Tipping points are funny: for years, decades, even centuries, the conditions for an event to occur may be ripe yet nothing happens. Then, in an instant, a shift occurs, whether its is due a change in conventional wisdom, due to an exogenous event or due to something completely inexplicable. That event, colloquially called a black swan in recent years, changes the prevalent perception of reality in a moment. This past week, we were seeing the effect of a tipping point in process, with gold prices rising to new all time highs day after day, and the price of silver literally moving in a parabolic fashion. What was missing was the cause. We now know what it is: per Bloomberg: “The University of Texas Investment Management Co., the second-largest U.S. academic endowment, took delivery of almost $1 billion in gold bullion and is storing the bars in a New York vault, according to the fund’s board.” And so, the game theory of a nearly 100 year old system of monetary exchange has seen its first defector, but most certainly not last. With an entity as large as the University of Texas calling the bluff of the Comex, the Chairman, and fiat in general in roughly that order, virtually every other asset manager is now sure to follow, considering there is not nearly enough physical gold to satisfy all paper gold in existence by a factor of about 100x. The proverbial Nash equilibrium has just been broken.
The Fed has been manipulating stock prices…its all unreality…no one knows what is real anymore.
When our fiat currency is rejected by the world, then reality will set in, and it won’t be pleasant.
Tipping points only arise in causal systems. The stock market is chaotic–in our limited hooman understanding: not causal which is why experts can make up causes as they wish because no one knows.
This gives the illusion of help: how many previous spikes in hard commodities foretold a Stock Market Fail, and how many didn’t? Of what percentage run up? and so forth===but it really doesn’t matter – there is no rationality in a rigged system and its downfall is hence trigger by many variable things.
Here is what is shocking: UT has One Billion to invest? You’d never know their purpose was to fund education? Who is ripping off the system?????? aka== follow the money and enforce the laws.
ha, ha.====who am I kidding?
There’s a silver lining to the Obama Greatest Depression, folks sleeping in open field, will again gaze upon the stars.
Nothing is real.
bobbo “Here is what is shocking: UT has One Billion to invest?”
Kind of hits you over the head. I read this article to the wife, that’s all she heard.
OOOoooooh wee what up wid dat?
# 4 What? said, “Nothing is real.”
Sister Mary Hand Grenade of Quiet Reflection is real.
For once I actually agree with you, Bobo. I too find it rather alarming that a university has a billion dollars to invest in something other than education.
Don’t take this too lightly folks. Buying this much gold at this price, is either the dumbest, or the smartest move they could make.
Its a big deal.
Telling me they took a billion dollars in gold means nothing.
If it was Zimbabwean dollars, that would even fill a cavity,
How much gold? In ounces please.
I have been to the bullion facility of the Bank of New York in Manhattan (which is where the Federal Reserve stores its gold in the North East), between Liberty and Maiden Lane and between Nassau street and William street.
You might get a receipt for that much but thats all supposedly moving from one basement vault to another.
That gold is useless and kept that way on purpose.
For all we know its all gilded lead ingots.
Its all fake, smoke and mirrors. Nothing to see here. Just move along…
msbpodcast:
I get about one 18-wheeler load.
#9 bspodcast – Ounces? Well, they may get a better price but at $1,400/oz that’s around 715,000 ounces or 22 tons.
McCullough, Bobbo, Bob73 – Don’t be surprised. UT and A&M are a couple of the best endowed universities in the US. Both have a ton of patents, too. I had a girlfriend who got her MSc at A&M. She may have been the token middle class student. A&M is where you can find the GHWBush Prezzie Library.
#1. “Local Currencies To Replace Dollar For 5 Countries’ Dealings” – Slashdot http://j.mp/gf0ZEq
#8 Impossible its the dumbest, gold is never zero, and it always spikes up = can’t lose, but stands to gain if our fiat currency loses its world reserve status and hyperinflation begins.
I can only hope Bernanke knows what he is doing, but his track record doesn’t inspire confidence.
Dvorak bloggers constantly predict the end of financial times, only to yet again get it wrong. This is just another ho-hum article to those in the know.
#13 That’s likely the beginning, a few start…and then the snowball, everyone joins in.
Given Boehner’s recent performance, I think the tipping point has already been reached.
These bastards can’t restrain their theft, they won’t stop spending till it collapses.
#15 Not just DU bloggers. Gerald Celente has been right more than wrong in other areas…about this he is consistent, but apparently his timing was off.
No one could predict what printing trillions of dollars would do, how long it would delay the inevitable.
Like the boy who cried wolf, it eventually came.
It’s all gold plated tungsten anyway.
http://marketoracle.co.uk/Article14996.html
#17 – with all them trillions, youd think a couple milion would fall in MY lap.
It’s a billion dollars guys, relax. Not exactly a lot of money these days.
It’s also grandstanding. Lots of companies/investors/endownments buy precious metals without having to truck it to a vault.