For those new to stacking, i found this archive of postings from 'Another' very informative. I'm sure the writings of Another, FOA and FOFOA are familiar to many stackers here. http://www.usagold.com/goldtrail/archives/another1.html Another started writing in the late 1990's about gold, manipulation, oil, and the links between various countries wrt oil. As far as I can make out, the basic gist is this: * The Saudis price their oil in USD. This makes the US happy, as it entrenches the USD as the world's reserve currency. * In return, the Saudis ask for part-payment of each barrel of oil in gold. So along with the USD price per barrel, the Saudis ALSO receive (for example) 1oz gold for every 1000 barrels of oil. * This means that as the price of gold increases, there is a direct correlation in the price of oil increasing. The Saudis don't care, they still get their gold ... But the cost to the US for oil becomes higher and higher and gold increases. * Thus, the Saudis have been accumulating MASSIVE gold reserves over the past decades. * Now we have a motive to surpress the price of gold. Cheap gold = cheap oil = higher standards of living are retained. Thoughts? Any corrections to my interpretation of Another's writings?
I like its logic, and it would work, but * Now we have a motive to surpress the price of gold. Cheap gold = cheap oil = higher standards of living are retained. Every gold bull, will think to himself "let the fools suppress (i.e sell ) their gold- i for sure aint suppressing mine " - and they are all waiting for the first entrants to this trend ( ie. its like the feeling when ur holding at least pocket QQ in a holdem game and you are praying form someone to raise you a little ), and as they are entering they are being bought by others, and they never manage to suppress it too low... Jig is up
I know this is an old thread but I have been reading Another (THOUGHTS!) and I think he is saying more than a simple gold/oil trade (oz per barrel). I believe he is saying, when he talks about a 'discount trade' is that the west purchases oil in USD, and the Saudis buy gold (back door) with said USD. A direct trade (gold for oil) would make both gold and oil sky-rocket in price so it must be done this way. It has kept oil flowing and therefore ecnomies growing. As a result, for the flow of oil to continue to the west, gold must be kept CHEAP in USD, as that means that the Saudis etc. get the same (or more) gold for their oil (via USD). It is paradoxical to normal thinking as cheaper gold actually means the USD can purchase MORE oil. ($100 will buy more gold at $1000 per ounce than at $10,000 per ounce), so the Saudis happily accept $100 USD per barrel (for example), if this can be converted backdoor for 1/10th of an ounce of gold, however, the oil will dry up if this will only purchase 1/100th of an ounce. If we remove the USD intermediary, both gold and oil sky-rocket AS the USD is nothing without its use for oil (oil backing). Thoughts? And that the problem arose as Asia realised this was going on and bought (and continue to buy) gold and therefore benifit from the 'discount trade'.
Oil for gold is totally plausible and only breaks down because gold is under valued and the fact that the futures market is shakey at best
No, don't you see. It is the fact that gold is 'undervalued' in USD, that makes the USD tradeable for oil! As long as gold stays cheap in USD, the MORE gold and oil can be traded without a HUGE revaluation of each in terms of USD. I think it is this back-door trading that ANOTHER was on about. "Gold and oil cannot flow in the same direction".
Agreed. Asia realised it was discounted, started buying and the system is continuing to break Fingers crossed ANOTHER was right and the re-evaluation is, as he says, "more than any other asset in all of history"
It's a great site, I spent a few days on it a while ago. The length of some of his posts would make Pamela Anderson blush. Can someone pls remind me from where do the Saudis purchace their gold?
