So far both are holding... the answers to both my questions at the moment is no...

Nothing real earth-shattering there.  Makes sense, but so what?  Even if 'mild' deflation is the greatest thing since sliced bread (for some folks including myself) that does not mean that that is what we'll see.

I expect that 'mild' will not be a word which is useful for characterizing many aspects of our economy given the machinations required to keep our highly leveraged systems stable as we approach end-game.  I believe we are reaching that point and most of my bets are based on this belief.

I believe that since 2008, we actually had at least periods of quite significant deflation.  Gold performed perfectly sufficiently to keep me smiling.  If the effects of heavy deflation during the next crisis cannot be masked, it will probably be terminal for most fiat regimes which means I'll be happy to hold Gold (and some Bitcoin for good measure.)  About the worst thing for PM's (and Bitcoin) would probably be mild controlled long-duration deflation with stable confidence in USD and other fiat.  In that situation, I would expect a _mild_ loss of opportunity by holding gold, but I think there is a pretty strong likelihood that that is _not_ the way things will play out.

BTW, why would your ever present fear/expectation of deflation in any of it's forms have a vastly different impact on the value of gold vs. on the value of BTC?  I think you've posited the answer is that the world will flock to Bitcoin as it's monetary solution.  I still don't see that as anywhere nearly as likely as that the world would move back to PM's in such a scenario (which would almost certainly be accompanied by massive social and technological shifts as well.)  But you are as free as I to position yourself for the future as you see fit.  At least as long as it is reasonably practical to exchange fiat for either PM's or BTC, and that may not be the case forever.

looks like ppl are taking their financial stock cashouts and dumping it into Bitcoin!

It never fails to put me in a good mood to hear you say this, cypher.

I dunno, I mean now the "financial elite" will decide this? Inflation is required to pay for all the various TBTF ponzis people have become dependent on.


Deflation will lead to social unrest, which, if it passes some threshold, will lead to the endgame and a new status quo. It is not just the government that has crushing debt.

Interesting article.

I like this part

"A crucial move for the U.S. is to shift its crisis to other countries – by coercing China to buy U.S. treasury bonds with foreign exchange reserves and doing everything possible to prevent China’s foreign reserve from buying gold."

But gold is totally worthless right.. Even thu your article states that the reason we aren't having crazy QE out the butt is to keep the Chinese from buying to much gold..

They just bought the freaking LME.. 

So the US debt ponzi trumps all lesser ponzis. I guess I can accept that. What is with me seeing ponzis everywhere?

You saw how easy it was to run the Chinese out of Libya literally by the ship full.  'Joe Kony' could pop up anywhere in Africa and both the left and right wings of our population would be foaming at the bit to send in the Marines.

We almost completely control the land routes for fossil fuels transport out of the parts of the Middle East that we allow it to be drawn from with the notable exception Iran, but that hole is primed and ready to go...and in the mean time, it's funny that it's so hard to find a nation who has not been, by our incredible grace, granted an exemption to do business with the Persians which demonstrates our control of their resources anyway.

I suspect is the biggest lever we have over China at this point is the threat of an actual invasion of the oil producing parts of Iran (Khuzestan.)  I heard a little news clip the other day that they blew the dust off some old cold war war-plans which happened to take this area in the process of halting the Rooskies...and since we have no more modern plans we would probably just have to go with those old outdated ones.

China will be our bitches until they decide to finally put up a fight.  If/when that day comes, I am supposing that they will eventually come out on top since they have the boots to put on the ground...if any of us are lucky enough to survive the event that is.

Gold down, Bitcoin UP.