M3 = stealing from the laborer to give to the investor?

[adios]

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On the other hand I doubt things like gold are the answer, cause just look at e-gold, the guy got indicted again and all his assets(gold) frozen by the feds. with the thing about good money driving out bad money, I doubt the government would let gold get out of control when they can just use police powers, declare gold a terroriist weapon or something.

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Cmon, here's a link providing some historical data for gold prices.

Historical Prices of Gold

Prices for gold can fluctuate wildly. Also note that if one bought gold in late January of 1980 and held it today they'd be severely underwater especially given the effects of inflation.

[PLOlover]

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Cmon, here's a link providing some historical data for gold prices.

Historical Prices of Gold

Prices for gold can fluctuate wildly. Also note that if one bought gold in late January of 1980 and held it today they'd be severely underwater especially given the effects of inflation.

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my point is that most of the antipapermoney crowd are in favor of gold, and I was just saying that even if they were 100% correct about gold it still wouldn't matter because the fiat money banks have the police power of the state at their disposal.

[cardcounter0]

M3 could be a predictor of stock prices, but there are problems making it useless. First, you cannot use raw M3 because it is merely on a upward trend ever-growing as the economy grows. The thing to plot is the rate of change. M3 generally always goes up, but is it going up faster or slower?

That rate of change could be predictive, but the problem is in how M3 is measured. It is not real time. Published M3 numbers are reporting previous months activity, there is a 1-2 month lag in the numbers. This lag kills the predictive effect. You are looking at 2 month old numbers trying to predict stock prices next month, and stock prices are forward looking to the month after that. M3 cannot forecast 5-6 months into the future.

[Copernicus]

[ QUOTE ]
M3 could be a predictor of stock prices, but there are problems making it useless. First, you cannot use raw M3 because it is merely on a upward trend ever-growing as the economy grows. The thing to plot is the rate of change. M3 generally always goes up, but is it going up faster or slower?

That rate of change could be predictive, but the problem is in how M3 is measured. It is not real time. Published M3 numbers are reporting previous months activity, there is a 1-2 month lag in the numbers. This lag kills the predictive effect. You are looking at 2 month old numbers trying to predict stock prices next month, and stock prices are forward looking to the month after that. M3 cannot forecast 5-6 months into the future.

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There is a study I read in searching this last night that attempts to do precisely that...look at the rate of change in M3 and time market moves based on "acceleration" or "deceleration" of M3, and using all of the seasonally adjusted final numbers it showed small profits, but far less than buy and hold.

[pvn]

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If you also correctly adjust bank accounts and bonds for the same inflation and higher tax rates the real after tax differential between them and the stock market makes the comparison much more favorable to stocks than just saying "10%". The trade off obviously is the high standard deviation.

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Yeah that's why I said the antipapermoneycrowd who advise hard assets, real estate, etc., over dollar denominated assets.

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You're conflating currency and investment vehicles.


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I doubt the government would let gold get out of control when they can just use police powers, declare gold a terroriist weapon or something.

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It's happened before.

[adios]

[ QUOTE ]
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Cmon, here's a link providing some historical data for gold prices.

Historical Prices of Gold

Prices for gold can fluctuate wildly. Also note that if one bought gold in late January of 1980 and held it today they'd be severely underwater especially given the effects of inflation.

[/ QUOTE ]

my point is that most of the antipapermoney crowd are in favor of gold, and I was just saying that even if they were 100% correct about gold it still wouldn't matter because the fiat money banks have the police power of the state at their disposal.

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I think their point is that a gold currency could not be controlled by the governemnt. If prices for gold can fluctuate so wildly, how does one government control those prices? I think their point is that having control of the currency gives government too much power. A currency based on gold solely with a 100% reserve requirements would remove much of the power that government has. IMO a decent discussion of this topic is contained in Milton Friedman's book, Capitalism and Freedom. I think that the objections to a fiat currency have merit btw. No better way to destroy a society than to destabilize and destroy the currency. A fiat currency does vest a great deal of power in government.