David Collum year in review

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Gilberto de Piento
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Re: David Collum year in review

Post by Gilberto de Piento » Sun Feb 25, 2018 10:02 pm

What I've read so far is interesting, thanks for sharing.

jacob
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Re: David Collum year in review

Post by jacob » Mon Feb 26, 2018 10:16 am

Thanks for the reminder ... I keep forgetting to keep up.

ffj
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Re: David Collum year in review

Post by ffj » Tue Feb 27, 2018 6:10 pm

Interesting and funny too. He mentions the Vegas shooting as implausible as described. I don't understand why he thinks it would be that hard to bring a bunch of guns and ammo to a hotel room or why he puts so much weight on unverified information. His foundation seems a little shaky on this one and it stands out from his other opinions.

Augustus
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Re: David Collum year in review

Post by Augustus » Tue Feb 27, 2018 9:42 pm

ffj wrote:
Tue Feb 27, 2018 6:10 pm
Interesting and funny too. He mentions the Vegas shooting as implausible as described. I don't understand why he thinks it would be that hard to bring a bunch of guns and ammo to a hotel room or why he puts so much weight on unverified information. His foundation seems a little shaky on this one and it stands out from his other opinions.
I didn't bother to check his political stuff until now, his gun knowledge is not very great to say the least. He also has at least one misattributed quote, I searched a couple to see if people were really that stupid, the answer is yes they are, but he attributed one of them I looked at to Wells Fargo and it was from some random financial services company instead. Considering he has a ton of data, probably not that surprising that he has some errors, but I think it would be worth my while to fact check a lot of the data he's throwing around.

Generally though, I agree with a lot of his assessments when it comes to the markets.

Gilberto de Piento
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Re: David Collum year in review

Post by Gilberto de Piento » Tue Feb 27, 2018 9:49 pm

I still haven't finished it. I lost interest after he veered away from financial info into ZeroHedge type stuff.

Farm_or
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Re: David Collum year in review

Post by Farm_or » Wed Feb 28, 2018 7:32 am

Wow, that is a lot of information. Well done, though. I like his format with using all of the qoutes. Left me with a lot of reasons to feel more pessimistic.

Thanks for sharing

Augustus
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Re: David Collum year in review

Post by Augustus » Wed Feb 28, 2018 6:18 pm

Farm_or wrote:
Wed Feb 28, 2018 7:32 am
Wow, that is a lot of information. Well done, though. I like his format with using all of the qoutes. Left me with a lot of reasons to feel more pessimistic.

Thanks for sharing
+1 for pessimism

I was reading it last night and my wife comes in and asks me "What's wrong? You look really concerned?!" Like someone died or something :) His writing kind of sucks you in to his emotional state haha.

bryan
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Re: David Collum year in review

Post by bryan » Thu Mar 01, 2018 10:06 pm

I much prefer to read an annual summary like this compared to monthly/weekly speculations.
Investors will get ETF’d right up the...well, you get the idea.
I would predict that as soon as a Bitcoin ETF (or similar) is announced/approved is a good day to sell your VTSAX/VTI/VT. At least sell it by a >=week before the ETF debuts. Of course, owning Bitcoin at least a few weeks before the ETF is announced/approved will be sweet as well. Just a matter of when/if regulators will allow it (Trump/Pence admin may be it's best shot..).
My ignorance of blockchain technology is profound...My failure to jump on Bitcoin leaves no remorse...I offer my current view of cryptos from a position of total technical ignorance guided by an only slightly more refined understanding of history and markets.
etc etc

:roll: Cool.

It's crazy to keep reading so much willfully ignorant writings on the topic of Bitcoin et al. Even Matt Levine gets it inconceivably wrong occasionally (specifically I'm thinking of his recent opinion, copied below).
Matt Levine wrote: Sure. I actually think that there is a lot of cool stuff going on in crypto and blockchain. But there is also this weird fetish for getting rid of currency, for abandoning the characteristics of currency that have made it a crucial human institution for thousands of years. "Let's have a thing that allows you to buy apples, Coke, subway rides and dentistry, but not bananas, Pepsi, taxi rides or psychotherapy," people always seem to be saying. Well: Why? The thing about dollars is you can use them to buy taxi rides and subway rides and Coke and Pepsi and all sorts of products and services that no one has even dreamed up yet. Dollars are infinitely useful, they can be used to buy and sell anything that can be bought or sold. And everyone is desperately trying to create something less useful.
The impending pension crisis is global and monumental with no obvious way out.
I'm prone to believe this (especially government pensions). Just seems like the managers of pensions make the absolute worst decisions.

Mister Imperceptible
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Re: David Collum year in review

Post by Mister Imperceptible » Thu Mar 01, 2018 10:36 pm

@banker22

Thanks for sharing, that was my introduction to Collum.

@bryan

I ripped on Bitcoin in the other thread. Maybe I was a jerk.

I heard about Bitcoin from a friend and a colleague independently of one another back in 2014.

My thought was “well, I don’t understand it, and there is no cash flow I can identify, so as I have no utility for it, there is no reason for me to risk money owning it.” I see it the same way now, only I have FOMO and regret to deal with.

He sold most of it and made a big profit. Now he says Ethereum is a better buy. I don’t know. No one wants to buy right before it goes to zero, so that probably informs a good deal of skepticism.

Collum’s portfolio is roughly 60/30/10 in cash/gold/equities. Given my skepticism of the current state of the stock market, maybe a 60/30/10 with the 10 in cryptos isn’t the worst idea. But if I buy it, I’m buying it for one reason- because I think it might go up. Isn’t that a terrible reason to buy anything?

bryan
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Re: David Collum year in review

Post by bryan » Fri Mar 02, 2018 4:24 pm

Mister Imperceptible wrote:
Thu Mar 01, 2018 10:36 pm
But if I buy it, I’m buying it for one reason- because I think it might go up. Isn’t that a terrible reason to buy anything?
Well, it's sort of a main reason people buy (private/public) stock, gold, real estate, etc. I don't think it's so bad.. (rentier behaviour, I think, is a bigger evil that people seem to be OK with).

> 60/30/10 in cash/gold/equities

If I had to add cryptos to that, I would certainly take from the cash allocation: 40/30/20/10 in cash/gold/equities/cryptos. For as overpriced everything is today, cash (USD or EURO) doesn't feel like a sure thing, either. One bull case for cryptos is an increased demand for capital flight or avoiding banks or fiat. I think it's time I take stock of my own portfolio allocations (and update my journal).

Mister Imperceptible
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Re: David Collum year in review

Post by Mister Imperceptible » Fri Mar 02, 2018 4:49 pm

@bryan

I agree that cryptos *might* have some elements of the store of value that gold has historically provided. So maybe a bunch of inflows from Zimbabwe or other places with collapsing fiat. Obviously black market usage is supportive. But it still is maintained by an infrastructure and higher authorities. Technocrats replacing Central Bankers just sounds like an Animal Farm/meet-the-new-boss-same-as-the-old-boss kind of deal. I know my gold can maintain its value because it relies on zero centralization and infrastructure.

Can the Bitcoin sect continue to update the cryptography so it can adapt as new cryptos with newer technology are introduced? Or will Bitcoin eventually be supplanted?

If I own equities and real estate, it’s a desire to have real wealth-generating assets. I’m not doing it to be a Good Samaritan. Someone has to take ownership and make money. If we all just own fiat and gold and cryptos, the economy isn’t going anywhere. But I’m not defending the system as much as I’m acknowledging my powerlessness to change it. I’m more interested in what merely “is” rather than what “should be.” I broached the “what is and what should never be” in the Warren Buffett thread, and many (erroneously) thought I was attacking Buffett.

https://m.youtube.com/watch?v=WnMiXsRtsfc

bryan
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Re: David Collum year in review

Post by bryan » Fri Mar 02, 2018 8:31 pm

> maintained by an infrastructure and higher authorities

How do you mean? I admit they control some defaults in the protocol via network effect.. but Segwit taking forever to gain adoption perhaps means folks don't blindly consume these defaults as much as we previously thought. You can run a node yourself today if you care about the infrastructure (though probably not a miner..). I was probably one of the first persons to publicly call out Bitcoin developers as "techo-tyrants" for a few reasons a few years ago. The banking/commerce/etc layers built on top of Bitcoin will be ever more prone to centralization risks.

I have always been a proponent of "letting a hundred coins bloom". I have no problem with some BetterBitcoin coming about (it seems just about inevitable). I would grant you your centralization/infrastructure argument if you were talking about some more centralized coins like ripple which explicitly relies on trusted parties. Though, in some ways I do agree; for instance here is a recent zooko tweet: https://twitter.com/zooko/status/968919238806208513

Techno-tyrants aren't the worst thing in a competitive marketplace. Certainly cryptos are a very competitive market and Bitcoin is the digital gold of the lot, for better or worse.

I don't see how owning specific equities helps the economy any more than owning specific cryptos might; cryptos are rapidly re-implementing the entire financial sector. I admit owning gold et al is not super productive, but at least Bitcoin has transfer and assurance capabilities baked in, enabling various online wealth transfer, security mechanisms for the masses (then again they could get priced out of the base layer due to fees.. better be happy with having a Bitcoin bank or jump to an alt-crypto!). Many folks own real estate for rentier purposes which I tend to believe is mostly a drag on the economy. Someone's got to own the Bitcoins!

jennypenny
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Re: David Collum year in review

Post by jennypenny » Tue Mar 27, 2018 6:18 am

I like Collum, but in this year's interview with Martenson he sounded really old when he talked about kids and their newfangled bitcoin.

OT ... Good video explanation of the Vegas shooting and timeline from NYT.


jacob
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Re: David Collum year in review

Post by jacob » Thu Dec 27, 2018 12:26 pm

FIRE gets a brief mention 8-)

Gilberto de Piento
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Re: David Collum year in review

Post by Gilberto de Piento » Thu Dec 27, 2018 3:09 pm

Entertaining and interesting but again stop when he gets away from economics unless you enjoy fast and loose with the facts, culture wars commentary.

Kriegsspiel
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Re: David Collum year in review

Post by Kriegsspiel » Wed Jan 02, 2019 1:30 pm

Collum wrote:We are parked at an all-time high of >500 claims against each ounce of gold at the COMEX vaults,ref 177 which could leave some wondering who Madoff with their gold.
From the reference:
“The gold in the COMEX vaults, does not cover all outstanding paper claims. Every 500 troy ounces of paper gold is backed by only 1 troy ounce of physical gold.”

What is wrong with this statement?

A lot. First, the COMEX does not own any vaults. The COMEX is a futures exchange, not a storage provider. Second, the paper contracts that are being referred to are in no sense direct claims on physical gold, but claims on the future delivery of physical gold (sometimes even years from now). Third, the owner of a gold future (with, let’s say, June 2017 as expiration month) is always in the position, as soon as the contract expires, to request physical delivery. He does not directly receive a physical gold bar, but rather a warehouse receipt with which he can claim physical delivery.

The fact that you can buy a gold future, as soon as the expiration date is reached, means that you can always convert the future into physical gold.
...
In brief, there can never be any “disconnect” between the paper and physical gold market for an extensive period. The possibility to arbitrage must, in that case, be completely eliminated (for instance, by restrictions or taxes). This is obviously not the case on the Comex, and that is exactly what no defender of gold market manipulation can prove. Not just that, if they were right, there would be massive shortages of physical gold outside London, because demand would exceed supply with the current gold price (which is, supposedly, set on the “London paper market”).
and
The idea is that the “paper” futures market will collapse under its own weight, similar to the commercial banks in the 1930s during the Great Depression (the number of demand deposits exceeded the number of bank reserves manifold). The similarities with a traditional run on the bank, such as in the movie Mary Poppins, are supposedly countless. As soon as this happens, suddenly a “flight” to physical gold will arise and those with physical gold at home will be the fortunate ones. As soon as this happens, the gold price reaches its “real” level. Gold prices will go through the roof and finally, after being manipulated and suppressed for years, the real gold price will surface.

That these investors will come out empty-handed should be no surprise. They never figured out the differences between an illiquid bank with fractional reserves (such as in Mary Poppins) and a futures exchange for commodities such as the COMEX in London.

Yes, counterparty risk is important to consider when investing in gold (that is why at GoldRepublic you have 100% ownership of your gold while storing it in professional storage facilities). Yet failing to distinguish between real counterparty risk and fictitious counterparty risk (distrusting anyone or anything) is just as big a danger as ignoring counterparty risk.

The main conclusion should be clear: a disconnect between “paper” and “physical” gold for any extensive period is impossible. And with liquid financial markets a single day would already be a rather extensive disconnect, much less a decade. Therefore, I gladly quote FD-journalist Joost van Kuppeveld who wrote: “The reason that these kinds of stories only appear on shady blogs and not in serious media, is because they are nonsense.” Fortunately, this is not a shady blog.
Am I missing something, or does Collum's reference call his statement nonsense?

Augustus
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Re: David Collum year in review

Post by Augustus » Wed Jan 02, 2019 9:31 pm

It wouldn't be the first time that allowing people to demand payment in a physical commodity that you don't actually own has caused a bubble and a collapse, that's in essence what happened in the tulip bubble. I don't know anything about comex though.

Mister Imperceptible
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Re: David Collum year in review

Post by Mister Imperceptible » Wed Jan 02, 2019 11:38 pm

I was not able to access the link from PeakProsperity but in the link provided by Kriegsspiel they do seem to be critical of the type of counterparty skepticism espoused by Collum. Not sure if it was the wrong link or if Collum was just being fast and loose. Then again, those people are essentially selling paper gold.

I have no idea what’s going to happen but Kyle Bass’s take on the Comex is worth hearing:

https://m.youtube.com/watch?v=hdyqwVEvyfY

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