Jim Rickards' New Book "The Death of Money", Review

[tabnloz]

We could write thousands of pages of discussion about this, but I try not to spend my time like this, sorry. I was already a bit pissed at myself for making that last post so long.

You are of another opinion, and that's cool. Your last link was interesting, hadn't seen that one before.

True, no worries. Thanks for the good discussion.

Im just going past halfway of the book. So far, another good read. I was probably more gripped by currency wars as much of the content was new to me back then.

But anyway, I really liked the few pages discussing negative rates. The true bastardry comes in the harmless sounding terms 'QE' and Op Twist and all these other easy to digest soundbite names; at heart they are deliberate policies designed to sipher your money via inflation.

This is actually quite sickening. While destroying savers and the wealth of the regular joe was previously done by bank laws on deposit rates, it now just does it a little more subtly.

And therein lies a damn good reason to be in bitcoin.

Where is the QE-caused inflation, or really inflation at all? If you don't believe official stats then use MIT Billion Price Index, or something else. Unless you try to come up with somewhat technical excuses, it's just not there. Please provide data.

From my interpretation of the book, inflation is 'working' via negative real interest rates, eg, interest rates on savings are at 0.5% and inflation is at 1.5%, therefore savers are losing 1%.

also from my reading, the QE induced inflation is being exported to other countries as are pressured to lower their currencies against the dollar thereby, as say with japan, making energy imports more expensive. Other examples given were Brazil, Iran.

Please lets not go down the 'put up data or else' route; im paraphrasing the book.

[gts476]

So read currency wars instead?

[Dr Bloggood]

So read currency wars instead?

I haven't read that one.

[Este Nuno]

Rickards completely ignores devastating numbers from the European economy, which have only been getting worse. Quote: "By late 2012, the European sovereign debt and bank crises was largely contained" (p. 128). Excuse me!?? He enthusiastically writes about a treaty between EU members that "requires signatories to have budget deficits of less than 3% of GDP when their debt-to-GDP ratio is under 60 percent." More rigid requirements are valid for counties with higher ratios - but he completely ignores all the regulations of the past about debt, which have been broken by most EU members without any consequences. So where is this guy living (in the US, I know...)?

According to him, "Greece needs only more flexible work rules, lower unit labor costs, and new capital." This stuff makes me laugh. Greece at least additionally needs/needed stricter tax enforcement and measures against corruption - but also, the Greek and the German economy, for example, just don't make a good fit! The same easy money policy Rickards condemns in the US, is totally ok for him in Europe. And finally, the most outrageous claim of the book is the claim that Germany (edit: the Eurozone) has "real positive interest rates" (p. 127)! What the fuck!?

This part in particular is pretty ridiculous I think.

[Dr Bloggood]

Rickards completely ignores devastating numbers from the European economy, which have only been getting worse. Quote: "By late 2012, the European sovereign debt and bank crises was largely contained" (p. 128). Excuse me!?? He enthusiastically writes about a treaty between EU members that "requires signatories to have budget deficits of less than 3% of GDP when their debt-to-GDP ratio is under 60 percent." More rigid requirements are valid for counties with higher ratios - but he completely ignores all the regulations of the past about debt, which have been broken by most EU members without any consequences. So where is this guy living (in the US, I know...)?

According to him, "Greece needs only more flexible work rules, lower unit labor costs, and new capital." This stuff makes me laugh. Greece at least additionally needs/needed stricter tax enforcement and measures against corruption - but also, the Greek and the German economy, for example, just don't make a good fit! The same easy money policy Rickards condemns in the US, is totally ok for him in Europe. And finally, the most outrageous claim of the book is the claim that Germany (edit: the Eurozone) has "real positive interest rates" (p. 127)! What the fuck!?

This part in particular is pretty ridiculous I think.

I hope you mean the book and not my quote, ha ha!

Where do you live? What do you think about the economy of your country?

[tabnloz]

I've finished the book, thought it was another good read. Some was a bit rehashed from Currency Wars, but overall good stuff.

Interesting part on the implementation of SDR's.

Rickards view is that the major nations are colluding to allow China to purchase enough gold to give them all a relative equal balance in gold reserves. When this occurs, the move away from top weighting to the US dollar will begin. He writes that the move towards SDR's, higher weighting for the Yuan and less for the USD has been acknowledged by the US Fed & Treasury. This goes part the way to explaining gold market swings and its decline in recent times.

Further, this is only the plan and works only if things remain smooth. Plenty of scope for increases in inflation, deflation and some kind of panic / collapse to bring this transition on in a hurry. The plan is, and always has been, for inflation, but whether it can be controlled without society rebelling (wiping out savings) or deflation winning the battle first is the $64k question.

I think that Rickards has generally been a sober kind of commentator. Quite measured and not prone to some of the more far out scenario predictions. In DoM however, I think he is very bearish, saying that there is no way this will end well and all signs point to some kind of chaos. He even brings up the oft cited SWAT / tanks / bullets etc being amassed by US counties /states as a harbinger of what is to come.

[Dr Bloggood]

Rickards view is that the major nations are colluding to allow China to purchase enough gold to give them all a relative equal balance in gold reserves. When this occurs, the move away from top weighting to the US dollar will begin. He writes that the move towards SDR's, higher weighting for the Yuan and less for the USD has been acknowledged by the US Fed & Treasury. This goes part the way to explaining gold market swings and its decline in recent times.

Yes, that was one of the most interesting parts of the book.

The problem with this theory is, it assumes all the countries really have the amount of gold they claim to have, and this, in my book, is definitely not the case. There are a lot of indicators pointing in the other direction, I can't believe for a second Western countries have the gold they claim to have.

[Swordsoffreedom]

I have heard about this book the death of money and appreciate the time you took to write a review about it
Saved me some reading myself which I can put towards other books
(Kind of want a book thread)
An interesting Book I read recently is The Prize by Daniel Yergin which goes into oil politics and economics so would recommend that to others looking for a good read

[Dr Bloggood]

I have heard about this book the death of money and appreciate the time you took to write a review about it
Saved me some reading myself which I can put towards other books
(Kind of want a book thread)
An interesting Book I read recently is The Prize by Daniel Yergin which goes into oil politics and economics so would recommend that to others looking for a good read

Thanks, I have never heard of that one. Just checked it out on Amazon.

[scryptasicminer]

Just name the book "The death of fiat".

Money will never die, it will change change form.

[Dr Bloggood]

Just name the book "The death of fiat".

Money will never die, it will change change form.

True, that didn't even occur to me. But as "The Death of Fiat", this book won't be marketable, ha ha! Plus, the car industry might sue you.

Gold is money, even if Ben claims otherwise.

[tabnloz]

Rickards view is that the major nations are colluding to allow China to purchase enough gold to give them all a relative equal balance in gold reserves. When this occurs, the move away from top weighting to the US dollar will begin. He writes that the move towards SDR's, higher weighting for the Yuan and less for the USD has been acknowledged by the US Fed & Treasury. This goes part the way to explaining gold market swings and its decline in recent times.

Yes, that was one of the most interesting parts of the book.

The problem with this theory is, it assumes all the countries really have the amount of gold they claim to have, and this, in my book, is definitely not the case. There are a lot of indicators pointing in the other direction, I can't believe for a second Western countries have the gold they claim to have.

Yep, ive read the theories but i really have no idea whether they are true. I'd say many less stable countries have traditionally kept their reserves in the US / UK as a form of protection. Apart from Venezuela who actually shipped the gold back, I'd say much other claims to get it back may be political posturing.

The slightly out there theory that I have a passing interest in is the WW2 loot theory that posits that there is actually much more gold in the world than is currently accepted.

The Japanese looted CHina / Manchuria and all of Sth East Asia prior and during the war, stealing thousands and thousands of tonnes of gold, jewels, precious arts etc. For the most part they shipped it back to Japan until the US blocked supply routes in late 43/44. From there on in, they buried it in massive PoW made underground complexes (that were housed under structures they believed the Allies would not bomb - churches, hospitals etc). We're talking thousands if not hundreds of thousands of generational gold hand me downs.

Anyways, the forerunners to the CIA (ISS) got wind of this after the war and spent the next 20 years recovering it all, in a kind of mad race with other Japanese, Ferdinand Marcos etc.

The loot, known as The Black Eagle Trust or the M Fund, was used to finance the fight against corruption across the world in the post war era and eventually fell into the hands of the Big Banks like Citibank who were chased through the courts for years and years in order to return the loot to many of its owners. Citibank eluded and dodged until the claimants died in many cases or used other nefarious means to avoid giving the massive interest bearing accounts back.

Proof of the size and scale of this operation are plentiful, with one such example being the biggest civil case in history where an amatuer Filipino treasure hunter named Rogelio Roxas was awarded a 22 BILIION dollar settlement against the Marcos estate for his torture and the confiscation of a Golden Buddha he discovered near a hospital in Manilla in the 70's.

Here's a brief summary of the Roxas case http://www.tseatc.com/jury.html

Yes, that's 22 BILLION in 1997 dollars.

[Swordsoffreedom]

I have heard about this book the death of money and appreciate the time you took to write a review about it
Saved me some reading myself which I can put towards other books
(Kind of want a book thread)
An interesting Book I read recently is The Prize by Daniel Yergin which goes into oil politics and economics so would recommend that to others looking for a good read

Thanks, I have never heard of that one. Just checked it out on Amazon.

I would recommend it highly although I messed up a bit their and meant the Quest which is the update on the Prize
I mixed the two up since I was watching the youtube video series on The Prize and read the Book on the Quest
Part 5 of an 8 part series
http://www.youtube.com/watch?v=IIJxBrHcSUo

[sana8410]

So I just finished Rickards' brand-new book. It's an ok read, but I also feel like I didn't learn too many new things.

On one hand, 90% of the book makes a lot of sense and there are some smart thoughts to be found in it. On the other hand, if you are well-informed about the current economic disaster (as a lot of posters on this forum are), you will not profit that much from reading it. Also, be adviced that some basic economic understanding is a precondition for reading this book: It certainly brought me to the edge of my economic understanding. All in all, if you know about the breakdown of the monetary system, save some time by reading this post and a couple of Rickards' interviews on the web and leave out the book!

The first half of the book, while a good read, is really relatively superfluous for anybody who knows a bit about the topic. The first chapter is about insider trading of terrorist associates before 9/11, and is really interesting, but has no connection to the topic of the book. Overall, the author really loves to hear himself talk, and that's a problem.

The book continues with chapters about the fragility of todays trading mechanisms, the blunders of the Fed and the region chapters: One about China, Europe and the Emerging Markets each. The ones about China and EM contain some interesting stuff, but the historical and theoretical explanations are way too waste IMO.

The second half is more interesting:There is a chapter on US debt, then one on the IMF (it was the most interesting chapter for me, but it didn't enlighten me in extreme ways either), a chapter on gold that told me almost nothing new (I know a lot about gold manipulation though), and the end of the book is about conclusions and the breakdown of the system. Oh, and Rickards gives advice on how to invest your money in times like these - he elaborates on almost 3 whole pages...

The book does also contain some stuff that I certainly don't believe in: Above all, this concerns the chapter about Europe, "The New German Reich". God, that chapter is one single piece of hogwash! Rickards seems very fond of Europe, fair enough. His outlook on Europe is extremely positive though, and the whole chapter reads like the stuff I see and hear on Main Stream Media every day: Europe is through the crises, brighter times are about to come, etc... As a European, I can only assume that he is too far away to grasp reality here.

Rickards completely ignores devastating numbers from the European economy, which have only been getting worse. Quote: "By late 2012, the European sovereign debt and bank crises was largely contained" (p. 128). Excuse me!?? He enthusiastically writes about a treaty between EU members that "requires signatories to have budget deficits of less than 3% of GDP when their debt-to-GDP ratio is under 60 percent." More rigid requirements are valid for counties with higher ratios - but he completely ignores all the regulations of the past about debt, which have been broken by most EU members without any consequences. So where is this guy living (in the US, I know...)?

According to him, "Greece needs only more flexible work rules, lower unit labor costs, and new capital." This stuff makes me laugh. Greece at least additionally needs/needed stricter tax enforcement and measures against corruption - but also, the Greek and the German economy, for example, just don't make a good fit! The same easy money policy Rickards condemns in the US, is totally ok for him in Europe. And finally, the most outrageous claim of the book is the claim that Germany (edit: the Eurozone) has "real positive interest rates" (p. 127)! What the fuck!?

But enough of that chapter.

Other unusual things Rickards claims are that he believes the official inflation numbers and doesn't believe the US gold is missing. Instead, he believes Germany never wanted its gold back when claiming repatriation, but just had political pressure inside of Germany to make a claim. In fact, Germany wants to keep its gold at the Fed to have it used for ongoing manipulation purposes. Doesn't make any sense to me.

An intruiging thought is that the goal of the international community is to let China accumulate enough gold so it is on par with the other main players in terms of gold-to-GDP-ratio. The others want China equal so it will be able to participate in the building of the new monetary world order. That order will be in gold and/or SDRs (Special Drawing Rights).

I'm glad we have economists like Rickards, smart thinkers outside of the system, but I also think unless you know very little about the topic, you don't have to read that book.

This book is a tour de force of the global financial system as it is today. The abrupt jumps of topic between chapters were a bit disconcerting at first, but worked to keep the book to a manageable length despite its expansive scope.

[Rigon]

I very much enjoyed Rickards' first book, "Currency Wars." This was a very good sequel, although in my opinion it doesn't rise to the same level.
The premise of the book is fairly straight forward: The current monetary system is unsustainable and it's bound to collapse. It all can be boiled down to a few reasons: debt, structural problems in the world economy, derivatives, and out-of-control increases in the money supply. I suspect that a lot of readers will not agree with everything Rickards has to say, but I also suspect that a lot of readers will learn something new by reading this thought-provoking book.

[tooil]

One thing people forget is the basic issue we have today.

None of the so called educated class actually do anything that is "productive".

Shuffling paper around is what the financial industry do and is being rewarded with billion of dollars.

This shouldn't being norm for a functioning society. Of course the country currency will go down the sink if everyone in the country is doing it.

[Nicolas Dorier]

One thing people forget is the basic issue we have today.

None of the so called educated class actually do anything that is "productive".

Shuffling paper around is what the financial industry do and is being rewarded with billion of dollars.

This shouldn't being norm for a functioning society. Of course the country currency will go down the sink if everyone in the country is doing it.

You remind me one book I read "Smart people should build things".
The guy complains that the intellectual are sucked by the financial market, when they should build businesses.

Smart people goes where capital is, so he complains the system should not give so much power to the financial industry.

[tabnloz]

It has been reported today that China will be pricing the gold used on its new Shanghai exchange in Yuan and not dollars.

The movement away from the USD continues....

[Charlie Prime]

So I just finished Rickards' brand-new book.

Thank you for the review.  Well-written.

[STT]

Greece at least additionally needs/needed stricter tax enforcement and measures against corruption

Mostly it just needs lower taxes and lower spending ideally.    That largely comes from default on its debt I think.    The reason is lower taxes are more often paid then higher taxes, just because its easier to do so will actually mean more people pay the tax.

It fits into the scales of economy type model.  A 99% tax will be paid at far less then a fifth the rate at which people would pay for 20% taxes.
It is not linear more likely exponential and that is true even if you have the army patrolling the streets taking taxes, the feasibility of higher taxes is just not there no matter how much force government applies it cannot will into being what is incorrect.
     This happens way too often in peoples line of thinking, 'government can do anything'   Nope, no they can and do often fail and just muddy and mire the streets with regulational crap of no use to anyone.

  Its possible to criminalise a population and part of what does is tax, classic communism would be to suppress individual will and capitalism should free them; not for idealist reasons but just because it actually works better.
  Corruption is a mislabel, a river is not corrupt if misdirected uphill and it does not proceed as told