5. August 2012

   Claudio Grass from Global Gold explains why and how Gold protects your wealth

 

August 1st, 2012. In the midst of the summer doldrums with a gold price flirting with the $ 1600 level and a silver price around $27 per ounce, Claudio Grass recorded his view on today’s economic climate. He is the managing director at Global Gold in Switzerland, a precious metals firm that provides a unique service for individual investors, professional investors and individuals who are concerned about protecting their assets against the ongoing debt crisis.

In an audio podcast of some 50 minutes, Claudio Grass shares a wealth of information and insights. He explains what the main reasons are to be invested in gold, as well as which gold investments you should consider. The podcast is well-structured and has six chapters:

  • Introduction: Austrian vs Keynesian economics
  • The current macro-economic trends
  • The most important insights from monetary history
  • The current state of the gold market & why gold is not in a bubble
  • The different gold investment options & why to avoid paper gold
  • How Global Gold can help protect your future

Clearly, the vision of Global Gold is that the Gold bull market is far from over and that the current economic climate provides the ideal conditions for a continuation of the rising Gold price. Global Gold is able to show that Gold is not in a bubble today, based on plain facts. By reviewing the different gold investment options, it appears that investing in physical Gold is the best solution to protect your  wealth and purchasing power. The ideas of Global Gold are influenced by the Austrian School of Economics; they are based on the idea that values of currencies are declining value and that fiat money has an intrinsic value of zero.

Listen to the podcast with Claudio Grass

If you want to learn more about the topic, Global Gold and GoldSilverWorlds recommend the detailed paper on Scribd and the unedited video presentation.

12. Juli 2012

Special Report Gold 2012 – "In Gold We Trust"

 

 

Ronald Stöferle’s 6th annual – "In GOLD we TRUST" report, covering the following highlights:

 

The foundation for new all-time-highs is in place. As far as sentiment is concerned, we definitely see no euphoria with respect to gold. Skepticism, fear, and panic are never the final stop of a bull market. In the short run, seasonality seems to argue in favor of a continued sideways movement, but from August onwards gold should enter its seasonally best phase. USD 2,000 is our next 12M price target. We believe that the parabolic trend phase is still ahead of us, and that our long-term price target of USD 2,300/ounce could be on the conservative side.

 

The study is covering the following topics:

 

·         Central bank’s monetary inflation supports progressive remonetisation of gold

·         Inflation ≠ rising prices: confusing terminology with grave consequences

·         The chronology of a hyperinflation – Explanation based on Peter Bernholz’

          “Monetary Regimes and Inflation”

·         Gold in an environment of a deflationary loss of confidence

·         The biggest misconception with regard to gold

·         High stock-to-flow ratio is the most important characteristic of gold

·         The advantages of a gold standard

·         Financial repression: the alleged magic formula

·         Why gold remains (dirt) cheap in India and China

·         Excursus on Interventionism – It is a fine line between manipulation and intervention

·         On the search for a “fair value” for Gold

·         Possible price targets for gold

·         Why gold is (still) no bubble

·         Gold improves portfolio characteristics The renaissance of gold in traditional finance

·         Why is gold such a highly emotional topic? Cognitive dissonance and normalcy bias

           as possible explanation

·         Challenges for the gold miners: Peak Gold and increasing resource nationalism

·         Gold shares (still) with historically low valuations

 

 

12. Juli 2012

Seeking Value in a World of Financial Repression

 

Hinde Capital CEO Ben Davies recently spoke at the Munich Value Conference. He explores the theory of what is value, looks at the world of yesterday and today and the subjects of debt liquidation and financial repression. Click here to see the transcript of the speech and here for the full presentation.

11. Juni 2012

 

 

Mises on the gold standard as the symbol of international peace and prosperity (1949)

 

 

Ludwig von Mises (1881-1973) noted that the gold standard had both practical and symbolic significance. It was a major means which enabled international trade to flourish and the industrial system to increase dramatically the wealth of all people. Yet, it was correctly identified by economic nationalists as a brake on the expansion of government power, especially by credit expansion and debt, and for that reason had to be dismantled:

 

 

"Men have chosen the precious metals gold and silver for the money service on account of their mineralogical, physical, and chemical features. The use of money in a market economy is a praxeologically necessary fact. That gold—and not something else—is used as money is merely a historical fact and as such cannot be conceived by catallactics. In monetary history too, as in all other branches of history, one must resort to historical understanding. If one takes pleasure in calling the gold standard a “barbarous relic,” one cannot object to the application of the same term to every historically determined institution. Then the fact that the British speak English—and not Danish, German, or French—is a barbarous relic too, and every Briton who opposes the substitution of Esperanto for English is no less dogmatic and orthodox than those who do not wax rapturous about the plans for a managed currency.

The demonetization of silver and the establishment of gold monometallism was the outcome of deliberate government interference with monetary matters. It is pointless to raise the question concerning what would have happened in the absence of these policies. But it must not be forgotten that it was not the intention of the governments to establish the gold standard. What the governments aimed at was the double standard. They wanted to substitute a rigid, government-decreed exchange ratio between gold and silver for the fluctuating market ratios between the independently coexistent gold and silver coins. The monetary doctrines underlying these endeavors misconstrued the market phenomena in that complete way in which only bureaucrats can misconstrue them. The attempts to create a double standard of both metals, gold and silver, failed lamentably. It was this failure which generated the gold standard. The emergence of the gold standard was the manifestation of a crushing defeat of the governments and their cherished doctrines.

In the seventeenth century the rates at which the English government tariffed the coins overvalued the guinea with regard to silver and thus made the silver coins disappear. Only those silver coins which were much worn by usage or in any other way defaced or reduced in weight remained in current use; it did not pay to export and to sell them on the bullion market. Thus England got the gold standard against the intention of its government. Only much later the laws made the de facto [actual] gold standard a de jure [legal] standard. The government abandoned further fruitless attempts to pump silver standard coins into the market and minted silver only as subsidiary coins with a limited legal tender power. These subsidiary coins were not money, but money-substitutes. Their exchange value depended not on their silver content, but on the fact that they could be exchanged at every instant, without delay and without cost, at their full face value against gold. They were de facto silver printed notes, claims against a definite amount of gold.

Later in the course of the nineteenth century the double standard resulted in a similar way in France and in the other countries of the Latin Monetary Union in the emergence of de facto gold monometallism. When the drop in the price of silver in the later ’seventies would automatically have effected the replacement of the de facto gold standard by the de facto silver standard, these governments suspended the coinage of silver in order to preserve the gold standard. In the United States the price structure on the bullion market had already, before the outbreak of the Civil War, transformed the legal bimetallism into de facto gold monometallism. After the greenback period there ensued a struggle between the friends of the gold standard on the one hand and those of silver on the other hand. The result was a victory for the gold standard. Once the economically most advanced nations had adopted the gold standard, all other nations followed suit. After the great inflationary adventures of the first World War most countries hastened to return to the gold standard or the gold exchange standard.

The gold standard was the world standard of the age of capitalism, increasing welfare, liberty, and democracy, both political and economic. In the eyes of the free traders its main eminence was precisely the fact that it was an international standard as required by international trade and the transactions of the international money and capital market. It was the medium of exchange by means of which Western industrialism and Western capital had borne Western civilization into the remotest parts of the earth’s surface, everywhere destroying the fetters of age-old prejudices and superstitions, sowing the seeds of new life and new well-being, freeing minds and souls, and creating riches unheard of before. It accompanied the triumphal unprecedented progress of Western liberalism ready to unite all nations into a community of free nations peacefully cooperating with one another.  

It is easy to understand why people viewed the gold standard as the symbol of this greatest and most beneficial of all historical changes. All those intent upon sabotaging the evolution toward welfare, peace, freedom, and democracy loathed the gold standard, and not only on account of its economic significance. In their eyes the gold standard was the labarum [(Latin) derived from the Roman, or Imperial, standard or symbol for which men live or die], the symbol, of all those doctrines and policies they wanted to destroy. In the struggle against the gold standard much more was at stake than commodity prices and foreign exchange rates.

The nationalists are fighting the gold standard because they want to sever their countries from the world market and to establish national autarky as far as possible. Interventionist governments and pressure groups are fighting the gold standard because they consider it the most serious obstacle to their endeavors to manipulate prices and wage rates. But the most fanatical attacks against gold are made by those intent upon credit expansion. With them credit expansion is the panacea for all economic ills. It could lower or even entirely abolish interest rates, raise wages and prices for the benefit of all except the parasitic capitalists and the exploiting employers, free the state from the necessity of balancing its budget—in short, make all decent people prosperous and happy. Only the gold standard, that devilish contrivance of the wicked and stupid “orthodox” economists, prevents mankind from attaining everlasting prosperity."

 

Mises agreed that the gold standard, “that barbarous relic”, was “merely” an historically determined institution, the use of which was not mandated by pure economic theory. However, it served such a useful function in promoting trade and productive activity that it had become a key institution in western societies up to the outbreak of the First World War. Having lived through the economic and monetary upheavals of the war and its aftermath Mises was sensitive to the demands of the state that it be “freed” from the restrictions which the gold standard placed on its banking, credit, taxing, and trade policies. By the time he came to write the first edition of his magnum opus, Human Action (1949), the gold standard had become the symbol of the old capitalist order which had to be destroyed if states wanted to pursue policies of credit expansion and currency manipulation – which they all did. Mises continued to vigorously defend the gold standard as an essential non-state institution which could be used to defend the ordinary person from ruinous policies of the modern nation state.

5. Juni 2012

 

Bill Murphy – Gold Anti-Trust Action Committee (GATA) – Cambridge House Live – June 2012

 

Bill Murphy talks about the proof of a Gold-Cartel at the World Resource Investment Conference in Vancouver, Kanada: 

 

3. Mai 2012

 

 

Gold: The Money of Freedom and Honesty

 

by John Laughland

 

The collapse of two major banks in Britain and America (Bear Stearns and Northern Rock) should make us pause to reflect on the fundamentals of the world financial system.
 
When currencies around the world were nationalised at the outbreak of the First World War, the reason was obvious. In order to fight the war, states needed to be able to print their own bank notes without actually having the money to do so. The relevant law in France, passed in August 1914, stated baldly “The Bank of France will no longer reimburse its banks notes in cash.”

The cash in question was gold, and bank notes were but titles to a certain amount of gold coin. The supply of money was dictated by the supply of gold. Although the state played a major role in the currency system – all countries had “central banks”, and use of the national currency was obligatory – its principal function was to uphold the promise to pay the bearer of its bank notes a specific sum on demand. Providing that that promise could be kept, the currency was sound.

After the First World War, attempts were made to reinstate the pre-war system because it was considered to be the indispensable bedrock of the financial system and world trade. How could nations trade freely with one another if their currencies fluctuated in value all the time? However, the “gold exchange standard” created at Genoa in 1922 contained a fatal flaw which soon led to the system’s collapse in the fateful year of 1933. That fatal flaw was that two currencies, the British pound sterling and the US dollar, were taken as having equivalent value as gold. Other currencies could be exchanged for them, and they could be used as collateral for their issue.

This was a fatal flaw because it gave a special privilege to these two currencies. That privilege meant they were always in demand, however much of them was in circulation. The great French economist, Jacques Rueff, identified this flaw as one which permitted “a deficit without tears”. The United States and Britain could basically print as many paper dollars or pounds as they liked, safe in the knowledge that they would be soaked up by other central banks to put in their reserves. They could use this paper to buy goods from abroad, exporting capital in return, without any fear that the increase in the money supply would lead to inflation at home.

As the Second World War was coming to an end, and plans were being laid for the post-war financial system, the old memory of fixed exchange rates persisted (although this was only a consequence of the gold standard, not its principal virtue). However, at Bretton Woods in 1944, the same mistake was made as at Geneva, only this time the United States dollar alone achieved supremacy as a currency with a “reserve” status. When its own link to gold was cut in 1971 – Richard Nixon needed to print dollars to fund the war in Vietnam – the world currency system was set adrift on the system we now live with, one in which currencies fluctuate in value against each other all the time.

What we now remember as the “oil crisis” of 1973 was, in fact, little more than a rational response by oil producing nations to the de facto devaluation of the dollar. Oil rose in price because it was denominated in a debased currency. The oil producers said they would price oil against gold instead – i.e. against real, as opposed to paper, money. This never happened, in fact, and black gold continues to be priced in dollars. But this is one of the main reasons why the United States continues to enjoy the “deficit without tears”, i.e. a seemingly limitless trade deficit, paid for by flooding the world with dollars which other countries use either in their central bank reserves or to buy oil.

In the last twenty years or so, this policy has been applied with a vengeance. The United States Federal Reserve, a private organisation with the privilege of printing dollars but owned by private banks, has flooded the American (and world) financial system with cheap credit. This has been the principal cause of the tremendous rise in the price (inflation) of stocks and shares. Other commodities which have risen greatly in price include property and, of course, oil. The financial system as a whole may be helped by this rise in credit, because the banks make money on it by lending the money on at a higher rate, but the economy and society as a whole suffer.

This is because artificially easy credit generates income for banks in the short term by mortgaging the long term instead. A rise in the money supply now makes profits for the banks but pushes up prices for everyone else. Specifically, a rise in property prices (a fixed and real asset which inevitably rises as the value of paper currency is debased) generates huge problems for the whole economy, and especially for family life. Families cannot afford to have more children; and the resulting collapse in the birth rate stores up trouble in the future for important things like pensions and health care. It also drives immigration, which in turn causes its own problems, specifically the abuse of social costs, which drives up taxes, taking yet more money out of the pockets of ordinary working citizens.

To put it in a nutshell, a system of paper currency, easy credit and high taxes destroys the natural order of society. It breaks the social contract and pays for the present at the expense of the future. The financial system, however, prospers. Banks make money because the cheaper credit is, the more money they can lend. In their search for ever greater income, banks have flooded the Western economy with credit. The current “sub-prime” mortgage crisis in the US and Britain is only the tip of the iceberg. It is now very easy to take out vast loans for property in both countries, many multiples of one’s annual salary, on the basis of no proof whatsoever: I, for instance, have a loan which is many times my own annual income and I obtained it without having any regular salary and without providing any proof of my financial position whatever. It was all done by word. My wife, meanwhile, was recently offered a credit card by our local department store, which duly arrived in the post, giving us £6,000 in instant credit even though she has no income whatever, and even though a card was issued in my name without me even having set foot in the shop.

Once people have difficulty repaying such dodgy loans, then of course the whole system risk collapse. The income from these loans is itself used as collateral for other increasingly baroque financial operations but if the basis for them dries up then the knock-on effect can be very serious, since it is a feature of options and other financial instruments that very large sums can be leveraged for very little money. All this, I repeat, is encouraged by the bank which directs operations at the centre, the Federal Reserve, which never pays its own debts and encourages a climate of easy credit.

The real collapse of the world financial system would come if countries and oil producers started to abandon the US dollar, as some are already doing. Because the US prints limitless amounts of green paper, demand for it has to be kept going somehow. Oil is a major source of demand – and one of the reasons for Saddam Hussein’s downfall was that he decided to sell his oil for euros in 2000. The link between paper currency and militarism is integral. If the dollar is abandoned, then the United States will no longer be able to pay for its limitless imports. Indeed, if oil rises significantly in price, then the very fabric of American life will be threatened since all American cities are constructed in such a way that it is not possible to live in them without a motor car.

The argument is also advanced that state control of the financial system is necessary to prevent financial collapse. This argument is looking a little threadbare as banks collapse in London and New York – the collapse of Northern Rock has caused the British government to pump in nearly twice as much money as it spends every year on the armed forces – and as whole currencies collapsed, in Russia and the Far East, in 1998.

Because the vested interests are so great, the US Central Bank and the other countries of the world will do all they can to keep this racket going for as long as possible. They may succeed for a while. But the world financial system is parasitic on society, and it impoverishes it in the end. It is contrary to the natural order and, sooner or later, it is the natural order which will return.


This article was first published at "Brussels Journal".

 

 

28. April 2012

 

Stephan Bogner: "The Gold Megathrust"

 

 

“One historic experience is that human nature never changes. Man will, therefore, always love and respect honest business dealings with a medium of exchange thy can trust: gold. Gold will finally win the war, but why not call an armistice now? Let us hope this will happen before it is too late, before too much time and too many lives are wasted.” (Ferdinand Lips in “Gold Wars – The Batlle against Sound Money as seen from a Swiss Perspective”, page 251; Fame 2002)

 

Read more here!

28. April 2012

 

Gold Wars – Thoughts from the Desk of a Gold and Silver Business Owner

 

Gold Wars is a blog designed and authored by Kirsty Hogg to address inflation, hyper-inflation, the long term manipulation of gold and silver, the gold standard, current economic events, peak oil and other related items. It is named “Gold Wars” in memory of Ferdinand Lips who wrote "Gold Wars. The Battle Against Sound Money As Seen From A Swiss Perspective". "In short: Because the world has forgotten the monetary role of gold, our world is in serious trouble. That is the one major reason for the worrisome state of the world. The abandonment of gold as money, of the discipline of gold, is the major reason if not the only reason why our world has become a very dangerous place. In my opinion, it is the biggest tragedy in world history." — Ferdinand Lips

 

Read more here: http://goldwars.blogspot.de/

17. April 2012

Gold Wars now in Spanish available

 

Ferdinand Lips’ classic book Gold Wars, first published in 2001, is now finally also available in the global language of Spanish. Las Guerras del Oro is essential reading for a wide Spanish-speaking audience highly interested in gold, and we thank the GoldMoney Foundation for sponsoring its publication.

The original English edition was written at the outset of gold’s latest, more than decade-long bull market and has meanwhile become a landmark book among people who believe in honest, free-market money.
 
In this book, Swiss banker and monetary historian Ferdinand Lips provides a basic understanding of the concept of sound money and why gold repeatedly took on the role of money in all cultures through the ages (not by official decree, but through Competition as a Discovery Procedure as outlined by Friedrich A. von Hayek), and he also criticizes our existing financial system.
The Lips Institute, headed by Ferdinand Lips’ daughter Barbara Lipsseen here in an interview during the GATA London conference in 2011 – is therefore pleased that this brilliant translation is now ready for the many Spanish readers around the world.
9. April 2012

Webinar "What about Gold?" with Claudio Grass

 

Webinar of the European Students for Liberty: "What about Gold?" with Claudio Grass

This webinar will focus on ways to protect yourself and society against the possible consequences of the fiat currency system.

On your computer! Tuesday, April 10, 2012 8:00 PM – 9:00 PM CEST

 

Register here to receive your link to sign in:

https://www2.gotomeeting.com/register/404279778

 

About the topic: The global financial markets have been in turmoil during recent years. Many have serious doubts about the stability of the fiat currencies that are one of the foundations of the financial system. But what are the alternatives to the current system and is there a way to protect yourself against a possible breakdown? These are the questions that we will look into during this webinar.

 

About the speaker: Claudio Grass, student of Ferdinand Lips, is Director of the division Precious Metals Services at the Swiss-based precious metals company Global Gold. He will be presenting his views on this matter based on his experience in the field.

 

https://www2.gotomeeting.com/register/404279778