Category Archive: 6a.) Monetary Metals

You Can’t Eat Gold, Report 14 Oct 2018

“You can’t eat gold.” The enemies of gold often unleash this little zinger, as if it dismisses the idea of owning gold and indeed the whole gold standard. It is a fact, you cannot eat gold. However, it dismisses nothing. This gives us an idea. Let’s tie three facts together. One, you can’t eat gold. Two, gold is in backwardation in Switzerland. And three, speculation is a bet on the price action.

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The Toxic Stew, Report 7 Oct 2018

Last week, we shined a spotlight on a crack in the monetary system that few people outside of Switzerland (and not many inside either) were aware of. There is permanent gold backwardation measured in Swiss francs. Everyone knows that the Swiss franc has a negative interest rate, but so far as we know, Keith is the only one who predicted this would lead to its collapse (and he was quite early, having written that in January 2015).

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Textbook Falling Interest Behavior

This is a textbook case. Well, it would be if there was a textbook that presented the dynamics of the rising and falling interest rate cycles. Costco is spending over a quarter billion dollars, to make a capital investment in chicken processing. This is not the typical entrepreneurial investment, which seeks to increase margins by serving an unserved or underserved demand.

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Permanent Gold Backwardation, Report 30 Sep 2018

Sometimes, one just needs to look in the right place. And often in those cases, it just takes a conversation to alert one where to look. We had a call with a Swiss company this week, to discuss gold financing for their business. They reminded us that there is a negative interest rate on Swiss francs. And then they said that a swap of francs for gold has a cost. That is, the CHF GOFO rate is negative (the dollar based 12-month MM GOFO™ is +2.4%).

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We Need a Free Market in Interest Rates

We do not have a free market in interest rates today. We have not had one since the creation of the Fed in 1913. The Fed began buying bonds almost immediately, which pushes up the price and hence pushes down the interest rate. However, as I discuss in my theory of interest and prices, the Fed creates a resonant system with positive feedback loops.

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Why Are Wages So Low, Report 23 Sep 2018

Last week, we talked about the capital consumed by Netflix—$8 billion to produce 700 shows. They’re spending more than two thirds of their gross revenue generating content. And this content has so little value, that a quarter of their audience would stop watching if Netflix adds ads (sorry, we couldn’t resist a little fun with the English language).

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Never Mind the Bollocks, Here’s the Avocado Toast, Report 16 Sep 2018

For about ten bucks a month, Netflix will give you all the movies you can watch, plus tons of TV show series and other programs, such as one-off science documentaries. They don’t offer all movies, merely more than you can watch. Oh, and there are no commercials. They don’t just give you old BBC reruns, which you know they can get for a pittance.

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Why the Fed Denied the Narrow Bank, Report 9 Sep 2018

It’s not every day that a clear example showing the horrors of central planning comes along—the doublethink, the distortions, and the perverse incentives. It’s not every year that such an example occurs for monetary central planning. One came to the national attention this week. A company called TNB applied for a Master Account with the Federal Reserve Bank of New York.

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#NewtonInterviews Keith Weiner, Monetary Metals

Please note this is not sponsored content. Thank you Keith for speaking with me so extensively. Your insights are profound! Make sure to check the YouTube transcript for some great quotes. https://www.change.org/p/nevada-should-sell-gold-bonds Who Would Invest in a Gold Bond? Nevada Gold Bond Petition Vote “If Nevada Democrats perceive this as a Republican bill, they will …

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Illicit Arbitrage Cut by Tax Cuts and Jobs Act, Report 3 Sep 2018

This week, we are back to our ongoing series on capital destruction. Let’s consider the simple transaction of issuing a bond. Party X sells a bond to Party Y. We will first offer something entirely uncontroversial. If the interest rate rises after Y buys the bond, then Y takes a loss. Or if the interest rate falls, then Y makes a capital gain. This is simply saying that the bond price moves inverse to the interest rate.

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Why Am I Fighting for the Gold Standard?

Life is good. They could not have imagined what we have now, back in the dark ages. So I have never understood why people prep for a return to the dark ages. The only thing I can think of is that they don’t really picture what life is like. 14 hours a day of back-breaking labor to eke out a subsistence living. Subject to the risks of rain, sun, and insects.

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Why Am I Fighting for the Gold Standard?

Keith Weiner, CEO of Monetary Metals talks about his personal motivations, why he is fighting the fight. He doesn’t believe that prepping for the so called “zombie apocalypse” makes any sense, when you think about what you’re prepping for. What a so called “reset” will be. A new dark age. Recorded August 12, 2018. ------------------------------------------------------------------ Links of possible interest... The Dollar Cancer and the...

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Another Gold Bearish Factor, Report 26 August 2018

Last week, we said that the consensus is that gold must go down (as measured in terms of the unstable dollar) and then will rocket higher. We suggested that if everyone expects an outcome in the market, the outcome is likely not to turn out that way. We also said that this time, there is likely less leverage employed to buy gold and that gold is less leveraged as well.

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In Next Crisis, Gold Won’t Drop Like 2008, Report 19 August 2018

Last week, we discussed the tension between forces pushing the dollar up and down (measured in gold—you cannot measure the dollar in terms of its derivatives such as euro, pound, yen, and yuan). And we gave short shrift to the forces pushing the dollar down. We said only that to own a dollar is to be a creditor. And if the debtors seem in imminent danger of default, then creditors should want to escape this risk.

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Who Would Invest in a Gold Bond?

Berkshire Hathaway CEO Warren Buffet famously dismissed gold. “Gold has two significant shortcomings, being neither of much use nor procreative.” I have recently written about how a government with gold mining tax revenues can use gold. The benefits of issuing gold bonds include reducing risk, and getting out of debt at a discount. Pretty useful, eh?

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Monetary Consequence of Tariffs, Report 12 August 2018

Last week in Monetary Paradigm Reset, we talked about the challenge of explaining a new paradigm. We said: “The hard part of accepting this paradigm shift, was that people had to rethink their entire view of cosmology, theology, and philosophy. In the best case, people take time to grapple with these challenges to their idea of man’s place in the universe. Some never accept the new idea.” We were talking about the fact that money is the unit of...

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Two In-Depth Interviews

Keith had two more in-depth, ideaful interviews. Keith was interviewed on the Jason Stapleton Program. Keith had a lively discussion with Peter Bell and Mickey Fulp, the Mercenary Geologist.

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Monetary Paradigm Reset, Report 5 August 2018

Keith Weiner’s weekly look on Gold. Gold and silver prices, Gold-Silver Price Ratio, Gold basis and co-basis and the dollar price, Silver basis and co-basis and the dollar price.

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#NewtonInterviews — Keith Weiner & Mickey Fulp on Monetary Matters

Enjoy this entertaining conversation on monetary matters with my special guest Keith Weiner, PhD. Thanks very much Mickey Fulp, the Mercenary Geologist, for suggesting. I can’t believe we discussed monetary econmoics for 45 minutes and I wasn’t triggered once! Got #gold? Read more from Keith here: https://monetary-metals.com/open-letter-to-the-banks/ Visit Mickey’s website: http://www.goldgeologist.com/ Thanks for watching!...

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Keith Weiner-Gold Backed Bonds, An Idea Who’s Time Has Come

Keith Weiner provides serious thoughts about an inevitable monetary reset triggered by Keynesian economics that has destroyed capital and currency price discovery.

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