tag:blogger.com,1999:blog-6276561747841568697.post5365272848734175044..comments2024-03-27T05:23:48.855-04:00Comments on Krugman-in-Wonderland: Gold at $1600? Paul Krugman says it is a nefarious plot by Glenn Beck!William L. Andersonhttp://www.blogger.com/profile/01802990642236807359noreply@blogger.comBlogger33125tag:blogger.com,1999:blog-6276561747841568697.post-17584401012179357902011-07-30T09:44:53.344-04:002011-07-30T09:44:53.344-04:00On the diamond question, it seems to me to be enti...On the diamond question, it seems to me to be entirely plausible that this should come down to marketing.<br /><br />If you try to market water as beer, you won't get very far (Heineken excepted). Diamonds don't have any intrinsic value - it's all in the eye of the beholder. In my elementary economics course scarcity was introduced by comparing water (cheap, essential to life)with diamonds (expensive, inessential).<br /><br />Diamonds would seem the perfect product for advertising.<br /><br />One way to test this would be to look at diamond sales in developed countries in which De Beers do not advertise. They would still get Marilyn Monroe films but it would give an idea.R.Muttnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-32602983478275526202011-07-30T08:11:19.345-04:002011-07-30T08:11:19.345-04:00Buying gold in inflationary times doesn't make...Buying gold in inflationary times doesn't make sense, since it isn't index linked.<br /><br />If things get really bad all you can do with it is throw it at the guy trying to steal your last potato. (Note to Republicans - no 'e' in this word).<br /><br />The reason gold is a good investment in these circumstances is because people think it will rise in price, so it does.<br /><br />Why do so many people behave irrationally? probably not much to do with Glenn Beck, although I can't find the actual quote where Krugman apparently claims this.R.Muttnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-78554655180870658052011-07-23T07:48:50.986-04:002011-07-23T07:48:50.986-04:00Some well thought out comments here. Also we seem ...Some well thought out comments here. Also we seem to have inflation in the Nobel Prize as it too seems to be more an more worthless when presented to the likes Krugman and others of his line of thought. A common thread with him and the FED is describing inflation as price increase rather than its historical meaning of an increase in the money supply. More simply we could have zero inflation if we had government price freezes. Zero inflation but at the price of fewer, or no, goods and services. As an Austrian myself I was buying both gold and silver way before I ever heard of Glen Beck. Besides it turned off the TV and picked up books. The greatest book ever written in my opinion is Human Action. It saved my financial ass! Blame gold prices a Mises, a dead man with living ideas!Al Sledgenoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-22443772709054394752011-07-22T18:12:53.131-04:002011-07-22T18:12:53.131-04:00@anon
do you think maybe the swiss frank is going...@anon<br /><br />do you think maybe the swiss frank is going up cause the euro is tanking?boatmanhttps://www.blogger.com/profile/12951618145166698522noreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-3559839147333828052011-07-22T17:56:09.244-04:002011-07-22T17:56:09.244-04:00Gold has been going up steadily since around 2000....Gold has been going up steadily since around 2000. Glenn Beck hasn't been a public figure for nearly that long.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-90469517588351160512011-07-21T19:10:12.107-04:002011-07-21T19:10:12.107-04:00Priced in USD gold is moving up, but not when pric...Priced in USD gold is moving up, but not when priced in Swiss Francs where gold is up just 5% on the year.<br /><br />http://tinyurl.com/GoldinSWFAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-19370741156790222882011-07-21T18:17:38.544-04:002011-07-21T18:17:38.544-04:00David B has it correct. The price of gold isn'...David B has it correct. The price of gold isn't changing, it is the value of the dollar that is changing.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-2713400082658551612011-07-21T17:23:25.586-04:002011-07-21T17:23:25.586-04:00If only Krugman read Murray Rothbard, he would not...If only Krugman read Murray Rothbard, he would not be at such a loss to explain gold pricemovents in dollars:<br /><br /><i>"It should be clear then, that the demand for paper money, in contrast to gold, is potentially highly volatile. Gold and silver are always in demand, regardless of clime, century, or government in power. But public confidence in, and hence demand for, paper<br />money depends on the ultimate confidence—or lack thereof—of<br />the public in the viability of the issuing government."</i> Rothbard, <i>Mystery of Banking</i> pp. 65-66.<br /><br />So what is actually happening? Is the gold price spiking upward in a volatile fashion because of Glenn Beck, or is the demand to hold paper money the volatile component? The volatility is in the dollar - a now meaningless name since a "dollar" is not it's own independent entity. The demand to hold dollars fluctuates wildly, with a long term trend downward to zero.David Bnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-84892116807959701912011-07-21T10:52:47.612-04:002011-07-21T10:52:47.612-04:00I would say that Keynesianism, being a complete cr...I would say that Keynesianism, being a complete crock of BS shrouded in doubletalk to intimidate the weak-minded, has been successful <b>ONLY</b> due to advertising.Bob Roddishttps://www.blogger.com/profile/17263804608074597937noreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-70221626689199387272011-07-21T10:01:37.476-04:002011-07-21T10:01:37.476-04:00Except that's a caricature.
The point of the ...<i>Except that's a caricature.</i><br /><br /><i>The point of the "Street Light" quotation is that there is a real possibility that a "good advertising campaign by gold producers could be enough to move the price of gold."</i><br /><br />Hahahaha, OK, next time anyone makes an argument that you don't agree with, then you just didn't understand that it was a caricature only.<br /><br />No, the point of Krugman's post was to blame Glenn Beck specifically.<br /><br />If it was "advertising" that makes people buy things, then Krugman would have to admit that it was only nefarious advertising that made people do what he recommends.<br /><br />He's undercutting his own position.Major_Freedomnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-66571277082890435662011-07-21T09:18:07.672-04:002011-07-21T09:18:07.672-04:00Beck has incredible reach. even China is buying li...Beck has incredible reach. even China is buying like crazy, who'd have thought that Wen Jiabao is a Beck fan.<br />i am sure though that China is not buying from Goldline - that place is a rip off. If you call to buy they will push you into overprices numismatics at obscene markups. I f you bought from Goldline when gold was $1000 you are probably still in the red.AlexPhttps://www.blogger.com/profile/16319668321925925488noreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-37453972268703385592011-07-21T09:05:26.453-04:002011-07-21T09:05:26.453-04:00If all it takes is advertising, as Krugman says ab...If all it takes is advertising, as Krugman says about DeBeers, then why didn't the copious advertising of GM cars save GM?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-37380373341128072212011-07-21T01:05:29.777-04:002011-07-21T01:05:29.777-04:00The problem with the idea that gold and silver is ...The problem with the idea that gold and silver is going up because of marketing strikes me as ignorant. Ignorant of other less glamorous metals that have increased greatly in dollar price, and the fact that most people have no clue about gold or silver.<br /><br />Further more the DeBeers diamond cartel can set the price. As far as I know the forces that are supposedly capable of manipulating gold prices (central banks, etc) have their interests in lower gold prices, not higher ones. <br /><br />I would think that central banks would be way more powerful than people who take financial advice from Glen Beck and his advertisers.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-9012334982020651092011-07-21T00:12:12.148-04:002011-07-21T00:12:12.148-04:00I don't recall Glenn Beck being on the scene t...I don't recall Glenn Beck being on the scene to hawk gold in the 1970's, when it went up from $35 to $850 by 1980.<br /><br />Then and now, it rose because of fiat "money," big spending and Federal Reserve policies to enable that.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-72364431208383020662011-07-20T23:21:19.950-04:002011-07-20T23:21:19.950-04:00Gold is primarily a wealth preserver in an inflati...Gold is primarily a wealth preserver in an inflationary environment. It helps if you buy before panic-buying sets in, (and rewarding, in dollars anyway if you sell at the top), if your goal is wealth preservation, once you buy (again, mostly before the run-up) the price is almost an irrelevancy. An ounce of gold may vary wildly in dollar terms, but barely moves in purchasing power.libertyvinihttps://www.blogger.com/profile/06242695257941874397noreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-68006041495402052982011-07-20T22:32:20.701-04:002011-07-20T22:32:20.701-04:00FdaPopo,
Thank-you.
As to answer your question, ...FdaPopo,<br /><br />Thank-you.<br /><br />As to answer your question, I'd suggest you read the book written by Swiss economist Peter Bernholz: "Monetary Regimes and Inflation: History, Economic and Political Relationships"<br /><br />http://www.amazon.com/Monetary-Regimes-Inflation-Political-Relationships/dp/1845427785JoeBnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-62740165236593511032011-07-20T22:09:48.244-04:002011-07-20T22:09:48.244-04:00JoeB,
That must be the best 3-paragraph overview ...JoeB,<br /><br />That must be the best 3-paragraph overview of the monetary significance of gold I have ever read.<br /><br />Gold is used as a hedge in both inflationary and deflationary markets. What matters is confidence.<br /><br />I have always wondered if the underlying mechanism here is that deep-down, investors recognize that in a truly free market, gold is always used as the currency of choice. Such that, if paper money becomes worthless, what will we turn to other than gold?FdaPoponoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-91272986535703519742011-07-20T21:58:28.703-04:002011-07-20T21:58:28.703-04:00Is this all they have?
It really is like debating...Is this all they have?<br /><br />It really is like debating your poodle.Bob Roddishttps://www.blogger.com/profile/17263804608074597937noreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-1404280531518738542011-07-20T21:32:34.724-04:002011-07-20T21:32:34.724-04:00@rob.impa.br
Rarely should one use gold as an ind...@rob.impa.br <br />Rarely should one use gold as an indicator of inflation, though it can be such an indicator at times.<br /><br />Joe's Axiom:<br /><br />"No one thing is caused by one thing, though there can be a dominate force."<br /><br />No doubt there are times when inflation places a positive upward pressure on the price of gold, but alas, inflation is not the dominate factor, lack of confidence is such a factor, as I explained above. This is why gold (or any other asset class) fluctuates in price, be it either an up or down trend. Various factors place pressure on price at any given time. These factors vary in their influence on price, causing the price to move in waves both up and down. What matters most is the dominate factor, should one exist. At the risk of sounding repetitive, the dominate factor for gold is confidence in the central authority which issues the nation's currency. <br /><br />Review the last bull market in gold (as priced in dollars), certainly there was money printing to pay for guns and butter, that said, there was also an assassination of a president, the Vietnam War, the failure of both LBJ and Nixon, Watergate, the perceived bumbling of Pres. Ford, the malaise of Carter, the Arab oil embargo, the fall of the shah, the hostage crisis and lastly the "misery factor." All the while gold rose through these events and topped out in the early Reagan years. A president who is given at least credit for restoring what in America and Americans? Answer: confidence. As that confidence waxed, the price of gold waned. Check the FEDs own numbers, Volcker's last four years showed a huge growth in the money supply and yet $gold continued to fall in price.<br /><br />Now review the events taking place in the US since gold hit it's low in 1999 and especially after 911. Has there not been a significant erosion in confidence of US leadership?JoeBnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-27917086617074982582011-07-20T20:57:23.661-04:002011-07-20T20:57:23.661-04:00Krugman's theory is pure genius: Glenn Beck tr...Krugman's theory is pure genius: Glenn Beck tricked the Indian government into buying 200 metric tonnes of gold from the IMF in November 2009; he fooled the Bangladeshi government into purchasing 10 tonnes from the IMF in September 2010; he has duped the Chinese government into buying record amounts of gold in the past few years.<br /><br />All those foreign governments being duped by Glenn Beck! And I didn't even know that foreign bankers and Chinese citizens were fans of his show. Thanks Paul Krugman for setting me straight.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-65811098016001438342011-07-20T20:56:16.469-04:002011-07-20T20:56:16.469-04:00First off all there tends to be a lag period betwe...First off all there tends to be a lag period between money growth and actual price inflation. It does not always hit the economy all at once or even in every sector at once. Although we have seen evidence of inflation in a wide range of commodities, just because we have not seen inflation manifest itself throughout the entire economy does not mean Austrians were wrong to predict it nor wrong to warn about it in light of the Fed’s unprecedented monetary expansion.<br /><br />Oh and also, gold is not in a bubble. If anything U.S treasuries are.<br /><br />If gold was in a bubble you would see it rise much faster than it is, and you would also see the gold mining stocks really take off. Both of those things have not happened. The fundamentals do not suggest gold is in a bubble whatsoever. I remember people saying that at 500, 1000, 1500, and now at 1600, you people are still wrong. <br /><br />Anyway, Krugman is laughably wrong about gold, among other things, as usuall. The guy is just a walking clown,grade A bafoon, and intalectually bankrupt in so many ways.zackA89https://www.blogger.com/profile/03695722179840739720noreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-40226281342418968352011-07-20T20:45:39.410-04:002011-07-20T20:45:39.410-04:00@rob... are you trying to put forth the position t...@rob... are you trying to put forth the position that inflation is low? That we don't have inflation? Everything costs more money and were making the same amount of money. What is that? Deflation? Go fuck a goat. Official government numbers which are a joke has us at an unacceptable level of inflation.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-70380403097050936812011-07-20T20:29:27.523-04:002011-07-20T20:29:27.523-04:00This post is just silly - the price of gold might ...This post is just silly - the price of gold might indicate a *fear* of inflation (or might just be a bubble), but surely to see inflation itself you look at wages, or measures of, well, core inflation. These have been low for several years; Krugman predicted this, you did not.rob.impa.brhttps://www.blogger.com/profile/09997250847068598127noreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-30664663245290567662011-07-20T20:19:10.295-04:002011-07-20T20:19:10.295-04:00Well... Also my mother yesterday told me why I don...Well... Also my mother yesterday told me why I don't switch her savings into gold "because euro is unsafe" and "because it keeps going up".<br />Last time she come up with this exact argument it was in 2000 for some internet stock gone bust long ago.<br />So my take based on the "mother indicator" is that gold goes up because it's a bubble... As simple as that.<br /><br />Twitter @borghi_claudioAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-6276561747841568697.post-57588285527814409742011-07-20T15:54:28.643-04:002011-07-20T15:54:28.643-04:00I want to hear the rest of the regular government ...<i>I want to hear the rest of the regular government shills counter this one and explain how this isn't jumping the shark.</i><br /><br />The libertarian argument is that the current price of gold is a legitimate market outcome, while the prices of government bonds are manipulated.<br /><br />I would think that the statist argument would likely be the opposite (government bond prices are legitimate market outcomes, while the price of gold is not.)<br /><br />Who has more power to influence market prices, Ben Bernanke or Glenn Beck? I think the common sense answer would be Bernanke but I guess Krugman thinks it's Beck.Daniel Hewittnoreply@blogger.com