Posts Tagged ‘Jim Rickards’

One argument which is used to discredit any realistic attempt to return to a gold standard in todays environment of ever expanding money supply, is that currently there is too much money in the system and too little gold to be able to adequately replace one for the other.

Well, Jim Rickards has one answer for us to consider…..

It is true that at today’s price of about $1,300 an ounce, if you had to scale down the money supply to equal the physical gold times 1,300 that would be a great reduction of the money supply.

That would indeed lead to deflation. But to avoid that, all we have to do is increase the gold price. In other words, take the amount of existing gold, place it at, say, $10,000 dollars an ounce, and there’s plenty of gold to support the money supply.

The limiting factor here is not the commodity….but the price itself.

Basic supply and demand economics and its impact on price…..don’t let so-called experts make simple concepts seem impossible. We can’t change the quantity, so change the price! Guess that means the market does not give us a correct price signal in view of this?

I’ve done that calculation, and it’s fairly simple. It’s not complicated mathematics

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I have linked here the latest article from Jim Rickards, touching on what he believes to be the next economic catastrophe. Note the quote below which illustrates his view of lessons not learned sufficiently from the causes of previous crises, and the disdain for perceived wisdom

The equilibrium and value-at-risk models used by banks will not foresee the new panic. Those models are junk science relying as they do on notions of efficient markets, normally distributed risk, continuous liquidity, and a future that resembles the past. None of those hypotheses match reality.

Advances in behavioural psychology have demolished the idea of efficient markets. The future does not resemble the past; it keeps getting worse

 

Still struggling to undertand the nature of the global operating monetary system, what it is and how it works?

View this explanation using easy to understand graphics, part 4 of Mike Maloney’s  Hidden Secrets of Money, a series exploring these issues and their history;

View the whole series here;

Your true wealth is your time and freedom

Wealth is never destroyed, it is only transferred….

 

 

 

J Rickards

Expert Jim Rickards discusses his forecast for the future of the debt based monetary system and the warning signs for the dominant position of the US Dollar in today’s state of geo politics….

http://rt.com/shows/boom-bust/global-economic-growth-2014-321/

Also read his blog regarding the few moves left for the Fed and it management of the US fiscal policy

http://jimrickards.blogspot.co.uk/