Gold and silver up +2000%.

Quote from TraderZones:

You can't drive a bar of gold to work, shopping or anything else...

Like comparing an apple to a rock.
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Very true...

But so is comparing gold to a car, IMHO.

As to the rationale question asked earlier... I am not a gold bug, but I own some gold. Following (although I did it first) the central banks, I hold it solely for purposes of diversification of my portfolio, which predominantly contains paper assets.
 
Quote from DrPepper:Our national debt is literally unpayable
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The US national debt is very payable. It's currently less than 100% of GDP plus there is a lot of room to increase the taxation basis (compared to other G7 nations).
 
Quote from SWScapital:

Fair enough.

I would think you ought to be looking out for number 2 and 4 right about now.

Glut of gold commercials and fed easing up language.

But what do I know? I prefer the dividends the SPY pays me. :D
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Well, determining when an asset class has reached mania levels is obviously quite tricky and I am too young to have lived trough one of the big bubbles of the past to compare.

I once read how during the peak of the Nasdaq bubble hair salons had televisions in them playing CNBC 24/7 so people would never lose track on their portfollio.

Are we there yet, I don't know and I don't think so but I could be wrong.:)
 
Quote from makloda:

Arguing obligations to your own citizens equal national debt is quite a stretch IMO.
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Why? Are you suggesting it's easier and less painful to default on the obligations to your own citizenry than to external creditors?
 
Although it is difficult to default on obligations to citizens, it is easier to do this than to default on debt owed to creditors.

Debt owed to creditors is a specific promise to pay a certain amount on a certain date.

Government obligations such as social security payments could be changed with a PR / marketing campaign about doing what is "right for the nation's interests".

This is particularly true if and when the US Dollar experiences a fast and sharp depreciation against other paper currencies.


Quote from Martinghoul:

Why? Are you suggesting it's easier and less painful to default on the obligations to your own citizenry than to external creditors?
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Quote from m22au:

Although it is difficult to default on obligations to citizens, it is easier to do this than to default on debt owed to creditors.

Debt owed to creditors is a specific promise to pay a certain amount on a certain date.

Government obligations such as social security payments could be changed with a PR / marketing campaign about doing what is "right for the nation's interests".

This is particularly true if and when the US Dollar experiences a fast and sharp depreciation against other paper currencies.
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I'm not sure I see it this way...

If anything, I'd be inclined to think it's the other way round. It's been demonstrated before (e.g. Callaghan's Winter of Discontent) that it's normally political suicide to default on what your citizens believe to be government obligations. IMHO, implementation of any meaningful austerity policy is a modern politician's nightmare.

I think it's infinitely easier politically to inflate your way out of your debt, especially if a large proportion of it is held by foreign investors. That's the sort of default I am referring to...
 
SS and Medicare obligations will not be paid, they cant be paid(its virtually impossible) which means they wont. Rich americans will have benefits cut, probably dramatically
 
Quote from Martinghoul:

I'm not sure I see it this way...

I think it's infinitely easier politically to inflate your way out of your debt, especially if a large proportion of it is held by foreign investors. That's the sort of default I am referring to...
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I'm in strong agreement with you here. I believe that the US will continue to (attempt to) inflate away its
(1) debt and
(2) other liabilities, such as but not limited to obligations to citizens.

However the main problem with this is that it relies upon both (1) an orderly decline in the US Dollar against other currencies and (2) low CPI inflation.

If and when the decline in the US Dollar becomes disorderly and/or if and when Americans get concerned about purchasing power of the US Dollar, then this may result in the US government considering a reduction in payments promised to citizens.
 
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