Friday, October 12, 2012

Debriefed #5 – Wendy

It is now my pleasure to present the delightfully charming and lovely Wendy, of Wendy's Open Forum fame. She has been at this blog for three years now, and has been participating in the comments almost as long. Never one to hold back how she really feels, Wendy delivers in this interview. So without further introduction, here's Wendy!


Tyrone said...

FOFOA, Reveal Thyself!!

Oh, I guess you did. And so did Wendy.


Winters said...

These interviews are coming thick and fast. I saw RJP's outtake which i missed before. Funny bugger!

Winters said...

PS: just in case it is lost in translation across the pacific: 'funny bugger' is a colloquial term of endearment

Anonymous said...

Good to see ya, Wendy. I think there's a few of us here from BC. I was hatched in Alberta, but now happily inhabit the south Okanagan.

Never thought I'd see myself Going to the City...

Wendy said...

/sleeping..... south okanagan? I pass by you regularly, on my way to the coast. I'll be flying over you next weekend :)

Anonymous said...

Sooo... you were hatched too, hey?

Yep, this little city on the water is my paradise:)

Naughty Slumdog said...

Six month ago, if one would ask me what is FIAT, I'd surely say "an italian car". I learned some interesting things, keep going guys!

costata said...

Hi Wendy,

I enjoyed your interview. You are charming.

Best wishes,


M said...


I went the other way around.. From BC (Abbotsford)to Edmonton. The city of Vancouver and the Okanagan is nice but I don't care for the rest. Much better in Alberta. 30% cheaper gas, no provincial sales tax, cheaper real estate, higher salaries, lower property tax and less rain.

JulesFlying said...
This comment has been removed by the author.
BaronSilverBaron said...

The first interview with something interesting. The lady has sense hanging on to her Silver despite 3 years of obvious indoctrination. Belts and braces: always a good idea. I'm an Englishman living in France so I'm used to people thinking I'm strange but my wife had 4 friends from Alaska staying with us for 4 days. Just to show how indoctrinated people can get they firmly believed Obama was doing a good job. Unemployment was getting less. 911 was terrorists attack and the Moon landings were not a hoax. They also couldn't see the point of buying Gold and Silver. So visiting this site I see I'm not the only mad-man (or woman)

Woland said...

Delightful debrief, Wendy. A minor aside in your interview
led me to make this comment: your fish/vegetable cycle
arrangement, where the vegetables utilize the waste produced
by the fish (which are presumably fed by you) has been done
on a large scale in California with.....ta da ta da.....sturgeon.
Can you guess what else they produce? Yup, yer right!
The company is called Tsar Nicolai Caviar. Google them if
you like. Cheers.

Woland said...

One other thing. Given your background in mathematics &
science, I think I have a treat for you. Back in Sept. 2009,
just about the time you arrived at Fofoa, the late Benoit
Mandelbrodt gave an interview over at the FT with John
Authers, on the subject ,"Why efficient markets collapse".
It goes through how Henri Bachelier's thesis, (Poincare was
his adviser!) on the theory of markets as random walks
led to the incorrect modeling of risk as a normal distribution
rather than a "power law distribution". This, in turn led
to "value at risk" models which provided the intellectual
cover for excessive risk taking. Again, just google the key
words and it should come up. Hope you enjoy it. Cheers.

Lord Sidcup said...

This video tells the story of the Oil for dollars deal, and says Iraq and Iran caused attacks by wanting to sell oil for dollars / gold.

byiamBYoung said...


Delightful interview. You are someone who looks and sounds precisely how you write, IMO. I would have been able to pick you out of a crowd!

FOFOA, I'm sure you have Motley Fool on your list, but that would be another fascinating conversation.


Jeff said...

Zolt the dolt. Another German gracing us with his gracelessness?

Tyrone, your interview is coming. I imagine you will do it poolside, surrounded by playboy bunnies. Reveal thyself!

Dante_Eu said...

Finally a lady interviewed. Nice! Always good with diversity, now maybe Lisa should be included down the line.


Nationality does not have anything to do with stupidity. In your case it’s redundant information.

Dante_Eu said...


Oh man, what are you on?

I would like to try some of that. :-)

Woland said...

Hi Jeff: I guess Sir John's son wont be giving out any
Templeton prizes to Sir Art. He would, as Henry James
put it, "be like a beggar with a jewel, wondering how he
might wear it."

KindofBlue said...


Ever read A Catcher in the Rye?

Second question. Do you think you're the first person to express frustration at the amount of human cruelty in the World? If it wasn't you I'm sure somebody would have got around to sharing your keen insights with FOFOA.

And finally, what year was it exactly that you left the Girl Scouts?

Note that none of these questions pertain to this blog directly, but there are some very thoughtful people here who may have some helpful insights for you.


Hi Wendy! I'm holding the little silver I have also (3%)!

burningfiat said...

Dante Eu, I think I'll pass. Seems like a bad trip... o_0

Phat Repat said...

"Tyrone, your interview is coming. I imagine you will do it poolside, surrounded by playboy bunnies. Reveal thyself!"

Now that's one I WILL watch... Keep up the good work Tyrone, you were spot on.

ampmfix said...

Hew is just a bitter drunk, no misterious drug here...

Wendy said...

Thank you to those that complimented me on the interview. Although removing that veil of anonymity was somewhat intimidating, it was fun.

costata, I look forward to seeing your interview when you are ready :)

Woland I appreciate you reminding me of the Mandlebrodt interview. I had seen it, but would enjoy watching it again.

Wendy said...

M, my daughter just moved to Edmonton and is liking living there. If I had only 2 choices (vancouver or edmonton), I would choose Edmonton for the reasons you site. However I live in the Kootenays for those reasons you site PLUS the weather here is way more civilized than Edmonton.

Sleeping, the OK is beautiful, but for those of us that require employment income, I suspect that mostly one would find low paying service industry jobs. Although I imagine that there are many opportunities for self employment.

Motley Fool said...


I expect you to offer a formal apology once the dust settles.

For now...just go away.


Wendy said...

the comment section on the zerohedge site has always been a bit of a freak show ;)

If anyone has read all the material in this blog they would know that FOFOA is about as far away from a banker as it gets. He has stated his area of expertise!

Wendy said...

Art, I am at a loss to understand why you bother with this blog. You can't have not noticed that your ideas are not embraced by those that frequent here. Do you really expend all that time and effort for nothing?

That you believe in your ideals is entirely irrelevant. That you choose this platform to "spread the word" is pathological.

Thank you for reminding me of this, and Goodbye!

Motley Fool said...


Sadly, all you expose is your own ignorance.


Wendy said...


Carry on as you wish, you know where this is going. Your posts will be deleted and you will have spent alot of time achieving the same nothing you always achieve here.

Wendy said...


read "worthless token" ;)

Anonymous said...

Wow the shit posters are really coming out in force these days.

BSB sez...

The lady has sense hanging on to her Silver despite 3 years of obvious indoctrination.

Hm... indoctrination you say?

...Just to show how indoctrinated people can get they firmly believed...911 was terrorists attack and the Moon landings were not a hoax.

HAHAHHAHAHAHAHA OMFG you're killing me here.

Say do you also believe the nonsense about the leaders of the world being reptilian aliens - or do you draw the line there?

Dante_Eu said...


Seriously man, you got it all backwards! By using gold as “money”, you give away the power to the bankers, power to create a fractional reserve gold. By using gold as a wealth reserve, outside bankers fractional reserve gold scheme, you empower yourself and in the end ordinary people. You and only you, have then full control over your savings.

So, if there ever was “a foot soldier for the bankers” it is YOU, my friend. You give the expression “Eyes wide shut” new meaning.

Aquilus said...


Very nice to finally meet you.

I see your mentions of trolls and silver has worked wonders in the comments... Although we are yet to see Crack's reaction to your ring!

As for the hard money troll here's something for him (and the rest of us) to ponder again:

Over time and life spans gold has been brought into official use countless times. Only to be bastardized by forces, we as peoples can never control.

After every failure and ruination of much wealth, the cries always return to bring gold back as money.

Once again to begin the long hard road that leads to the same conclusion.

Gold coins, then bank storage, then gold lending, then gold certificate use, then lending of certificates, then certificates are declared paper money, then overprinted, then gold backing removed, then price inflation, then,,,,,, we begin again. But this time it's different the hard money crowd say.

Yes, it is. Only the time has changed.



Nickelsaver said...

"Freegold" = Absolute rule by the bankers for the bankers.

All moral judgement aside, I offer this alternative definition.


Physical Gold, unfettered by a commodity futures market, unpegged by governments, central banks, and currency issuers; is recognized globally as a premier store of value for saving; is traded openly in both private and public arenas between individuals, corporate entities, governments and currency issuers as a secondary medium of exchange; is used as a reference point reserve asset by currency issuers such that its floating value is seen to determine the strength of one currency relative to another.

Wendy said...

The pleasure is mine Aquilus.

I must admit I've enjoyed this attention but it's time to get on with my weekend. Fall came today, and I'll know I'll regret my words sooner rather than later, but "Yayyyy, goodbye old flip flops, hello new boots"

:D =8o}

DP said...

CORRECTION: none of the above should read.

Crack said...

Impressive finger work!

Woland said...

Luke 8: 26 - 39
"Then they arrived at the country of the Gerasenes
Which is opposite Galilee
As He stepped out on land, a man of the city who
had demons met Him
For a long time he had worn no clothes, and he did
not live in a house, but dwelt among the tombs....."

(from the Gadarene demoniac)

Naughty Slumdog said...

I have two issue with gold backed currency:
- As the number of humans and assets is ever growing, whilst the quantity of gold has physical limitations, how can we devise a “stable currency” with that ? This means that we have some sort of permanent devaluation of the paper currency banknotes, not to mention the economic side effects of not having enough physical paper money for all transactions to be carried out in the world. The number of humans, boll of rice, daily bread, kilowatts, how you want to measure, is growing, a the bread will become cheaper and cheaper ?
- The gold currently held in central banks is bought with proceeds from taxation. As individuals, certain nations “saved” and put the excess in gold. Other nations either did not “saved” or choose some other public assets, such as roads, hospitals and schools. Basically the nations that do not have enough gold should not have the right to issue banknotes ? On the other hand, is that moral to issue banknotes, e.g. to allow individuals to appropriate gold that was obtained through public money ? Because if you just hold gold but you are not allowed to take physical possession on it, that it is not really backed by gold… The gold of central bank is a wealth stored for the entire group of people that form that nation, and all individuals of that nation hypothetically have equal right over that gold, as they have equal civil rights (eh, for that type of countries). Nation, as a big community, should have stored some asset for bad times, such as wars, major crisis and natural catastrophes. Same with individuals. Then, from where the gold backing the banknotes would come from? Hand it over to private gold holders ?

I have no oppion yet on the topic, as I jumped into this macro world last year ...

Anonymous said...


Edmonton is alright, I guess. Plenty of opportunity in Alberta, that's for sure. Most of my friends are in oil related work, and they make some seriously good money. Me, I could never live there again... too flat, way too cold and too many mosquitoes! hah! Everything I enjoy doing is here in BC, and the weather is 10x better:) At least here in the semi-desert it is.


We lived in Creston for 3 years... nice little town, but not much happening. It's beautiful in the Kootenays, I can see why you might choose to live there. I have a close friend that left Alberta oil money for a nice job in Trail at the smelter. I guess they moved for the same reasons we did, in the end.

RJPadavona said...

Nice interview, Wendy!

Has anyone ever told you that you look like Anjelica Huston?

It's great to finally put a face and voice with the matriarch who keeps us mischievous boys in line here in NeverNever Land.

And I'd also like to thank you. I thought that accent had been ruined for me by Sarah Palin. Now when I hear it, my first thought will be of you :)


PS: +1 for grannies around the world. I wish my granny looked as good as you!

Lord Sidcup said...

If the Euro becomes the world's reserve currency under FreeGold, will Europe get the initial benefits, then disadvantages that the US reaped. The 'exorbitant privilige" that partly caused the rise and fall of the US ?

Wendy said...

Thank you RLP. I can see a bit of likeness in that pic an Anjelica, although I think she has about a decade on me.

In terms of keeping anyone in line, Perhaps I could have used some of that myself today. I was really just going to Walmart today and I did. On the way home I was driving past that auto dealer, and, well I turned in >>>>>>>>>

and the rest is history (sigh) :D

Wendy said...

i mean RJP ;)

Nickelsaver said...


In Freegold, it is not the Euro that serves as a reserve, but Gold. The Euro as a world trade currency, will not have an exorbitant privilege due to its separation from the nation state, as well as the severed link to gold.

costata said...

This is a must read in my opinion. (h/t Ed Steer) FWIW I think that part of this flow is "big money" on the move.

In 2011, over 2,600 metric tons of raw gold were imported into the country, to a total value of SFr96 billion ($103 billion). This was a record, the quantity having more than doubled over the last ten years, not including the gold that transits through Swiss free ports.

Take note: "not including" the flow through the transit channels.

If to this figure you add the gold coming from small businesses all over the world, which say “we buy gold,” and from illegal mines – a figure not considered in official statistics, – it would appear that two thirds of the world’s gold transits through Switzerland.

The refineries are mainly service providers. “As a rule these foundries get the gold from their customers and refine it to the standard grade of purity. The customer then decides whether to take the gold back or sell it on the market or to the refinery,” explains Panizzutti.

It would be very interesting to know how much of this refining is "round-tripping" - jewellery is purchased and exported to be processed into bars etc. Apparently this is a common practice in Vietnam.

What keeps the Swiss refineries going at full pace right now is not so much the demand for semi-finished products for jewellery and watchmaking, but the demand for gold bars.

Again it would be interesting to know if any of this gold is coin-melt bars being refined into 99.99 good delivery bars. Likewise if, say, you are an Indian or ME "giant" and you wanted to internationalize your gold holdings then converting it into good delivery bars (and perhaps the standard 1kg bars popular in Asia) would make it a more easily tradeable "money".

In the same vein it would help to obscure the source of your gold. Once it has a Swiss refinery's mark there's no way to trace the source. It becomes part of a large (the largest?) "pool" of bullion developed over a long period of time.

For some reason this story reminds me of the LBMA disclosure that Another discussed. Why trumpet (at this point in time) the fact that Switzerland is the centre of the gold refining world? Establishing their credentials and credibility for a more overt role in the gold market under a Freegold-RPG regime? Perhaps a concomitant to the large Euro holdings the Swiss have obtained from their currency peg?

Anyway some food for thought and discussion.

Michael H said...

Now might be a good time to repeat a public service announcement from a while back. I couldn't find the original comment and I don't recall the author but I will reproduce the content:

If you subscribe to comments via gmail and would rather not be bothered by a troll (let's call him "art"), follow these steps:

1. On the upper right corner of the screen, select the 'gear' drop-down menu and click on 'settings.

2. Click on the 'filters' tab.

3. Click on 'Create a new filter' at the bottom of the screen.

4. In the 'From' field, fill in

5. In the 'Has the words' field, fill in "Art has left a new comment" (be sure to include the quotations).

6. Click 'Continue' on the bottom right of the popup.

7. Under When a message arrives that matches this search: put a check mark in the box next to Skip the Inbox (Archive it) and in the box next to Delete it.

8. Click on the 'Create filter' button, and you're done!

Repeat as needed.

Michael H said...


It's also a curious notion that you can defend the exchange rate of a floating, fully convertible currency via the FX market. That worked out very well for the BOE (Soros/Rogers raid) and Thailand (circa 1997) NOT!

I did say they may attempt it. I didn't claim they would succeed.

costata said...

PS. Just to drive ART nuts. Perhaps he would like to consider whether this Swiss story is the big money breaking down their good delivery bars into smaller weights and getting ready to UNLOAD part of their stashes onto Joe Public at Freegold prices for their own exorbitant SELFISH gain at the expense of the MASSES.

(If anyone thinks this is an instance of Uncle costata being a nasty bastard read the comments sections from the silver open forums. I owe ART a few shots.)

On a serious note. It's worth bearing in mind that after the Freegold-RPG transition some (many?) of these giants will need to do some serious investment portfolio rebalancing.

Back to the hermitage for me until I see another piece that I think important enough to warrant a report.

costata said...

Michael H,

Understood. A triumph of hope over experience perhaps?

Before I head back to my cave I'd like to comment on this notion that you can manage a currency's exchange rate through the FX market. In the long view of monetary history this is a relatively recent idea (as is the concept of the modern FX market itself). And a very bad idea of how to go about the management task I would assert.

If you review the historical record the main technique for maintaining currency stability (value) is to manage the base money supply. And I stress, base money, not this Rothbardian confection of base money plus deposits etc. The so-called True Money Supply of Rothbard and friends that some would argue is an error prone monetarist divergence from the classical/Austrian path.

From this perspective a peg against gold should not be interpreted as a strategy requiring the price of gold to be managed. Rather it requires the currency to be managed with gold as the constant - the indicium/RPG.

IMHO the gold exchange standard folks should invert their perception of a peg under a gold exchange standard and view it as a moving target not a fixed value for all time. Also IMHO the goldbugs should accept that it is infinitely better that the public holds most of the gold (rather than the State) as an asset (rather than a currency) and then prices the currency using said asset through exchange in a free market.

If these folks could accept these two notions then I think a lot more of them would be in the lounge sipping champagne on the good ship Freegold instead of leaning over the rails chundering every time someone mentions fiat currency and/or fractional reserve banking.

(That last bit was for an old chum of mine who reappeared in some recent threads.)


Phat Repat said...

Uh, Art, I believe your cut-n-paste and publish buttons are stuck. Please take your computer and toss it out the window (avoiding all personnel and property in the way of trajectory/free-fall). Thank you.

Wendy said...

Thank god for the scroll button AD

Aquilus said...


" On the way home I was driving past that auto dealer, and, well I turned in >>>>>>>>>"

I totally understand... Happens to me every time I browse the gold dealer inventory online... :D

Wendy said...

Yikes Aquilus, you've reminded me that I had planned on buying a bit of gold next weekend. I might have to postpone that temporarily.

Wendy said...

thinkin out-loud:

I really wasn't planning to buy a vehicle, but when my daughter came home for thanksgiving last weekend, for alot of reasons I let her take my car. She left me her good, but oldish car (2001 olds alero).

I thought I might drive it through the winter, I quite like it. However the car needs winter tires all around, and that will cost quite alot for the tire profile to fit the rims she has. It needs other bits as well

The car runs great today, but who knows for how long. It's not a car that one wants to dump money into.

Sooooo, I bought a used 4WD Jeep. After my last car I have vowed to never buy new again, I can't justify the depreciation that I have had to suck up.

I won't pay the stupid interest rates the banks charge, so I have significantly depleted my digital currency reserves; the "what if something really bad breaks in my house" currency.

I apologize for putting everyone through my anxiety episode regarding this issue, but typing it has worked for me. ;)

I had to get on elli the eliptical trainer bitch tonight in order to find peace with this.

Hey, i'm the shrimpyist of the shrimps :D and have to constantly monitor my input/output.

Anonymous said...

James Mackintosh in the Financial Times:

Dear Chancellor (can I call you George?),

I wanted to write to you privately to follow up on my application for the job of Bank of England governor, and hope you’ve seen my CV (I applied as plain Adair Turner, skipping the Lord). I have tried the usual application route of speeches and media leaks in my current role as the country’s top financial regulator, but I thought some extra detail was in order.

My proposal is simple: give me the job and I can help with those nasty debts so you can get the economy moving again.

I said at the Mansion House this week that I would be ready to go beyond buying bonds, a strategy anyway losing its effectiveness. When I said we could “employ still more innovative and unconventional policies”, you might have thought I meant some gentle blurring of monetary policy lines, perhaps Japanese-style share purchases.

That would impress your friends in the City for a while, but you and I both know it isn’t the radical step the economy needs.

That’s why I want to make a more radical proposal: give me the job and the bank will consider writing off government debts. You might think Mervyn’s been doing his bit by letting inflation run well above target over the past few years but, frankly, the bank was just lucky.

The bank could do a lot more to help your re-election ambitions the economy. We’ll soon have 30 per cent of government bonds and bills. Give me the nod, and you might never have to pay it back. I know some economists will warn of inflationary dangers. And it’s true we would have to print a few quid to keep the chaps in accounting happy. But it’s only £366bn; you hardly get change from that at the IMF bar nowadays.

The worry-pants out there are probably the same people who keep rabbiting on about the danger of buying bonds in the first place. I saw this chart (left) using data from the bank’s survey of what inflation rate people expect and you can see that even after all the QE, we only had a teensy rise. I know you missed out on economics at Oxford but you should see this matters because it affects pay rises workers demand.


Anonymous said...


I should warn you that there’s some headline risk to cancelling gilts. Journalists are sure to put “monetise” into Wikipedia and write about unpleasant foreign experiences. Germany’s Weimar Republic and Zimbabwe will come up. But we can hardly be compared to them, can we George? They didn’t have the benefit of modern monetary theory, after all. Anyway, we would only have a problem if you did something silly and stopped trying to balance the books. I’m sure you’d stick to austerity even if it did not seem necessary.

If anyone asks, printing money to cover the gilts would only double the monetary base. In the past six months the bank has already increased it by a quarter and that’s without cancelling anything. Rudolf Havenstein was much more aggressive. He ran the Reichsbank’s presses hard in the middle of 1922 to increase the monetary base 50 per cent every six months and managed to secure full employment as a result. True, the German currency had to be scrapped 18 months later but that couldn’t happen to the pound. Probably.

As chancellor you might consider going further. It is one thing to cut the debt. But the economy is struggling because of all the poor souls who thought the good times would last forever and so borrowed too much. Our total debt as a country is more than five times the size of the economy, worse than any major country apart from Japan, the Netherlands, Denmark and Ireland. Reducing that means transfers from debtors to creditors, and there are only three ways to do that: time, inflation or defaults.

The public seems to be less happy with the idea of waiting it out amid the inevitable weak growth. The debts are so big that the small doses of inflation administered so far have done little to help – government, financial and corporate debt are all higher than before the crisis and household debt has hardly dropped at all. I would never suggest the British government should default, of course. But perhaps a one-off wipeout of a chunk of all debt would be in order?


Anonymous said...


The principle is simple: use the proceeds of a levy on owners of capital to wipe out debt. It sounds wacky but the ancients used to have frequent debt jubilees; if it is in the Bible it can’t be all bad. Boston Consulting estimates Britain would only need a tax of about a quarter of household wealth to bring debt down to reasonable levels. Once that was done, the economy could head off to the sunlit uplands again.

The alternative is just spreading the pain over time. Growth will be drowned in debt and capital slowly destroyed – savers have seen this already with returns below inflation. It might be better to give them a one-off haircut, but let them see a rosy future.

Yours in hope,
(Not) Lord Turner


Unknown said...

Owed to Art

DP said...


Never feed trolls.

Not even a shit sandwich with a few chocolate sprinkles on top.

Woland said...

Hi Victor:

Cute historical inversion. At least in biblical times, it was
the debts of the peasants which were cancelled. Today,
it's the Imperial debts we need to wipe out?? Help! I've
fallen and can't spend anymore!! Please, refill my SNAP

ein anderer said...

Hi all.
I am reading in this blog since about 18 months. I am still overwhelmed by the huge amount of informations. And I like the private style of the ongoing discussions.
FOFOAs blog inspired me to do something similar in Germany: yet with another theme focus. My focus will be: consciousness (the underestimated ruler of the world ;) )
Now my first comment here: Did already somebody ask where the intro music of the Debriefings came from?

Dante_Eu said...

@ein anderer:

Metallica - Ecstacy of Gold


Ennio Morricone - Ecstasy of Gold (The Good, the Bad, the Ugly)

ein anderer said...

Thanks, Dante-Eu. I love Western, but I am still waiting for getting time to see them all … There is so much love for so MANY things in the world …

Freegoldtube said...

Ecstasy Of Gold Remix

ein anderer said...

freegoldtube: That’s it. And I like the Comment under this YT-Link:
»The moment you have in your heart this extraordinary thing called love and feel the depth, the delight, the ecstasy of it, you will discover that for you the world is transformed.« (Krishnamurti)
Depth of insight into the real mechanics of social transformation is my theme ...
(And by this I have introduced myself a bit …)

Freegoldtube said...

All you need is love

Freegoldtube said...

Red Bull Stratos - freefall from the edge of space - LIVE

J said...

Something I "googled" upon earlier. Re: Triffins Dilemma

Found this excerpt particularly interesting

"In case China achieves to make its currency the third global reserve currency, would atripolar monetary system be more stable than the current? It is difficult to say. Morecompetition could bring more efficiency because the Triffin Dilemma would be shared. However, more competition can also mean more volatility and more tensions. Fearing thelatter, it is quite probable that the desire to achieve a multilateral IMS will continue, eventhough we are aware that finding a consensus will not be easy. As Padoa-Schioppa(2010:13) would put it in the reform of the IMS
, “we need a flying object; inventing the airplane is a different matter altogether”

More on Padoa-Schioppa

"But how would the world look like with a single currency?"

"I don't know, it is a project which it is urgent to work and think deeply, and I doubt that the solution is a single currency. it is a different thing to imagine an object able to fly or to invent the airplane. Today we know enough to say that we need an object able to fly, a common measure which imposes discipline to the international monetary system. On the global scale I do not think that a solution similar to the euro could be practicable, ie. something based on the model of a single currency - a "globus" for example - and of a single central bank. Rather I envisage a system on two levels: a global standard with a common governance and regional currencies with exchange rates that will no longer be entirely left to the market.

Woland said...

A global currency is about as appealing (or possible ) as
a global cuisine - picture haggis-sushi or a cheese steak
mousse. But a global measurement of "nutritional value"
for each item on the menu? That's a 5***** rating in my
Guide Michelin for "Ristorante Padoa Schippoa".

ampmfix said...

thanks Freegoldtube, that was quite moving (the jump of course).

milamber said...

Costata wrote,

“I'm still quietly pursuing the subjects that have my attention these days. I'm breaking my silence to highlight something that I think is a game changer in the speech by Christian Noyer linked above (h/t milamber).”

Glad I could contribute :)

I also found this speech at the BIS that I thought was a fascinating speech in regards to the debate about country’s wanting to enter/exit the Euro. I think it is a very important read as it highlights the decision making process that Iceland is taking in regards to Euro membership. I also can’t help reading it and seeing so many concepts & predictions that FOA wrote about 15 years ago. Really interesting & I hope that there is some way to read the full report when the Iceland CB releases it. If someone knows how to access it right now, please post details!

Már Guðmundsson: Currency and exchange rate regime options

Introduction by Mr Már Guðmundsson, Governor of the Central Bank of Iceland, to a report
issued by the Central Bank of Iceland on Iceland’s currency and exchange rate policy
options, Reykjavík, 7 September 2012.

Some selected pull quotes…

"Iceland has had its own currency since 1885, maintaining parity with the Danish krone until
June 1922, when it was devalued by 23%...The króna is now worth only 0.05% of its value prior to the 1922 devaluation; in other words, it has depreciated by 99.95%. In terms of consumer prices, the króna has eroded in value even more, or about 99.99%. In other words, its purchasing power in terms of goods and services is currently only 0.013% of what it was in June 1944, when the Republic of Iceland was founded.

Nevertheless, over this period, Iceland developed from being one of the poorest countries in Europe to one of the richest in per capita terms, despite the economic costs of persistent inflation. Currency depreciation and subsequent inflation episodes have sometimes expedited the necessary adjustment following economic shocks, however, thereby returning the economy more quickly to a path of economic growth…

there are indications that smaller countries have more difficulty than large ones in
pursuing independent monetary policy while they are becoming more integrated globally. In
this context, it is worth noting that, prior to the financial crisis, Iceland was by far the smallest
country in the world with a floating currency….

Money serves as a medium of exchange, retains its value against goods and services and other currencies, the better a store of value and the more reliable unit of account it is. The more it used in trade and the more generally it is recognised in settlement, the better a medium of exchange it is. In this sense, the euro has been successful, and the current crisis in the euro area has not yet changed this to any marked degree. The euro is the world’s second-largest international reserve currency, after the US dollar, and is recognised in trade everywhere. Underlying it is one of the two largest and most efficient financial markets in the world. As is discussed in Chapter 2, inflation has been close to the 2% inflation goal for most of the euro’s existence, averaging 2.1% from early 1999 until mid-2012 and currently measuring just under 2½%. On the whole, the euro has retained its value against other currencies. At the end of August 2012, it was nearly 6½% stronger against the US dollar than at the beginning of 1999, and 4% above the average over the intervening period. Euro area payment systems have proven effective, even in the financial crisis. No controls have been imposed on movement of euro-denominated assets, either within or outside the euro area. As a result, there is no currency crisis in the area, and it is therefore misleading to speak of “the crisis of the euro” as such…"


Indenture said...

Without question this was the most pleasing to the eye interview. Wendy, you look marvelous. (Billy Crystal voice optional).

Michael dV said...

Ah-ha moment
the transitional period between making a verbatim statement and hearing yourself say 'holy shit, what did I just say'

Wendy said...

You are very kind Indenture, thank you

Wendy said...

Cracky ...awesome finger-work ;)

Wendy said...

although I'm certain it's a pain in the ass ..... thank you FOFOA for moderating the comments at the moment :)

costata said...


That Noyer speech was a good find. Thank you. This speech by Iceland's CB Governor is a good find as well. The Euro "crisis" brigade (and the currency deflationistas) should take note of these quotes from these speeches.

Már Guðmundsson:

As is discussed in Chapter 2, inflation has been close to the 2% inflation goal for most of the euro’s existence, averaging 2.1% from early 1999 until mid-2012 and currently measuring just under 2½%.

Christian Noyer (my emphasis):

The second cause of this crisis lies in the competitiveness gaps that had widened for a long time before the crisis. The economic rationale is easy to understand: when joining a currency area whose goal is to achieve an inflation rate of just below 2%, changes in unit production costs must be in line with this central bank objective, modulo the productivity gains.

The objective of this 2 per cent inflation target is not currency devaluation per se. The aim is to create a small buffer against currency deflation. (BTW Japan is a case study on the dangers of currency deflation if the deflationistas care to investigate it.)

As Noyer points out countries in the Eurozone are expected to offset this currency inflation (devaluation) with fiscal and economic policies that foster "productivity" gains of 2 per cent per year.

Let's assume that there is zero possibility of increasing incomes by 2 per cent (real - after inflation) and consider this question: Is there a government or business (or middle class household for that matter) in the developed countries that could not find 2 per cent in overall savings or efficiency gains each year?


PS. It's also worth noting Noyer's interpretation of the 3 per cent deficit limit as opposed to the Eurozone politicians "interpretation".

Bjorn said...

Thank you Costata and Milamber. That was very interesting and dare I say uplifting. Especially in contrast to our own finance ministers (Borg)recent ramblings about how Greece will be forced out of the Euro and get more income from tourism as a result of the Drachma depreciating afterwards... Reminds me of Wimp Lo.

Woland said...

Hello Fofoa:

Please consider what follows as a request for advice, both
from you, and the members of the blog who may have an
interest in such things.

For no particular reason, I have become interested in the
question of just who Another and FOA were. I used to be
interested in who Fofoa was, but I have, miraculously, lost
interest in that question recently. I have drawn my own
tentative conclusions re: Another, and I know that others
have a different opinion, which is fine, because either way
we're speaking of a very tight circle of men who both knew
one another and interacted closely within the realm of BIS,
ECB, and the founding of the Euro.
So, that leaves us with our mysterious Texan, (when he
wasn't stationed elsewhere, or traveling the world) on business,
either his own or that of a large oil related corporation.
Which brings me to the Petroleum Club of Houston 1996
annual yearbook, which arrived here a few days ago. This
is a convenient volume, in that it precedes by only a year
the time when FOA began publishing, and it is highly
likely, given his comment , "We never could have had a very
private conversation at the petroleum club. If you did know
me, you would know exactly why." (smile), that he was a
member. It is not a certainly, just a high probability.

Anyway, there are 700 members! And when I eliminate
those that are lawyers, too young, clergy, women and a
few other people who couldn't possibly fit, the number is
still quite large, maybe 2/3 of the original 700. Checking
the bio's on each of these is not too hard, but it IS time
consuming, so I'm wondering if any commenters have an
interest in finding a way to share the load. On this subject
I'm happy with "majority rules". Thoughts? Bueller? Bueller?

DP said...

But but but … we can easily reel back in all the liquidity stimulus!


The second set of costs stems from the risk that exit from this regime could prove difficult. In particular, some observers worry that the expansion of the Federal Reserve’s balance sheet could ultimately prove inflationary. If that were the case, then I would regard the costs as exceptionally high.

Fortunately, I am confident that such fears are misplaced. That is because we now have the ability to pay interest on excess reserves (IOER). This means we can keep inflation in check regardless the size of our balance sheet. If the recovery got underway in earnest and credit demand surged, we could slow down the rate of credit creation by raising the interest rate we pay on excess reserves. Banks wouldn’t lend out funds at lower rates than what they can earn from holding reserves with us. As a result, a hike in the IOER would raise the level of interest rates throughout the economy and this would dampen any expansion of credit. Our ability to pay interest on excess reserves is an essential tool that we can use to avoid future inflation problems.

Yes, the government can readily tolerate those elevated rates and keep it's budget in balance. No problemo! What's that? Market rates in this particular market are uncorrelated with rates in other credit markets?

Your response to increased velocity of money that is in the system, is you attempt to slow down the rate of increase in the volume of money (credit) in the system?

… OK then. If you say so…

I'll not trouble myself with reading beyond this point in your publication, sir. NEXT!

Naughty Slumdog said...

Turism my … tail. If you want to understand better you mark FOFOA’s words about EXISTING gold in greek central bank and watch closely the natural resources Greece still has gold: and oil
Hopefully this will put in the right prospective the claims of politicians

If one should ask “why the Club Med is so shitty now”? one very good answer would be the “free money”. They pumped into average economies EU funds “to make them more competitive” channeled through politicians. I could not find the correct figures, but Ireland was a champion of “absorbing EU funds”. Greece, Portugal and Spain have their fair share. Does it look like their economies are any “competitive”? Or the flow of really free money just make those economies lame in front of the Chinese tide ? But of course such funds made EU look like Nirvana and the friendly politicians get reelected over and over.

Anonymous said...


if you are willing to put that membership list on a nearby scanner and produce a PDF and if you think a little oil hunt is fun, why don't you drop your contact information (anonymous email if you prefer) into this box?


Anonymous said...

Oooops, got stuck in the barbed wire around FOFOA's lounge table - FOFOA doesn't allow me to chat up other participants in this discussion. So try again without links.

Woland, if you think you want to put that membership list onto a nearby scanner and produce a PDF, why don't you drop your contact information (anonymous email if you prefer) into the feedback box on my blog.


KnallGold said...

Felt the tension yesterday with Felix Baumgartner on his stratosphere jump, what a relieve when he was back on ground!

I was surprised he didn't feel anything from the sonic boom (well actually it's a double "Knall" ). Some people dismissed it as scientifically not so interesting but if you've ever been "on the edge" of something, then you can relate...

My ancestors btw are also from Austria, Baumgartner is my Mom's maiden name. Loved that Felix didn't give in to his sponsors wish and just drank water after the fall (guess its a similar "freigeist" gene, also known here at FOFOA ;-).

The only thing that hurt me is the Helium we lost for the balloon (probably the biggest bubble in history...).

A professor at CERN told me that the liquid Helium we use comes from natural gas, as a byproduct, and after use its lost in space because of its low weight. So we have what we have in our reserves. Relevance? Its also used in NMR/MRI technologies for the cooling of the superconducting magnets, imagine when nothing is left...and I haven't heard of new superconductor technology enabling us to use just liquid Nitrogen.

Like a reserve that is depleted, no matter how much money we have. Something to think about.

Apropos flow, Helium is a superfluid, funny thing to handle (and breathe...) if you ever come to it.

shortrib62 said...

So, you think you know who FOFOA is now, do you?



shortrib62 said...

No, I'm FOFOA!

shortrib62 said...

No, I'm Spartacus, I mean FOFOA!

JR said...

Nobel Prize in economics awarded to Lloyd Shapley and Alvin Roth for:

Stable allocations – from theory to pratice
This year's Prize concerns a central economic problem: how to match different agents as well as possible. For example, students have to be matched with schools, and donors of human organs with patients in need of a transplant. How can such matching be accomplished as efficiently as possible? What methods are beneficial to what groups? The prize rewards two scholars who have answered these questions on a journey from abstract theory on stable allocations to practical design of market institutions.


On Roth

The type of economics he is best known for is what is called “Market Design.” Essentially, it means bringing market-type thinking to areas in which historically non-market allocation mechanisms have been used. A few examples of the areas Roth has explored are matching fledgling doctors to hospitals for their residency, matching students to public schools in school choice programs, and matching kidney donors with those who need a kidney.[...]

Roth’s work on kidney transplants. As much as economists think we should just have a market for kidneys, the rest of the world hasn’t quite caught up to that idea. So Roth came up with a different scheme – one that involves barter — that takes into account the real-world constraints that people aren’t allowed to pay for kidneys. So instead he developed a clearinghouse for connecting chains of pairs in which there is both a person who needs a kidney transplant and a person willing to give one, but who is not a good match medically to donate to his or her loved one. The key is that the potential donor is a good match for someone, just not for the loved one. But, if you can make a chain in which it all balances out: each donor matches with someone willing to donate, then it works out for everyone.

Nickelsaver said...


Now that the dust has settled on the trolling, allow me congratulate you on your candid interview.

I do have a question for you.

Seeing as you are a long time reader and participant of this blog, and knowing the argument made here that portrays silver in a less than favorable light, is there any particular part of the argument that you doubt?

Moreover, if you believe that Gold has more promise, what keeps you from exchanging some of your silver for more gold?

milamber said...

@ Woland,

I am interested in helping you out on your project. you can reach me at:


replacing the AT with @ and DOT with .


Michael H said...


on May 23, 2012 9:34 PM,

you wrote

Robert have you considered the idea that they (FO/A) might perhaps be posting using a different nic? And may have been for a long time?

and subsequently

btw....Aaron is not FOA :D

nor am I :D

So ... how do we know you are not ANOTHER?

FOFOA said...

Sorry about the confusion from releasing comments out of order today. Blame it on either the blogger email notification system or my email server. I received some of them out of order (and late), so that's what happened.

It's not a normal problem, so hopefully it was just a fluke.

FOFOA said...

Hello Woland,

As much as I would like to know and meet FOA, and have him start posting again, I'm a little concerned that a public search for his identity could ensure that he never comes back to us. There was one guy who I once thought might be FOA and I told someone and that person sent him an email asking if he was FOA. Of course he answered "FO who?" But if someone doesn't want to be identified, then identifying them only ensures they'll deny it all the way and we'll never be graced with his presence again.

Just a thought.


costata said...


I've never seen Wimp Lo before. LOL thanks.

Wendy said...


If push comes to shove, I don't want to have to exchange gold at the wrong time, I'd rather exchange silver.

The time period between push and shove is not known.

Might silver out-perform gold in the medium term? Perhaps, but again it's an unknown.

In my heart of hearts I am a scientist, and as such when there are more than one unknown variable, the math becomes very difficult (think economics).

I frankly prefer to hedge even my beliefs.

Wendy said...

AHHHH Micheal H, I have stated publicly and for the record that I believe the identity of Another was Sir Gordon Rirchardson.

I have also stated that I would keep my thoughts to myself in terms of my belief of the identity of FOA

Wendy said...


my comment above might be of interest to you. Or it might not ;)

Wendy said...

.......Waiting for Pete T to hurl insults my way .......

Wendy said...

BTW,I picked up my not so new vehicle today.....:D :D :D =8o} =8o}

Ender said...

Hi Wendy,

Remember, silver is for spending, Gold is for saving.

When someone asks you why you hold silver, the simple answer is that it’s currency with intrinsic value. In the worst case, that currency can always be put into circulation to compete. This is a key reason why silver will not sit side-by-side with gold. There is a human factor one needs to consider when talking about ‘money’. People will use silver to complete with currencies for function rather than complete with gold as a wealth reserve.

Also, when you think about one of the key fundamentals of the Freegold Concept, which is that currencies still function, you’ll find that as we move forward we will have functioning fiat currencies. If silver has to complete for function, it will be a weak currency. Why? Because fiat currency provides better function for trade then metal. Digitally, there is no need for metal as currency.

This leaves silver to complete with gold as a wealth reserve. Now it’s a matter of deciding for yourself which metal plays a better role at being a wealth reserve. History has always shown gold is the people’s choice.

Ultimately, the value of these metals will be determined by their function. Look deeply at what that is.


Wendy said...


I believe what you state to be true, I will however continue to hedge our believes.

BTW are you gonna be debriefed???? PLEASE!!

Anonymous said...


I recall FOFOA once speculating that Alexandre Lamfalussy was conspicuously "on sabbatical" over the three years (1997 - 2000) just when Another was posting . . .

Nickelsaver said...


I totally understand the timing aspect. I myself am holding some silver, waiting to hit that certain number. And I recognize it as a calculated risk.

As far a science is concerned, I am not unfamiliar with that vector either. I certainly would FEEL a lot better about joining the ALL IN club if the entire theorem could be represented in formula, and I could understand it.

But what do we have? We have an argument that is based on sound logical reasoning. And we have probability.

Now let me ask you this. What do you suppose is the probability that silver will outperform gold for more than a brief period of time? What is the probability it will stay within the same GSR band as it has over the last 100 years? And what is the probability that Gold will pull away from silver to a GSR of greater than 1000?

Also, I will tell you that based on what I understand, the GSR is either headed for the moon, or both gold and silver are in trouble. And I put the probability of the former at around 95%.

Allow me to explain. It all comes down to reference point. The superorganism is either going to use gold, or they are not. I give zero probability that they would use silver instead of gold. And so if they use gold, silver is toast, because all the monetary holders of silver will rush out of it when the gig is up, flooding the supply chain.

Now if the superorganism chooses something like bitcoins, or SDR's on steroids, or some other crazy thing, and gold is left behind, it won't matter much if your holding gold or silver.

So you see. There really is no good argument to hold silver other than gambling on when to switch. And every day we get closer to this whole deal changing.


Dang, I just looked up and saw that Ender posted. I'm got to hit publish anyway.

Wendy said...

It was not FOFOA speculating, it was Mortymer

Michael dV said...

"the end game is a change in the monetary order"
'perhaps gold goes up and stays up as part of a new order' (roughly quoted)

Ben Davies from 2 years ago....if this was quoted before I got here sorry. I just found it wandering through the site.

Wendy said...

Nice Micheal dV ........

Goodnight everyone, it's really way past my bedtime

Delusional Investing said...

Hi Nickelsaver,

On probabilities, I once tried to calculate the optimum portfolio allocation in gold using the Kelly formula. Trouble was, with such a high payout (30x), the answer became dependent on, and was essentially equal to, the initial input likihood of freegold occurring. 

So, exactly what FOFOA said - allocate as much as your understanding allows.


Bjorn said...


Yes, Kung Pow is a seriously disturbed movie.:-)

For some reason the quote about Wimp Lo "We have trained him wrong on purpose, as a joke" pops up in my mind almost every time I try to watch the MSM news nowadays. ;-)

ampmfix said...

Silver is the second most important commodity in the world, after oil. If silver was in a real huge shortage, its value would skyrocket because the world cannot function without it. That is the only bullish scenario I view for silver. Also, but to a much lesser extent, silver as an investment has still some way to go up, hand in hand with gold and BEFORE Freegold reval. When the bull market in metal reaches huge popularity (stage 2 or 3), lots of people will go into silver (sure they could buy gold instead but if you don't believe in Freegold, isn't it better to buy a silver american eagle rather than 0.55 grams of gold?) I think popular psichology would go for the silver coin.
To me, the GSR to watch is maybe between 30-40, I guess we'll get there soon... Another parameter for me is 150$/oz, so that makes us 4500-6000 for gold (following Alf Field's and Rickard's scenarios).
It's going to be fun watching this unravel!

Motley Fool said...

@Ender and NS etc

I understood Wendy's reasoning from the video to be that she is hedging against her own fallibility and misunderstanding, which is a interesting and viable reason.

Her experience with stock trading has taught her some caution it would seem.


ampmfix said...

Silver = gold hedge (everything turns out ok and the world recovers from all insanity, silver does very well in industry), Gold = silver hedge (we continue on the actual path, gold does well). A Black and White approach but good enough for me.

So which is it? seems like gold will win, right?

JR said...

Hi Wendy,

Great interview. Thanks for sharing.


I understood Wendy's reasoning from the video to be that she is hedging against her own fallibility and misunderstanding, which is a interesting and viable reason.

That strike me as odd: assuming one is right about everything but silver and gold, and then hedging the fact that one is, at the same time, completely wrong about gold vis-a-vie silver.

If you are so uncertain of gold as to own silver, then it would seem consistent to also be buying lots of other stuff besides silver.

Woland said...

Victor: It's above My pay grade technically, but my wife can
do it. It will take a little time.

Ender: I heartily second Wendy's request. Your Sept 2008
comments have meant more to me than you could
imagine. Cheers

Woland said...

Agreed JR: "Everything in moderation, including moderation
itself". Vegetables are allowed to touch each other on the
plate in this world, and each mouthful does not need to
contain the perfect nutritional balance. Drink as much
Romanee Conti as your understanding allows.

ampmfix said...


"If you are so uncertain of gold as to own silver, then it would seem consistent to also be buying lots of other stuff besides silver."

Sure, for example real estate...

Not necessarily, gold is unique in its class and it is the BEST protector for the disaster coming. If, the disaster is NOT coming and the world magically gets straight, which I doubt, then the best item contrary to gold is silver, not oil, not cans of peas. Again and ad infinitum, because it is the most valuable industrial commodity.

And what is really fantastic, in case the SHTF, silver will also go up a little, beacause of the masses NOT KNOWING FREEGOLD, that is my bet.

Motley Fool said...


You are of course welcome to correct me if I misinterpreted. Don't want to put words in your mouth. :)


JR said...

Hi ampmfix,

Not necessarily, gold is unique in its class and it is the BEST protector for the disaster coming. If, the disaster is NOT coming and the world magically gets straight, which I doubt, then the best item contrary to gold is silver, not oil, not cans of peas. Again and ad infinitum, because it is the most valuable industrial commodity.

So if you are not certain about gold being best for what is coming, why would you be certain about silver.

The issue is not what is coming (can we know the future), but hedging against your own misunderstanding of what you expect to be unfolding/coming.

If one recognizes their own fallibility in one regard, it would seem that acceptance would also extend to other areas.

Wendy said...

Not really. My experience with stocks ended up rather neutral. I traded in/out during oversold/bought periods until I had recouped my original investment. I sold everything in May 2010.

My best explanation is that there are times that I act in a manner that is neither entirely rational or logical.;)

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