"Minting the coin would be nothing but an accounting fiction" Krugman

Krugman is a well documented idiot. His solution to everything is print more money. Time and again when the US economy has faulted he has argued for more stimulus via the printing presses. 5 years of printing and stimulus hasn't worked so what is his solution - do more of it! A totally discredited hack and not worth wasting time with unless you want a good laugh.
Of course, the idiots in the USA love him because he wants bigger government and more interference.

 

I posted this in the other thread but thought it was worth reposting here.

 

I agree completely. In one breath this guy is calling the creation of the coin a fraudulent fiction, then in the next saying it should be done because nothing should be beyond moral limitation when it comes to saving the USA's failing economy. He does realize the effect this will have on the trust of international holders US T-Bonds, doesn't he?

 

I wouldn't be surprised if Mike Maloney was revising his chapter on historical failed fiat currencies for the next edition of ''Investing in Gold and Silver", literally right now. History being played out before our eyes.

No amount of circuses or gladiator bouts can distract growing numbers of people from whats coming.

 

Notice the comic says "a coin worth a trillion dollars"

Are people thinking the platinum itself is worth a trillion dollars?

 

Wouldn't surprise me

They don't even know what a $20 gold coin is worth (hint: more than $20)

(But not people on here obviously)

 

That would be a mighty big coin.

 

with all the money printing 1 oz plat could be worth a trillion soonish

 

Well yeah, it'd be a coin weighing just over 20,000 tonnes.

I'm not even sure if there is that much currently available.

According to wiki: "Of the 245 tonnes of platinum sold in 2010, 113 tonnes were used for vehicle emissions control devices (46%), 76 tonnes for jewelry (31%). The remaining 35.5 tonnes went to various other minor applications, such as investment, electrodes, anticancer drugs, oxygen sensors, spark plugs and turbine engines"

 

Q. What's bigger...a trillion dollar platinum coin, or a trillion dollar gold coin?

A) Platinum
B) Gold
C) Depends how big the font is

 

In the other thread on this I calculated that for 1Trillion worth of platinum to be used for the coin, it would require over 500 years global annual production of the metal.

Maybe that's part of the plan? A plan for Americans to pay off their existing debt over 500 years - the creditors being the portion of the rest of humanity that happens to produce platinum.

 

This is a reasonable point. For years I have expected imminent collapse of the US economy and it hasn't happened yet. Therefore I WAS WRONG. I suspect every single one of you was WRONG too, as have been the assorted gurus spruiked here.

Why?

(PS. Denial isn't an argument.)

 

I was correct its called reality .Look past the BS & spin & you will quickly realise that they will do anything & i mean anything to keep it going

 

Talk about jumping the gun a bit?

I don't think it's time to start 'FiatStackers' just yet.

I think of out like this: we're currently in a high fire danger environment. We get warnings continually about the dangers and imminent threat of uncontrollable fires. But just because your house doesn't burn in January, does not mean it is safe for February.

Krugman's argument is about the people who cry wolf - there was no wolf so therefore they should be ignored. His credibility (not that i think he has any) will be eaten by the wolf when it finally arrives.

Edit: Ps, you're only 'wrong' if you set a date. Steve Keen was wrong. Yippee was wrong. Maybe you were wrong too. Time to sell the stack then?

 

Already have sold. For a profit. (See http://forums.silverstackers.com/topic-28672-selling-silver-is-a-major-mistake.html )

I still expect ultimate collapse of the US economy but I think it's delusional not to admit the ball-jugglers and can-kickers have greater skill than was widely anticipated.

I also think everything still points to precious metals initially falling when stocks do, so that's the time to buy, not when stocks are riding high. (Disclaimer: yes I could be wrong.)

 

Just nonsense Hennypenny, you were right before, and its only NOW that you're wrong.

There HAS been runaway inflation, its just not reflected in the phony CPI numbers: http://finance.yahoo.com/blogs/dail...bles-down-inflation-prediction-144054976.html

 

FYI My own thinking since ~2009, and the various people I listened to (and took seriously), was that the first pressure was always first and foremost the deflation in asset prices as the funny money based on monetising and remonetising every asset in existence evaporated. It's a financial crisis after all, and that affects (debt-based) asset prices before general prices.

The freshly printed cash was first and foremost to shore up the balance sheets of the banksters to prevent them from going under (since the fictional T-accounting of solvency was based principally on assets whose values turned out to be false). So the first tranches of QE went directly to things like TARP to give cash for crappy "assets" so that the banksters would still exist. This is NOT inflationary in and of itself as it is principally replacing the bank-created components of M1 with the central bank M0.

What we should have seen in the absence of the initial rounds of QE was DEFLATION. We did not see this because of the printed cash. Although this parallels Krugman it comes from different economic paradigms like Schiff, Rothbard, Rockwell etc.

The inflation always lags the money supply and people like Schiff openly said this years ago. How long the lag is differs from event to event as there are lots of interrelated pieces of the puzzle that make any single time-based prediction fraught. What we have NOT seen is an economic recovery (as predicted by Schiff et al) despite being FIVE YEARS into the GFC. What we have seen is the switch from printing money for a short term shoring up of balance sheets (which is still playing out as new asset problems keep cropping up and the Basel III rules will require more cash on balance sheets etc) to the money printing being used to outright monetise Government expenditure (aka Zimbabwe, Weimar etc).

The inflation will happen once the banks eventually get into the position to lend out the new M0, which as Pirocco and I have posted before has not left the central banks yet (see the "Net M0" line on the graph and you'll notice it has essentially been rising at trend). Once that new M0 enters the real economy, that is when the inflation will happen. Once the US Govt bonds are dumped, that's when the US will experience extreme-inflation.



I believe there are a couple of possibilities that will allow the US to significantly reduce the future stagflation etc but I have serious doubts that they will have the political will to do it.

On a final point while talking predictions, hyperinflation is not certain, default is. Silver and gold rising substantially in the next couple of years is not certain either. Silver and gold being one of the best possible hedges against the coming inflation for the medium term, however is certain (IMHO).

My two fiat cents worth

Edit: This is the link to the earlier thread which also shows the true money supply growth. (I must admit, I didn't think the delay would take this long to come through but makes sense in hindsight.)

 

The design for the trillion dollar coin has been confirmed

 

You are wrong on both counts. Even going back to my posts when i first joined this site months ago, i explained this in detail. Firstly that the can kickers and ball jugglers have any skill what so ever. When the US collapses is not in their hands or for that matter any American.

Secondly, and relates to the first epic fail of Krugmans premis that there has been no inflation. Sure the CPI is lying to every American who reads it. Sure real prices in the US are up closer to 10% in reality. But that doesn't reflect the "run away" inflation predicted by the likes of Peter Schiff.

Why? Because while the monetary base has tripled, all of that extra cash isn't circulating in the US economy. Krugman is right, it's a liquidity trap, but it's a liquidity trap that has the vast majority of all those US dollars trapped in 3 places. China's and Japan's central banks are the biggest and then the commercial banks that the Fed and the treasury are giving a free ride to run a distant third.

There HAS to be a turning point. There is already one set in stone that is slowly approaching in Japan with its aging population over the next decade or so. That will surely trigger the Chinese to offload. That is the best case scenario for the US and still gives it time to sort out its defecits and restructure its economy. A worst case scenario is China cracking the shits at the US for debasing it's currency (and the value of its 3T assets it currently holds) by doing something stupid like minting trillion dollar coins, and China dumping them wholesale(it's US assets).

All of that exported inflation will come flooding back to the US faster than a tsunami hitting a Japanese nuclear plant. No one will want to deal in USD over night. That will make Weimar and Zimbabwe look like they had paper shortages at the time.