where are the gold threads?

[Meadbh]

For the record: as one of the designated sourpusses of the forum, I own some gold.

Well, so far it's done better than my euro's... (I'm European)

I don't believe that I have much talent for market timing, but for now the lack of gold threads is reassuring me. I realise that I'm taking a risk, but it may help limit damage from currency problems and bank failures. I hope I'll be able to get out in time and switch to a buy and hold approach after stocks and real estate have been thoroughly thrashed overhere. A man can dream...

I also have some gold, but I got out of Euros a few years ago . Now I'm wondering whether I should go buy a few. Just for my visits to the old country/continent.

 

[samclem]

I also have some gold, but I got out of Euros a few years ago . Now I'm wondering whether I should go buy a few. Just for my visits to the old country/continent.

Wait a little longer and maybe you'll be able to buy some drachmas, deutchmarks, and guilders instead.

 

[haha]

Wait a little longer and maybe you'll be able to buy some drachmas, deutchmarks, and guilders instead.

Waiter, gimme me guilders, deutchmarks, and drachmas please, but hold the drachmas.

Ha

 

[Hamlet]

Certainly some adjustment has to be made for hedonics though.

Cars today cost quite a bit more than they used to, but they also last a ton longer.

In fact, most things have gotten a lot better over the years.

I realize that it is a difficult and subjective thing to measure, but I do think that the government should make some effort to do so.

We're also forgetting about hedonics. The way the government calculates it...

Say the price of a new fridge goes up 100% but the newer fridge is twice as energy efficient as the old, then the price increase in dollar terms is never counted in the CPI. I can see many instances where this kind of fuzzy math can pose as problematic.

 

[Texas Proud]

Agreed. Nobody disputes that monetary policy needs to be normalized and deficits need to be reduced. Nobody. The question is over timing.

The folks who have been forecasting a run on the dollar, hyperinflation, and a federal debt crisis have been advocating fiscal and monetary tightening for two years. But history has not borne out their apocalyptic forecasts. Instead of all the dread outcomes we've been promised, we see modest growth amid decelerating inflation. Against that backdrop it's hard to see how higher interest rates and fiscal austerity would have achieved anything but a deeper crisis. Someone please explain how this isn't true?

Don't get me wrong... I think things will balance out 'in the long run'.... the question is what kind of pain we will have before it does...

I will give two examples... the tax increases that Obama is putting into place to pay for the health care bill will probably come at the wrong time... but let's say it does not... well, we COULD have had those same exact tax increases to pay down our debt (both stated and unstated) and all the future promises we have already made that we can not pay for.... and we probably would be running a surplus for a number of year...

And as someone else said (don't know who... don't know in which thread)... but why do we follow Keynsian (sp?) economics and spend like crazy when we have a business downturn, but don't follow him when we are having a business spurt (you are supposed to run surpluses then to pay DOWN the debt you incurred on the last downturn)....

We will all see some major reductions on services in the future... because we will not be able to tax our way out of the problem that is occurring right now...

 

[Gone4Good]

Certainly some adjustment has to be made for hedonics though.

Or in the case where the oak in your fine dining table is gradually replaced with lesser woods. The price doesn't come down, but the quality does. That's inflation to me . . . and to the BLS too.

The BLS has done studies on this and shown that the hydonic adjustments have a modest upward bias on the index. Yup, that's right, upward. But of course the BLS can't be trusted because they are part of the conspiracy to manipulate inflation statistics.

I've found it is pointless to talk about this subject. Folks are convinced that CPI is massively manipulated. They have all kinds of stories and theories to back them up. No real evidence, mind you. This lack of evidence is "surprising" given the simplicity of checking the index against real independent data. But, as with the debate above, simply ignore the evidence if it interferes with a good story.

 

[IndependentlyPoor]

Or in the case where the oak in your fine dining table is gradually replaced with lesser woods. The price doesn't come down, but the quality does. That's inflation to me . . . and to the BLS too.

The BLS has done studies on this and shown that the hydonic adjustments have a modest upward bias on the index. Yup, that's right, upward. But of course the BLS can't be trusted because they are part of the conspiracy to manipulate inflation statistics.

I've found it is pointless to talk about this subject. Folks are convinced that CPI is massively manipulated. They have all kinds of stories and theories to back them up. No real evidence, mind you. This lack of evidence is "surprising" given the simplicity of checking the index against real independent data. But, as with the debate above, simply ignore the evidence if it interferes with a good story.

It would be really interesting to read an article explaining the hedonic adjustments. What adjustments have they made? Did they really substitute ground chuck for ribeye steak?

The problem seems impssible to me. Most folks would agree that machine made shoes are a fine substitute for handmade ones - in fact, we don't even think about it.

On the other hand, is agri-factory produced chicken a productivity increase similar to machine made shoes, or a loss in quality compared to free range chicken?

And what about things that didn't even exist until recently, home computers for example? There is something that went from nonexistent, to very expensive, then experienced dramatic price declines while at the same time saw huge increases in features and power.

 

[REWahoo]

It would be really interesting to read an article explaining the hedonic adjustments. What adjustments have they made? Did they really substitute ground chuck for ribeye steak?

The problem seems impssible to me. Most folks would agree that machine made shoes are a fine substitute for handmade ones - in fact, we don't even think about it.

On the other hand, is agri-factory produced chicken a productivity increase similar to machine made shoes, or a loss in quality compared to free range chicken?

And what about things that didn't even exist until recently, home computers for example? There is something that went from nonexistent, to very expensive, then experienced dramatic price declines while at the same time saw huge increases in features and power.

The CPI validity is one of the most often discussed topics around here. You can find links to threads discussing the hedonic adjustment controversy dating back to creation - of this forum, that is:

http://www.early-retirement.org/for...-index-cpi-and-its-validity-or-not-30742.html

 

[ultimo]

Some folks sign up on the forum and introduce themselves here following the suggestions found here.

Others do the online version of walking into a crowded room and start shouting...

That crowded room can be pretty dense, eh?

 

[ultimo]

so i breezed through the thread titles from 2010 - and didnt see anything about gold (or silver).

with the outrageous monetary inflation by the private company known as "the fed".....it is prudent to have some REAL money in your portfolio. real money, as defined by the constitution is gold and silver coins. the paper money printers have gone insane since their house of cards blew up in 2007/2008....see the trillion to europe for their latest escapade --

we are looking at a potential inflationary nightmare resembling..or worse than the late 70's. bonds will be CRUSHED. tips are a guaranteed loser...as they are tied to the bald-faced lie CPI.

imo there are only two places to hide from the insanity - precious metals and a distant second would be oil.

as soon as velocity picks up, the inflation monster will appear. you cannot game the laws of economics.

insane money printing = rising prices

if you are overweight bonds, now is a GREAT time to sell. you can buy them back after they take their lumps.

i'm waiting on double digit 30 yr treasuries.....to ride off into the sunset.

I stopped by this forum a few months ago saying something pretty similar and then found myself dealing with people who can best be described as often wrong but never in doubt.

 

[ultimo]

The CPI validity is one of the most often discussed topics around here. You can find links to threads discussing the hedonic adjustment controversy dating back to creation - of this forum, that is:

http://www.early-retirement.org/for...-index-cpi-and-its-validity-or-not-30742.html

Jeez, this is exactly where I dropped out of the forum the last time.

It's not about CPI. CPI is a symptom, not the disease.

 

[Texas Proud]

I stopped by this forum a few months ago saying something pretty similar and then found myself dealing with people who can best be described as often wrong but never in doubt.

For me.... there is just so much gold this and gold that that I can stand... I used to have a friend who would basically say the same thing as the OP... but back in the late 70s and during the whole 80s.... finally we stopped talking to each other....

If you want to put in some interesting posts in other threads... great.. I would like to get your opinion... but I would suggest that maybe the person who is often wrong but never in doubt is you....


Let's do an experiment.... where do YOU think gold prices will be in one year... we will come back and take a look at how good you did....

 

[Gumby]

A discussion of whether we are headed for a stretch of accelerated inflation is a legitimate discussion, as is a discussion of whether holding physical gold will help protect one's portfolio. We have had both discussions on here before and undoubtedly will again.

But the accompanying conspiracy theories about the Federal Reserve Board and the Supreme Court, and arguments about the long-settled constitutionality of paper money, add nothing and detract much from what are otherwise legitimately arguable positions.

I submit that if anyone wants to start either of the discussions I noted above, they do so in a sober and measured way. Ranting only ensures that no one will listen (and usually leads to moderator action at some point).

 

[haha]

It's the nature of a forum or any more or less cohesive group to suppress dissent. It doesn't matter that we are often wrong, wrong we don't mind.

Want we don't want to be is open to criticism.

For example, the "mention" of moderation above. How is it established that the Federal Reserve may not in fact be a main cause of our instability? I consider that Bernanke and even more Greenspan were and are legitimate targets for criticism. In fact, why does one have to estblish the legitimacy of criticism? Are't people grown up enough to evaluate arguments?

Anyone who looks to ER.org for advice about what to do with his/her money will be guaranteed of getting a board approved subset of academic and FA consensus.

That should work out spectacularly!

Ha

 

[REWahoo]

Translation: Don't stop the cheap entertainment!

 

[haha]

LOL I guess so.

 

[Gumby]

For example, the "mention" of moderation above. How is it established that the Federal Reserve may not in fact be a main cause of our instability?

That was just my observation that these type of threads almost inevitably deteriorate to ranting diatribes where everyone shouts and no one listens. Whether the Federal Reserve has taken, is taking or will take wise and/or proper action is a legitimate discussion. Even whether the Federal Reserve should exist at all could legitimately be discussed.

It is not the particular substance of any argument that is problematic, but the way it is presented. I have no particular dog in the fight, but it appears to me that opponents of the Fed have in past discussions been unable to present their views in a reasoned and restrained fashion. As a consequence, few people take them seriously.

 

[haha]

True enough I guess, as people who present these things are often true believers of one sort or another, or are the very least people with jammed social antennae that are not easily silenced or controlled.

But it is also true that in times past we in the US thought that there was a social and political value in allowing unpopular or aggressively presented opinions- not only because it is guaranteed to us, but because as a society we would on balance benefit from this intellectual and social freedom.

I know this forum is more like a privately owned mall than it is like a public space, and from time to time the moderators have reminded us of that. So I am not arguing that anything should be different, anymore than I would argue that a cat should be a dog. I am just wondering if a certain narrowness may not be the price?

Ha

 

[Gumby]

I think one can have deeply held convictions and still present a reasoned and reasonable argument that won't drive people off. For example, the Christian Coalition was so successful back in the 90's precisely because Ralph Reed came across as a reasonable guy, not some whacky religious fanatic.

 

[Purron]

True enough I guess, as people who present these things are often true believers of one sort or another, or are the very least people with jammed social antennae that are not easily silenced or controlled.

But it is also true that in times past we in the US thought that there was a social and political value in allowing unpopular or aggressively presented opinions- not only because it is guaranteed to us, but because as a society we would on balance benefit from this intellectual and social freedom.

I know this forum is more like a privately owned mall than it is like a public space, and from time to time the moderators have reminded us of that. So I am not arguing that anything should be different, anymore than I would argue that a cat should be a dog. I am just wondering if a certain narrowness may not be the price?

Ha

You bring up some interesting points Ha. It's easy for a forum like this to develop a certain type of "groupthink". Perhaps that's why it's good for someone to challenge us once in a while.

Here's a wiki article on groupthink: Groupthink - Wikipedia, the free encyclopedia

 

[brewer12345]

You bring up some interesting points Ha. It's easy for a forum like this to develop a certain type of "groupthink". Perhaps that's why it's good for someone to challenge us once in a while.

Here's a wiki article on groupthink: Groupthink - Wikipedia, the free encyclopedia

Stimulating chat over morning coffee is one thing. Unceremoniously pissing in the cornflakes is another.

 

[Gone4Good]

Meanwhile, on the hyperinflation front . . .

Coupon strippers declare inflation dead in zero coupon bond revival

The call for Strips, which started in 1985 after former Federal Reserve Chairman Paul Volcker broke the back of inflation, suggests growing bullishness toward the bond market after the Bank of America Merrill Lynch U.S. Treasury Master Index fell 3.7 percent in 2009. Yields on Treasury Inflation- Protected Securities show money managers expect the consumer price index to increase an average 1.94 annually next 10 years, down from 2.43 percent as recently as April 29.

 

[NW-Bound]

For me.... there is just so much gold this and gold that that I can stand... I used to have a friend who would basically say the same thing as the OP... but back in the late 70s and during the whole 80s.... finally we stopped talking to each other....

I have often told the story of how close friends of mine withdrew all their 401k, took a big tax hit to buy gold. This was in the late 80s, and there was no gold ETF then to buy in an IRA account, of course. They got hurt big time as the price of gold dropped, and then capitulated to buy stocks in the late 90s, just to see the market tanked.

I still talk to them. I would not rub salt into their wounds, and avoid bringing this matter up. That's how we remain friends.

 

[Texas Proud]

I have often told the story of how close friends of mine withdrew all their 401k, took a big tax hit to buy gold. This was in the late 80s, and there was no gold ETF then to buy in an IRA account, of course. They got hurt big time as the price of gold dropped, and then capitulated to buy stocks in the late 90s, just to see the market tanked.

I still talk to them. I would not rub salt into their wounds, and avoid bringing this matter up. That's how we remain friends.

It was other things that broke us up.... not the talk of gold...

BTW, he also was someone who was thinking about following some nut job who said that you did not have to file income tax returns if you never opened up a checking account and a few other items.... I can not remember the whole thing, but something to do with not being a citizen of the US, but living under the law of the sea or something... you were not a citizen of any country.... maybe this should go under that renounce your US citizenship thread...

But really, he knew of some guy who had not filed tax returns for over 20 years...

 

[Purron]

But really, he knew of some guy who had not filed tax returns for over 20 years...

This reminds me of the movie Off the Map. In this case, the family didn't need to file because their income was so low but an IRS agent came to audit them anyway. His life was changed.

Here's a description on Yahoo movies. I loved this movie.

Off the Map (2005) - Movie Info - Yahoo! Movies