Help w/buying gold

[SDEngineer]

[quote=partypup]

Hat, I keep hearing the same thing about Europe’s predicament, and I must confess that my knowledge is sparse here. But isn’t it the case that the ECB has chosen NOT to inflate it’s way out of this mess?

“EU presidency: US economic plans ‘a road to hell'”

http://www.google.com/hostednews/ap/article/ALeqM5iiXCmvt7Z8-97sodbSHsAd03V0AwD97540HG0

Granted, the whole world is in a world of s*** now, but am I missing something, or would people not gravitate to a currency that is not being debased as quickly as the dollar? I am not challenging you; I simply want to understand the thought process. I personally have come to suspect most of the information coming out of the U.S. mainstream media, and their goal in recent months seems to be aimed at trashing Europe with the “we suck, but they suck more” argument for supporting the dollar.[/quote]

Bear in mind that the President of the EU is a rotating assignment, not an elected one, and what that person says may not reflect “official opinion”. In this case, the Presidency just rotated to the Czechs – who’s government has just collapsed on a “no confidence” vote. I’d take with a very large grain of salt any economic advice he feels like dispensing (especially since it appears much of the rest of the EU is backpedaling from his assertions).

Europe is, in fact, trying to inflate their way out – just as we are. They simply have been trying to inflate less than we have.

[partypup]

[quote=SDEngineer]
Europe is, in fact, trying to inflate their way out – just as we are. They simply have been trying to inflate less than we have.[/quote]

That’s the point I’m trying to make, SD. How can a less-inflated currency be at greater risk than a more inflated currency? I don’t understand.

[partypup]

[quote=SDEngineer]
Europe is, in fact, trying to inflate their way out – just as we are. They simply have been trying to inflate less than we have.[/quote]

That’s the point I’m trying to make, SD. How can a less-inflated currency be at greater risk than a more inflated currency? I don’t understand.

[partypup]

[quote=SDEngineer]
Europe is, in fact, trying to inflate their way out – just as we are. They simply have been trying to inflate less than we have.[/quote]

That’s the point I’m trying to make, SD. How can a less-inflated currency be at greater risk than a more inflated currency? I don’t understand.

[partypup]

[quote=SDEngineer]
Europe is, in fact, trying to inflate their way out – just as we are. They simply have been trying to inflate less than we have.[/quote]

That’s the point I’m trying to make, SD. How can a less-inflated currency be at greater risk than a more inflated currency? I don’t understand.

[partypup]

[quote=SDEngineer]
Europe is, in fact, trying to inflate their way out – just as we are. They simply have been trying to inflate less than we have.[/quote]

That’s the point I’m trying to make, SD. How can a less-inflated currency be at greater risk than a more inflated currency? I don’t understand.

[SDEngineer]

[quote=partypup][quote=SDEngineer]
Europe is, in fact, trying to inflate their way out – just as we are. They simply have been trying to inflate less than we have.[/quote]

That’s the point I’m trying to make, SD. How can a less-inflated currency be at greater risk than a more inflated currency? I don’t understand.[/quote]

The answer is that it will depend on which method is more effective at turning an economy around.

After all, in a fiat money system, money essentially represents a portion of that country’s GDP in proportion to the total amount of currency. The U.S.’s actions are causing that money supply to grow, which means that holding GDP constant, the money is worth less than in Europe where their monetary supply is growing slower. The U.S. is betting that the money spent will end the recession and cause the GDP to rise proportionally faster than Europe’s. If this does happen, than the U.S.’s method worked better (at least in this case) than Europe’s.

Only time will tell which method works better – but we do have a recent example in Japan which largely avoided inflating their currency to deal with a similar economic bubble – and the results of that were not exactly good. Maybe neither of these approaches will work either – but it’s really uncharted territory.

[SDEngineer]

[quote=partypup][quote=SDEngineer]
Europe is, in fact, trying to inflate their way out – just as we are. They simply have been trying to inflate less than we have.[/quote]

That’s the point I’m trying to make, SD. How can a less-inflated currency be at greater risk than a more inflated currency? I don’t understand.[/quote]

The answer is that it will depend on which method is more effective at turning an economy around.

After all, in a fiat money system, money essentially represents a portion of that country’s GDP in proportion to the total amount of currency. The U.S.’s actions are causing that money supply to grow, which means that holding GDP constant, the money is worth less than in Europe where their monetary supply is growing slower. The U.S. is betting that the money spent will end the recession and cause the GDP to rise proportionally faster than Europe’s. If this does happen, than the U.S.’s method worked better (at least in this case) than Europe’s.

Only time will tell which method works better – but we do have a recent example in Japan which largely avoided inflating their currency to deal with a similar economic bubble – and the results of that were not exactly good. Maybe neither of these approaches will work either – but it’s really uncharted territory.

[SDEngineer]

[quote=partypup][quote=SDEngineer]
Europe is, in fact, trying to inflate their way out – just as we are. They simply have been trying to inflate less than we have.[/quote]

That’s the point I’m trying to make, SD. How can a less-inflated currency be at greater risk than a more inflated currency? I don’t understand.[/quote]

The answer is that it will depend on which method is more effective at turning an economy around.

After all, in a fiat money system, money essentially represents a portion of that country’s GDP in proportion to the total amount of currency. The U.S.’s actions are causing that money supply to grow, which means that holding GDP constant, the money is worth less than in Europe where their monetary supply is growing slower. The U.S. is betting that the money spent will end the recession and cause the GDP to rise proportionally faster than Europe’s. If this does happen, than the U.S.’s method worked better (at least in this case) than Europe’s.

Only time will tell which method works better – but we do have a recent example in Japan which largely avoided inflating their currency to deal with a similar economic bubble – and the results of that were not exactly good. Maybe neither of these approaches will work either – but it’s really uncharted territory.

[SDEngineer]

[quote=partypup][quote=SDEngineer]
Europe is, in fact, trying to inflate their way out – just as we are. They simply have been trying to inflate less than we have.[/quote]

That’s the point I’m trying to make, SD. How can a less-inflated currency be at greater risk than a more inflated currency? I don’t understand.[/quote]

The answer is that it will depend on which method is more effective at turning an economy around.

After all, in a fiat money system, money essentially represents a portion of that country’s GDP in proportion to the total amount of currency. The U.S.’s actions are causing that money supply to grow, which means that holding GDP constant, the money is worth less than in Europe where their monetary supply is growing slower. The U.S. is betting that the money spent will end the recession and cause the GDP to rise proportionally faster than Europe’s. If this does happen, than the U.S.’s method worked better (at least in this case) than Europe’s.

Only time will tell which method works better – but we do have a recent example in Japan which largely avoided inflating their currency to deal with a similar economic bubble – and the results of that were not exactly good. Maybe neither of these approaches will work either – but it’s really uncharted territory.

[SDEngineer]

[quote=partypup][quote=SDEngineer]
Europe is, in fact, trying to inflate their way out – just as we are. They simply have been trying to inflate less than we have.[/quote]

That’s the point I’m trying to make, SD. How can a less-inflated currency be at greater risk than a more inflated currency? I don’t understand.[/quote]

The answer is that it will depend on which method is more effective at turning an economy around.

After all, in a fiat money system, money essentially represents a portion of that country’s GDP in proportion to the total amount of currency. The U.S.’s actions are causing that money supply to grow, which means that holding GDP constant, the money is worth less than in Europe where their monetary supply is growing slower. The U.S. is betting that the money spent will end the recession and cause the GDP to rise proportionally faster than Europe’s. If this does happen, than the U.S.’s method worked better (at least in this case) than Europe’s.

Only time will tell which method works better – but we do have a recent example in Japan which largely avoided inflating their currency to deal with a similar economic bubble – and the results of that were not exactly good. Maybe neither of these approaches will work either – but it’s really uncharted territory.

[Diego Mamani]

[quote=partypup] Diego, get a grip. This crisis, like everything else in life and in our universe, is moving in STAGES. That means that you won’t get killed for your precious can of beans, and I won’t be killed for my gold, anytime soon. What it DOES mean, however, is that your standard of living will erode rather rapidly, as will those around you, and over a period of months and years it will become increasingly expensive for you to buy the things you need, and as more time passes, those items may not even be available. And that’s when the real trouble starts.[/quote]

Stages or not, it’s the end point that I find unrealistic. From reading your text above, then you’re saying that you don’t expect the US govt and the dollar to collapse? I ask, because that (total collapse) is what most gold bugs believe.

But apparently you don’t expect total collapse of law and order, but rather a slow deterioration in our standard of living as the dollar, euro, etc. lose value against gold? If that’s the case, then land is a far better option than thinly traded gold that is already quite expensive.

If we’ll enter a period where currencies lose value rapidly (high inflation), then not only gold, but also land, and stock prices will go up very steeply in nominal terms. The key is simply to not hold cash.

[Diego Mamani]

[quote=partypup] Diego, get a grip. This crisis, like everything else in life and in our universe, is moving in STAGES. That means that you won’t get killed for your precious can of beans, and I won’t be killed for my gold, anytime soon. What it DOES mean, however, is that your standard of living will erode rather rapidly, as will those around you, and over a period of months and years it will become increasingly expensive for you to buy the things you need, and as more time passes, those items may not even be available. And that’s when the real trouble starts.[/quote]

Stages or not, it’s the end point that I find unrealistic. From reading your text above, then you’re saying that you don’t expect the US govt and the dollar to collapse? I ask, because that (total collapse) is what most gold bugs believe.

But apparently you don’t expect total collapse of law and order, but rather a slow deterioration in our standard of living as the dollar, euro, etc. lose value against gold? If that’s the case, then land is a far better option than thinly traded gold that is already quite expensive.

If we’ll enter a period where currencies lose value rapidly (high inflation), then not only gold, but also land, and stock prices will go up very steeply in nominal terms. The key is simply to not hold cash.

[Diego Mamani]

[quote=partypup] Diego, get a grip. This crisis, like everything else in life and in our universe, is moving in STAGES. That means that you won’t get killed for your precious can of beans, and I won’t be killed for my gold, anytime soon. What it DOES mean, however, is that your standard of living will erode rather rapidly, as will those around you, and over a period of months and years it will become increasingly expensive for you to buy the things you need, and as more time passes, those items may not even be available. And that’s when the real trouble starts.[/quote]

Stages or not, it’s the end point that I find unrealistic. From reading your text above, then you’re saying that you don’t expect the US govt and the dollar to collapse? I ask, because that (total collapse) is what most gold bugs believe.

But apparently you don’t expect total collapse of law and order, but rather a slow deterioration in our standard of living as the dollar, euro, etc. lose value against gold? If that’s the case, then land is a far better option than thinly traded gold that is already quite expensive.

If we’ll enter a period where currencies lose value rapidly (high inflation), then not only gold, but also land, and stock prices will go up very steeply in nominal terms. The key is simply to not hold cash.

[Diego Mamani]

[quote=partypup] Diego, get a grip. This crisis, like everything else in life and in our universe, is moving in STAGES. That means that you won’t get killed for your precious can of beans, and I won’t be killed for my gold, anytime soon. What it DOES mean, however, is that your standard of living will erode rather rapidly, as will those around you, and over a period of months and years it will become increasingly expensive for you to buy the things you need, and as more time passes, those items may not even be available. And that’s when the real trouble starts.[/quote]

Stages or not, it’s the end point that I find unrealistic. From reading your text above, then you’re saying that you don’t expect the US govt and the dollar to collapse? I ask, because that (total collapse) is what most gold bugs believe.

But apparently you don’t expect total collapse of law and order, but rather a slow deterioration in our standard of living as the dollar, euro, etc. lose value against gold? If that’s the case, then land is a far better option than thinly traded gold that is already quite expensive.

If we’ll enter a period where currencies lose value rapidly (high inflation), then not only gold, but also land, and stock prices will go up very steeply in nominal terms. The key is simply to not hold cash.

[Author]

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