Most of the atoms in the world are either hydrogen or helium. Hydrogen, of course, is the simplest of atoms. One electron circling one proton. The Ockham's razor of atoms. Helium is what you get when a lot of hydrogen atoms are tightly compressed together in a star. It is the consequence of the process of fusion in that context. What about all the other elements? Most of them can be explained as themselves also the products of nuclear fusion in the stars, increasingly rare as they get heavier. But there are a few elements that scientists think require a more complicated explanation, and gold is one of these. These problem elements are neutron heavy and they could only have come into existence in an environment that allows rapid neutron capture, known as "the r process." The usual theory has been, for decades now, that the r-process is created when neutron stars merge with each other, since a dense soup of neutrons, is the most plausible source for gold and ...
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There has been a new discovery of gold in the Indus River valley. Not a huge story, but I will use it to make a point about numbers and ambiguity. The Indus River originates in Tibet, flows northwest through Kashmir, and eventually takes a sharp left turn before it would have reached Afghanistan in order to flow instead through Pakistan and enter the sea near Karachi. The main current of the Indus never, then, travels within the present boundaries of the Republic of India -- it almost neatly parallels India's own northern border, to its north. That delta near Karachi, though, does include some Indian territory. Initial reports estimated the deposit as worth 80,000 crore. How much is that? Pakistan and India both call their currency the rupee, and in both countries a group of 10 MILLION rupees is called a crore. So if I'm getting this arithmetic right 80 thousand crore is 800 billion rupees. But ... WHOSE rupees? Here I t...
Was JPMorganChase manipulating the price of silver and/.or silver futures in the markets in 2010-11? I submit that the question is one of historical importance, not of importance merely to the parties directly involved in the litigation captioned above. Further, I expect that a trial on this question will aid the historians of posterity, bringing to light valuable data on this point, and thus on the significance of precious metals as a Magoffin in the post-Crisis financial world. If you're a law student, and are taking the Civil Pro course, dear reader, this case might also be a valuable introduction for you into the vagaries of pleadings law. http://www.reuters.com/article/us-jpmorgan-lawsuit-silver-idUSKBN15G4Z But let's get back to the point: WHY is this case of historical importance? It may clarify judges and parties' attitudes toward the traditional Precious metals, gold predominantly but silver as well, once thought of as the paradigmatic form of Money. ...
1. George Washington (1788-96).Got the experiment with the new constitutional structure going. Jefferson and Hamilton, two cabinet members, famously argued over the extent of federal powers, and the propriety of a national bank. 2. John Adams (1796-1800). Often called the “father of the American navy.” Built up the Navy in the face of the conflict between England and France, and their competing claims to control trade in the North Atlantic. 3. Thomas Jefferson (1800-1808). Founder of the Republican-Democratic Party. Later shortened its name to “Democratic.” Still around – oldest political party in the world. 4. James Madison (1808-16). He allowed the charter of the Bank of the United States, Hamilton’s bank, to expire unrenewed. But he was soon forced to create a new one, the so-called Second Bank, in order to finance a new war w...
Yesterday, I began a discussion of the work of Professor Guillermo Calvo, now of Columbia University’s School of International and Public Affairs, in an effort to answer the question in the headline of this blog entry, and I got so far as to introduce the word "stickiness." Let's proceed from there. Calvo does acknowledge that fiat money contains within itself the principle of its own destruction. But ... why does its destruction take so long? Even if deliberate government buttressing of the use of its money were "completely absent," he says, this factor would slow the aforementioned destruction. Stockiness is simply a convenient name for the behavioral fact that suppliers of goods and services "broadcast, far and wide, their willingness to take fiat money in exchange" for what they are selling. Further, private sellers often "reaffirm their willingness to do so over extended periods of time." The suppliers find it useful as a mar...
At the movies recently I saw a preview for a soon-to-be released movie called GOLD, which will be a fictionalized version of the true story of Bre-X, a Canadian company that lost investors billions in the 1990s as a result of a spectacular rise in stock price and then a sudden fall, based first on a fraudulent claim to the discovery of vast gold reserves in Indonesia and then to the unravelling of those claims. In 1999 the Royal Canadian Mounted Police wrapped up a criminal investigation. The RCMP brought no charges. Somebody was presumably responsible, but proving who ... that seemed, and still seems, murky. The story is a fascinating one and although at the time it was rather overshadowed (for those of us in the US anyhow) by the dotcom madness on the one hand and the related rise-and-fall of Enron on the other, the Bre-X saga has its own archaic quality that makes it stand out in recollection. It was a tale that was in the 1990s but of an earlier time. It was a ta...
The website of BBC recently ran a list of the ten greatest continuing controversies about Winston Churchill. Personally, I was a bit surprised to find nothing about Bretton Woods there. Certainly Churchill's relationship to the Bretton Woods conference, of '44, which formally gave the US dollar the central place as the western world's currency, has been a matter of considerable controversy. I refer the reader doubtful on that point to THE BATTLE OF BRETTON WOODS, a recent offering of the Princeton University Press, which paints the conference itself as a dollar-versus-pound tug-of-war. Churchill either acceded to the lessened significance of the pound, or simply wasn't paying attention, and either fact is an important one. It is hard to believe that he wasn't paying attention. He had been closely associated with a gold standard earlier in his political career (a fact which also doesn't get into the BBC list), so it is possible he acceded to the supremac...
Nouriel Roubini recently tweeted, "Currency wars coming, but don't bet on gold." Roubini is an economist affiliated with New York University, Stern Sch. of Business. He has had an on-and-off relationship with the International Monetary Fund, and is probably best known to the general economics-literate public for the book Bailouts or Bail-Ins? (2004). That Roubini believes "currency wars" are coming means that opinion has gone well beyond the "usual suspects." But why does he mean you shouldn't bet on gold? In essence, he believes that as all currencies are about to drop in value relative to real assets, you should do your best to turn your currency into real assets. And this doesn't mean shiny metals. It means real estate and equities.
It is a truism that "hyperflation in Germany paved the way for Hitler's takeover." Everybody knows this ... right? Everybody has seen the photos of the wheelbarrows -- filling one wheelbarrow with marks was enough to get the bearer of the barrow a loaf of bread. Like much that everybody knows, this isn't quite ... accurate. There is some truth to it, but ... The worst of the hyperinflation in Weimar Germany was over long before Hitler became Chancellor in 1933. It was in the early 20s that those famous wheelbarrows were rolling about with those bills. Late in '23, after a new currency was introduced [one Rentenmark, as above, was pegged to each one TRILLION of the cheapened Reichsmarks ] the govt wisely pegged the new Rentenmarks to the US dollar at a ratio of 4.2:1. A peg to the U.S. dollar was, indirectly, a peg to gold. Then the currency situation gradually normalized. This is worth noting because there was no very direct relationship between th...