Honest Money

Gold is Wealth Hiding in Oil

Archive for July 13th, 2009

Geithner must feign inexistent value of dollar

Posted by Ivo Cerckel on 13th July 2009

“Gulf looking for reassurance from Geithner”

Excellent title.

The US dollar is a worthless piece of paper and Geithner must push it.

Geithner will say that the dollar has much value, but will nevertheless ask for stability in the dollar-denominated oil price.

This blogger submits that perhaps if oil were priced in Honest Money …

Gulf looking for reassurance from Geithner
Jul 13, 2009 at 07:57
http://business.maktoob.com/20090000007567/Gulf_looking_for_reassurance_from_Geithner_/Article.htm?utm_campaign=Night-Newsletter&utm_medium=Main-News4&utm_source=Night-Newsletter&utm_content=

Ivo Cerckel
honestmoney@maktoob.com
http://twitter.com/ivocerckel/

Posted in Uncategorized | 1 Comment »

Shariah prohibition of borrowing precious metal as money

Posted by Ivo Cerckel on 13th July 2009

The Shariah prohibits the borrowing or loaning out of precious metal

If that precious metal is money, then money can not be borrowed or loaned out under the Shariah?

Investors look for safe asset classes
Mushtak Parker | Arab News
Monday 13 July 2009 (20 Rajab 1430)
http://www.arabnews.com/?page=6§ion=0&article=124504&d=13&m=7&y=2009
SNIP
LONDON: In the aftermath of the global credit crunch and financial crisis, investors have been increasingly on the lookout for value-added and safe asset classes. In the emerging asset classes of exchange traded funds (ETFs) and commodities (ETCs), for instance, investors have tended to favor physically-backed precious metals especially gold, whose price has been appreciating over the last few months. Indeed, commodities in general including oil, gas, coal agricultural products and of course precious metals have been outperforming traditional asset classes such as real estate and equities.
+
According to Tim Harvey [head of EMEA sales at ETF Securities Ltd.], ETF securities physically backed precious metal exchange traded commodities are Shariah-compliant.
+
Consistent with allocated gold, no precious metal is borrowed, loaned out and nor does it earn any income.
UNSNIP

Islamic banks are not able to create money out of nothing or without the backing of real assets, as is the case in the conventional system today.
(Muhammad Ayub, “Understanding Islamic finance”, John Wiley & Sons, 2007, p. 92)

Indeed,
the Holy Koran says in Verse 161 of Surah An Nisaa’:
That they took usury, though they were forbidden; and that they devoured men’s substance wrongfully;- we have prepared for those among them who reject faith a grievous punishment.

And,
when one party gives something of value
and the other party pays him with something,
in this case paper, of no value,
and when one party’s wealth is created out of thin air,
while the other party has to slave and earn to pay off the ill-gotten credit or loan,
this is devouring of other people’s wealth.

Therefore,
all money in Islam must be something of value.

But if the Shariah prohibits precious metal to be borrowed or loaned out
then
if that something of value which is money in Islam is a precious metal,
that money, precious metal, can not be borrowed or loaned out  ?????

I am surprised by my conclusion, which conclusion is wrong, I suppose.

Comments welcome.

Ivo Cerckel
honestmoney@maktoob.com
http://twitter.com/ivocerckel/

Posted in Uncategorized | 1 Comment »

Das Kapital ist kaput

Posted by Ivo Cerckel on 13th July 2009

From The Times July 13, 2009
Boosting bank capital is not enough to avert crises
by Anatole Kaletsky
http://business.timesonline.co.uk/tol/business/columnists/article6695317.ece

HAVE YOUR SAY
What capital?
There is no currency to denominate capital in.
There is only paper-sterling and paper-euro.
Repeal central banking
so that Gresham’s law (bad money runs out good money) cannot come into play.
Ivo Cerckel, Siquijor, Philippines

No apology to, but revenge against, Karl Marx …

ivocerckel@siquijor.ws
http://twitter.com/ivocerckel

Posted in Uncategorized | No Comments »

Zorro est arrivé … dans le Golfe

Posted by Ivo Cerckel on 13th July 2009

Treasury chief Geithner in Gulf to explain US economic defense
Wayne Arnold
Last Updated: July 12. 2009 7:43PM UAE / July 12. 2009 3:43PM GMT
http://www.thenational.ae/article/20090712/BUSINESS/707129936/1005
EXTRAIT
ABU DHABI // Timothy Geithner is scheduled to pay his first visit to the Gulf as US Treasury secretary this week with a message that may sound jarringly familiar to the one his predecessor delivered a little over a year ago: the US and its dollar remain sound destinations for the region’s oil profits.

Posted in Uncategorized | 4 Comments »

Tim Congdon, René Descartes & Mao Zedong

Posted by Ivo Cerckel on 13th July 2009

Universal Monetary Research at Tenth Egg Street, not Lombard Street

More than a decade ago, Professor Tim Congdon, then at Lombard (1) Street Research, compared European Monetary Union to the Maoist leap forward. (2)

The Great Leap Forward of the People’s Republic of China (PRC) was an economic and social plan used from 1958 to 1961 which aimed to use China’s vast population to rapidly transform China from a primarily agrarian economy by peasant farmers into a modern communist society through the process of agriculturalisation and industrialisation. Mao Zedong based this program on the Theory of Productive Forces. It ended in catastrophe as it triggered a widespread famine that resulted in millions of deaths. (3)

More than a decade ago, Congdon argued that monetary union can work if it is accompanied by political union. EMU is the most daring step so far in European integration much more far-reaching than harmonisation of regulations (sic) or the ending of exchange controls; it is intended not as an incremental advance, but a complete transformation of Europe’s financial arrangements, said Congdon. (2)

On 09 July 2009, Congdon, now at International Monetary Research, argued in the Financial Times that he wanted to keep newly printed money flowing to stave off deflation. (4)

On this eve of Bastille day 2009, Ambrose Evans-Pritchard writes in The Daily Telegraph in an article under the title ”Europe digs its economic grave while the ECB answers to no one “:
“Professor Tim Congdon from International Monetary Research said the eurozone money figures are “horrifying” and portend a serious crunch ahead. “My verdict is that the senior people in the ECB [and the Fed] have little organised understanding of the debt-deflationary processes initiated in late 2008,” he said. ” (5)

Is it because the euro was intended as a complete transformation of Europe’s financial arrangements, that the printing of money is the appropriate response to the debt-deflationary processes initiated in late 2008?

As Moist von Lipwig said:
Where do you test a bankable idea? Not in a bank [such as Lombard Street nor at International Monetary Research], that was certain. You needed to test it where people paid far more attention to money, and juggled their finances in a world of constant risk where a split-second decision meant the difference between triumphant profit or ignominious loss. Generically it was known as the real world, but one of its proprietary names was Tenth Egg Street. (6)

Congdon’s Great Leap Forward consists in the printing of money.

As Etienne Gilson said in his introduction to René Descartes’ “Discours de la Méthode”:
On appelle méthode, l’ordre  que la pensée doit suivre pour parvenir à la sagesse et conformément auquel elle pense une fois qu’elle y est parvenu. 
(Method is the order which thinking has to follow in order to arrive at wisdom and in accordance with which it has to think once it has arrived there (7))

Just like for René Descartes, for Tim Congdon truth is not out there, truth is in here. Truth is in Congdon’s mind.

The real world of Tenth Egg Street does not exist for Congdon.

Ivo Cerckel
honestmoney@maktoob.com
http://twitter.com/ivocerckel

NOTES

(1)
If I remember well, the final but two note of 100 Belgian francs bore the picture of Lambert Lombard

(2)
Tim Congdon, “Could EMU be Europe’s ‘Maoist leap forward’?”, in: Paul Temperton, (ed.), “The euro”, John Wiley and Sons, 1998, 2nd ed., 187 – 203

(3)
http://en.wikipedia.org/wiki/Great_Leap_Forward

(4)
Keep the money flowing to stave off deflation
By Tim Congdon
Published: July 8 2009 19:53 | Last updated: July 8 2009 19:53
http://www.ft.com/cms/s/0/d7333976-6bef-11de-9320-00144feabdc0.html

(5)
Europe digs its economic grave while the ECB answers to no one
The European Central Bank preens as the last guardian of virtue in a sinful world, yet its actions are devastating the public finances of almost every country under its care.
By Ambrose Evans-Pritchard
Published: 7:01PM BST 12 Jul 2009
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/5811343/Europe-digs-its-economic-grave-while-the-ECB-answers-to-no-one.html?state=target#postacomment&postingId=5812646\
SNIP
Professor Tim Congdon from International Monetary Research said the eurozone money figures are “horrifying” and portend a serious crunch ahead. “My verdict is that the senior people in the ECB [and the Fed] have little organised understanding of the debt-deflationary processes initiated in late 2008,” he said.

(6)
Terry Pratchett, “Making Money – A Discworld Novel”, London, Corgi Books, 2008, (originally published in 2007 by Doubleday in … Great Britain),  p. 170
[With thanks to my teachers at timesonline.co.uk for having suggested the reading of this novel to me]

(7)
Gilson, “Introduction au Discours de la Méthode de Monsieur Descartes”, in : Descartes, “Discours de la Méthode”, Paris, Vrin, 2005,  p. 11

Posted in Uncategorized | 1 Comment »

 

Fatal error: Call to undefined function get_current_site() in /home2/bphouse/public_html/wp-content/themes/andreas09/footer.php on line 4