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Someone used the term "Dow industrial propaganda index" or something like that in a article I read a while back. Seems fitting

Think of the stock markets as your propaganda to say all is well even if it isn't. I will refer to companies taking on debt to buy back shares which drive the index higher as my example. So when the indexes are hot then people are sucked in hard and they are throwing all kinds of dollars around in the casino at the high profile games. When suddenly things fall apart then rational people move away from the games and back to something real. Keep in mind that real people don't have much say in any of these moves but perhaps there is actually some sort of big players that think this way. In times of turmoil first assets are sold and then people start to disengage from the fictional world and move to the real world and buy assets.

Speaking of propaganda. One of the things I was looking at was the return of the S&P index over 70 years as it relates to the grandpa's gold example. Over 70 years of 1955 to now the index returned around 6900% or so without dividend reinvestment. So $3500 in 1955 becomes $240,000 today. What needs to be considered is that assumes you have the balls to let it ride through all the crashes, don't move conservatively into bonds as years go by, you buy the index on your own and somehow wave all brokerage fees and you don't pay capital gains when you cash out. If you buy as a mutual fund then the 6.5% average yearly gain is dropped by 2% management fee so it is 4.5% return per year. Now everything changes. You would pay capital gains if you moved gold to cash but some states don't charge that, some places you can claim collector status and other such things like 250 sales of under $1000 each. Thought it interesting how numbers are thrown around. Most interesting part of all this that occurred to me yesterday: even though a lot of people right now are looking at their stock holdings and are worried about their retirement, the primary thought is when to get back to the tables and regain your losses. Hardly a better analogy than a player in a casino.

A little stability today i see. That's good. Main thing is to keep attacking the credibility of the central banks. The longer things go the better. A massive surge up right now would be played out as the central banks being successful so I honestly don't want to see that. Sounds bad but I do have a lot riding in the casino myself. I would rather see the CBs ended so looking at the big picture and hoping.

For your reality check, think of what $10T being pumped in by the Fed over last 6 months really means if it was going to real assets. Instead it is going to something fake. The economy was doing whatever it was producing last month. Now the world is putting in 10s of Trillions just to keep the wheels turning and not actually accomplish anything. Just debt to paper over debt and not become anything resembling capital investment. People really need to step back and look at what is going on in looking at impacts to the real world vs fake world. And all this financialization is supposed to serve you, the citizens. That is why Wall street and bay street were built we are told. The revenues from the trading are good for the economy and gdp. How do you feel about that? We are told $10T needs to be repaid and banks need to be recapitalized.
 

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First two minutes of this video explain the money being pumped into the system right now. Talk about a crooked and broken system! The quicker you are not indebted to these crooked bankers the better. How long before the world bank essentially owns everything? Not sure where we go to escape the madness, even if you own stuff they will tax it away down the road.

 

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wait....you guys have money to invest?
I was considering growing some Camelina for a company this year. Their parent company had a 5 cent stock. I thought about investing a little in them just to help me watch who I might go in business with. They sent me out a contract to sign but said they did not have their money yet from Exxon and planned to have it the 31st. The stock is now a true penny stock. I have decided to not grow anything for them this year. I don't have the money to risk or invest anyway. Was a good looking contract for this area the first time they told us about it.
 

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The video does a good job of clarifying how this all works. But, since most people are talking about the beer flu there really is no need to be concerned with all these monetary issues. Same as it has always been. I was going to calrify that the Fed is not actually putting that $10T into the system directly, it is only made available. It is up to the other entities to draw on it. I wonder if any of those downstream entities take any "recommendations" on what to draw down, how much, the timing, and where to direct those funds drawn on. Well, it is a free market so we shouldn't think about that. Much like all the corporations buying back shares with debt was simply about directors getting rich, to think there could be some outside influence to move an entire financial system in a certain direction would be crazy talk. But I do wonder if all the top level changeover of big corporations over the last few years is consistent with a 30 year average.

I expect something will change soon. It has gone so far that even the people completely unaware are starting to question how things got here and how doing the same thing that apparently has not worked for 12 years will work this time. All that is left is what the new system will look like. Will it be good for the citizens or bad. Either way, during such a transition the majority will be panicked. Such a change can not take place off business hours from 5 pm - 7 am. It would require some sort of massive shut down and business stop for a while to do it. All they need to do is figure out if they announce the change before hand so people prepare or they use some other major event as cover.

Another comment on the USD. Keep in mind that, contrary to what the free market people think, exchange rates aren't determined by a bunch of day traders. The primary role of the central banks is to control its currency valuations and then hold other currencies in reserve to provide a second means to regulate. Since central banks are organized under the BIS it is not too much of a stretch to speculate that the BIS orchestrats the actions of 64 or whatever central banks to buy and sell currencies at any given time. Free market participants are in play but, since no one audits the CBs, no one really knows how much funding is thrown around to move as desired. Some say that "the free markets have won" in regards to a move in a particular direction but my guess is central banks have simply completed another action and are done. So, should other people intervene and take control of the BIS then it is conceivable that the USD can be directed in which ever direction needed to serve a purpose.

It was often speculated that WW3 would be mainly a cyber war. I wonder if that is a relevant way to view things right at this moment. If we view the world as entities such as corporations and banking operating irregardless of borders then a war against their power would not be a land war.
 

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Good point Phil, never considered that aspect.

A random point on gold and silver. If people are thinking about it I am going to take the position that this is not a get rich quick plan. I actually don't expect metals to change much in value over the next year. Perhaps silver may double and gold up 20% but I am honestly not taking the position it will go exponential or anything. Metals are a store of value, they protect your wealth. They don't need to generate "a return" or make you rich. In my grandpa's gold example the gold is priced pretty close today as it was 70 years ago to still act as a store of value. That is the point. If you don't understand this then you are missing the big picture because you are thinking like you are standing in the casino.

It is pretty darn hard to buy them right now. You can place orders but stock is hard to find. The whole point of having metals at home is that you control your wealth and not someone else. No counter party risk. So ordering metals and essentially having a claim cheque because they are a long way off on delivery is not what a guy wants to see. But I am in that boat right now anyway.

As Phil notes, all the lockdowns occuring in the last 3 days could certainly be used as an explanation for some wild markets. Remember that for every seller there must be a buyer. If lots of people are running for the exits then buyers disappearing makes a person's exit strategy a whole lot different. We haven't seen that yet I don't think. And again we see the possibility of wanting the Fed as buyer of last resort. And perhaps they already do that as we talk of the Plunge Protection Team. That would only happen if we didn't have free markets though.
 

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You must have already forgot what gold and silver did during the 08 **** dump.
Gold lost 30% of its value and silver shed half or close to it. Where was the storage of wealth???

What that did do is set up some incredible returns if you filled your pockets at the bottom or start of the recovery. More than doubled your money on gold and silver was an out of park home run over the next 3 years. Nothing saying that repeats but the whole storage of wealth idea sure took a beating.
Now I’m going to call up my gold/silver bug uncle and rub some salt in the wound....😂
 

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Yes, a 3 year window over a hundred or so years. And the book isn't closed yet. The stock markets tend to be indicative of inflationary and deflationary cycles. So now we watch the next 10 years to play out. Hypothetically, if we enter a long deflationary period then will land hold its inflated values and your stock investments be sound? Will gold? We don't know yet. But suppose gold bought at its peak in 2011 is shown to preserve wealth 10 years from now. Talking what is a bad investment and using a 6 year period is not being realistic I would say. How about buying the stock indexes in 2000 or 2007. How about buying gold in 2000 or 2007 instead of cherry picking 2012.

Notice every person pushing the stock market investment angle talks of dollar cost averaging, being in for long haul, buy the dips, etc. How come the opposite is true if someone mentions gold. Is putting all your wealth into land a smart move right now? Hard to say, let's give it 10 years and see if I can cherry pick some time frames. I can cherry pick 1980-1984 though. But even that don't matter because land is an asset. Does gold fail in that regard because of 3 years over 100? I would say a lot of many people say so. So they should just stay in stocks, but don't look at 3 year periods they tell you because you can loose 30% of your savings, go for the long haul.
 

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stay in stocks
Trudeau said he would compensate seniors for the huge decline in stocks because of the flu. A physical asset is a conservative approach. I know you don't make interest , hey what s interest these days! I like buying silver because you can buy several units for next to nothing and than wait for that asset to take off. Worked beautifully in 09. Storage is an issue though. My grand parents fled out of Germany in the second world war with gold , silver and jewels. It was a enough to start a dairy farm in Canada. I guess its ok if you want to invest in something you cant see, and take a loss because our liberal government will pick up the tab for your poor financial decision.
A physical asset also allows you the power to borrow against that as collateral. I Don't think if you have testla stocks the bank may not honour that now.!
 

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When Trump said he didn't want to see stock buy backs in response to the federal stimulus package , I wonder how that can be enforced?. How is Trudeau going to handle that.? Could those company stocks be suspended? Markets will get sporty this week.
 

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Discussion Starter #138
there was some severe violence in the soy futures just after the AH open. The bid survived what looked like a large outside margin call redemption for liquidity. The fact that soy survived that volume and violence in AH speaks to the liquidity and willingness to purchase in this environment, that can't be said for every asset at this time. If there is anything to be cautiously (very cautiously) optimistic about this might be it, unless you purchased OTM leap puts on spy or otm calls on vix, then you would be very optimistic.
 

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Looks like commodities are holding ok this morning and getting bids. More importantly they don't seem to be tied in response to the shitshow that is Fed intervention over the last few hours. That is hopeful. In a free market world commodities would not be influenced by absurd stock market valuations.

The whole bail out thing is something I can't begin to speculate on. All I can do is remind people this is the result of a controlled apparatus at work for decades. To say any administration can step in and undertake a few steps that will fix things and restore the economy in 3 months is not being realistic. I saw a suggestion that any bailout of the corporation could be done by the government buying shares and those shares become property of the government and perhaps the employees. Ok, that is a valid possibility though we are making fascism that much more visible. But more importantly, how do those small businesses feel that are operating in the same economic area as the corporation being bailed out. Or just small businesses in general, how do they get their support to stay in business. There is no right or good answer.

One last thing about gold preserving your wealth. First I assume a guy would change fiat into assets (gold, silver) over time just the same as any other savings plan. So doing it all at the top of a ramp up would not really fit that reality. But secondly, massive ramp up, and ramp up of asset values in general, is because of currency debasement (money printing) and generally an asset will reflect that. Meaning an asset rises in terms of fiat as more fiat is pumped into the system. Which all our bankers are doing these last few weeks at levels never been attempted in history. So a buyer should probably look at the price of an asset in your local currency terms. This is also why I can't say where land values would go. If they are in a massive bubble and the bubble pops then down, however massive money printing means they could perhaps hold or go up. That would ultimately be determined by how many buyers there are vs sellers. So it comes more down to whether you can earn a living at any given price point. And that is all influenced by how the currency is effecting all the components going into trying to earn that living.

There was a one year surge in gold price in 1980 so bad year to switch from fiat to gold. However if you were accumulating gold for decades before then you were insulated from the run up in land prices because gold rose accordingly. So you could say your wealth from the previous years was protected. If you sat on cash for years to buy land in 1980 you were SOL. And so you should have had your fiat in the casino and hope to be on the winning tables.

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Discussion Starter #140
Throwing this one out there. We look at the global agriculture situation in the way we do things, I do this all the time. We can get the crop in with a minimum of people and do it in a hurry. Indias farmer and farm worker population is 263 million. India is in deep crap if the virus gets going the way it is looking right now. Africa is in a similar boat, they need a lot of people to get things done over there and they do not have the medical facilities and distribution channels for meds and testing. If this virus is not contained soon there will be some sporting markets by late fall. Even if a big chunk of the population just gets sick it will be taking a lot of the required labour out of the game due to illness.

We are not at an agricultural crisis yet but the potential is there if things go just a little bit wrong.
 
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