USD devaluation

Jim Sinclair’s Commentary
The following is a note from CIGA Richard that speaks to the buying power of gold, and silliness that deflation today can be described as an increase in buying power for the dollar.

Jim,
As I type this and look on the wall at my $100 Trillion Zimbabwe Dollar note, I’m struck again by how few people understand the difference between ‘nominal’ and ‘real.’ I will not use Webster’s definitions, because with the advent of Google, even fewer folks now posses a dictionary.

Using my definitions then: - Nominal: the ‘face’ value printed on a paper fiat note. - Real: what you can really buy with that note, or these days, a whole lotta fiat notes.

While the buying power of fiat money has fallen by 96% under America’s greatest failure (the Fed), the buying power of Gold has increased ~700%. This equals the ‘invisible’ robbing of the Poor and Middle Class by the Fed. Let me give you an example of the difference between average wages in paper fiat over time, compared with equivalent ounces of Gold:

- Average wages in 1959 were $5,016 or 143oz of Gold
- Average wages in 1977 were $15,000 or 120oz of Gold
- Average wages in 1999 were $28,970 or 104oz of Gold
- Average wages in 2008 were $41,335 or 53oz of Gold

This is not exactly rocket science, yet most folks consider that they are ‘doing better’ because their nominal wages have increased over time, when in fact it takes increasing nominal amounts of debauched fiat to buy the same ounce of Gold (in effect making Gold more valuable over time in terms of buying power, as the Dollar slides into bongo-buck territory… my Zimbabwe note ref’d infra germane).

Hmmm… which would I rather have? A wheelbarrow stuffed with $100 bills that won’t buy me a loaf of bread, or 100 ounces of Gold? Gee, tough one. Too bad the Fed and our politicians (excepting Ron Paul) aren’t making any efforts to help me choose.

Meanwhile, I’m completely ignoring the very short-term white noise in the heavily manipulated bullion markets, and hanging tough until the ‘invisible hand’ has inflicted maximum pain and this temporary swoon turns around.

http://www.jsmineset.com/2012/05/14/jims-mailbox-931/

Saskatchewan Army

Rules for Entering Saskatchewan
1. Pull your droopy pants up. You look like an idiot.
2. Let's get this straight; I drive a pickup truck because I want to.
3. It's called a "gravelled road." No matter how slow you drive, you're going to get dust on your Lexus. Drive it or get out of the way.
4. There are cattle and oil wells. That's what they smell like to you. They smell like money to us. Get over it. Don't like it? Highways #1 and #16 go east and west, highways #6 and #2 go north and south, pick one.
5. So you have a $60,000 car. We're impressed. We have $250,000 combines that are driven only 3 weeks a year.
6. Every person in every pickup waves. It's called being friendly. Try to grasp the concept.
7. If that cell phone rings while a bunch of ducks are coming in, we WILL shoot it out of your hand. You better hope you don't have it up to your ear at the time.
8. Yeah, we eat beef and bison. You really want sushi and caviar? It's available at the corner bait shop.
9. The "Opener" refers to the first day of deer season. It's a religious holiday held the closest Saturday to the first of November.
10. We open doors for women. This applies to all women, regardless of age.
11. No, there's no "vegetarian special" on the menu. Order steak. Or you can order the Chef's Salad and pick off the 2 pounds of ham & turkey.
12. When we prepare a meal, there are three main dishes: meats, vegetables, and breads. We use three spices: salt, pepper, and Barbeque Sauce.
13. You bring "coke" into my house, it better be black, wet, and served over ice. You bring "Mary Jane" into my house, she better be cute, know how to shoot, drive a truck, and have long hair.
14. Curling and hockey are as important here as the Lakers and the Knicks, and a dang site more fun to watch.
15. Yeah, we have golf courses. But don't hit the water hazards; it spooks the fish.
16. Colleges? Try our University of Saskatchewan. They come outta there with an education, plus a love for people and country, and they still wave at passing pickups when they come for the holidays.

FAILURE TO FOLLOW THESE RULES WILL RESULT IN THE SASKATCHEWAN ARMY BEING DISPATCHED. WATCH OUT FOR OUR HOME GROWN FORM OF PRAIRIE JUSTICE! YOU HAVE BEEN WARNED!

quoting Jesse Livermore

It was the change in my own attitude toward the game that was of supreme importance to me. It taught me, little by little, the essential difference between betting on fluctuations and anticipating inevitable advances and declines, between gambling and speculating.

I think it was a long step forward in my trading education when I realized at last that when old Mr. Partridge kept on telling the other customers, "Well, you know this is a bull market!" he really meant to tell them that the big money was not in the individual fluctuations but in the main movements that is, not in reading the tape but in sizing up the entire market and its trend.

And right here let me say one thing: After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: It never was my thinking that made the big money for me. It always was my sitting. Got that?

My sitting tight! It is no trick at all to be right on the market. You always find lots of early bulls in bull markets and early bears in bear markets. I’ve known many men who were right at exactly the right time, and began buying or selling stocks when prices were at the very level which should show the greatest profit. And their experience invariably matched mine that is, they made no real money out of it.

Men who can both be right and sit tight are uncommon. I found it one of the hardest things to learn. But it is only after a stock operator has firmly grasped this that he can make big money. It is literally true that millions come easier to a trader after he knows how to trade than hundreds did in the days of his ignorance. – Jesse Livermore

Buffett buying gold miner?

On April 28, 2012 at 8:08 am, Irwin says:

Happy Saturday to all :) Seg #2: The audio is muffled, but did I hear Peter G compare miners to buggy whip manufacturers? He’s starting to give old farts with dyed moustaches a bad image. (joke) Yesterday I heard someone say that many mining companies are at or close to trading below their intrinsic value. And you know who likes to buy companies below intrinsic value? Allow me to start this rumour: Warren Buffett may be looking to buy gold in the ground.

On April 28, 2012 at 8:53 am, Mark Alan says:

Warren Buffet WILL NEVER BUY a gold mining company. They don’t receive subsidies from the government. Pay attention to Warren’s investments and you will see that he only invests in quality companies that generate cash flow, and companies that are going to be subsidized by the government and supported by legislation. Gold companies may produce cash flow, but they are not something that every day people are going to want or need.

He bought that railroad company not because of value, but because the company is going to have future contracts with the U.S. government in transporting military goods. It is also a stealth play on the commodity sector itself. Have a mine? Need your ore shipped? No problem! I know just the railroad to use! Oh don’t like the cost, ask for some financial assistance from the government and I will sign a five year contract with your company and we can ship all the ore you want. Can’t lose!

Funny thing, his father Howard was a man of decent morals and believed in a gold standard. Too bad his son is a sociopath who doesn’t care one bit about blowing up villages and the killing of innocents so that an oil company can get its pipeline laid. And his promo about “need to tax the rich more” is total bull!

On April 28, 2012 at 9:31 am, Marc says:

Mark A, Do you think Buffett will get it when the “paper” ponzi scheme we call the US Dollar collapses? Your damn right he will buy gold and silver mining shares! But, with what?! :) LOL! All the best, Marc

On April 28, 2012 at 9:39 am, Mark Alan says:

First of all, Buffett is getting old, what does it matter to him if the U.S. Dollar declines in value. He already has plays on inflation. He won’t buy mining companies because they are too risky for him. He already bought 130 million ounces of silver once.

I don’t think the dollar will collapse. I do think we will have serious problems of civil unrest and infrastructure break downs, like electric power grids. We will definitely see riots in the streets this year and they will be violent.

Buffett will not buy gold or silver stocks unless he can get a promise in writing on a guaranteed amount of income.

On April 28, 2012 at 9:59 am, Jerry O^OTB says:

Mark, it thing you are correct on Buffett,

On April 28, 2012 at 10:00 am, Jerry O^OTB says:

my typing and one eye are getting to me….should read, Mark, I think you are correct on Buffett

On April 28, 2012 at 10:18 am, Mark Alan says:

Hey Jerry
It only makes sense because IF Buffet DID BUY gold mining companies….IMAGINE WHAT MESSAGE THAT WOULD SEND TO THE CONVENTIONAL MARKETS AND THE GENERAL PUBLIC. It would be massive and the establishment don’t want that message broadcast.

On April 28, 2012 at 2:46 pm, Marc says:

Mark A., Of course, you are right. Buffett would NEVER do that. Just funnin around..stay frosty! Marc

On April 28, 2012 at 4:06 pm, Jerry O^OTB says:

Just remember , Buffit..did cash in his silver stash, and they started the SLV.., paper mkt. I think it was 190,000 tons? at $9.50 oz.., someone correct here, I am going by my 63 year old brain…and after all it was back in 05 ?

http://www.kereport.com/2012/04/28/6811/
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