Debt Rattle October 19 2017
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Joan Miro The sun embracing the lover 1952 • Don’t Rely on US Consumers to Power Global Growth (DDMB) • Who Has the World’s No. 1 Economy? Not
[See the full post at: Debt Rattle October 19 2017]To bring up the bitcoin link from yesterday, he seemed only to be saying that money is the unit you think of prices in. That’s both easiest and hardest to change since it’s entirely psychological. While true, not a functional pivot point to hang your hat on. You start pricing in other currencies when you use them more. No doubt Europeans used to price in 2-3 currencies all the time, and we know many South Americans do, as they use their own currency and black market US$. Oddly, BTC people are already mentally pricing in BTC, most commonly concerning crypto exchange rates.
Nevertheless, it’s not nothing. How to look at it? Well, we can use P.R. as an example. What worked there? BTC was pretty much shut down, a zero in the recovery, as although in theory you can move crypto on paper, or phone-to-phone, in reality no one does. Gold, however, was at a steep discount to cash. Maybe not as much as pawned guitars, but unpleasant. Cash remains king.
But let’s not stop there. How’s it going in my favorite case Venezuela? You have official currency at a steep and rising discount that hard to change. Cash is not king there. US$ is probably most taken, but very hard to get. And how do you price, as the author suggested was a necessary function? You can’t. Not in US$, not in Bolivar. Yet there is money.
How is gold there? Fine, except that food is more valuable, and having gold (or gasoline) will get you killed. If there’s one gold coin and one chicken in the ruined neighborhood, the chicken is more valuable for dinner. Gold is only good for exchange, but the ports and other infrastructure are shut down. You know what is useful, though? Bitcoin. Even aside from the free-electric BTC mining, Bitcoin isn’t visible to be robbed, and isn’t locked into the physical neighborhood it resides. Citizens who get ahold of it order food delivered in from Amazon.com, breaking the idiotic government blockade. So in their case, with electric up, BTC is MORE valuable than gold or US$. So it depends on the situation.
The one problem they definitively don’t have is which currency to price in. They could care less. Pricing and long-term planning is a far higher level than pure exchange, and in any case, it hardly matters anymore since any PC, even your phone will have instant and perfect exchange calculations, rendering the “thought-about-pricing” somewhat moot.
Dr. Diablo
Your hypotheticals do not translate to reality.
Case in point; my ex-father-in-law was Russian; captured by the Germans; released at wars end.
He hated Jews, why? Because if, as a refugee, if you wanted bread; the bakers (Jews) would only accept gold for payment. That’s a true story.
You might want to read David Graeber’s book; Debt; the First 5,000 Years…That is quite true. However what do you do if, like Venezuela, the local bakers have no flour because nothing is made locally anymore? You need to ship that gold to the shipper, the grinder, the farmer. How do you do that? Hitler and Stalin and Maduro are going to be everywhere in between. This may sound crazy, but we’ve never had a world where the materials for survival are not local, even national. How are the Americans going to get transformers, radios, shoes, copper, lead, car parts? “Globalization” has insured that the middle men are everywhere and each nation’s needs for survival are 5,000 miles away. This is what Venezuela found out: with the country in disarray, they needed to import things. Yes, they can be bought on the black market for gold –or easier with greenbacks– but they can be bought directly with less premium if you have an operational de-facto worldwide bank-transfer system. But again, that’s within a window. Easiest is of course a paycheck direct-deposit tied to a debit card, all credit, all virtual. Moving down through paper checks to cash-purchases, then to gold and even back to barter and family favors all the way to bullets and violence. Bitcoin works in only one of those windows, but then, so does gold. Gold was less useful in both Puerto Rico and Venezuela, but is more useful under Stalin, or quite probably in Syria and Libya. BTC is probably useful in Ukraine but not Puerto Rico. It depends on the problem you’re trying to solve.
Is gold going to be more reliable than Bitcoin? Almost certainly. A donkey breaks less than a car as well, but that doesn’t mean I don’t own one. But like I said, if there’s nothing in your neighborhood to buy, or having gold will get you killed, it can be useful to have an invisible option that’s tradable worldwide. How will you get your palatial estate worth of gold across the Austrian border, Mr. VonTrapp? In the meantime, do you really think the border guard is going to accept bitcoin? Horses for courses.
Let me put it this way: I’m the only guy left in the neighborhood that grows anything. And it’s a shock that even I do or know how, since it costs me a lot of scarce money and a lot of valuable time. I may also be one of the few who could still bake the town’s bread from air-yeast. But I won’t take gold.
First, they don’t have any, so it’s pointless. But even if I took gold, then everyone in town knows I own gold. It’s too dangerous. Over time, all their gold is in my house and they’re looking at me. So if I, who have the town’s only (garden) seeds and only (garden) crops, who is the only one who makes and grows food, won’t take gold for food, tell me again how useful gold is.
Now if only I could ship that money out to a safer area and be part of a wider trading system, I could safely trade with my town all day long, and everybody eats. You tell me how it works. In “Dying of Money” by Jens O. Parsons, Berlin farmers were sitting on their food because it was too dangerous to bring to market and didn’t need to trade for that 3rd piano. That was still under a silver/gold-coin system with a hundredweight of metal in every county. Yet they were using theft and murder to distribute goods instead.
Excellent comments, Diablo.
Food and fuel (barter) could also someday challenge cash, gold, Bitcoin, etc., especially if falling EROEI leads to a collapse in delivery systems and/or power grids. Oh, and add attractive daughters to food and fuel. So keep doing what you’re doing.
Let’s just hope the directed energy weapons used on 9/11 and the California fires can be harnessed for constructive purposes before falling EROEI ends civilization.
Caused by directed energy weapons:
Same as 9/11:
Why is directed energy only used as a weapon? Who makes those decisions?
“To learn who rules over you, simply find out who you are not allowed to criticize.” -Voltaire
I learned yesterday that it is now against the law in seventeen countries to criticize Israel or question the so-called “Holocaust.” They’re currently trying to make the U.S. #18. Remarkably, most people are too cowed to even dare to ask why.
If a couple semesters of college physics taught me anything, it was that I’m no physicist. But from all I’ve read, I’ve had to formulate a tentative picture of some sort to explain directed energy to myself. So I’ll tell you my tentative picture so you have at least one broken hook to hang your hat on while you rummage around.
This won’t make sense to anybody not paying any attention, and it frankly makes no sense to me, but here goes. You have NexRad and HAARP working in conjunction with chemtrails, the result being clouds with standing waves (clouds that look like the face of a washboard). The point of this is somehow to dilate a portion of the ionosphere, far above the clouds, to create a bubble in that highly charged atmospheric layer. Then, and I’m just guessing, an array of satellites in geosynchronous orbit focuses microwaves (or ion beams?), perhaps along laser beams, at targets on Earth (after reading license plates and home addresses).
In an old-fashioned tungsten filament light bulb, the glow comes from electrical resistance, not combustion. Fluorescent and LED bulbs don’t even get hot. Those homes might have “flared up” in tandem with their disintegration from outer space. All I know for sure is that “we’ve never seen anything like it before” means they’ve never seen anything like it before.
But I’m not frightened. I’m terrorized. The chemtrails along the Front Range corridor between Colorado Springs and Fort Collins have been absolutely thick the last few days, and not a drop of rain is forecasted for the next ten. Since they’ll be able to link my comments to my IP address, and possibly my home, maybe now’s the time to pack a suitcase?
“Warning Of ‘Ecological Armageddon’ After 75% Plunge In Insect Numbers (G.) ”
I am glad to say that here in Melbourne there is no shortage of insects. They are all over the place now that winter seems to be over (it was 30C two days ago and today it is a maximum of 17C). Lots of birds too – which one no longer sees in Europe. Without the spiders and birds, we would be in trouble.
Perhaps the Germans should try and reflect on the likely connection between their huge pesticide businesses and the absence of insects.
I am normally pretty sceptical about “directed energy weapons”. Can someone more knowledgeable than me explain why the wood of this fence post is burning first near the wire, nails and bolts?
The way the trees are burning looks pretty odd too. Here is what burning trees look like in Australia:
Diablo, I wholeheartedly agree with you that gold is not what you want to be relying on in the midst of crisis. It can get you killed. Rather, gold should be lying still, untouched, unseen, unknown, out of sight and out of mind until the transition to the next system is complete. There is a coming revaluation. Not a bull market, but a night-and-day one time revaluation. I have no idea when it is coming, but it will come. The reserve asset that central banks have on their balance sheets is the same reserve asset you should have buried in the back yard under your chicken coop.
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