O/T economy and silver

[Mike]

Ok, so I split this conversation from the humor thread since there isn't too much humor in it....

The whole discussion started with plthjnx's joke about the economy recovery package. Then a few of you replied that Cessna isn't building a lot of their parts in the States anymore either and so forth.

I know we said no politics but if you behave and stay nice to eachother we'd be happy to have the discussion going on, even though it's off topic.

Here is the original joke and then the rest of the thread:


Sometime this year, we taxpayers will again receive another 'Economic Stimulus' payment.
This is indeed a very exciting program, and I'll explain it by
using a Q & A format:


Q. What is an 'Economic Stimulus' payment ?

A. It is money that the federal government will send to taxpayers.


Q.. Where will the government get this money?

A. From taxpayers.


Q. So the government is giving me back my own
money?

A. Only a smidgen of it.


Q. What is the purpose of this payment?

A. The plan is for you to use the money to purchase a
high-definition TV set, thus stimulating the economy.


Q. But isn't that stimulating the economy of China ?

A. Shut up.


Below is some helpful advice on how to best help the U.S. economy by spending your stimulus check wisely:



* If you spend the stimulus money at Wal-Mart, the money will go to China or Sri Lanka .


* If you spend it on gasoline, your money will go to the Arabs.


* If you purchase a computer, it will go to India , Taiwan or China .



* If you purchase fruit and vegetables, it will go to Mexico, Honduras, and Guatemala ..



* If you buy an efficient car, it will go to Japan or Korea .


* If you purchase useless stuff, it will go to Taiwan .



* If you pay your credit cards off, or buy stock, it will go
to management bonuses and they will hide it offshore.


Instead, keep the money in America by:


1) Spending it at yard sales, or

2) Going to ball games, or

3) Spending it on prostitutes, or

4) Beer or

5) Tattoos.


(These are the only American businesses still operating in the U.S.)
Conclusion:

Go to a ball game with a tattooed prostitute that you
met at a yard sale and drink beer all day!

No need to thank me, I'm just glad I could be of help.


Then I started after Rooster mentioned the parts situation at Cessna:


The Cessna story is getting sad. I recently talked with some mechanics and avionics people from there and they are not a big fan of the Textron take-over and the corporate machine. After our own experiences with Textron (the licensing for the Huey shirt) I wouldn't be surprised if they go out of business with the small planes again. All these businesses need to go back to their roots and start over on a small scale I think.
The Cessna parts are made in Toluca I believe. I've been there and Toluca is massive with tons of industry (has some of the worst air I've ever experienced in my life as well)

What plthjnx posted is one of those "funny but not really" jokes. It shows that we all know we're in trouble but nobody says anything. Kinda like "The Emperors New Clothes" fairytale....

Oh and I've mentioned this before, but if you take your cash and buy physical gold, or better even SILVER, you will take your money out of the big-bank and corporate and tax circles and have your own personal timeless value in something that will never be worth nothing like a stock, or a house, or a bank account. I like the thought of excluding banks from the money I make. And if you buy online out of state, you won't pay tax either (or if you bought cash in Utah which is going back to the gold standard). And if you pay cash or check, then the banks won't know and the credit companies won't get a cut either. If every American would buy just one once of silver JP Morgan will be bankrupt. Wouldn't that be cool?

[tundra_flier]

Mike, the future of light aviation in the US seems to be coming from European and Australian imports.  And homebuilts.  Last year the FAA issued more airworthyness certificates to homebuilts than to factory aircraft (half were Van's RV's).  It's sad, but the US manufacturers just can't compete with countries that are either socialized, or just don't give a d**m about the environment or worker safety.

On top of that, I still meet a lot of people who take the additude "Why spend $350,000 on a new Cessna 182, when a 40 year old one for $70,000 will do the job".  What they don't realize is the cost of maintaining those old aircraft is getting outrageous.  And they're starting to show their age, with metal fatique and corrosion problems.

Then there's the ethics of US aviation companies.  For example, I had my O-200 rebuilt, bought 4 brand new Continental cylinders at $800 each.  Less than 200 hours later they were all scrap.  Seems continental tried a new rocker shaft design that didn't work.  All of these cylinders failled.  So they offered to sell me a new set for full price!  Face it, if any auto manufacturer had done that it would have been a recall issue and they would have fixed it for free.  Same for AD's, in the auto industry They'd be recalls and fixed for free.  But in aviation, the customer is expected to foot the bill for the manufacturers mistakes.  Any wonder they're going out of business?

[Fabo]

(or if you bought cash in Utah which is going back to the gold standard)

Well, unlike Stef I only am a failed economy minor, so maybe he can explain... how can a state go to the gold standard if they dont issue their separate currency?

Also I understand that gold standart would just open a whole new can of worms that people usually dont realize, but I was never good in public finance anyway, so...

If every American would buy just one once of silver JP Morgan will be bankrupt. Wouldn't that be cool?

No it would not be bankrupt, just as it did not go down at last financial crisis. Side effects of this would also mean rising the price of silver, and then later I think it would fall down on normal levels rendering this bad investment. And maybe some other bad things, I think.

[Mike]

(or if you bought cash in Utah which is going back to the gold standard)

Well, unlike Stef I only am a failed economy minor, so maybe he can explain... how can a state go to the gold standard if they dont issue their separate currency?

Also I understand that gold standart would just open a whole new can of worms that people usually dont realize, but I was never good in public finance anyway, so...

If every American would buy just one once of silver JP Morgan will be bankrupt. Wouldn't that be cool?

No it would not be bankrupt, just as it did not go down at last financial crisis. Side effects of this would also mean rising the price of silver, and then later I think it would fall down on normal levels rendering this bad investment. And maybe some other bad things, I think.

Oh Fabo, I probably won't get into a long draw out discussion over this in here (unless you want to) and I have a feeling Stefan might add his own 2 cents to this but you don't have to be a graduated economy major to figure this out. All you have to do is read a little history and be around for a few years.
Reading the news helps as well:
http://www.foxnews.com/politics/2011/03/04/utah-house-passes-recognizing-gold-silver-legal-tender/
all it means is that they will accept gold and silver as legal tender as well as our current fiat currency

It's probably stupid to buy your groceries with silver dollars because the face value of the coin is still only a dollar. BUT! what it means to me is that I no longer have to pay sales tax to buy gold or sliver in the State of Utah. What this decision will bring in the long run and how it will affect the big picture is still to be seen.
To know how one State can do something other States won't do you also don't need to be an economist. You would need to know a few things about the US legal system and how their States are set up.

And as far as your second statement goes:
The crisis those "break JP Morgan" people are talking about will make the 2008 crisis look like a walk in the park. Do I believe it 100%? I hope they're wrong.
But you make it look like gold and silver overinflating is a bad thing!! In the times of the Weimar hyperinflation in the early 1920's you could buy a whole city block with only 8oz of gold. The key might just be to know when to put your silver into another investment. If you hold on to it, of course the price may come down again if you hold on to it too long.
Although I am not sure what you consider "normal levels". If you look at history, silver has always been 1/16 of the price of gold which means right now it's undervalued and should be 90 bucks.
I once bought a stock for 27 bucks a share (I am too embarrased to say which one) which is now worth 2.6 bucks. I don't think this will happen to silver since it's a valuable industrial metal (unlike the money Ben Bernanke is printing), it has to be labored into existence (unlike the money Ben Bernanke keeps printing every day with the push of a button), and there is no endless supply (unlike the money Ben Bernanke is printing). So it will always be worth at least that, just like copper and steel and so forth......

So if you want to disagree, go ahead. I love a good discussion and I don't mind being wrong (I almost hope I am wrong in this case) but I like to see some more detailed explanations why you are so sure they won't go bankrupt. "normal levels" and "some other bad things will happen" don't quite cut it for me personally.
Thanks for chiming in though! Most people ignore me when I start talking about this. (although I have some friends who are stoked they trippled their money last year by buying silver)

(maybe this should be in a different thread cause this topic isn't all that funny....  )

[tundra_flier]

Mike, the only part I don't get is the part about buying gold?  Why would you pay for something you can just go dig out of the ground?   
I'm thinking this weekend might be a good time to dust off the old sluice box and pans and head for the hills.   

[G-man]

Relax, all this talk about buying stocks and making money got me thinking....

A boat docked in a tiny Mexican village. An American tourist complimented the Mexican fisherman on the quality of his fish and asked how long it took him to catch them "Not very long," answered the Mexican.

"But then, why didn't you stay out longer and catch more?" asked the American.

The Mexican explained that his small catch was sufficient to meet his needs and those of his family.

The American asked, "But what do you do with the rest of your time?"

"I sleep late, fish a little, play with my children, and take a siesta with my wife. In the evenings, I go into the village to see my friends, have a few drinks, play the guitar, and sing a few songs...I have a full life."

The American interrupted, "I have an MBA from Harvard and I can help you! You should start by fishing longer every day. You can then sell the extra fish you catch. With the extra revenue, you can buy a bigger boat. With the extra money the larger boat will bring, you can buy a second one and a third one and so on until you have an entire fleet of trawlers. Instead of selling your fish to a middle man, you can negotiate directly with the processing plants and maybe even open your own plant. You can then leave this little village and move to Mexico City, Los Angeles, or even New York City! From there you can direct your huge enterprise."

"How long would that take?" asked the Mexican.

"Twenty, perhaps twenty-five years," replied the American.

"And after that?"

"Afterwards? That's when it gets really interesting," answered the American, laughing. "When your business gets really big, you can start selling stocks and make millions!"

"Millions? Really? And after that?"

"After that you'll be able to retire, live in a tiny village near the coast, sleep late, play with your children, catch a few fish, take a siesta, and spend your evenings drinking and enjoying your friends!"

[Stef]

Well I started to write a reply about the gold stuff, but it got too long, so here's the short version. Fascinating subject! Actually, I can only recommend everybody to research into the history of money and how our monetary system works today. There is a reason why we're not taught in school. I swear that, once you understand it, it's like taking the red pill and you can never unsee the matrix.

Let me sum up my opinion real quick: Gold & silver: good for insurance and preserving wealth, great historical track record. Not suitable as currency for a modern economy though. Fiat money =/= bad. Debt based fiat money issued by private banks and connected with compounding interest = bad (= what we have today).

I suggest that if we get more into that subject, we go to another thread.

--------------------------------------

To return to the subject at hand here, here's a short collection of short, but tasteful jokes:   

An Irishman walks out of a bar.

Q: What's worse than raining cats and dogs?
A: Hailing taxis.

Q: Why did Willie Nelson get hit by a truck?
A: He was playing On The Road Again.

You hear about the guy who had his whole left side amputated? I hear he is all right now.

Q: How much does it cost a pirate to pierce his ears?
A: A buck-an-ear.

Q: What do gay horses eat?
A: Haaaaaaaaaaaay

Q: What kind of bees make milk?
A: Boo-Bees!

Q: What power do women have in the Catholic Church?
A: Nun.

Q: What did the leper say to the prostitute?
A: Keep the tip.

Q: What's brown and sticky?
A: A stick

[Mike]

Hear ye! 

I know 70% of you won't click on this link and 90% of you won't read what is on this website. BUT if I can just get one of you to store an extra quart of water or buy and extra bag of rice or maybe start keeping an extra 100 bucks handy, this post has done it's job.

This is the best website I have ever found on this subject (the economy subject we werre taliking about).
 All my other research has always left me wondering if the people and specialists talking about this stuff don't have an alterior motive. The news are out for ratings, the gold & silver sites want you to buy gold or silver, the investment tycoon sites want you to buy ETF's or go to their seminars, the religious sites want to scare you towards their end-of-the-world believes, the politicians want to be re-elected rather than speaking the truth, . . . you get my drift.

This guy is an easy read. He doesn't give out his name and he will never be rich or on 60 minutes with his stuff. I don't believe everything 100% but he makes some valuable points without trying to make you change your mind or trying to sell you something. He is non-political, non-religious, just a guy who has done some research (as you know we like the non-political, non-religious stuff here in the forum)

http://iseedanger.com/stories/

Take it or leave it.

I am, however, always amazed about how people in this country are never prepared for any kind of emergency. I see a lot of power outages, lived in the woods, flown to disaster areas with my job so I have seen what could happen. I know people who have life insurance, health insurance, a fire extinguisher, car insurance, yet they don't have an extra gallon of water or 100 bucks in cash. I can see this attitude maybe in my home country of Austria where water is plenty, there haven't been any diasters in decades, and there are no dangerous or poisonous animals but in the US ?
Katrina? 9-11? Ike? wildland fire? Hurricanes? .... right in their own country!

This read is a good overview not only on the economy but also how to plan your money, how to plan survival, how to live as carefree as possible without having to be a government conspiracy believer and hide in a bunker in the woods with a big caliber gun.

anyways..... this concludes my 0.02 bucks about the subject (for now  )

[Stef]

That's an interesting read. Thanks for sabotaging my workday, now I have to go through that all. Fortunately the abundance of colored or bold fonts cease at page 2.

I started some "perparing" after the 2008 banking crisis, but I have seriously slacked off again recently. I guess I should put some time and effort in again. Living in Europe, we don't really have that many natural disasters (and Mike, you forgot earthquakes on your US list), so in my mind a a type of banking or economic crash is the most likely scenario. I am one of those guilty of only having a minimum amount of cash at hand which could already be a problem if there's just a bank holiday for a week.

All those doomsday and end-of-the-world roadwarrior type scenarios are a bit far fetched for me. But I guess they're a template for preparing and if you're prepared for the worst, you're prepared for everything. Also, I think it depends on where you live. If you're living in a rural or remote area it might make more sense to stock up on ammo than in my case, as I'm living in a densely populated area and don't even own a gun.

I'm curious. Who in here would be self-sufficient for a couple of weeks? I know that I probably wouldn't.

[tundra_flier]

A week I could usually manage just fine.  I often go that long without spending anything.  2 weeks?, might have to eat the dog.   

[Mike]

I am sure most Alaskans are a little more thoughtful when it comes to this stuff and the average suburban housewife . . . 

As for me:
until I read the article above I always thought 3 days was enough.

Watching the news (Katrina, Japan Earthquake, and so on) it seems to me that's usually as long as it takes for help to get established.
My problem is water (supply, storage) in Vegas. I'd be out (unless I drink the pool water) in a few days and worse I'D BE OUT OF BEER ! !
what a sickening thought that is, huh?!