Thursday, October 2, 2008

Inflation, Deflation, Snails and 30 Days

Ender has a very good point when he says, "large changes happen at a snail’s pace". But once in a while throughout history, large changes happen at what seems like lightning speed!

The thesis of this blog is that back in 1997 a man, who went by the name ANOTHER, had the wisdom and such a high vantage point, the height at which leaders view the scene, that he was able to see what was coming and share that view with a few people. And sometimes, when you are really high in the mountains, things are farther away than they appear.

On Wednesday, November 5, 1997, Another laid out a scenario which he saw happening specifically within a 30 day time frame. Remember, at that time the price of oil was his trigger. It may still be, but as I said in a previous post, we are now awash with potential triggers.

Here's the quote:

At this moment in time and space, the price of oil in US$ terms is about to roar! It will crush the Pacific Rim and South America. It will drive the US$ sky high in terms of other major currencies but the dollar will collapse in terms of gold! Short term interest rates in the USA will be driven thru the floor much the way they have been in Japan from the early 90s. This will be done to combat a imploding equity market. Long government bonds will almost stop trading as their yield soars from the oil price fears of "inflation"! Because of todays "new digital paper markets" this entire act will be played out in 30 days or less. Yes, you are right! During that time we will have inflation and deflation. - ANOTHER

I think we may have finally arrived at the beginning of that 30 days.

That is a bold statement to make on the eve of an historic vote by Congress, but I don't think it makes a bit of difference which way the vote goes. Sure it makes a difference for the future of freedom and capitalism, but not for the future of physical gold.

And on the subject of inflation and deflation, this is a short post I made on another site explaining how inflation and deflation go hand in hand.

Just my two cents on Inflation/Deflation. If I buy a house on a street with 5 houses for $100,000, then later someone buys a house for $200,000, all of a sudden, all 5 houses are worth $200,000. My net worth went up $100,000. The street's net worth went up $400,000. But 400,000 dollars were not created. Asset inflation happened.

Asset deflation is happening now, which is the reverse effect. If I bought a house for $500,000, and now someone sells for $250,000, then all the houses on the street are now worth $250,000. So the net "loss" to the street is $1.25 Million. That is deflation.

This is happening with all types of assets, things that were assumed to be good investments. But as we bail them out, we take some of that phantom net worth, like the $400,000 in the first paragraph, and make it real, spendable cash.

That cash is no longer going to go into bad "assets" that were previously thought to be good investments, it is going to go into real things, like gas, oil, gold and milk. And because it is newly printed spendable cash, it is going to bid against the previously existing spendable cash. That bidding process will cause the cost of real things to go up. That is inflation.

So we can have both asset deflation and real world inflation at the same time. Necessities will cost more. Luxuries and Mortgage Backed Securities will cost less
.

FOFOA

4 comments:

Ender said...

Keep in mind that oil wants some gold – ie – they don’t trust claims, but rather want some small amount of settlement. Another also said that if the world bids for gold, all bets are off regarding settlement of oil for dollars. The world is starting to bid for gold. Physical supplies are going into hiding.

Also, do we have to have hyper-inflation on ALL assets? Hyper-inflation of the price of one asset will do. If gold is revalued so it can be used to settle claims, it can absorb the extra dollars in circulation. The Euro financial system has gold on reserve, thus any threat to their system would require the mobilization of gold. If gold is actually mobilized to defend that currency, oil will be VERY happy and gladly find function therein.

Thirty days or overnight. The difference is that the longer it takes, the harder the shock to the world.

He who holds the gold makes the rules.

SatyaPranava said...

many of my comments on here will clearly be with hindsight (and without the benefit of reading future articles). for that I apologize (please feel free to redirect me anytime.

i'm curious to know just how much lindsay williams's information from his alleged insiders about the west opening oil pipelines in Indonesia and Russia have changed the nature of the oil-gold-dollar war? the alleged goal (i'm sure among many others) is to bankrupt the Saudis, Russians, and Venezuelans.

I'm curious to know if this further delays Another's vision and if so, for how long does it shift the geostrategic balance of power.

Especially knowing that Brzezinski is keen on isolating Russia and China, by utilitizing Pakistan, Iran, and Afghanistan (in much the same way he did when in charge back in '79), I'm curious to know how this game has changed w/those two pipelines coming online (or any other significant details i've missed).

don't get me wrong, i see the empire accelerating down their own imperial slope. but curious to hear some other perspectives.

prana

FOFOA said...

Hello Prana,

Nice to see you pop up in different places.

I believe the dollar is the key to everything. And the dollar has, since 1971, relied on the "backing of oil". This deal fell apart in the late 90's according to Another. And I believe it has taken 10 years for the effects to start to be felt in a big way. The GCC is now planning its own reserve currency, which it would like to launch next year.

Also, the Gulf region is finally taking possession of its physical gold that has been stored in London for years. (See today's comments under Stress Test Results Are In!)

The US is very powerful, but only so long as the dollar is strong and the rest of the world craves dollars. It will be hard to maintain the military when this is no longer the case. This will be a frightening turn of events.

I believe things are aligning for a transition around the end of this year or the beginning of 2010. It is impossible to predict the little twists and turns along the way, but the final outcome is pretty much set in stone.

Here is a recent interview with Lindsey Williams from last week. It is in 6 parts on YouTube. I have not watched it yet. If you watch it, let me know if he says anything new!

Thanks,
FOFOA

SatyaPranava said...

my pleasure to be popping up in different places...only until these discussions flame-out, and I catch-up to the main board.

I can't wait to read what I've seen are some 130+ comments in the stress test results are in, blog in may '09. haven't gotten there yet. but it probably won't be more than a week or two before i do arrive.

i've actually been censoring many questions that I have simply because i've posted all over the place on here and that some of my questions don't seem as poignant as they were when many of these stories were breaking, or further implanted in a select consciousness.

i can't wait to explore this little (big?) and very expected power-flap re: the GCC, what with UAE, Saudi Arabia, etc. I have been expecting the US to insert some influence, but then again, much of Cheney's wealth is reportedly in the UAE and "we" (the western power elite) made the UAE just as much as we did Saudi Arabia--the former we created for more geostrategic shipping purposes through the Strait of Hormuz.

can't the US sustain w/many natural resources (coal, natural gas, solar, oil) if the dollar collapses? this could be done with the political will, no? I realize that she'd be much more isolated politically, economically, even socially, but I would think she might be able to be ok. And I'll pretend that I don't believe such a political will to be likely in the coming future.

the foreign countries asking for gold back is a HUGE story.

i love the twists and turns...they're so fun. i mean, seriously, on the highways we have speed limits...but in the realm of international political and economic intrigue, that works as an amazing endogenous sort of evolutionary high, with potential and real world implications...that's the stuff that life is made of. my med school pre-reqs? ha!

I'll tell you my problem with Lindsey Williams. I have NEVER heard him do an interview yet where he doesn't tell the public something that has not been previously reported (irrespective of its future outcome). As i've been listening to him now for some 6 years, i find that interesting. Moreover, I find it very difficult to listen to 41.2% of every interview where he has to boost his own credibility by selling his modesty and his right time/right place fortuitous connections. But probably most importantly, intuition tells me that something is amiss w/him. I think that intuition has me believe he is not that well connected, though is somewhat. and he's very intelligent and has a great angle for selling himself.

as for me, i took on the international power structure, the vatican, and interests in russia, the US, UK, germany, and france in the region where so many fight (Israel). I lobbied (in a miniscule capacity) for AIPAC on capitol hill, as well as worked on a few congressional campaigns, was student govt president of the most prestigious university in israel for the rothberg school, etc. I can tell you some stories and can leverage those stories, connections, insights, etc. to give myself more credibility than I ought to deserve. I think that may be what Mr. Williams is doing, w/all due respect if he's not.

Hell, even if he is, he's still providing an important service, as long as he's not setting ppl up for a huge piece of disinformation down the road. so good for him if he's doing it for his family, or even himself. but again, intuitively, something is not there for me whenever i hear him interviewed.

i will watch it at some point, but he rarely says anything new of serious substance. so i won't hold my breath. i can tell you for sure that he'll tell his story, and tell yo uto buy his DVDs, etc.

ok..enough williams cynicism for the moment. i do appreciate the message :) (ending on a more positive note).

we'll continue this more, i'm sure.

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