August 27, 2008
Elaine Meinel Supkis
We get to bounce back and forwards in history as we try to figure out what is going on. The echos from 1930 is very strong indeed. Pensions are vanishing in England and the US. Japan is on a buying binge that has shot up 91% and they are buying up US systems. Once again, I explain how some gold bug or silver bug websites give very, very bad advice. Buyers, please beware! Ulrich, an accountant, sued the IRS and won. Over 100 lenders this year have been forced to fold their tents and go bankrupt. Housing prices are still down but not dropping like a rock. They are just dropping sort of like in 1930. People forget, the Great Depression was supposed to be very short and not all that painful. The banking system took 3 long years to collapse. We barely are entering the second year of this present collapse. We don't hit bottom for another 24 months or more! And ICE makes another mass arrest, setting records. Seems much of our industrial workforce has been displaced by illegal aliens.
First, a look at exactly one year ago.
Super-rich Brats Complain About Cheap Bernanke Santa
After deliriously rising on the news that the big housing developers managed to sell new houses last month without inquiring as to how they did this deed, the markets are now in danger of fainting away due to the very bad news that existing housing is collapsing in value and sales. And the happiness in Japan will also vanish as they contemplate the possibility their number one chumps, the US, will go under. And everyone wonders if the magician, Bernanke, can pull a hell hound out of his hat instead of a skunk.
*snip*
I'm angry that the goofs who run our media and our government both adamantly refuse to admit the big boom/bubble built by Greenspan in 2002 with his fake 1% interest rates has collapsed. It fell apart way back in late 2005, for crying out loud! The remaining sectors collapsed one by one over the last 2 years. As the Fed and the investing classes frantically built new financial structures or designed new hedges or new dikes and barriers, they all fell down. So now the bankers and the top officials running the world's economies...oh, leaving out China, of course....are all frantically trying to use backhoes and bulldozers pushing huge mountains, historically huge mountains of money in a frantic attempt to turn the tide.
Again, it pays to read past postings here. Older readers might remember this stuff. But even I forget what I wrote in the past. Must be getting old! Anyway, the accuracy of these postings is most satisfying. Now, on to the present. England and America are doing the same thing: reducing workers to third world status. This, the rulers imagine, will fix inflation and recapitalize their own bank accounts.
Time running out for final-salary schemes
Employers are rushing to close final-salary schemes to new members to escape the extra cost of their employees' increasing longevity.A record low of 17 per cent of British final-salary schemes are still open to new applicants, down from 28 per cent last year, according to research by Aon Consulting. In 2003 about half of final-salary pension schemes - which offer guaranteed pensions regardless of market movements - were still available to new employees.
Companies are moving away from final-salary schemes, also known as defined benefit schemes, because of tighter regulation, the present volatile market conditions that have depleted many pension schemes, people living longer and fears over future developments in accounting for pensions.
Across the entire 'First World' universe which is mainly the NATO countries, the US, Canada and Japan, are all dropping worker's wages, dropping pension funds and dropping all sorts of civilized things. Soon, workers get to return to the Victorian model universe of capitalism, red in tooth and claw. The systems are so underfunded and loaded down with debt, the only way to capitalize left is to destroy wages by undercutting the workforce. If everyone works real cheap and gets no retirement, this means more money will flow into offshore investment bank accounts where it can't be taxed! See, isn't that a glorious future for the first world nations' workforces?
Across this toxic, blasted landscape, the governments run lotteries. Winners get to live like kings. Everyone has an equal but one in a 20 million chance to strike it rich. Lady Luck gets to decide who lives in a McMansion or who dies in a cardboard box. This is highly popular with people. Everyone thinks, they will be the winner. So this supports unfair taxation that treats the poor like the rich: both get to pay the same percentage. But one gets to get richer while the other gets even poorer. This is why all third world system feature extremely rich people paying little to no taxes and a great mass of poor peasants who barely can stay alive! Why the US wants this baffles me. I suppose it is human nature: people hate democracy and sharing. They think, if only they can win the lottery, they can be the rulers, too! No lottery winner ever joins the ruling class, by the way. The winnings get frittered away. Seldom does it end up in some capitalist venture that makes the wealth grow. And all the rich rulers know that if you spoil the kids, they turn rotten.
Lottery winners tend to want to spoil their families. None of this stern, 'You better make it on your own before I give you a penny' stuff I grew up hearing. The fact is, even lottery winning peasants are basically socialists if they could confine this socialism to their own ethnic/religious group. It is the business of sharing it with rival groups that irritate so many. This is part of the 'fracturing empires' business: everyone wants to be king of the hill even if it is a mole hill or worse, a red ant hill.
Newmont's O'Brien Says Gold May Reach New Records in a Year
(Bloomberg) -- Newmont Mining Corp. Chief Executive Officer Richard T. O'Brien said gold prices ``probably'' will reach records in the next year as investors seek a buffer against accelerating inflation.Gold has declined 20 percent since credit market losses and a weak dollar drove the price to an all-time high of $1,033.90 an ounce in March. Investor interest in the metal may be revived as inflation reduces the value of other assets, O'Brien said yesterday in an interview from Denver, where the company is based. Newmont is the largest U.S. gold producer.
O'Brien's view that inflation will accelerate contradicts that of Federal Reserve Chairman Ben S. Bernanke, who said last week that price increases may slow later this year as oil declines and the dollar strengthens. Higher energy and food costs pushed consumer prices to the steepest gain in 17 years in the 12 months through July, government figures show.
One of the features of a true global economic meltdown is how nothing works. Absolutely nothing works. Everyone hopes for a pot of gold at the end of a rainbow. Everyone hopes to win the lottery. Everyone hopes to marry a rich heiress or sugar daddy. Everyone runs around, looking under the furniture or behind the sofa for spare change. Everyone prays that Santa Claus is real. I lost a number of readers when I suggested that gold is a mere commodity like so many others. Hell, paper money is now a commodity! And all of these are manipulated in surprising ways. Namely, a gaggle of wild investors are rushing from one life raft to another. As each one gets overloaded with a host of hedge funds, investors, pension funds, OPEC princes, etc.----it sinks! This is why all economic collapses feature not one but many multiple bubbles.
The bears and bulls wear themselves out by this constant thrashing about by all these frightened investors. This is part of the destruction of wealth process unleashed by the dire Goddesses. These beings are Lady Luck, Inflation and Depression. All of them are impossible to stop. Only when they are done and Libra rises up from Her starry throne, do these three Gorgons return to their Isle of the Setting Sun. Libra picks up the pieces and restarts the systems. Sometimes, it takes humans a thousand years to work out how to do things again. Money vanishes. And is totally gone. This is a very real possibility in our futures: if we experiment with WWIII nuclear hell, this will happen again. Several times, the ability to read and write, do numbers greater than a dozen, to do simple civilized tasks, collapses.
Gold might go up. But this is predicated on people having paper money with which to buy gold. I don't see too many people using gold to buy cars, for example. It has to be translated into paper money. The FX markets were sold to gullible savers as a guaranteed market for increasing the value of one's savings, for example. This, too, has been thrashing about and destroying wealth just like everything else. I look around and see fewer and fewer systems capable of an easy return.
Oil, by the way, has ceased declining. It is bouncing about at the $111-120 range. Ditto, gold has stabilized. If the world economy continues to shrink and I expect it to shrink, both will stay at this level or decline, too. The inflation/deflation whipsaw will continue to ravage various markets. Just like it did in the 1930s.
Two-Cent Pennies: a Window on Inflation
Johnny Carson might have quipped about the economy, "Inflation is so bad these days… that pennies are now selling on the street for two cents."This joke may not be all that funny, even with the great Carnac delivering it, but it does have the underpinnings of good comedy: an absurd story based on a kernel of truth.
Old pennies are routinely traded at premium prices, sometimes twice or more their face value. This is not because they are rare or precious — they were minted by the tens of billions — but simply because they are worth more as metal than as money.
Because of this "bullion premium" on the older pennies, a small cadre of penny hoarders is actively searching through America's stock of pennies to pick out these undervalued coins.
Casual observers are not struck with a deep sense of economic import when they learn about penny hoarding. Neither are most economists. The government dealt with the problem by simply making the coin out of a much cheaper metal: zinc. So what's the big deal?
The government would LOVE to get rid of the penny. This is a fancy way of saying, 'Let's get rid of one of the zeros'. Zeros have this habit of going to infinity. So if we whack them off at the lower end, all will be well, eh? As a penny pincher, I always get a good grip on my pennies. And they do count. And accumulate. Buy ten items at 99¢ @, we get 10¢ in savings. This is one tenth a dollar. The US can't keep up the fiction of having any hard currencies if we let inflation roar out of control. Most nations solve this by dissolving their currency values totally and starting all over again. The Germans did this in an epic way and are very nervous about repeating this. South American southern European nations do this like clockwork and shrug it off. But now, the southern Europeans are being trapped in the paranoid German system. Heh. They hate it.
Amateur Hour in the Precious Metals Markets
Richard J. Greene
When investors saw gold get bashed after the Fannie Mae debacle it was the last straw. They came to the conclusion that there is nothing that can happen that will make gold work. While this is understandable it is also very regrettable because the very forces that caused this to occur are probably the same that are sitting back with bids under the market price to accumulate at giveaway prices. The commercial shorts on the COMEX can now have a field day covering their massive short positions. It is time for investors to hold tight and add to their positions and to speak out against the interventions. As Ed Steer of the GATA clan has said, ‘there are no markets now, only interventions”. If you are willing to give up your only protection in the face of this you are announcing your willingness to be a slave and you will eventually be a slave.Silver has dropped over 40% from its highs just before Bear Stearns went belly up while the average listed silver stock is down 51%. There are many silver stocks with just sparkling earnings reports including one that is growing over 40% and trading at less than three times earnings and very few people would be able to name that stock. Investors in today’s markets know only one thing: that a stock that they know by name only has broken some chart level that they consider means this company is automatically tossed on to their junk heap. Throw out your charts and step up to buy companies growing 20-60% that are absolute jewels. There are only two ways to invest in this market to avoid this constant smashing. Build a big position in physical gold and silver and if you do not want to arrange to store it do not trust the ETFs. Quality gold and silver stocks are a different investment than physical gold and silver but they provide some security most investors don’t appreciate. The metal investment is secure because it is still in the ground, especially if the drill results are high quality by reputable firms.
Look, many of the gold and silver bug sites are filled with some very strange insects. Assuring readers that the gold is safer because it is not being mined is total hogwash. Mines are NOTORIOUS for being uncertain. Politically as well as geologically uncertain. The ONLY way to deal with gold or silver is the third world method: you wear it and carry a gun. If you put it in a safe, you have to have a secure fortress to protect it. This means family members and big dogs you can trust. And it has to be hidden very, very carefully. Throughout history, the method used the most was to bury it in the ground. Then, when the holder is killed or dies, no one can find it and it is found thousands of years later by strangers. Oops.
We have to be reasonable: if the three goddesses who rule our fates are determined to zero down wealth, they will. No matter what we do. We can survive not by hoarding anything or doing something strange. Oddly enough, the best route is the Libra one: build a strong family, take care of the family. Join with neighbors in group projects. Keep a wary eye on the weather and on the schemes of rivals. And stay out of debt as much as possible. This means living within one's means. This also means finding new ways to be capitalists.
Lone accountant takes on IRS and wins
It took seven years, but Charles Ulrich did something many people dream about, but few succeed at: He beat the IRS in a tax dispute. Not only that, but tax experts say potentially millions of other taxpayers could benefit from his victory. The accountant from Baxter, Minn., challenged the method the IRS has used for more than 20 years to tax shares and cash distributed by mutual life insurance firms to their policyholders when they reorganize as public companies.A federal court recently agreed with his interpretation.
Good for Mr. Ulrich. This is how we fight back. Taxes are a complicated mess. Every time they are simplified, they are made complex very rapidly as a hoard of lobbyists go to work. And the politicians create more and more tax loopholes. We hold shares in a mutual fund life insurance business. And yes, they go private so the executives can line their own pockets. Generally, these deals make little or negative sense for the share holders. Who are bullied around by the executives who are really executioners seeking to slay the golden goose so they can grab an egg.
CF Industries (nyse: CF - news - people ) is in the headlines, as news breaks that the company is going to be added to the S&P 500 list after the close of trading on a date yet to be announced. We have highlighted the company in the past as one of the leading ways to play the fertilizer boom.CF Industries had been a solid performer up until early August. We removed the shares from our "recommended" list on Aug. 8, at the $140 level. The stock is currently trading at the $145 level, but our concern is that momentum investors have dominated trading in the agriculture/fertilizer names.
Like at the beginning of the Great Depression, transportation of goods is collapsing. Just like housing. This is a bad sign. Flooding the US with Mexican trucks won't fix this. It will drive down prices even more and cause even more fury in the hinterlands. And both parties will exploit this rage if they can. Except they don't dare do the Hitler thing. Which means someone will come out of the dark and do it.
Home Prices Fell at Record Pace in June
Home prices fell a record annual 15.9 percent in June, but the monthly rate of decline slowed from May which suggested the decimated housing sector may be stabilizing, according to Standard & Poor's on Tuesday."While there is no national turnaround in residential real estate prices, it is possible that we are seeing some regions struggling to come back, which has resulted in some moderation in price declines at the national level," said David Blitzer, chairman of the index committee at S&P, in a statement.
The S&P/Case-Shiller composite index of 20 metropolitan areas slipped 0.5 percent in June from May, bringing the measure down 15.9 percent from June 2007.
The month-over-month drop in the 20-city index was the smallest since July 2007.
The good news? They really think prices are nearly done dropping and will take off if only someone drops the interest rate to 1% again. This is too sad.
ICE: Nearly 600 detained in Mississippi plant raid
The largest single-workplace immigration raid in U.S. history has caused panic among Hispanic families in this small southern Mississippi town, where federal agents rounded up nearly 600 plant workers suspected of being in the country illegally.One worker caught in Monday's sweep at the Howard Industries transformer plant said fellow workers applauded as immigrants were taken into custody. Federal officials said a tip from a union member prompted them to start investigating several years ago.
*snip*
Those detained were from Brazil, El Salvador, Germany, Guatemala, Honduras, Mexico, Panama, and Peru, said Barbara Gonzalez, an ICE spokeswoman.
From housing to trucking, in nearly every factory, insidiously, illegal workers poured in and drove down wages. If this wasn't happening, even more manufacturing would have moved offshore. This is why I push relentlessly for tariffs and barriers! Geeze! The ruling elites loved this flood of semi-slaves. These people were outside the system and therefore, easier to exploit. They never complained. They didn't hang around to become annoying retirees demanding services. They can't vote! As the ICE goes from factory to farm, the numbers of these people is most astonishing. It should have never been allowed and the US was quite capable of preventing this. But refused because this was a major component of the 'stop inflation' business. Cutting wages is the #1 way of stopping inflation. It is also the best way to make a depression.
If no one takes charge of this mess, we will definitely see some vicious person going about the poorer parts of the US, raising cain. And it is now nearly inevitable. Someone waving a gun and yelling, 'Let's go get them!' will be immensely popular if we go into a depression. Inspiring ethnic warfare will be all the rage. The liberals agitating for Tibet to be 'free' should look more closely at what they are advocating. For this is logically, support for ethnic warfare. And even more so: Jewish support for Israel, one of the more vicious ethnic cleansing states on earth.
Japan Goes on Buying Spree, Shrugging Off '80s Bubble
(Bloomberg) -- Japanese companies are increasing overseas acquisitions, using their cash-hoards to snap up assets beaten down by the global credit crisis and economic slowdown.The value of foreign purchases by Japanese companies this year has already topped 2007's total by 91 percent, according to data compiled by Bloomberg. That's the biggest gain among the world's 10 largest markets and contrasts with fewer deals in the U.S. and U.K., where credit is drying up after the subprime rout.
I have hammered away at this topic for several years. Japan has NOT been in a depression at all. Japan's workers are being repressed. This is different from a depression. Depressions hit banks, businesses, etc. Japan's businesses at the top are roaring ahead. They had more growth this last 8 years than in their entire history. Japan is a RIVAL. And is working on her own behalf as all rivals are prone to do. Instead of reacting to this, the US has rolled over, dead. We cannot be allowed to understand this. Israel's economy is growing like gangbusters. And so has Japan's export markets. Both have huge surpluses with the US. Both use the US for their own ends. Both are buying out the US. And both are 'untouchable'. As we go broke, they come in with checkbooks and buy us out. This is NOT A GOOD THING. IT HAS TO BE STOPPED.
Again, any patriotic person who can rise up and get the masses agitated will be an unstoppable force. The idea that we should be looking after America is one most people find nearly impossible to conceive. Anyone who does is called a 'xenophobe' and told to shut up. This business is very strongly connected to racism, ethnic cleansing and other ugly forces...but then look at Israel and Japan! Both have extraordinary immigration hurdles. Only people who are specifically of one ethnic/religious affiliation BY BLOOD are allowed to gain citizenship in either racist state. Both are very firmly attached to the US. Which is a multi-ethnic/religious state in grave danger of collapse. The US cannot sit idle while these nations move in to secure our mutual wealth systems. Any more than we should be idle when rival empires throw a net of debts over us.
The people in our government who are enabling and allowing this are traitors. The media that lies about this, ditto. This is why we have this very strange and unpleasant election. People praying to be saved while not being saved at all. Otherwise, we would be hearing talk about illegal immigrants undermining US workers or the debt load held by foreign rivals.
ONGC Agrees to Buy Imperial Energy for $2.58 Billion
(Bloomberg) -- Oil & Natural Gas Corp., India's biggest exploration company, agreed to buy Imperial Energy Plc for 1.4 billion pounds ($2.58 billion) to tap Siberian deposits and make up for dwindling output at home.The cash offer of 1,250 pence a share is 61.9 percent more than Imperial Energy's stock price on July 11, the day before the London-based company said it received a bid, according to a statement distributed by Regulatory News Service. China Petroleum & Chemical Corp. indicated today it may bid for Imperial Energy.
India and China are busy buying up commodity distribution systems. The dead British Empire is holding a fire sale. There isn't much left. Most industry has been already sold or removed. We are on the same trajectory.
Carteret Mortgage Will Close, Chief Executive Says
(Bloomberg) -- Carteret Mortgage Corp., a closely held mortgage broker that originated more than $4 billion in loans in 2006, plans to close in several weeks, said Chief Executive Officer Eric Weinstein.``We ran out of money,'' Weinstein, 49, said in an interview today. ``We're not technically out of business yet, but we're winding it down and trying to do the best we can for everybody.''
More than 100 lenders have halted loans, closed or sold themselves over the past 18 months amid the worst housing market since the Great Depression. Weinstein said the Centreville, Virginia-based company has about 800 employees, including 40 at headquarters.
In 1930, there were still quite a few functional banks. Most people thought, the downturn was pretty much over. Hoover worked hard to stimulate the economy. So did the Fed, actually. But the global economy was collapsing due to this being the only way to cope with the massive WWI debts and reparations. Until this destruction of these debts was done, no one could do any business, really. It kept getting worse and worse each year. The US has taken on similar debts to pay for the Cold War. We are reacting to the collapse of our banking system by trying to restart the Cold War. I guess the thinking is, our trade rivals would then be scared into funding our wild spending. I fear, they are unable to do this or in the case of Japan, are openly hostile and using this as an opportunity to destroy the US economy and enslave the US public.
Here are some headline stories from exactly 78 years ago:
Aug. 18, 1930---- Bearish Britain
Gloomier than any other nation at present is Great Britain. Few bullish items appear any more in its financial papers; article after article tells of mysteriously shrunken profits, disgruntled shareholders, deep depression. Last week, although imports of gold from Brazil balanced the steady drain of British gold by France, Britain turned more bearish. Unemployment, steadily rising throughout Europe, passed the 2,000,000 mark in Great Britain last week, the worst since 1921. Further increase seemed certain.A new Nadir of outspoken pessimism was reached in a trade forecast issued last week by the British Electrical Manufacturers' Association. This potent group went on record as predicting the present trade depression will almost surely last through 1931, that any recovery in 1932 will be only temporary. The U. S.. said this forecast, will take longer to recover than in 1921, being retarded by too large a production capacity, overcapitalization of earning assets.
Aug. 18, 1930---- Drought Relief
President Hoover last week took up the kind of national problem with which he knows best how to deal. A drought,* worst since the Civil war, was upon the east and midwest (see p. 15). Husbandmen across a checkerboard of devastation faced immense crop and livestock losses. President Hoover could not bring rain, but he could and did organize relief agencies¶To President Hoover last week was sent a report by Commissioner of Indian Affairs Charles J. Rhoads on his Bureau's program "to make the Indian a self-sustaining, self-respecting American citizen." The Indian Bureau will "discourage the proclivity of the average Indian to participate in circuses, rodeos, Wild West shows and similar enterprises."
Aug. 18, 1930---B.&O.'s Portion
Last week B. & O. announced that, acting through the great railroad house of Kuhn, Loeb & Co., it had acquired control of C. & A. The total cost to B. & O. was estimated at $21,500,000 against the I. C. C.'s 1928 valuation of C. & A. at $75,000,000.
The deal was done entirely through the purchase of bonds, which carry voting control. Puzzling in the case was unusual strength in C. & A. stock issues early last week with both the common and preferred selling at 7¼, before dropping to 3⅞ (common) and 3 (preferred). Even the wary New York Times said flatly: "There will be nothing left for stockholders."
Aug. 11, 1930---- Wage Symposium
Widely quoted as a bearish argument have been recent wagecuts by such large companies as Chrysler Corp. and National Cash Register Co. (10% each last month). Last week Roy Dickinson, alert associate editor of Printers' Ink (22,645 circulation, advertising trade weekly) telegraphed a list of tycoons to learn what future wage reductions may be in store. Some of the replies which he received:James A. Farrell, president of the United States Steel Corp. (224,980 employes in 1929): "I heard a steel man say the other day, in fact more than one recently, that wages should come down. I said, 'Oh no, wages in the steel industry are not coming down; you can make up your mind to that fact. If you are going out to sell your goods and eliminate your profit and expect to get it out of the men in the mills you are greatly mistaken.' "
George Francis Johnson, president of Endicott Johnson Corp. (shoes, 17,000 employes): "Reduction of income of labor is not a remedy for business depression; it is a direct and contributing cause."
Richard S. Shainwald, president of Paraffine Companies, Inc.: "The Paraffine Companies, Inc. has made no reductions in personnel . . . nor has it made any wage cuts . . . believes such reductions can be and should be avoided."
Chesley Robert Palmer, president of Cluett, Peabody & Co. Inc. (5200 employes) : "A general reduction of wages and salaries at this time is entirely unwarranted."
Walter A. Sheaffer, president of W. A. Sheaffer Pen Co.: "Believe it would be a serious mistake."
Albert Russel Erskine, president of Studebaker Corp.: "Have not even considered reducing wages or salaries."
Charles Ruffin Hook, vice president of American Rolling Mill Co.: "Wage reductions would, in our opinion, retard and not stimulate business."
Albert C. Loring, president of Pillsbury Flour Mills Co.: "We have not contemplated any reduction in wages. . ."
Oh, god. Look at that! This last 8 years, all the media has trumpeted the collapse in wages as a GOOD thing. Our grandfathers knew better. All of the top employers were very anxious, one year after the Black Tuesday to reassure everyone, they are not going to depress wages and thus, deepen depression. Everyone whose wages dropped found themselves unable to pay for things and this made things worse. Well, today, the Fed and our government, our media, EVERYONE in power celebrates cutting wages! 'Inflation is DOWN!' they shout. Well, depression has been spreading like wildfire thanks to this process.
For the U. S. farm situation never looked less happy than it did last week when Chairman Alexander Legge of the Federal Farm Board returned to Washington from a swing through the suntanned wheat belt (TIME, July 21). Chairman Legge had harangued planters on the economic necessity of reducing wheat acreage to eliminate their surplus. Their retort, through their Governors and Senators, was a demand for the farm board to buy more wheat and more and more until the surplus vanished and the price went up from 60¢ per bu. Already staggering under more wheat than the whole state of Nebraska produces in a year. Chairman Legge had flatly refused."Bunk." When he got back last week to his large Washington office on the seventh floor of the old Southern Railway Building one block from his room at the Willard Hotel, Chairman Legge summoned newsmen and told them what he thought. Said he:
"The farm board was created to assist the farmer and not for politics. From now until November politicians will be so busy saving the farmer, it might be just as well to take a vacation. . . . "I notice the Democratic National Committee has adopted as a slogan 'the failure of the farm board.' This seems to be copied almost word for word from the grain dealers and the Chamber of Commerce of the United States,. . . .
"Certain interests [he meant the grain brokers] which seem to feel they have a God-given right to handle the products of the farmers, and who have accumulated immense fortunes in doing so ... doubtless will be easy picking for any politician of any party who is willing to play their game.
"However, farmers as a class . . . seem to be aware that their present unhappy condition is a result of long years of unregulated production, while they listened to gigantic schemes that high-powered statesmen have had to offer.
*snip*
Legge declares: "We've no authority to give anything away, to China or any other country. . . . I've discussed these proposals with President Hoover but no solution has been found.'' Others have suggested that wheat be fed to cattle since it is now cheaper than some other feeds. Mr. Legge rejects that scheme as unfair to the raisers of other feeds.
History runs in cycles. This is increasingly painfully obvious. Or rather, history is a spiral since we can't go back in time, we can follow the same trajectories. But we make a new path, doing this. Gravity is at work here.
"'Gold might go up. But this is predicated on people having paper money with which to buy gold."
I thought it was based on central bank buying.
Posted by: ziff house | August 27, 2008 at 12:18 PM