Quixote2
23rd September 2011, 05:49 PM
I went to Denningers web site to check if the anti-PM Denninger had any commentary on the last two days action in gold and silver. I only visit the site about every two months since being banned for pointing out errors and bias in a previous Denninger anti-PM rant. Today's rant is at:
http://market-ticker.org/akcs-www?post=194719
Posted 2011-09-23 13:55
by Karl Denninger (http://market-ticker.org/akcs-www?email-send=genesis)
in Monetary (http://market-ticker.org/akcs-www?blog=Market-Ticker&page=1&cat=Monetary)
http://market-ticker.org/smilies/ignore.gif (http://market-ticker.org/akcs-www?ignore_thread=194719)
Where's The Helicopter?
There are times I have to chuckle...
http://market-ticker.org/akcs-www?get_gallery=2253 (http://market-ticker.org/akcs-www?get_gallerynr=2253)
I know, I know, it's just a correction (never mind that the blow-off was one of those things that I warned people about.)
But.... before you are utterly convinced, I think you should consider this chart, the "other" alleged sound money....
http://market-ticker.org/akcs-www?get_gallery=2254 (http://market-ticker.org/akcs-www?get_gallerynr=2254)
Roughly a 40% loss against the dollar in four months. Why that's damned impressive! What would that be in annualized terms? Let's see... about 78% if my calculations are correct... without leverage. http://market-ticker.org/smilies/eek.gif
http://market-ticker.org/smilies-local/toldyaso.gif
Ps: Can someone point to just one actual "printed" monetary unit among major currencies since this crap started in 2007? Just one please. Hint: Issuing debt is not "printing" - you have to pay that back, with interest, and screeching that "they will, they will!" when you can't present any evidence that they did ought to be carefully contemplated before such a statement is made on the forum. You know how much I love swinging the Thor Device around and the weekend is coming up. http://market-ticker.org/smilies/evilgrin01.gif
Well, he can't count the months since the silver high, he says 4 months and it is closer to 5 months (5 days less than 5 months from 4/28/11 to 9/23/11). The actual annualized decline of the NY Globex silver closing prices is 67.0%, not the 78% annualized he states.
He fails to provide a balanced report of gold and silver performance in the market. A more balanced approach would be to compare returns to the S&P 500 index (I have used the Vanguard S&P 500 Index, VFINX to get daily performance instead of end of month values, and the NY Globex closing Ag and Au prices as reported by Kitco.com)
Some comparable market performance values expressed as annualized returns to Sept 23, 2011 are:
Year to date: Silver +0.09%; Gold +23.4%; and S&P 500 -13.0%.
One year: Silver +46.2%; Gold +28.2%; and S&P 500 +1.05%.
Three year: Silver +32.5%; Gold +22.9%; and S&P 500 -1.64%.
Five year: Silver +22.6%; Gold +23.0%; and S&P 500 -2.87%.
From 1/1/2000, 11.7 years: Silver +16.2%; Gold +16.0%; and S&P 500 -2.17%.
Which would you prefer to be invested in? (even including the last two days carnage.)
If anybody cares to point out to Karl the error of his ways, point him to this posting. Be aware that he may shoot the messenger and ban him from his site for pointing out that the "great and powerful" Denninger shoots from the hip, cherry picks time periods to make his biased point, and makes numerical errors. (I believe that Denninger and Buffett do not understand PMs because they do not generate a cash flow to calculate a generated profit (they just sit there as an inert lump in your vault without earning a return). He apparently does not understand the concept of negative real return with fiat when inflation/devaluation exceed the interest cost or calculated rate of return using fiat.)
http://market-ticker.org/akcs-www?post=194719
Posted 2011-09-23 13:55
by Karl Denninger (http://market-ticker.org/akcs-www?email-send=genesis)
in Monetary (http://market-ticker.org/akcs-www?blog=Market-Ticker&page=1&cat=Monetary)
http://market-ticker.org/smilies/ignore.gif (http://market-ticker.org/akcs-www?ignore_thread=194719)
Where's The Helicopter?
There are times I have to chuckle...
http://market-ticker.org/akcs-www?get_gallery=2253 (http://market-ticker.org/akcs-www?get_gallerynr=2253)
I know, I know, it's just a correction (never mind that the blow-off was one of those things that I warned people about.)
But.... before you are utterly convinced, I think you should consider this chart, the "other" alleged sound money....
http://market-ticker.org/akcs-www?get_gallery=2254 (http://market-ticker.org/akcs-www?get_gallerynr=2254)
Roughly a 40% loss against the dollar in four months. Why that's damned impressive! What would that be in annualized terms? Let's see... about 78% if my calculations are correct... without leverage. http://market-ticker.org/smilies/eek.gif
http://market-ticker.org/smilies-local/toldyaso.gif
Ps: Can someone point to just one actual "printed" monetary unit among major currencies since this crap started in 2007? Just one please. Hint: Issuing debt is not "printing" - you have to pay that back, with interest, and screeching that "they will, they will!" when you can't present any evidence that they did ought to be carefully contemplated before such a statement is made on the forum. You know how much I love swinging the Thor Device around and the weekend is coming up. http://market-ticker.org/smilies/evilgrin01.gif
Well, he can't count the months since the silver high, he says 4 months and it is closer to 5 months (5 days less than 5 months from 4/28/11 to 9/23/11). The actual annualized decline of the NY Globex silver closing prices is 67.0%, not the 78% annualized he states.
He fails to provide a balanced report of gold and silver performance in the market. A more balanced approach would be to compare returns to the S&P 500 index (I have used the Vanguard S&P 500 Index, VFINX to get daily performance instead of end of month values, and the NY Globex closing Ag and Au prices as reported by Kitco.com)
Some comparable market performance values expressed as annualized returns to Sept 23, 2011 are:
Year to date: Silver +0.09%; Gold +23.4%; and S&P 500 -13.0%.
One year: Silver +46.2%; Gold +28.2%; and S&P 500 +1.05%.
Three year: Silver +32.5%; Gold +22.9%; and S&P 500 -1.64%.
Five year: Silver +22.6%; Gold +23.0%; and S&P 500 -2.87%.
From 1/1/2000, 11.7 years: Silver +16.2%; Gold +16.0%; and S&P 500 -2.17%.
Which would you prefer to be invested in? (even including the last two days carnage.)
If anybody cares to point out to Karl the error of his ways, point him to this posting. Be aware that he may shoot the messenger and ban him from his site for pointing out that the "great and powerful" Denninger shoots from the hip, cherry picks time periods to make his biased point, and makes numerical errors. (I believe that Denninger and Buffett do not understand PMs because they do not generate a cash flow to calculate a generated profit (they just sit there as an inert lump in your vault without earning a return). He apparently does not understand the concept of negative real return with fiat when inflation/devaluation exceed the interest cost or calculated rate of return using fiat.)