deflation + dip = nervousness

+1

There is more hype floating around than needs to be, but I guess they need to be sensational to sell. We see the same thing repeated here frequently.

As investors/speculators, it's our duty to look at all sides of the coin - whether we like it or not.

 

gold backed (and 100% reserves held) currency fluctuates naturally with the change in the market in gold, production causes slight inflation, saving causes slight deflation.

anyone who knows about the proper management of money for investement, one would know that for every dollar of capital pushed into production there is 10-20x as much in savings, and it is not at all safe to invest without a backup of savings to handle losses on investments.

in other words, in an economy based on commodity backed money, only very rare circumstances can cause significant deflation or inflation. the tulip mania was caused by the dutch government bank offering to press coins out of gold brought to them, all the gold of europe converged on the dutch bank which then led to a massive malinvestment process as is the mark of inflation and the business cycle. such a situation is unlikely in a market where most of the marketplaces are not debasing the money market by whatever means.

...which obviously is not likely to happen on this planet anytime before 10-20 years time when the full fruits of this tree of fiat are matured and harvested. but people are choosing to move towards trading only in physical metal now and this is a trend that is likely to keep going.

 

Bump. Been thinking about this, thought others would appreciate it.

Great debate

 

about the original post, I thought China cant get too angry and sell off their US bonds becuase they rely on US market and European markets to buy their stuff. If they(US and Europe) go broke noone left to buy so kind of like shooting themselves but probably not in one lg but probably both legs. So the only thing they can do is complain and not buy more or if they do buy more in less and less quantaty till they are strong enough not be too reliant on US and European customers

 

in time the USA might become known as the United States of Asia

 

We had USSR, we have USA and we will have UCF(United Chinese Federation) the last one will include Taiwan and maybe even some current countries

 

Yes, i heard that we're heading into a hyperinflationary-Depression. IF that is the case, this world is FU**ED

 

We'll be North Mexico first