3 Minute Gold News – Jim Rickards – Gold – February 19, 2017

3 Minute Gold News

A Quick Read for Busy People

A synopsis of an interview with Jim Rickards, New York Times bestselling author of The New Case for Gold, The Death of Money, Currency Wars and The Road to Ruin, by Greg Bonnell of BNN.

Jim is the editor of Strategic Intelligence, former general counsel for Long Term Capital Management, and a consultant to the U.S. Intelligence community and U.S. Department of Defense.

by: Elaine Diane Taylor

 

Topics:

 

Gold

Gold as a Standard

 

Jim Rickards

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Interview Link

GOLD

We’re getting close to when the price of gold will lift off.

It has some headwinds in the short term, as Jim expects Janet Yellen will raise interest rates in March.

That’s not fully priced in, and as that gets fully priced in it will make the U.S. dollar get a little stronger.

When you have a stronger price for the dollar you have a weaker price for gold.

So in the short run the dollar will be stronger and gold will have a lower price in U.S. dollars.

But the Fed is tightening (raising interest rates) into weakness (a weak economy).

The Federal Reserve have flip-flopped on their policies nine times since 2013. They literally don’t know what they’re doing. (Jim has said that the individuals at the Fed are very intelligent but their models are incorrect because the global economy is a complex system).

Right now the Fed is in tightening mode and they’re going to raise rates, but Jim expects that by April or May they’ll have to flip-flop again because of a combination of new appointees and a slowing economy.

Look for the Fed to lower interest rates again, and that will be a rocket booster for gold.

GOLD AS A STANDARD

Look at what’s been going on in the currency markets in the last couple of years.

On January 15, 2015 the euro fell 20% against the Swiss franc in two hours.

On August 10, 2015 the Chinese did a shock devaluation and lowered the yuan by 3% against the U.S. dollar instantaneously.

On June 24, 2016, right after Brexit, pound sterling fell 14% against the U.S. dollar.

These are currencies — they’re not lottery tickets.

Why are currencies moving so much so quickly?

It means the entire system is unstable.

It’s not too late to solve the problem, but as the system is right now there’s going to be a crack up that leads to a global liquidity crisis worse than 2008.

The system needs a frame of reference.

A gold standard is one answer, a commodity basket or the U.S. dollar (if the U.S. stands up to its obligations) are other answers.

Right now we have nothing.

The system is highly unstable so you should expect a collapse (crisis) of some sort.

CRISIS VS BUSINESS CYCLE

A financial crisis is different than the business cycle.

The business cycle has its ups and down and we expand and contract. We’ve had a mild expansion for eight years and you can argue that it’s getting a little long in the tooth. That’s different than a financial crisis.

Sometimes they come together at the same time but they’re different things.

In 1987 the stock market crashed 22% in one day, but there was no recession going on at that time.

In August 1998 we had the Russian/Long Term Capital Management (LTCM) crisis. Global markets almost came to a complete halt. Jim was legal counsel for LTCM and negotiated the bail out. But, again, there was no recession at that time.

So sometimes you get a financial panic without a recession.

Also, you often have a business cycle recession without a financial panic like in 1989, 1990 and 2001.

Sometimes they come together — like 1929 and 2008.

Jim’s much more focused on systemic risk and the possibility of a global liquidity crisis, as opposed to whether the economy is just slowing down or not.

Jim Rickards can be found on Twitter and at James Rickards Project.

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My thoughts…

 

Everything vibrates.

Edward Dewey was hired by the U.S. Department of Commerce in 1931 to find out why the market crashed in 1929.

He discovered that the laws that govern vibration and cycles apply to market cycles as well. He founded the Cycles Research Institute which looks at short and very long cycles of many things, and what happens when they overlap.

All matter vibrates.

So what are the laws of vibration?

We see colours, we hear sounds and we feel heavy footsteps. This is all matter vibrating at different frequencies, which we interpret with different organs in our bodies. Our bodies pick up lower frequencies and feel them. Our legs and arms and gut feel low bass notes in music and the rumbling of a truck going by. Our ears pick up frequencies above those our bodies can’t feel, and our eyes pick up the ones that are even faster, above the speed that our ears can pick up.

Markets have a frequency as well – repeating cycles of events.

Like water ripples outwards in a ring shape when we toss a stone, those ripples double in size or cancel each other out when the rings overlap after a handful of pebbles are thrown in at the same time.

So sometimes there are big lifts and big dips. This happens when different cycles are happening at the same time and they are at the top or bottom at the same time.

When things vibrate close to other things, they can sometimes be expanding and contracting at the same time. This is called in phase, and it doubles the energy. If you’re in the audience at a theater in the middle between two speakers you can experience the change in volume if the engineers have not put the speakers’ sound waves in phase. Also, sometimes the waves are out of phase, exactly opposite, and it cancels both of them out. So, in the theater the volume at the exact spot where the sound meets between two speakers can drop off if the speakers are not set ‘in phase’.

Markets are like that.

Vibration. Cycles. I call it the rod and the ring. Every empire and marketplace moves to the rod and the ring (from the song ‘Rod and Ring’).

Sometimes a market business cycle and a market crisis cycle meet at the same time and you get an exceptionally big dip.

A new spring, a rise, happens after that. I’m not a market speculator. I’m not much for money, actually.

I’m about the cycles and understanding how gold, which is beautiful, plays a part in what moves and what stays.

Many cycles are converging, not just the market but also technology and how people communicate and group together. I believe it will be the end of Modernity and the beginning of something new. So I’m preparing for the ‘exceptionally big dip’, and then comes spring.

Glorious golden spring. That’s what I’m watching for.

 

Elaine Diane Taylor~

February 19, 2017

 

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Jim Croce’s ‘Time in a Bottle’, just laying back on the chesterfield in Vancouver, Canada, last month. Not for sale at this time.


https://elainedianetaylor.files.wordpress.com/2017/02/edt_jan2017_livingroom_timeinabottle.mp3

 

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Gold is $1,234.60 U.S. per ounce

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Not Much of a Holiday (Greek Debt and Media Persuasion)

words and music Elaine Diane Taylor

© 2015 Intelligentsia Media, Inc. All rights reserved.

SOCAN/ASCAP

Single available on iTunes

The Greek bank holiday and long lines to get a few euros for the day. Debt deals behind closed doors. The media telling us what opinions to have. China building islands in the South China Sea and claiming all the international waves. More dealing to come. More standing in line for those who owe. Who owes? There’s a long line of nations in debt and this is far from done.

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Preparing for the Fall live boutique album available on iTunes — featuring Wag the Dog, Black Swan Dive,  American Pie and Gods of the Copybook Headings.

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Coins and Crowns

words and music Elaine Diane Taylor

© Intelligentsia Media Inc. All rights reserved.

SOCAN/ASCAP

from the album Coins and Crowns available on iTunes

Single featured in Episode 1 of Mike Maloney’s documentary series Hidden Secrets of Money.

 

The Gods of the Copybook Headings

words by Rudyard Kipling and music by Elaine Diane Taylor

©2014 Intelligentsia Media Inc.

SOCAN/ASCAP

from the album Preparing for the Fall available on iTunes

 

The copybooks of the early 1900s gave us all the wisdom we need. The sayings that were copied are the truths, the gods, of our world. All the empires who followed the gods of the marketplace instead have fallen, and there’s terror and slaughter when the gods of the copybook headings return. The lyrics are by Rudyard Kipling. One of my gurus.

Another Week on Wall Street

words and music Elaine Diane Taylor

© 2013 Intelligentsia Media Inc. All rights reserved.

SOCAN/ASCAP

from the album Coins and Crowns available on iTunes

See the bankers wave their Wall Street wands and conjure piles of paper green. Naked short selling is like betting that your neighbour’s house will burn down. But in this scenario it happens to burn down. If the bankers win then we lose the whole world as we know it. I wrote this in 2009, with a lyric “A little grease (Greece) is floating out to sea, and little pigs (Portugal, Italy, Greece and Spain) are bobbing up and down, they’ll send a storm and we’ll see, when the tide goes out who’s naked on the beach“, and it’s coming on now. The world is changing as we know it.

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Nothing on this site is intended as individual investment advice. We’re all watching which way the wind is blowing.

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