Posted On: Monday - October 26th 2026 7:06PM MST
In Topics: Economics Inflation Scams People's Revolt
Note that this ZeroHedge blurb says "Sponsored Content". Those blurbs are for ads, so I don't click and read them.
I can tell what the sponsored content would have been getting at, had I read this one. You can make loans using your precious metals as collateral or something. It may not even be a total scam.
However, the headline implies that if one's gold is just sitting there, that's a bad thing financially. Nope, you're wrong, Mr. Monetary Metals.
That gold is just sitting there, in a safe, vault, back yard, silt under the lake after that unfortunate boating accident. Wherever - errr, if you can find it ... it's there storing value, as opposed to, say, pieces of green paper or bits on a computer that stand for lower and lower potential spending value as the days go on.
Yes, the gold just sits there. That's the whole point.
Comments:
The Alarmist
Tuesday - October 27th 2026 2:13PM MST
PS
Evening all.
Interest on indebtedness has been around for millenia; it just wasn’t as conceptually developed as the current model. It would be fair to say it was historically seen as compensation for the risk taken by the lender, which nowadays is only one part of the factors built into interet rates. It was only recently that “time value of money” became a thing, which oddly enough disappeared in much of the Western world in the last decade.
The more interesting aspect is how early the elites learned to game the system so that they weren’t making as much money with the interest as they were by foreclosing on the collateral, often property, on loans in default, and even taking debtors into bondage. The interest was the least of a borrower’s problems. Which goes to the concept of debt relief or “jubilee years,” which became tools of keeping the little people on-side of the current or new ruling elites while at the same time checking the ambitions of the up-and-coming elites building their fiefdoms through foreclosure and debt bondage.
PMs and “sound money” didn’t really do much to alter the picture since the victims of debt peonage were people willing to literally mortgage their future to cover their needs that day. Inflation is just another tool to plunder the borrower, which is why it is now a component built intonsetting an appropriate interest rate to compensate the lender. Interest rate = Risk-free + Risk Adjustment + Expected inflation rate adjustment + fudge factor (tax impact) + financing costs … the model evolves as needed.
I haven’t checked out the ZH bit, but if you want ”interest” on your gold or other PMs, it is likely you vault it with them, and they lease it out. Jewelers are typically borrowers of the metal, though it can include other business that deal in PMs as part of their working capital. Interest usually accrues in the PM, so it fluctuates in value in fiat terms. Then there are taxes ….
☯️
Evening all.
Interest on indebtedness has been around for millenia; it just wasn’t as conceptually developed as the current model. It would be fair to say it was historically seen as compensation for the risk taken by the lender, which nowadays is only one part of the factors built into interet rates. It was only recently that “time value of money” became a thing, which oddly enough disappeared in much of the Western world in the last decade.
The more interesting aspect is how early the elites learned to game the system so that they weren’t making as much money with the interest as they were by foreclosing on the collateral, often property, on loans in default, and even taking debtors into bondage. The interest was the least of a borrower’s problems. Which goes to the concept of debt relief or “jubilee years,” which became tools of keeping the little people on-side of the current or new ruling elites while at the same time checking the ambitions of the up-and-coming elites building their fiefdoms through foreclosure and debt bondage.
PMs and “sound money” didn’t really do much to alter the picture since the victims of debt peonage were people willing to literally mortgage their future to cover their needs that day. Inflation is just another tool to plunder the borrower, which is why it is now a component built intonsetting an appropriate interest rate to compensate the lender. Interest rate = Risk-free + Risk Adjustment + Expected inflation rate adjustment + fudge factor (tax impact) + financing costs … the model evolves as needed.
I haven’t checked out the ZH bit, but if you want ”interest” on your gold or other PMs, it is likely you vault it with them, and they lease it out. Jewelers are typically borrowers of the metal, though it can include other business that deal in PMs as part of their working capital. Interest usually accrues in the PM, so it fluctuates in value in fiat terms. Then there are taxes ….
☯️
Adam Smith
Tuesday - October 27th 2026 9:35AM MST
PS: A quick update...
https://i.ibb.co/3YN28RbG/The-Velocity-of-Usury.jpg
https://share.google/aimode/qxGLF4PPryA3yIUQa
Sorry about relying so heavily on the clanker this morning. I got to bed late, and (because of the Hunter's Moon last night?) I didn't sleep as well as I usually do. And I got up earlier than usual because we thought the carpenter might come by to finish the deck/railing repair going on here at the house. Anyway... I'm foggy brained today. Ideas and words aren't flowing like usual.
☮️
https://i.ibb.co/3YN28RbG/The-Velocity-of-Usury.jpg
https://share.google/aimode/qxGLF4PPryA3yIUQa
Sorry about relying so heavily on the clanker this morning. I got to bed late, and (because of the Hunter's Moon last night?) I didn't sleep as well as I usually do. And I got up earlier than usual because we thought the carpenter might come by to finish the deck/railing repair going on here at the house. Anyway... I'm foggy brained today. Ideas and words aren't flowing like usual.
☮️
Adam Smith
Tuesday - October 27th 2026 9:16AM MST
PS: Good afternoon, Achmed!
I mean any/all interest when I talk about usury in this way. As you know, "interest" is the cost of usury. And while the expansion of the fiat debt is the main, driving force that causes most of the "inflation" the usury itself also helps drive the devaluation of the currency. (Because the interest was not created when bank loaned the principal into existence, the ponzi scheme economy depends on new loans to create the currency to cover the interest. ad infinitum ad absurdum.)
(A massive percentage of the $400,000 retail price of a modern home doesn't represent the intrinsic value of physical matter or human sweat. It represents the cost of capital. The system forces the end consumer to pay off the debts of the entire supply chain, and then—ironically—take on their own "death pledge" (mortgage) to finance that aggregated debt.)
(Check this out for what I mean about the toxicity of usury...)
https://share.google/aimode/hMH9go3E8efABA2AB
𝐵𝑎𝑐𝑘 𝑏𝑒𝑓𝑜𝑟𝑒 𝑡ℎ𝑒 𝑑𝑜𝑙𝑙𝑎𝑟 𝑤𝑎𝑠 𝑡𝑎𝑘𝑒𝑛 𝑜𝑓𝑓 𝑔𝑜𝑙𝑑 𝑐𝑜𝑚𝑝𝑙𝑒𝑡𝑒𝑙𝑦 (𝑅𝑜𝑜𝑠𝑒𝑣𝑒𝑙𝑡'𝑠 𝑐𝑜𝑛𝑓𝑖𝑠𝑐𝑎𝑡𝑖𝑜𝑛/𝑡ℎ𝑒𝑓𝑡 𝑝𝑟𝑒𝑣𝑖𝑜𝑢𝑠𝑙𝑦 𝑖𝑠 𝑡ℎ𝑒 𝑓𝑖𝑟𝑠𝑡?), 𝑜𝑛𝑒 𝑐𝑜𝑢𝑙𝑑 𝑠𝑡𝑖𝑙𝑙 𝑔𝑒𝑡 𝑖𝑛𝑡𝑒𝑟𝑒𝑠𝑡 𝑜𝑛 𝑚𝑜𝑛𝑒𝑦 𝑖𝑛 𝑡ℎ𝑒 𝑏𝑎𝑛𝑘, 𝑟𝑖𝑔ℎ𝑡?
I don't think so. Certainly not like we think of it today. For example, modern negotiable certificates of deposit (CDs) were introduced in February 1961 by the First National City Bank of New York, now known as Citibank.
A little moar quick info...
https://share.google/aimode/X6PBPviW5cx8iPr72
Modern "interest" as we know it today was not a thing when people had sound money. (As far as I understand it. Perhaps I'm mistaken? The Alarmist might know more about this phenomenon?)
Cheers! ☮️
I mean any/all interest when I talk about usury in this way. As you know, "interest" is the cost of usury. And while the expansion of the fiat debt is the main, driving force that causes most of the "inflation" the usury itself also helps drive the devaluation of the currency. (Because the interest was not created when bank loaned the principal into existence, the ponzi scheme economy depends on new loans to create the currency to cover the interest. ad infinitum ad absurdum.)
(A massive percentage of the $400,000 retail price of a modern home doesn't represent the intrinsic value of physical matter or human sweat. It represents the cost of capital. The system forces the end consumer to pay off the debts of the entire supply chain, and then—ironically—take on their own "death pledge" (mortgage) to finance that aggregated debt.)
(Check this out for what I mean about the toxicity of usury...)
https://share.google/aimode/hMH9go3E8efABA2AB
𝐵𝑎𝑐𝑘 𝑏𝑒𝑓𝑜𝑟𝑒 𝑡ℎ𝑒 𝑑𝑜𝑙𝑙𝑎𝑟 𝑤𝑎𝑠 𝑡𝑎𝑘𝑒𝑛 𝑜𝑓𝑓 𝑔𝑜𝑙𝑑 𝑐𝑜𝑚𝑝𝑙𝑒𝑡𝑒𝑙𝑦 (𝑅𝑜𝑜𝑠𝑒𝑣𝑒𝑙𝑡'𝑠 𝑐𝑜𝑛𝑓𝑖𝑠𝑐𝑎𝑡𝑖𝑜𝑛/𝑡ℎ𝑒𝑓𝑡 𝑝𝑟𝑒𝑣𝑖𝑜𝑢𝑠𝑙𝑦 𝑖𝑠 𝑡ℎ𝑒 𝑓𝑖𝑟𝑠𝑡?), 𝑜𝑛𝑒 𝑐𝑜𝑢𝑙𝑑 𝑠𝑡𝑖𝑙𝑙 𝑔𝑒𝑡 𝑖𝑛𝑡𝑒𝑟𝑒𝑠𝑡 𝑜𝑛 𝑚𝑜𝑛𝑒𝑦 𝑖𝑛 𝑡ℎ𝑒 𝑏𝑎𝑛𝑘, 𝑟𝑖𝑔ℎ𝑡?
I don't think so. Certainly not like we think of it today. For example, modern negotiable certificates of deposit (CDs) were introduced in February 1961 by the First National City Bank of New York, now known as Citibank.
A little moar quick info...
https://share.google/aimode/X6PBPviW5cx8iPr72
Modern "interest" as we know it today was not a thing when people had sound money. (As far as I understand it. Perhaps I'm mistaken? The Alarmist might know more about this phenomenon?)
Cheers! ☮️
Moderator
Tuesday - October 27th 2026 8:40AM MST
PS: Oh, good point about the taxes. The beauty of PMs is that if you had paid cash for them, the IRS need not be involved. That's what my accountant said... I kid... he wouldn't say that on the record.
It depends on what you mean by usury - do you mean ANY interest, or just above the "price of money"? Interest is the charge for use of money for some time period, as you know, but I don't see that it's the cause of inflation.
Back before the dollar was taken off gold completely (Roosevelt's confiscation/theft previously is the first?), one could still get interest on money in the bank, right? I long for the days when, gold or not, one could still hold onto his hard- or easy-earned money by just keeping it safe and not need to become and investor. It's not my job.
It depends on what you mean by usury - do you mean ANY interest, or just above the "price of money"? Interest is the charge for use of money for some time period, as you know, but I don't see that it's the cause of inflation.
Back before the dollar was taken off gold completely (Roosevelt's confiscation/theft previously is the first?), one could still get interest on money in the bank, right? I long for the days when, gold or not, one could still hold onto his hard- or easy-earned money by just keeping it safe and not need to become and investor. It's not my job.
Moderator
Tuesday - October 27th 2026 8:36AM MST
PS: Yes, I followed that discussion of art as money in that thread Adam. One thing about art is it's very hard to value. It is the farthest thing from a commodity, which is the word I should have used when writing to whomever (Mr. Shearer, I think).
I'll get into your links later on.
Nice day here too! I've got a few days off. I wrote elsewhere that we planned and then called off the plans about going to a Trump rally. We still may go to a different one. It's not that I really need to listen to his "weave" where he mouths off about new lakes to be renamed and that, but I don't know - gotta support somebody.
For right now, yeah, the back yard is a jungle, but my wife still has pumpkins and such, so... one day, we've got to come in with the big clippers, mower, chain saw, the works...
Oh, and "boatwogs", you're not gonna want to waste that one!
I'll get into your links later on.
Nice day here too! I've got a few days off. I wrote elsewhere that we planned and then called off the plans about going to a Trump rally. We still may go to a different one. It's not that I really need to listen to his "weave" where he mouths off about new lakes to be renamed and that, but I don't know - gotta support somebody.
For right now, yeah, the back yard is a jungle, but my wife still has pumpkins and such, so... one day, we've got to come in with the big clippers, mower, chain saw, the works...
Oh, and "boatwogs", you're not gonna want to waste that one!
Moderator
Tuesday - October 27th 2026 8:31AM MST
PS: Good morning, Alarmist, or possibly afternoon, depending on your 10-20.
Agreed. I'm not sure how these people work it - again, I wasn't going to even read it - but, if they want to hold onto that gold, that's a "non-starter", in CorporateSpeak.
Agreed. I'm not sure how these people work it - again, I wasn't going to even read it - but, if they want to hold onto that gold, that's a "non-starter", in CorporateSpeak.
Adam Smith
Tuesday - October 27th 2026 7:59AM MST
PS: 𝐵𝑒𝑐𝑎𝑢𝑠𝑒 𝑖𝑛𝑓𝑙𝑎𝑡𝑖𝑜𝑛 𝑖𝑠 𝑡ℎ𝑒 𝑜𝑛𝑒 𝑜𝑓 𝑡ℎ𝑒 𝑐𝑜𝑠𝑡𝑠 𝑜𝑓 𝑢𝑠𝑢𝑟𝑦...
Because inflation is one of the costs of usury. (Dammit.)
🏴☠️
Because inflation is one of the costs of usury. (Dammit.)
🏴☠️
Adam Smith
Tuesday - October 27th 2026 7:55AM MST
PS: Good morning, Messrs. Alarmist and Newman!
I've been meaning to check in for several days. (Or so it seems.)
I hope y'all are well...
I was going to chime in under the last post, mostly because I wanted to use the word 𝑏𝑜𝑎𝑡𝑤𝑜𝑔𝑠 in a sentence. But... Whatever it was that I was writing (something about the 𝑏𝑜𝑎𝑡𝑤𝑜𝑔𝑠 begin at Calais?) was unnatural/forced, so I moved on without mashing the submit button. Anyway...
𝑂𝑛𝑒 𝑜𝑓 𝑡ℎ𝑒 𝑝𝑜𝑖𝑛𝑡𝑠 𝑜𝑓 𝑜𝑤𝑛𝑖𝑛𝑔 𝑔𝑜𝑙𝑑 𝑖𝑠 ℎ𝑎𝑣𝑖𝑛𝑔 𝑔𝑜𝑙𝑑 𝑤ℎ𝑒𝑛 𝑡ℎ𝑒 𝑠𝑦𝑠𝑡𝑒𝑚 𝑜𝑓 𝑡𝑟𝑢𝑠𝑡 𝑡ℎ𝑎𝑡 𝑎𝑙𝑙𝑜𝑤𝑠 𝑖𝑛𝑒 𝑡𝑜 𝑙𝑒𝑛𝑑 𝑜𝑛𝑒’𝑠 𝑔𝑜𝑙𝑑 𝑑𝑜𝑒𝑠𝑛’𝑡 𝑤𝑜𝑟𝑘...
As usual, we agree. I'm ok with an asset simply holding value.
But... We are not like some of the others.
I lightly touched upon this concept (𝐴𝑟𝑡 𝑜𝑓 𝑡ℎ𝑖𝑠 𝑛𝑎𝑡𝑢𝑟𝑒 𝑖𝑠 𝑎 ℎ𝑖𝑔ℎ𝑙𝑦 𝑠𝑜𝑝ℎ𝑖𝑠𝑡𝑖𝑐𝑎𝑡𝑒𝑑 𝑓𝑖𝑛𝑎𝑛𝑐𝑖𝑎𝑙 𝑖𝑛𝑠𝑡𝑟𝑢𝑚𝑒𝑛𝑡) last month with my unz comment about the art backed loans. I haven't looked into any links on zerohedge about this, but I think the mechanism is similar...
https://www.unz.com/isteve/isteve-open-thread-30/#comment-7772122
https://i.ibb.co/mVgrPNvn/Art-Backed-Loans.jpg
https://i.ibb.co/C3S6g3BR/Gold-Backed-Loans.jpg
https://i.ibb.co/WNNBZP2Y/interest-tracing.jpg
Someone like James B. Shearer might argue that "value" is being created when someone takes out a $40 million loan at 2% backed by a Basquiat painting (or something like that) but I see it as someone taking equity out of the financial system at other's expense. (Because inflation is the one of the costs of usury. And because these sorts of loans are being subsidized by the taxcattle. And mostly because no "value" is being created.) (But this is kind of beside the point. I think?)
Ok... So I'm back from doing the dishes and helping Mrs. Smith prep lunch. (We're having ossobuco today!) But now I kinda forget where I was going with this...
Probably something about why sell your gold and/or artwork and trigger a taxable event when you can take a low interest ("government" subsidized) tax deductible loan using the asset as collateral? (I think this sort of 𝑙𝑒𝑣𝑒𝑟𝑎𝑔𝑒 is what the zerohedge kids are getting at.)
---------
A little more info...
https://www.artsy.net/article/artsy-editorial-art-loans-popular-ultra-wealthy-good-economic-times-bad
https://www.cnbc.com/2021/02/25/the-wealthy-are-borrowing-billions-against-their-art-collections-.html
https://privatebank.jpmorgan.com/nam/en/services/lending/specialty-lending/fine-art-financing
https://www.privatebank.bankofamerica.com/solutions/art-services.html
https://www.fgcapitaladvisors.com/top-10-art-backed-lenders-for-collectors
---------
Looks like another beautiful fall day here on the mountain. I should probably do a couple painting projects around here while it is still in the mid 70s. (In fact, I think that is what I should focus on today.) Everything else is good here.
So happy Tuesday!
I hope you guys have a great day!
☮️
I've been meaning to check in for several days. (Or so it seems.)
I hope y'all are well...
I was going to chime in under the last post, mostly because I wanted to use the word 𝑏𝑜𝑎𝑡𝑤𝑜𝑔𝑠 in a sentence. But... Whatever it was that I was writing (something about the 𝑏𝑜𝑎𝑡𝑤𝑜𝑔𝑠 begin at Calais?) was unnatural/forced, so I moved on without mashing the submit button. Anyway...
𝑂𝑛𝑒 𝑜𝑓 𝑡ℎ𝑒 𝑝𝑜𝑖𝑛𝑡𝑠 𝑜𝑓 𝑜𝑤𝑛𝑖𝑛𝑔 𝑔𝑜𝑙𝑑 𝑖𝑠 ℎ𝑎𝑣𝑖𝑛𝑔 𝑔𝑜𝑙𝑑 𝑤ℎ𝑒𝑛 𝑡ℎ𝑒 𝑠𝑦𝑠𝑡𝑒𝑚 𝑜𝑓 𝑡𝑟𝑢𝑠𝑡 𝑡ℎ𝑎𝑡 𝑎𝑙𝑙𝑜𝑤𝑠 𝑖𝑛𝑒 𝑡𝑜 𝑙𝑒𝑛𝑑 𝑜𝑛𝑒’𝑠 𝑔𝑜𝑙𝑑 𝑑𝑜𝑒𝑠𝑛’𝑡 𝑤𝑜𝑟𝑘...
As usual, we agree. I'm ok with an asset simply holding value.
But... We are not like some of the others.
I lightly touched upon this concept (𝐴𝑟𝑡 𝑜𝑓 𝑡ℎ𝑖𝑠 𝑛𝑎𝑡𝑢𝑟𝑒 𝑖𝑠 𝑎 ℎ𝑖𝑔ℎ𝑙𝑦 𝑠𝑜𝑝ℎ𝑖𝑠𝑡𝑖𝑐𝑎𝑡𝑒𝑑 𝑓𝑖𝑛𝑎𝑛𝑐𝑖𝑎𝑙 𝑖𝑛𝑠𝑡𝑟𝑢𝑚𝑒𝑛𝑡) last month with my unz comment about the art backed loans. I haven't looked into any links on zerohedge about this, but I think the mechanism is similar...
https://www.unz.com/isteve/isteve-open-thread-30/#comment-7772122
https://i.ibb.co/mVgrPNvn/Art-Backed-Loans.jpg
https://i.ibb.co/C3S6g3BR/Gold-Backed-Loans.jpg
https://i.ibb.co/WNNBZP2Y/interest-tracing.jpg
Someone like James B. Shearer might argue that "value" is being created when someone takes out a $40 million loan at 2% backed by a Basquiat painting (or something like that) but I see it as someone taking equity out of the financial system at other's expense. (Because inflation is the one of the costs of usury. And because these sorts of loans are being subsidized by the taxcattle. And mostly because no "value" is being created.) (But this is kind of beside the point. I think?)
Ok... So I'm back from doing the dishes and helping Mrs. Smith prep lunch. (We're having ossobuco today!) But now I kinda forget where I was going with this...
Probably something about why sell your gold and/or artwork and trigger a taxable event when you can take a low interest ("government" subsidized) tax deductible loan using the asset as collateral? (I think this sort of 𝑙𝑒𝑣𝑒𝑟𝑎𝑔𝑒 is what the zerohedge kids are getting at.)
---------
A little more info...
https://www.artsy.net/article/artsy-editorial-art-loans-popular-ultra-wealthy-good-economic-times-bad
https://www.cnbc.com/2021/02/25/the-wealthy-are-borrowing-billions-against-their-art-collections-.html
https://privatebank.jpmorgan.com/nam/en/services/lending/specialty-lending/fine-art-financing
https://www.privatebank.bankofamerica.com/solutions/art-services.html
https://www.fgcapitaladvisors.com/top-10-art-backed-lenders-for-collectors
---------
Looks like another beautiful fall day here on the mountain. I should probably do a couple painting projects around here while it is still in the mid 70s. (In fact, I think that is what I should focus on today.) Everything else is good here.
So happy Tuesday!
I hope you guys have a great day!
☮️
The Alarmist
Tuesday - October 27th 2026 7:14AM MST
PS
I love the ads suggesting you can earn “interest” on your gold by lending your gold … sounds nice, while it works, but one of the points of owning gold is having gold when the system of trust that allows ine to lend one’s gold doesn’t work. Same with gold in a vault. Shame ‘bout that boating accident….
🏴☠️
I love the ads suggesting you can earn “interest” on your gold by lending your gold … sounds nice, while it works, but one of the points of owning gold is having gold when the system of trust that allows ine to lend one’s gold doesn’t work. Same with gold in a vault. Shame ‘bout that boating accident….
🏴☠️
True, I also see a charge for that risk of default.
This is not to say that there aren't plenty of loans made to family members with no compensation for the temporary loss of use and the risk, the latter often higher than even with your bankers, especially high when it's the ex-wife you're... no, don't do that. Keeping it in the family can pay off on the whole, and it's not all about the money, of course.
Well, I'll write another inflation note tonight. I'm low on windshield washer fluid - yep, that's the post, sorry...