richard says:

            Good for you, Al. Denominations and the organized church are good to be involved in; however, the spirit of God isn’t rendered to us through the established church. It’s given to those who seek through scripture and prayer.

          • On December 14, 2013 at 10:22 am,
            Andrew de Berry (Rev) says:

            Precisely so Richard and Al, A

    • On December 15, 2013 at 1:00 am,
      impeach says:

      Come on, Andrew, stop posting conspiracy theories! We all know the Titanic could never have sunk, it just went into a cold shutdown.

      Talk about investment clues hidden in movies: Was that a silver or platinum chain?
      http://www.terry-posters.com/images/product/image/7615/dobrodrpos-oww.jpg

      • On December 15, 2013 at 4:55 am,
        Andrew de Berry (Rev) says:

        Silly me impeach….I’m just sooooo gullible!

    • On December 16, 2013 at 11:39 am,
      Shad says:

      Glad you got Alex Letourneau from Kitco on here. I watch his and Daniela’s video blogs each day and think it will be good to have Alex on every week as he covers interviews with the greatest names in the space. Cheers!

  2. On December 14, 2013 at 5:30 am,
    Andrew de Berry (Rev) says:
    • On December 14, 2013 at 6:00 am,
      Ann says:

      Great analogy!!

      • On December 14, 2013 at 9:08 am,
        Big Al says:

        So are you guys in Mexico or in BC? (Or do I have you mixed up with another Ann?)

        Best

        • On December 14, 2013 at 10:19 am,
          Ann says:

          Big Al, we live in BC, vacationing in Mexico,5 weeks, another week to go.

          • On December 14, 2013 at 11:45 am,
            al korelin says:

            I am jealous!

    • On December 14, 2013 at 9:07 am,
      Big Al says:

      Cute

    • On December 14, 2013 at 1:06 pm,
      Dai Uy says:

      Makes sense to me; I’ll bet to Krugman as well……….

  3. On December 14, 2013 at 6:43 am,
    SILVER MAN says:

    AL,

    I REALLY ENJOYED DR. MARK I HOPE YOU HAVE HIM BACK AGAIN.

    • On December 14, 2013 at 9:09 am,
      Big Al says:

      Count on him being back along with more folks from Mises!

  4. On December 14, 2013 at 6:49 am,
    Gary says:

    Here is the chart Al is talking about showing the fundamentals driving the last three bull markets. Including the end game when the inflation moves from financial assets into the commodity markets. I think as we progress into the currency crisis next year we will enter another second stage inflation similar to what happened in 2008.

    http://stockcharts.com/h-sc/ui?s=$SPX&p=D&st=1980-1-14&en=(today)&id=p34111887561&a=327669083&listNum=1

    • On December 14, 2013 at 9:10 am,
      Big Al says:

      Thanks for posting this Gary

  5. On December 14, 2013 at 7:24 am,
    richard says:

    Dr. Thornton’s comments were quite interesting about the deflationary (deleveraging) forces upon us with ever increasing monetizing. He mentioned wages were decreasing and he was quite correct about that. If you look at aggregate wages as a % of the economy, they’re at an all time low. Of course that goes hand and foot with the labor participation rates which are at an all time low along with the employment ratio compared to the adult population which is at an all time low. Then if you look at how well the 1%ers are doing, all you have to look at are the corporate profit margins which are at an all time high. So, you not only have distortions in the capital markets but you also have distortions in the labor markets.

    • On December 14, 2013 at 9:10 am,
      Big Al says:

      Which is all causing havoc in society, right Doc!

  6. On December 14, 2013 at 7:26 am,
    SILVER MAN says:

    GLEN DOWNS IS RIGHT. WE COULDN’T AFFORD ANOTHER GOVERNMENT SHUT DOWN AT THIS TIME. KEEP OBAMA CARE FRONT AND CENTER, BECAUSE IT IS SO BAD FOR THE AMERICAN PEOPLE. WE HAVE TO TAKE THE SENATE AWAY FROM THE DEM’S. FIRST. THEN WE SHOULD TRY TO IMPEACH THE KING.

    • On December 14, 2013 at 9:12 am,
      Big Al says:

      I will be surprised if that happens Silver Man.

      I look for the D’s to be there for a while. Am I happy about that? I really kind of don’t think it matters anymore.

      Am I crazy? What do you think?

  7. On December 14, 2013 at 8:11 am,
    Dick Tracy says:

    Dr. Marc Thornton believes that without The Fed guiding the economy we would be out of this mess if they would just allow deflation to happen. Deflation is the economic cleanser, I believe deflation will come when the money pumping collapses. I have cried wolf on this subject many, many, times.

    This coming sudden decline in values might not be so utterly terrifying if people could know what is happening at this moment. It is the unknown which causes real panic. That is where education and sites like this are important. DT

    • On December 14, 2013 at 8:44 am,
      Dick Tracy says:

      If (when) the economic structure cracks wide open as the bubbles start to “POP” what we need to have are people that can come forward and explain to the citizens what has caused this, why it has happened again, and how the system needs to be allowed to correct itself and not to prime the fiat currency pump.

      But you know that that will never happen because to many failed reputations will be on the line. DT

      • On December 14, 2013 at 9:14 am,
        Big Al says:

        And, perhaps as important, because better than half of our great population would simply not understand!

    • On December 14, 2013 at 9:13 am,
      Big Al says:

      Man are you correct, Machine Gun!

      Ignorance is bless to some and a terrible thing to others like us!

  8. On December 14, 2013 at 8:56 am,
    HEAVYHITTER says:

    GREAT SHOW….the speaker and all the guests are awesome. I think though with any investment especially gold there is a lot of risk even at these lows. But this is the time
    to buy but ALWAYS…ALWAYS… be ready with lots of dry powder to buy on a washout from hell. Pigs make money, hogs dont. IMVHO

    • On December 14, 2013 at 9:14 am,
      Big Al says:

      You are posting some great comments Heavy, thank you!

  9. On December 14, 2013 at 9:10 am,
    Dennis M. O'Neil says:

    The Ludwig von Mises web site is a treasure.

    Ludwig von Mises wrote the following in a 1950 Preface to The New Edition of his book “Socialism: An Economis and Sociological Analysis”, to wit:

    “The great ideological conflict of our age must not be confused with the mutual rivalries among the various totalitarian movements. The real issue is not who should run the totalitarian apparatus. The real problem is whether or not socialism should supplant the market economy.”

    This observation was true in 1950 and it is true today. We find ourselves engaged in this same struggle at a later stage. We are destroying the price mechanism in favor of edicts from on high. It matters less who holds the levers of price discovery than it is the fact that the levers exist.

    • On December 14, 2013 at 9:15 am,
      Big Al says:

      That, Dennis M, is a great comment. Thank You!

      • On December 14, 2013 at 10:15 am,
        Dennis M. O'Neil says:

        Spending time on the LvM website is time invested.

        • On December 14, 2013 at 11:50 am,
          al korelin says:

          A solid one at that!

        • On December 15, 2013 at 9:27 am,
          Jeff Deist says:

          Dennis- it’s a huge site with a ton of free material, but not very user friendly. We are migrating content furiously and plan to unveil a new site- with a much better search function- in 2014.

          • On December 15, 2013 at 6:19 pm,
            Dennis M. O'Neil says:

            It is best to make the search functions user friendly.
            The goal should be to be like a stained glass window.
            That is communicating ideas to the illiterate.
            The ergonomics of a stained glass window and that of a McDonald’s piture-esque cash register should be your goal.

  10. On December 14, 2013 at 9:19 am,
    HEAVYHITTER says:

    FOR BIG AL and everyone have we really seen the big wash out that slways comes or since everything in the mining companies is just so cheap…..the risk is low for that capitulation and thats now behind us with other than a little bit more selling ??? THATS WHATS REALLY ON MY MIND. THANKS !

    • On December 14, 2013 at 9:59 am,
      Big Al says:

      We will be on top of this as best as we can!

  11. On December 14, 2013 at 9:35 am,
    Andrew de Berry (Rev) says:

    Wondering what’s happened to the Bird?

    • On December 14, 2013 at 9:58 am,
      Big Al says:

      I believe that he is a bit sick. At least that is what he told us a week or so ago.

      Let’s pray that he is okay!

      • On December 14, 2013 at 11:15 am,
        Bird Man says:

        Still out here guys. I am recovering. Just busy getting photos loaded for the family for Christmas but I am hopeless with a computer so it is always a challenge for me trying to figure out how to make it work. All I can say is I appreciate not living with snow especially when a virus gets me down like now.

        Great show today, Al. I really enjoyed the macro discussion. When I heard you and Gary talking about bringing jobs back to the US, how the wage gap is closing and what it would take to generate new employment needed to bring back the good old days I felt discouraged.

        I look around here where I live at all the plastics, shoe and garment factories and really wonder if anything can ever be normal again back home. The Chinese and Indians have been working overtime developing capacity here because it is so much cheaper than in their own countries.

        Land is almost free, power is dirt cheap, labour rates amongst the lowest on earth. The Chinese factories near me are paying wages to the locals starting at 26 dollars per month for machine operators (not a misprint…..they pay a buck a day for fabrication workers as a starting salary). That is for work demanding up to 12 hour days and six days each week.

        How the hell can you compete with that? Even the Chinese in China cannot produce at such low rates in their own country which is why they are here busy putting their own countrymen out of work!

        The only thing separating people here from back home is education and skill levels needed for high tech jobs which pretty much don’t exist in this area. But they build a lot of the components used by tech industry. So it seems obvious to me the West must remain focussed on doing what is not practical in poorer countries. Nobody back home can produce t-shirts for a dollar each for example. Not even in a factory that is totally automated and runs in the dark. Near the equator the days are all 12 hours long throughout the year and you never need to pay for heat.

        That means that services will continue to dominate the business landscape in Europe and America. You can all pretty much forget about bringing most factories back though. Hell, the Chinese are building cars, busses and aircraft in Africa now. They do it at labour rates that could make you cry. So the world cannot go back to how it was in days past unless all trade ends.

        How likely is that?

        • On December 14, 2013 at 11:55 am,
          al korelin says:

          Are they taking advantage of these folks or helping them, Bird?

          • On December 14, 2013 at 12:04 pm,
            al korelin says:

            Kathy also asked me to ask you if the majority of the workers were men or women.

          • On December 15, 2013 at 10:58 am,
            Bird Man says:

            That is a loaded question Al. The wages are terrible yet it would be a disaster if the jobs disappeared. Industrialization is still a pretty new thing here. This is the last stop along the globalists road to finding the lowest wage economies on earth where nobody would argue what is offered because the alternative is so much worse. Since there are no social programs or safety nets the only option available if you don’t work is begging or going back to the country and weaving baskets. Tell Kathy that most of the workers in these plants are women by my best reckoning. I have not seen stats on it but just judge by who is getting off the bussloads that come in to the factories daily. The gals (and guys too) have been pulled in from the rural areas in search of opportunity and a shot at a better life. Some are indeed making it. Urban areas are booming. It is not uncommon to see a dozen or more renting very small spaces all shared though. They do what they need to keep costs low. Our neigbors are all Sudanese and there is at least 20 of them renting a single small house together. The point is though that the misery is happening at both ends of the jobs spectrum across the globe. Over here people earn a pittance for jobs that were once union elsewhere in Europe or the Americas. So the bottom wage earners got screwed even worse than the folks in the high income places whose work disappeared in the labour shift overseas. If there is any good news it may only be that there is no place cheaper to go after this so maybe this is the real bottom.

        • On December 15, 2013 at 12:57 am,
          Dennis F. Brophy says:

          Bird, where do you live, just wondering ? I thought it was the middle-east, tnen its Canada, then its somewhere in Africa, then its the U.S., then its South America, perhaps thats why you call yourself Bird ? Man. – … for the family for Christmas, in the happy land of Islam, gee must be wonderful. – Ever see the Mel Brooks movie: `Young Frankenstein`, the creature(Peter Boyle) dancing before all those doctors and scientists with de Young Franfenstein(Gene Wilder) refering to the stuff shirts in the spectator section of the theater the doctor, introduced the creature as the `man about the town`, singing and dancing tap dance, what a sight. You my friend from `creature from Jekyll Island`. – – Have a very merry Christmass. – And I guess the new FED charter is already a done deal too.

          • On December 15, 2013 at 8:21 am,
            Bird Man says:

            Yes Dennis, all of those except South America. My favourite place in the world though is Northern Vancouver Island but for retirement it will be the East Kootenays where I can pan gold until the cows come home.

  12. On December 14, 2013 at 9:50 am,
    Andrew de Berry (Rev) says:

    Obnoxious little Chinese snot…..get’s boring after three minutes….!!!

    http://www.maxkeiser.com/#fBWDT5tmaDLYEy7J.99

  13. On December 14, 2013 at 9:52 am,
    Andrew de Berry (Rev) says:

    PS Scroll down under O’Sullivan.

  14. On December 14, 2013 at 9:54 am,
    Dick Tracy says:

    Several years ago it was reported that there were 8,000 to 10,000 hedge funds operating in North America. With a combined worth estimated to be in the area of 600 to 700 trillion dollars, these numbers don’t make sense to me but certainly they control a huge amount of capital and if as Dr. Thornton suggests that most of the money flowing out of The Federal Reserve goes to rich and well connected first and he mentions The Hedge Funds, that would explain how many of them who must be run by venal promoters have been able to keep their Ponzi schemes alive. DT

    • On December 14, 2013 at 9:59 am,
      Big Al says:

      Absolutely, Machine Gun!

  15. On December 14, 2013 at 10:54 am,
    bj says:

    Re: Dr Thorton:

    “Bubbles everywhere” = inflated prices of real and paper assets = inflation! But I don’t think the Feds money was ever intended to benefit the general population.

    Also:
    This latest budget deal was a complete sellout by Big Government Republicans. When the Sequester kicked in, they talked in terms of 10 years to make the number look big. Something like a one $trillion decrease in the net increase of gov’t spending over 10years–but never a decrease in actual spending. But the Sequester didn’t even survive one year thanks to Boehner and enterached big gov’t Rs! At the very least, over $60billion was restored to the net increase of runaway gov’t spending over the next year–never to be taken back; ergo over $600 billion increase minimum increase in spending over the next 10 years. So yet again we were treated to much ado about nothing called a Sequester. And again, the Sequester did not cut actual spending only the rate of increase to spending.

    Thus the Speaker of the House sold out fiscal conservatives yet again. Talking the talk and then running away in the wrong direction. Best analogy would be a glass of water: Some would say Boehner is half full (of it) while other would say he is an empty vessels–brainless but obedient to his K Street masters.

    Agree that bankruptcy was the way to go. That’s what those courts were set up to do, and the only ones who think we or the world can’t live without Goldman Sachs or its counterparts are GS and its counterparts and mouths in the mainstream media.

  16. On December 14, 2013 at 11:00 am,
    bj says:

    BTW, Social Security and Medicare were walled off because they were trust funds. The fact is that these trusts were raided year after year, since LBJ declared stealing from these trust funds was borrowing (with no intent or ability to pay it back). I suppose Sec Kerry mightd call it stealing, “but not in the classic sense of the word”, but more likely he would call it borrowing, “but not in the classic sense of the word”.

    • On December 14, 2013 at 12:10 pm,
      al korelin says:

      I can’t add much bj except to say that I. agree.

  17. On December 14, 2013 at 11:36 am,
    Bird Man says:

    You know what really has me worried about the stock market right now is the incredible levels of leverage. That is one place the nearly free Fed money is definately showing up. Bank brokerages have flooded the market with mountains of cheap money making everyone on margin look like a genius. The risk is that just a little setback of 5 or 10% is enough to start wiping some guys out and forcing liquidations. At margin levels now it is easy to picture the carnage should we encounter a heavy selling day that starts triggering stops and forcing margin calls. Do we even need a trigger? This sucker is primed and ready to pop just waiting for bad timing and coincidence to meet daily rreality.

    • On December 14, 2013 at 11:48 am,
      Andrew de Berry (Rev) says:

      Glad that you’re resurfacing Bird!

      • On December 14, 2013 at 11:49 am,
        Bird Man says:

        Thanks Andrew. Good to hear from you as well. Best of the season to you.

        • On December 15, 2013 at 12:48 am,
          Andrew de Berry (Rev) says:

          And to you BM, A

    • On December 14, 2013 at 12:12 pm,
      al korelin says:

      Remember 1929?

  18. On December 14, 2013 at 12:20 pm,
    bj says:

    Cool that you can remember back as far as 1929! I’m just a baby boomer.

    Anyway, it took four years before things got critical enough socially and economically that the U.S. Congress passed in 1933 as the Banking Act, which prohibited commercial banks from participating in the investment banking business.

    • On December 14, 2013 at 12:21 pm,
      bj says:

      The Glass Steagall Banking Act, that is.

      • On February 1, 2014 at 9:00 pm,
        Rodrigo says:

        This incteduros a pleasingly rational point of view.

    • On December 14, 2013 at 1:18 pm,
      Andrew de Berry (Rev) says:

      bj You, Al and I are ALL baby-boomers!

      • On December 14, 2013 at 1:58 pm,
        Matthew says:

        Andrew, I think Al just missed the post-war baby boom (he was born in 1943).
        http://en.wikipedia.org/wiki/Baby_boomers

        • On December 14, 2013 at 2:40 pm,
          franky says:

          yes can’t by !

        • On December 14, 2013 at 7:33 pm,
          bj says:

          Glad we got that all figured out. Best wishes to all God’s children of every age and station and hopes and prayers for more and lasting peace on earth across this Christmas and beyond.

          • On December 15, 2013 at 10:21 am,
            Big Al says:

            Amen bj

        • On December 15, 2013 at 12:49 am,
          Andrew de Berry (Rev) says:

          OK so did I on that basis Matthew, born in 1944!!!

        • On December 15, 2013 at 10:18 am,
          Big Al says:

          And I thought my satire was the best of all time. You are the champ!

          • On December 15, 2013 at 10:21 am,
            Big Al says:

            Refering to the above comment to Reverend. Not sure just why it was posted way down here.

        • On December 15, 2013 at 10:22 am,
          Big Al says:

          December of! I prefer to round up!

    • On February 2, 2014 at 3:53 pm,
      Manapol says:

      Your answer lifts the inlentigelce of the debate.

  19. On December 14, 2013 at 3:15 pm,
    Dick Tracy says:

    Matthew you make a lot of sense in almost all your posts but you haven’t been able to see the deflation bogeyman and I don’t know why except for the fact that maybe you think The Fed has more power then I think it has. DT

    • On December 14, 2013 at 6:14 pm,
      Matthew says:

      I just stick to the definitions, DT. I have always said that we have had deflation in real terms (especially since 2000). Measured in gold, most things have gotten cheaper. From 2000 to 2011, the Dow fell from over 44 ounces of gold to under 6. Yet, measured in dollars, the Dow is up something like 40%.
      The 1999/2000 peak for the stock market is the one that is most comparable to the 1929 high. The money supply has only grown since then while living costs have only risen (very sharply I might add).
      Without Fed intervention, collapsing debt LEADS to deflation, but it isn’t deflation itself. Marc Faber understands this, so why doesn’t Martin Armstrong or Bob Hoye? (Faber studied Economics at the University of Zurich and, at the age of 24, earned a Ph.D. in Economics, graduating magna cum laude)
      http://en.wikipedia.org/wiki/Marc_Faber

      I think that you continue to think inflation=good, deflation=bad. Don’t forget that the Fed OWNS the FRNs that it emits. Therefore, it has complete control over the issuance of both paper and digital FRNs.
      I have never said that inflating the money supply will help the economy to grow or will restore good times in any way. Martin, Bob and you need to share your definitions of deflation.
      As long as we accept the Fed’s “dollar” for the purpose of economic measurements, general price inflation or deflation will be the result of the Fed’s preference.

      If you would rather hold gold than dollars, you are not really a deflationist when it comes to the currency of the empire. Robert Prechter is bullish the dollar (or least he was the last time I paid any attention to him) because he is a deflationist in terms of dollars. I, on the other hand, am a deflationist in terms of gold but but am an inflationist in terms of dollars.
      Remember that hyperinflations are deflations if we use gold as the measure. Hyperinflations never lead to REAL economic growth. So, inflation or deflation should be the debate, not hyperinflation or deflation. Hyperinflations come from a contracting economy+a collapsing currency. High inflation can happen in a good economy while hyperinflation only happens in a bad economy. High inflation usually happens when there is strong demand for the currency while hyperinflation happens when there is collapsing demand for the currency.

      • On December 14, 2013 at 9:27 pm,
        bj says:

        “contracting economy+a collapsing currency” — to me the debate is the ‘true’ health of the economy and true value of our currency and their direction. To me both are trending in the wrong direction, ie unhealthy.

        Goldman Sachs made a call this week for a weaker dollar in 2014 and the commercials are net buyers of bullion. Both are encouraging signs for PM investors, as is the wide radius rounding bottoms for PM and PM mining stocks on the charts.

        • On December 14, 2013 at 9:57 pm,
          Matthew says:

          Of course I agree that both are trending in the wrong direction. This is why we can expect deflation in gold terms (gold’s purchasing power will go up). Prechter thinks gold is going to $500 (when gold was $300 he thought it would go to $100). $500 gold is very unlikely in my opinion.

          • On December 15, 2013 at 10:34 am,
            Big Al says:

            Mine too Mathew

        • On December 15, 2013 at 10:33 am,
          Big Al says:

          You bet, BJ!

  20. On December 14, 2013 at 3:40 pm,
    Michael says:

    Your weekend round-table is composed of 100% technical folks. No fundamental folks. Would be nice to see a mix next time.

    • On December 15, 2013 at 10:24 am,
      Big Al says:

      Consider it done as you are correct.

  21. On December 14, 2013 at 3:45 pm,
    HEAVYHITTER says:

    My radar screen is showing higher gold surpassing 1300 by year end. At the least a bear market rally maybe with a move to 1500 in the months ahead. Then analyze the market then for higher prices starting the bull in gold to 3000.

    I DONT THINK THE REST OF MY DRY POWDER IS GOING TO LAST LONG. We hit the bottom if anything happens we might visit 1200 and then gold will take off. It will be quick too. As quick as you can hit your key board. IMVHO

    • On December 15, 2013 at 12:51 am,
      Andrew de Berry (Rev) says:

      Well done HEAVYHITTER. I’m looking to mid 2014 for some significant improvement.

      • On December 15, 2013 at 7:49 am,
        HEAVYHITTER says:

        The COT’S support a rally soon. Also I believe that derivatives all going in one direction for a while now in favor of the bears cant last. The shrewd bears know this, that a rally is emanate.
        All those short bets making money is not in favor of the establishment. IMVHO

      • On December 15, 2013 at 10:31 am,
        Big Al says:

        I have to say Reverend that I agree but today nothing makes any sense at least from a fundamental standpoint!

  22. On December 14, 2013 at 4:46 pm,
    Joseph says:

    Word of the Day: Obamatory

    • On December 15, 2013 at 10:26 am,
      Big Al says:

      Is that like “inflammatory”?

      • On December 15, 2013 at 2:07 pm,
        Joseph says:

        More like “laboratory”

  23. On December 14, 2013 at 8:16 pm,
    ray colella says:

    I agree.

  24. On December 15, 2013 at 11:02 am,
    HEAVYHITTER says:

    Everyone should take a look at the new TPP TRANS-PACIFIC PARTNERSHIP. America has major problems as this bill is soon to be passed.

    • On December 15, 2013 at 1:01 pm,
      al korelin says:

      Thanks Heavy

      • On February 2, 2014 at 2:37 pm,
        Juan says:

        I feel so much happier now I unstdreand all this. Thanks!

  25. On December 15, 2013 at 11:03 am,
    Billy says:

    HH: good luck man. I take my cue from a world class investor.
    “You have to shake the trees until the diehard bulls are no more. The fact that more and more people are now joining the bearish side is indicative of how the thinking process flips – a cycle inversion in a way. At the top in a bull market, you cannot find a bearish voice. People talk about new plateaus and the high will move exponentially higher. That is the fuel for the crash for it is never a short, it is the lack of shorts who support markets in a decline. When everyone is long and they start to sell, you get the major downdrafts because there are no bids. At the low, everyone is bearish and shorts abound. That in turn is the fuel for the reversal to the upside. The classic short-cover out of the hole, So we need the majority of analysts to now turn bearish at last. They will begin to call for $600 gold soon. We need this type of bearishness to build in order for the low to take place.”

    • On December 15, 2013 at 11:25 am,
      HEAVYHITTER says:

      Cant argue with you Billy. Certainly can happen and it might. Still my view is the same a bear market rally will ensue if nothing else. The bear view is long in the tooth. Markets dont go straight down. Lets ses what happens when we are at year end. I DONT WANT EGG ON MY FACE BUT ITS POSSIBLE. IMVHO

  26. On December 15, 2013 at 11:16 am,
    HEAVYHITTER says:

    TPP IS A COMPLETE FORIEGN TAKE OVER OF AMERICA. Its beyond belief what this means. ITS THE END OF AMERICA. This exactly what a nation gets going into debt it can never payback. The dollar collapse is getting close now.

    • On December 15, 2013 at 11:32 am,
      Billy says:

      Good points. China’s buying everything up….Just want to make sure we see the washout for a load up. Bear market rally is possible….

  27. On December 15, 2013 at 11:34 am,
    Billy says:
  28. On December 15, 2013 at 11:56 am,
    HEAVYHITTER says:

    Hey Billy, that is a great concern…the wash out. Im in the mining shares so gold could make further declines while the shares hold….very little weakness or rally.

    I THINK MINING SHARES HAVE ALREADY SEEN THE WORST WITH MAYBE 10 MORE PERCENT. IMVHO

    Gold is wsy over sold too. But it could get worse. I think 1200 is about it. If goes below that then we must be on our way to 1150. IMVHO

  29. On December 15, 2013 at 12:23 pm,
    Billy says:

    I’m not going to argue!
    Here’s a decent view that agrees with you…http://www.cknw.com/money-talks/
    Dec 14 1hr show 12mins in…

  30. On December 15, 2013 at 2:39 pm,
    HEAVYHITTER says:

    Thanks Billy……listeningto it now but really for me to take on huge positions the more everyone disagrees with me the better. I DO NOT LIKE COMPANY

  31. On December 15, 2013 at 3:13 pm,
    HEAVYHITTER says:

    Billy….Don the tech. Anaylist is excellent. Good job. I might join his services. No snake oil far as I can tell. Thanks a million !

  32. On December 15, 2013 at 3:26 pm,
    Billy says:

    You and I….are talking the same. I actually sold $250,000 of G coins recently not because I don’t like gold…Its because in the next few years we should get some serious leverage from pounded PM stocks….RIO.TO for instance I bought at .50 and sold at $4.50. Its cheap again and solid runner I think…Your right I think on that they have been flushed and If or bull returns 10 fold is doable.

  33. On December 15, 2013 at 3:35 pm,
    Billy says:

    Dons may just be right as rain. As we know news is built in to the markets. I’m seeing stupid on the DOW and can get a lot more stupid…. BUT The TSX has JUST broken out and corrected back to the breakout. I’d rather be buying cheap…. http://stockcharts.com/h-sc/ui?s=$TSX&p=D&yr=2&mn=4&dy=0&id=p04511750172&a=327349449&listNum=1
    Also I was Tracking the CRB that broke a huge uptrend that just rallied back above it..

  34. On December 15, 2013 at 5:05 pm,
    HEAVYHITTER says:

    Billy..have you considered NUGT ? Pure levrerage and no options to expire. Take that 250 you will have 5 mil. If gold hits say 1700. Im pouring the rest of my funds next week. Fidelity gives me 50 % margin on NUGT. No where can you get that. For example 100k NUGT is 3 times appreciation as GDX. Now with Fidelity you have maybe 4.5 times appreciation. No risk on individual stocks and no options to expire. IT HIGHLY DANGEROUS BECAUSE IF THINGS GOT REAL BAD YOU COULD LOSE IT ALL. Buy NUGT …no margin and even thats dangerous if the market goes real bad. BUT ITS AN EXCELLENT BET….and dont trade in and out. IMVHO

    • On December 15, 2013 at 5:54 pm,
      Billy says:

      I think the stocks have enough leverage…Just have to pick solid CO.s. I know all about NUGT. HGU.TO is 2x. I watched a rock solid manager kill himself on natural gas way back and the leveraged funds went from 1000$ to 1$. And this was a very good manager.. top in Canada. Ill buy companies when the time is right…I’d be surprised if I don’t know every fund out there. I bought in 1999 $150k and went to $3mil…AND I realize I know nothing…welcome to the market scam.

  35. On December 15, 2013 at 6:04 pm,
    Billy says:

    Sold a brilliant business that would be worth 6 mil today. Tax efficiency and righ-offs benefits are the best…Markets suck in the biggest way. Pissed at my self…But I’m swinging a machete and I don’t care if heads roll. You want to win or get shit kicked…

  36. On December 15, 2013 at 6:24 pm,
    HEAVYHITTER says:

    Dont be upset at yourself Billy. Learning respect for the markets is with experience. Heres some sound advise if you do make a fortune. DO NOT GO OUT AND TREAT YOURSELF. Like buying very expensive cars and homes. You have to keep your morals and not get caught up in the dog and pony show out there. If the money and wealth is all about our pride…look at me….thats when failure comes. PRIDE GOETH JUST BEFORE THE FALL.

    • On December 15, 2013 at 9:47 pm,
      Billy says:

      No worries Bra. Shit happens. Watch who you listen too and my ears have become very acute the last 15 y. I’v e got he lessons. On average you will never beat the market.. Commercial Real will stick for life. There’s a lot of dreamers and schemers here. Lets just be real….trading yourself to real wealth is pretty much a laugh. I could write a book but Im to lazy..If I pace the dough just right and bail just right milllions are ahead!! 3 mil is the poor house today….for real…

    • On December 16, 2013 at 2:30 am,
      Andrew de Berry (Rev) says:

      Brilliant HEAVYHITTER. We can have our ‘pride’ or Ego for motivating us. But it can also be our most deadly foe! When I was young I came into some money and went straight out and bought a decent second hand Jag. Of course I was a poseur, but for a while I needed the car to prove something for my earlier sense of inferiority/poverty. Sorry I’m waffling here, but when maturity kicks in we all get to know that of itself money never buys happiness.

  37. On December 16, 2013 at 4:55 am,
    HEAVYHITTER says:

    Amen….Rev. WE NEED TO BE MUCH MORE CONCERNED WHERE WE END UP FOR ALL OF ETERNITY. Off subject but everything here is temporary. However in closing the greed is what puts peoples lifes in ruins. Its never enough and they do fall hard one day. WARREN BUFFET DOES NOT LET THE WEALTH GO TO HIS HEAD. Once it goes to your head ..ego kicks in…..YOUR DOOMED TO LOSE IT. Odds are very high too. IMVHO

  38. On December 16, 2013 at 5:16 am,
    HEAVYHITTER says:

    The story is told if the person who has their necessities already met and the new found wealth is a life changing experience to a much larger degree….NOT RIGHT AWAY BUT THEIR LIVES MOST LIKELY END UP IN RUINS WITHIN 5 YEARS. Odds are 80 to 90 percent.

    SUBJECT CLOSED

    • On December 16, 2013 at 7:29 am,
      Andrew de Berry (Rev) says:

      Again, spot on HH!

      • On December 16, 2013 at 8:05 am,
        HEAVYHITTER says:

        THANK YOU ….REV. I know I wanted to close the subject because its not fair to the forum but …..WITHIN 10 YEARS A 100% OF THOSE TYPES OF PEOPLE HAVE LOST IT ALL.

        If just one person here gets the message has saved that person from the coming ruins of greed and money. If we dont humble ourselves, mother nature will do it for us.

  39. On December 16, 2013 at 9:33 am,
    Billy says:

    Good stuff HH!!

  40. On December 16, 2013 at 9:38 am,
    HEAVYHITTER says:

    Billy, I have watch myself becsuse if we dont stay disaplined and fall for all these destructive wants and desires…..we deserve whats coming to us. UNFORTUNATELY !

  41. On December 16, 2013 at 9:39 am,
    Billy says:

    HH: Ive made a lot of $s and I still drive a 1990 740 Volvo. Showing flash to me is foolish….

  42. On December 16, 2013 at 9:56 am,
    HEAVYHITTER says:

    When you make the fortune again keep your perspective with your knowledge and wisdom .Dont get greedy take your money and run. BE HAPPY WITH IT !

  43. On December 16, 2013 at 10:04 am,
    HEAVYHITTER says:

    When you flash you become a target everything and anything. LITIGATION POPS UP OUT OF NOWHERE….everyone wants a piece of you.

  44. On December 16, 2013 at 10:45 am,
    Billy says:

    Nothing to do with greed for me..Thats exactly what I do. I sold my business and HAD a hot shot broker. Also was tight with Sprott guys. They all fell off the apple cart and got expensive. I’m still 7 figures not including my real estate free and clear. Its bairly enough to survive in this country!

  45. On December 16, 2013 at 1:17 pm,
    HEAVYHITTER says:

    Sorry Billy….doing the math it doesnt add up. Its the conflicting statements. No greed but having seems reasonable assets that you do have but not content.

    • On December 16, 2013 at 1:36 pm,
      Billy says:

      You invest to make money period. For safety and quality of life..You can call anyone out there greedy…Whats the definition by your standard? The goal post moves for each individual. Warn Buffet should hang it up then? Have ya seen his last years salary?

  46. On December 16, 2013 at 1:28 pm,
    Billy says:

    HH: Was just thinking. NUGT is a real scary vehicle. A derivative product and in a real meltdown it could vanish…You would be better off to buy 5 companies that have good solid prospects. They have a shot at being 10 baggers anyhow. Take delivery of the certs and then your as safe as one can get…

  47. On December 16, 2013 at 1:55 pm,
    Billy says:

    Here’s what greedy is; Bloated Govs that produce nothing and tax me 40% and that’s just income. There 100 other taxes. 6% of the Billy’s pay for 55% of the non productive population. The system is full of leaches… Bankers that have $1000 lunches because they get the bailouts and the backdoor deals. I could go on for hrs but a waist of time…
    HH: Your off base mate….

  48. On December 16, 2013 at 3:43 pm,
    HEAVYHITTER says:

    Well…Billy I just dont see how living costs right now are that expensive. Unless you like ecpensive things. Im in the USA. I can live on 2300 a month and feel fine. I cook my own healthy meals because eating out for high quality is stupidly expensive. I am not your aversge breed of cat and dont waste any resources. . I have plenty to learn though. HUMBLE AND BEING HONEST WITH MYSELF AND OTHERS IS TOP PRIORITY. Thats all I can do and along the way keeping the peace. I changed my life where material things should not play a role in my life now. Its not worth it with all my great wealth I had no friends. Its very lonely at the top. LETS DROP IT AND MOVE ON. NUGT IS HIGH RISK and know about the perils. However Im not staying in it that long. Margin is not good either but NUGT is my choice.
    Taking your certs is wise but if nothing happens my account will far exceed your returns.
    NUGT will be leveraged and managed by me. At 4.5 times GDX maybe closer to 4 because once it goes up im not layering on anymore at higher prices. Still 20 times on your money not risking on penny golds and managing a bunch of juniors is better odds for success. IN MY VIEW

  49. On December 16, 2013 at 4:34 pm,
    Billy says:

    HH: A tear down house in Vancouver is a million bucks. I live up the coast and its gotten stupid expensive. We just visited family in Bellingham and we bring 2 coolers. Organic chicken here is $6 per LB. $2.20 down there….12 Beers $24 here you can get for .75cents at Costco and that’s Candian beer. Gas is down a bit but about $5.50 gallon. Hydro is going way up. To get in and out of town on the ferries is $200 return. 5 mouths to feed is $2000 per month and that’s all cook home. Lunch out for 2 is $45. Hell we went to Bob Burgs and Brews in USA and shared a meal we couldn’t finish and 4 pints for $28!!. The US is dirt cheap compared to here. We considered the US but its broke and about to do a lip stand. We all may? Check this out…my brother-in-law built a mansion 4400 sq and my 1975 barn 2400 sq is valued the same….Just got back from the plumbing store and a small hose and a fitting $22. Down there at Lowe’s $10 and when ya figure 35% income tax and 12% GST My lord!! I drive old cars guy oh ya and fix everything myself… ANYWHO….You have great points and I appreciate the feed back…I’m owning BGM.TO at .45c in a real bull market could see $10 share. Just today they drilled a 3oz per ton hole and the market yawned. Stocks are still weak and Id like to see this broken. http://stockcharts.com/h-sc/ui?s=$SILVER:$GOLD&p=D&yr=3&mn=2&dy=0&id=p67692360819&a=317942009&listNum=1
    At the end of the day their all risky..

  50. On December 16, 2013 at 5:30 pm,
    HEAVYHITTER says:

    I agree Billy ..Canada is socialist and the medical care is a failure. However, this gold trade is going to be a winner…I hope. Never any guarantees. The companies are good but its a hassle when you have GDX or NUGT for leverage you can use both too. I have made a lot of money in juniors but its a lot of work. NUGT and GDX or GDXJ is very liquid. This is so cheap right now NUGT its an easy 10 times. At this price though. Once it goes up…its no longer going to pay out 10 times. I feel 20 times is a good probability
    buying right now though. Leveraging it your talking 20 times probably easy and 30 on the higher end. WON’T TAKE LONG IF GOLD HITS 1700. Spring maybe and gold could be over 2000. Now your talking 50 times on the higher end. Its liquid too. These small stocks will be tough to get out of sometimes with millions. Lots of work selling the crap.
    I have major experience with all the buying and selling millions in equities in a day.
    You want liquidity. Push your bUtton and your out. DONE !!!! You got millions in your account in seconds and take your money and run…..SHOW IS OVER !!!

    I’m buying corn here soon as well. I’m also a futures trader. Right now though this gold trade is what I’m focused on and its better than being in gold futures. BESIDES THE GOLD MINING CO’S ARE MUCH MORE UNDERVALUED THAN GOLD ITSELF.

    HOPE THIS HELPS…KEEP YOUR EYE ON THE BALL AND HAVE NO FEAR…ITS CHEAP.

  51. On December 16, 2013 at 5:46 pm,
    HEAVYHITTER says:

    One more thing if the derivatives market melts down thats Armageddon. No one will have a life here on planet earth. ITS COMING BUT NO ONE KNOWS WHEN.

    PHYSICAL GOLD WILL BE RENDERED USELESS TOO. IMVHO

    • On December 16, 2013 at 7:18 pm,
      Billy says:

      I here ya on the work part!! I’ve got 15 companies now. 100K Shares BGM alone so I may take your advice on some NUGT. Not so sure if this is the bottom…This puppy goes down hard if we move south so I want to be sure. THANKS

  52. On December 17, 2013 at 1:00 am,
    HEAVYHITTER says:

    Elliott wave count breaks 1205 going to 1180. Breaks 1267 we might be off to the races. IMVHO…..The snake oil is not bad with this anaylist. You are making good good decisions because we never know for sure with positions all ready piled on. So myself have not gone all the way in. If we do go down I have a whole bunch of dry powder. So dont want to be early putting that capitol to work if we get a huge waterfall decline. Also this is dangerous waiting too long. When prices rise it gets away fast. RIGHT NOW IS CRITICAL TIME for that huge return we were talking about if this is the very bottom. Especially NUGT…IT SHOOTS UP FAST AND HARD TO CATCH.

    • On December 17, 2013 at 10:20 am,
      Billy says:

      Too soon I think…Most stocks are performing terribly in the wake of the small failed rally we had.
      http://armstrongeconomics.com/2013/12/17/market-updates/

      • On December 17, 2013 at 11:34 am,
        HEAVYHITTER says:

        I have not poured anymore in. I might do 30 30 and then the rest all on declines. ALL DEPENDS IF THEY GET REALLY CLOBBERED THEN IM ALL IN.

        • On December 17, 2013 at 12:21 pm,
          Billy says:

          Ya too wishy washy I think….Need some real fear to buy.

          • On December 17, 2013 at 12:56 pm,
            HEAVYHITTER says:

            I have to agree. Lets get it over with. BRING IT

        • On February 3, 2014 at 12:49 pm,
          Caroline says:

          Right onh-its helped me sort things right out.

  53. On December 17, 2013 at 7:20 am,
    Matthew says:

    Today, True Gold (TGM.V) just announced a Positive Feasibility Study for their Karma Project. Note that even at $1,000 gold, the IRR is a very healthy 21.3% (and 43.1% at $1250).
    If any management team can achieve their $5B-$10B valuation objective in 5 years, it is this one. Even if the share count doubles in that time, TGM would still deliver a 25 to 50 fold return if they deliver.
    http://finance.yahoo.com/news/true-gold-announces-positive-feasibility-111500766.html
    Thought you might be interested in the huge potential this situation offers.

    Disclosure: I have owned/traded TGM since 2009 (when it was still RVS) and am long now.

    True Gold Announces Positive Feasibility Study for Karma Project