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research24
2nd December 2008, 21:05
I find Sinclair's writing to be obtuse and often incomprehensible. Anyone else feel this way?

cdavport
2nd December 2008, 22:39
I find Sinclair's writing to be obtuse and often incomprehensible. Anyone else feel this way?

Funny you should mention it, I made the same mental note tonight as I was reading his daily post. However, I still get the feeling he knows what he is talking about, even if I can't always understand his cryptic comments.

Right or wrong, you won't find many writers that are more confident in their positions than he is.

SkinnerVic
2nd December 2008, 22:47
I highly respect his work, but it's akin to mental puking on paper at times.

skijake
3rd December 2008, 03:07
Brash, defiant, indispensible. It's an Irish thing! ;)
For me it is a daily read. He and his cohorts are way ahead of the curve.

research24
3rd December 2008, 13:17
I raised the question because he's starting to sound like just another gold bug that is perpetually wrong and incapable of adjusting his opinion to real events.

For example, the dollar. There is a $600 trillion world wide unwind in CDS ahead. That means the $$ is going to stay strong for quite some time, could be a year or more. Yet he insists gold to $1650 by January. I see zero chance of that, yet he is adamant. Starting to doubt his judgement.

ascentient
3rd December 2008, 13:23
Research24 - He insists gold to $1650 by January 2011, not 2009. Other than that, I do agree his responses and comments are a bit obtuse, but it's still on my daily reading list. :)

research24
3rd December 2008, 13:25
It was 2011? If so, I missed that. Sorry.

skijake
3rd December 2008, 13:37
I raised the question because he's starting to sound like just another gold bug that is perpetually wrong and incapable of adjusting his opinion to real events.

For example, the dollar. There is a $600 trillion world wide unwind in CDS ahead. That means the $$ is going to stay strong for quite some time, could be a year or more. Yet he insists gold to $1650 by January. I see zero chance of that, yet he is adamant. Starting to doubt his judgement.

I think you are just glossing over his comments if you don't pick up on the Jan 2011 price point he has laid out. 2011 not 2009! Anyway, we all read alot and I think we are trying to understand what is happening and what is going to happen. In any society in history, when you devalue the currency [coin clipping, lower metal content, paper printing] you have seen extreme turmoil. You see deflation[I think] others see hyper inflation. How it is possible to get back to 'normal' is beyond my comprehension. 600 trillion---that number is incomprehensible. Gold will be 400 or 1600 within 2 years, not 800 as today.

research24
3rd December 2008, 13:43
I read him daily, so I don't think I was glossing. He uses a variety of terms to tell us that the time has come; very insistent about that lately.

Were I him, I'd at least say, "never underestimate the power and determination of government so sustain itself." And never underestimate the Fed, either. Everyone who doesn't understand Fed monetary operations claims they are printing money like mad. So far, they are not, but will start soon, but I cannot see how they can get enough money in circulation to make up for the huge ongoing price deflation. See my "back door inflation post" for how I think it will happen and when.

skijake
3rd December 2008, 13:58
This is it, This is it now. Sounds like the the Titanic Movie.:p
I think he doesn't mince words but his style doesn't suit everyone. Anyway, we all prepare for some huge calamity that seems to be headed our way the best we can. I pick everybodies brain as much as possible and try to learn. So far I am glad he has his Web site and offers his service.

research24
3rd December 2008, 14:01
Here is his comment today: "The Comex will never default or be broken. It is simply impossible in a practical sense. The Comex in the final analysis will transmute to a cash gold exchange."

I couldn't agree more, but apparently no one else on this forum does.

skijake
3rd December 2008, 16:17
Here is his comment today: "The Comex will never default or be broken. It is simply impossible in a practical sense. The Comex in the final analysis will transmute to a cash gold exchange."

I couldn't agree more, but apparently no one else on this forum does.

We all know we are dealing with a Mafia like organization. Secretive , powerful, used to getting their way. We all want to see them go down but individually we don't have the power. If we can get some pressure on them you never know where they might crack. That's what gives us hope and we cheer any news that may lead to such an event. We already know our underdog status--spitting in the wind. The "dogs" will have their day! ;)

cfole
3rd December 2008, 16:37
I read him daily, so I don't think I was glossing. He uses a variety of terms to tell us that the time has come; very insistent about that lately.

Were I him, I'd at least say, "never underestimate the power and determination of government so sustain itself." And never underestimate the Fed, either. Everyone who doesn't understand Fed monetary operations claims they are printing money like mad. So far, they are not, but will start soon, but I cannot see how they can get enough money in circulation to make up for the huge ongoing price deflation. See my "back door inflation post" for how I think it will happen and when.

research:

I read recently that US money production for Nov. was at 58% annualized out to 395%. This is up from normal monthly production of 1-2%.

I realize it is not your job to teach but can you explain how this does not equate to the Fed printing money like mad?

Also, can you venture a guess as to what a $600 Trillion unwind looks like. The very concept is incomprehensible to me. I see no way to do it. Unless public default and collapse are options.

Argentum
3rd December 2008, 19:09
The gov will not let the Comex "fail" They will and can "change" it, support it, by "growing" it and any number of things that I'm could not even begin to dream of. Don't you all listen when Ben and Paul tell us they will do ANYTHING to keep this economy's ball in the air???

Will this be good or bad for silver/gold? Who knows. BUT metal leaving the Comex, IMHO is not a bad thing.

research24
3rd December 2008, 20:50
research:

I read recently that US money production for Nov. was at 58% annualized out to 395%. This is up from normal monthly production of 1-2%.

Also, can you venture a guess as to what a $600 Trillion unwind looks like. The very concept is incomprehensible to me. I see no way to do it. Unless public default and collapse are options.

Where did you read that? Here's the deal, so far most of those huge numbers you hear about are simply loan guarantees - nothing actuated yet. Of the $1.2 tr increase in Fed balance sheet, half went out in loans that replaced wasted assets so that's a wash. Think of it this way, If you lost $100 and I loaned you $100 temporarily, does that increase the money supply? No, there's still $100 less because you lost it. Now, if none of these loans are repaid, that would be inflation since the Fed created new money to make those loans. IF the loans are paid back, the Fed would then extinguish that newly created money.

Next, the other half of the Fed loans $600 bn. is very short term loans, like 27-60 days. It gets repaid and extinguished.

Next, the TARP ($700bn) and the stimulus ($300 bn) and whatever ungodly amount given to Fanny and Fraudie and AIG, is all BORROWED. This is it comes from existing money stock and will reduce economic activity since its pulled out of the private sector, so its actually deflationary.

Fed purchase of trouble assets: these are potentially inflationary, although some of this is merely loan collateral and other outright purchases. If it turns out they are not worthless, then its inflationary. The amount is $257 bn.

Of the $7.2 or $8.5 trillion you hear bandied about so much, that is all systemic guarantees such as bank deposits, money market funds, etc.

Finally, $600 bn of direct long term loans to banks, which is nearly all of it (commonly called bailouts) has ended up deposited right back at the Fed as bank reserves since the Fed is now paying interest on them. As you can see, there is a lot of slight-of-hand going on at the Fed and they'd be very pleased to have you thinking they are inflating so you won't hoard your money.

I don't claim that there hasn't been any monetization, just that it hasn't been very much. You can get all the details from the Fed web site if you know how to interpret that stuff. Its laid out in more detail than you'd ever want to know (or have time for).

Lastly, if the Fed were seriously inflating, the stock markets would be doing much better than they are since they are the very first to react to new money, no? New bank credit to speculators is approximately zilch.

research24
3rd December 2008, 20:54
I'll answer the $600 trillion derivative unwind question separately.

It looks like the end of the world as it would mean a total financial collapse of world banking.

I asked an insider, "Why doesn't congress just pass a law (or executive order) invalidating all CDS?"

His answer, "Trillions of dollars of pension funds are involved."

mizou
3rd December 2008, 22:24
Where did you read that? Here's the deal, so far most of those huge numbers you hear about are simply loan guarantees - nothing actuated yet. Of the $1.2 tr increase in Fed balance sheet, half went out in loans that replaced wasted assets so that's a wash. .....

Next, the other half of the Fed loans $600 bn. is very short term loans, like 27-60 days. It gets repaid and extinguished.

This is where I get a bit lost as I haven't fully grasped the fractional reserve banking thing..
"Of the $1.2 tr increase in fed balance sheet" - Where does this 1.2 tr come from and once it goes into the system, won't the banks just be able to just X 10 that money (after some legal fractional accounting fiddles) and repay that portion of the loan ontime and then pump the rest 90% in the economy via the various tools available them or whatever methods they employ?? and will that then be the source of this excercise being inflationary?

OyPolloi
3rd December 2008, 23:38
This is where I get a bit lost as I haven't fully grasped the fractional reserve banking thing..
"Of the $1.2 tr increase in fed balance sheet" - Where does this 1.2 tr come from and once it goes into the system, won't the banks just be able to just X 10 that money (after some legal fractional accounting fiddles) and repay that portion of the loan ontime and then pump the rest 90% in the economy via the various tools available them or whatever methods they employ?? and will that then be the source of this excercise being inflationary?

The $1.2T is an additional debt obligation of the US gov't. It comes from selling more Treasuries.

The banks can't/won't loan it out because (i) they have massive liabilities that need to be paid off which eats up the money and (ii) they are deathly afraid to loan money to anyone or (especially) any other bank or company or hedge fund, since no one really knows who is insolvent.