Global financial system implosion begins

[Dr Jon]

Experts Agree: U.S. May Become A 'Simpsons' Episode And Need Platinum Coins Or IOUs

a $1 trillion coin, which would weigh more than 43 million pounds and occupy roughly 32,000 cubic foot (assuming about $1,600 a troy ounce of platinum)

If they actually used sensible-sized coins, do they actually have that much Platinum?
There's already squeezed / declining output from South Africa and this is a key component in catalytic converters AFAIK.


It's Official. Krugman Does Not Understand the Value of Money

But in grabbing this whacko platinum gimmick of overt monetization which typifies almost everything that is wrong about modern economics, and in stubbornly claiming that it can do no harm, while dismissing anyone who expresses concern as some economic Luddite, Krugman and too many others have shown the purblind ignorance of the ideologue who does not understand what is wrong, and why the people are becoming restless.

And they answer them with sophistry and derisive baby talk. No wonder that economics is a disgraced profession.

 

[gosub]

Experts Agree: U.S. May Become A 'Simpsons' Episode And Need Platinum Coins Or IOUs



If they actually used sensible-sized coins, do they actually have that much Platinum?
There's already squeezed / declining output from South Africa and this is a key component in catalytic converters AFAIK.

Don't get the need for that much platinium either, when the production cost of a coin gets anywhere near exceeding the value of of the coin they change the alloy composition to lower production costs.

 

[Frank Merton]

The idea as I get it is that the Secretary of the Treasury is restricted by law in the amount of money in gold or silver or even paper and other things he or she can create, but they wrote a special law regarding platinum and failed to include any limits -- they had medals and commemorative coins in mind and so the lawyers overlooked this.

So maybe they can mint a platinum coin, declare it to be worth a trillion or so dollars, then give this coin to the Fed so the treasury can borrow from the Fed on this coin as collateral.

 

[Frank Merton]

It strikes me as perfectly rational, by the way, although a little round about. Governments have been creating money ex nihilo for a long time. Indeed, even when you barter you in effect create money.

 

[laptop]

It does seem a rather elegant solution.

The Washington Post piece - or rather Wonkblog piece - says they'd have to "ship" the coin to the Treasury.

Hmmm...

* knits balaclavas *

 

[junglevip]

Had enough?

 

[Falcon]

It strikes me as perfectly rational, by the way, although a little round about. Governments have been creating money ex nihilo for a long time. Indeed, even when you barter you in effect create money.

This is not a true statement. "Money" is proxy for something of value in the real world. To extent that the quantity of money remains in proportion to the quantity of things of value in the real world, the money system retains its integrity. Each ex nihilo unit of money reduces the value of all money units until confidence in all money units collapses.

This is elementary money theory. The barter theory of money is one of those concepts that would have to be true for the ex nihilo theory to be true. Unfortunately, there are no societies in which the barter theory has ever, in practice, been observed.

Interesting, isn't it?

 

[phildwyer]

Indeed, even when you barter you in effect create money.

You create the distinction between use- and exchange-value, and hence the distinctions between essence and appearance, sign and referent, body and soul, that define all Western metaphysics, as soon as you barter.

But money comes later. Money is a symbol of value.

 

[phildwyer]

This is not a true statement. "Money" is proxy for something of value in the real world. To extent that the quantity of money remains in proportion to the quantity of things of value in the real world, the money system retains its integrity. Each ex nihilo unit of money reduces the value of all money units until confidence in all money units collapses.

Put another way: there is no longer any denying that money is a mere sign. As long as it is conceived as a referential sign, its status as sign poses no logical contradiction.

But once money mutates into a non-referential or a self-referential sign, as officially happened at Bretton Woods, the logical and ethical problems inherent in attributing determining power to money become clearer. Or should do so anyway.

It is interesting to note that this development within finance has been paralleled by analogous developments in politics, philosophy, natural science, linguistics, psychology, aesthetics, personal relations, medicine... in short throughout the totality of culture and society. In every area, representation becomes confused with, and eventually indistinguishable from, reality.

 

[junglevip]

http://www.independent.co.uk/news/u...ce-500m-bill-for-rbs-libor-fraud-8452959.html

MPs warn of public fury at size of fines for wrongdoing, most of which will go to US watchdogs

Whatever

 

[junglevip]

I think that mps should warn of ignorance and apathy

 

[Dr Jon]

I think it would have been much cheaper for the government to guarantee personal deposits, let the banks go bust and put the money-juggling parasites in jail like they did in Iceland.

 

[teqniq]

That would have required integrity and backbone neither of which they possess.

 

[Dr Jon]

AVERAGE bonus of £250k for 6,000 UK employees at Goldman Sachs
Money-juggling parasite vermin.


Cash em in for transplantable organs...

 

[ska invita]

It Begins: Bundesbank To Commence Repatriating Gold From New York Fed
http://www.zerohedge.com/news/2013-...sbank-commence-repatriating-gold-new-york-fed

 

[junglevip]

It Begins: Bundesbank To Commence Repatriating Gold From New York Fed
http://www.zerohedge.com/news/2013-...sbank-commence-repatriating-gold-new-york-fed

Do you reckon they still have it?

 

[gosub]

It Begins: Bundesbank To Commence Repatriating Gold From New York Fed
http://www.zerohedge.com/news/2013-...sbank-commence-repatriating-gold-new-york-fed

I wonder how much tungsten they get?

 

[ska invita]

Do you reckon they still have it?

wasnt there some thing about this that someone wanted to go and look at it and they made up some bullshit excuse about how the room was being cleaned or something? Sure i heard something along those lines

ETA: A bit about it here http://www.businessinsider.com/germany-wants-its-gold-back-2012-10

 

[ska invita]

Someone call Michael Caine up, this could be the job of millenium!!

 

[junglevip]

wasnt there some thing about this that someone wanted to go and look at it and they made up some bullshit excuse about how the room was being cleaned or something? Sure i heard something along those lines

ETA: A bit about it here http://www.businessinsider.com/germany-wants-its-gold-back-2012-10

The rumors are that it has all been loaned out or 'rehypothecated'

 

[ymu]

I wouldn't take Zero Hedge's take on it too seriously. They're Austrian gold standard obsessives. Business Insider are very unreliable also. AFAIK the 'missing gold' is a conspiracy theory.

*goes off to look for more sources*

 

[junglevip]

I wouldn't take Zero Hedge's take on it too seriously. They're Austrian gold standard obsessives. Business Insider are very unreliable also. AFAIK the 'missing gold' is a conspiracy theory.

*goes off to look for more sources*

Yep! The LIBOR thing is for tin foil hat wearer's n'all

 

[ymu]

OK, so this looks like a fairly straightforward report: http://www.cnbc.com/id/100382718

In short, there is some speculation that it marks a breakdown of trust between central banks, but there's no real evidence of that. US political shenanigans certainly provide a reason to repatriate more of the gold as a defence against craziness, but historically Germany has held very little of its own gold because of fear of attack from the East. They're keeping half of it in Frankfurt and the rest split between New York and London. They're leaving none of it in France because there is no longer any purpose to keeping it in France when they now share the same currency.

 

[ymu]

Yep! The LIBOR thing is for tin foil hat wearer's n'all

I find that hard to believe. Care to explain?

 

[ska invita]

I wouldn't take Zero Hedge's take on it too seriously. They're Austrian gold standard obsessives. Business Insider are very unreliable also. AFAIK the 'missing gold' is a conspiracy theory.

neither source say its missing though i dont think - Zero Hedge jsut reporting that the germans are asking for it back now.

 

[ymu]

If you read the first couple of paragraphs only, yes. The rest is a conspiranoid wank fantasy fetishising the gold standard.


It begins

 

[ska invita]

If you read the first couple of paragraphs only, yes. The rest is a conspiranoid wank fantasy fetishising the gold standard.


It begins

red handed (reading first two paras)! I thought the It Begins refers to them beginning taking the gold back - it was mooted last year IIRC

 

[ymu]

Not everything they publish is bullshit, but it's worth knowing that they're Austrians and firm believers in the gold standard. Hence, the desirability of checking other sources for serious analysis.

 

[ymu]

Just reminded myself of this handy reference: EconoTrolls: An Illustrated Bestiary

Austrians

"Cue hyperinflation in 5...4...3..."​

"With real money backed by real gold, America experienced the greatest boom in any nation's history. Things were great and the American people flourished."​

"No math needed. Read Rothbard. Economics (human action) is logic. Beautiful, simple logic."​

How they see themselves:​

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How the world sees them:​

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Favorite blog: Zero Hedge​

Favorite dead economists: Ludwig von Mises. Murray Rothbard​

Will appear in response to posts regarding: Monetary policy, the gold standard, gold, and possibly pyrite​

Craziest idea: That fractional reserve banking and fiat money are a conspiracy by the Rothschild family to take away people's freedom​

Special attack: Real money, backed by real gold​

Secret weakness: cannot withstand being subjected to intellectual contempt​

Notes: For more on this odd and often frightening species of troll, please consult the fieldwork of the intrepid naturalist J. Bradford DeLong...​

 

[Dr Jon]

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