Monday, December 20, 2010

1845: US/UK Price Differential



USD$ 1. =  £ 0.2055
USD$ 1. = Fr 5.29?




1 руб = Fr. 3.50

Sunday, December 19, 2010

Monday, December 13, 2010

Germany, 19th C. : Silver Weight & Fineness

Coin weight, purity, and silver weight establish bullion value of the various German silver currencies.

Prussian Thaler, 1813 - 1821:
Weight: 341 grains/ 0.7104 Troy Oz. ; Fine: 748 = 0.5314 Troy, pure Ag

Prussian Thaler, 1821 - 1838:
Weight: 343.76 grs/ 0.7162 Troy Oz. ; Fine: 750 = 0.5372 Troy, pure Ag

Prussian Thaler, 1838 - 1857
Weight: 285.6 grains/ 0.595 Troy Oz. ; Fine: 900 = 0.5355 Troy, pure Ag

VereinsThaler, 1857-77
Weight: 285.784 grs/ 0.5954 Troy Oz. ; Fine: 900 = 0.5359 Troy, pure Ag

South German Taler, 1828
Weight: 200.6 grains; 0.4179 Troy Oz.; Fine: 750 = 0.3134 Troy, pure Ag

South German Gulden/Florin, before 1838
Weight: 200.6 grains; 0.4179 Troy Oz.; Fine: 750 = 0.3134 Troy, pure Ag

Bavarian Gulden/Florin, 1838 - 1848
Weight: 163.5 grains; 0.3417 Troy Oz.; Fine 900 = 0.3075 Troy, pure Ag

Convention Thaler (money-of-account) = Troy, pure Ag

Thursday, December 9, 2010

Deflation thoughts

Calling what we don't know, or misapprehend SOMETHING ELSE is not very helpful.  I'm not convinced an un-backed, free-float currency system can EVER experience "Deflation" - don't forget episodic price drops can be indicative of DISEQUILIBRIUM, too.

Gold (or Silver) had always been MONEY, the basis for evaluating & calculating the value of those promises known as "debt" and worth-less paper money.  This goes back to ancient Greece, at least. That system ONLY ended in 1972 or so, by President Nixon's fiat: that's quite recent, IN OUR LIFETIMES.

Yet we insist this weird aberration (the last 40 years) is somehow 'normal' - nevermind the skyrocketing price of Commodities since 1972, nevermind the condensing cycles of global financial crises, the vaporizing of TRILLIONS and the creation of the most complex paper ponzi the world have ever witnessed. 

Call it 'Deflation" is playing make-believe. Forget history?  Of course, paper money has almost everywhere and at all times been worth-less, the bizarro 'last 40 years' gamesmanship notwithstanding.  One profound singular (terrifying) fact remains: every single paper currency issued before this free-float Dollar regime has FAILED, most within 35 years.  The Pound, and every major paper currency supported by Pax Americana since 1972 are wholly dependent on this momentary Dollar Scheme... for however long it will last.  I sure hope they have a Plan B, do you?

For years I've been reading about "Deflation" and wondered why that might be either good or bad.  I understand that "Deflation" means falling prices and rising money value, and I can grasp why any big disruption in prices can be bad for business & the economy. (Inflation I get - needs no explanation.)  But I've looked carefully at the 19th C. - there were long periods of REAL US Deflation and the US was growing faster than almost any other nation on earth: so why is "Deflation" per se bad? 

Because it's a Boogeyman, and Americans don't know history?
FACT: the USA (the Dollar's primary economy) never experienced "Deflation" off some Gold or bimetallic Standard.  (If that it incorrect, give me the dates otherwise.)  So we're back to admitting our singular "great unknown" is different.  Only FAITH in their free-float currency requires we call it "Deflation" - that denies both economic history & reality, however.

Look more closely at US history : there WAS Deflation throughout MOST of the 19th C.  One period (1863-79) was quite extraordinary: Gold rose & fell dramatically, nearly a dozen states went bankrupt (sovereign default; and after the Confederacy's Paper became worthless), a series of financial panics struck (and wiped out millions) ... And yet, the USA grew & grew. 

Do we credit the Gold Standard or admit that Deflation isn't always bad?  Or do we start begging exceptions and pretend that Deflation has never happened before?  It seems that some people really want to LIE about this, play make-believe.

Flash-forward to the Post War period after Bretton Woods ended, 1972-2010: any other world fiat paper currency that has experienced "deflation" always had THE DOLLAR (for whatever that fiction was nominally worth) as a reserve or base.  The 'Dollar Standard' was a deliberate substitution for Gold: that was the stated goal of Greenspan (and Rubin, Summers et al.)  It worked for awhile, but the world has NEVER witnessed "Deflation" without a Gold Standard and the Fiat Paper Dollar Standard is now being tested. 

The value of Money should only increase when it has appreciating relative value, intrinsic or otherwise.  There's NO intrinsic value to a US Dollar, but where other "investments" become worthless overnight it CAN be perceived as a 'better paper' for a time.  Don't confuse that (momentary price disruption) with Deflation, however.

The US fiat paper under Pax Americana has a 40 year legacy, but it's certainly running out of time: ultimately, the 'promissory nature' of paper (or any simulacra) will evaporate.  But as the Collapse of the Roman Denarius was NOT a straight-line down, so the Collapse of the Dollar will be a zig-zag trail downwards. That chart might even temporarily characteristically resemble "Deflation" at points; don't be fooled by the fun-house mirror.

We're witnessing the implosion of one paper fiatsco system, it's happened before and it wasn't "Deflation" in those times, either.  It's far more likely were witnessing the impoverishment of the American Middle Class, and disruptions in the global consumer economy following that reality. 

"Deflation" fears are now the justification for greater printing press debasement (although they cannot even print the Monopoly Money properly, it seems.) That's the only reason why I suggest clients HOLD GOLD BULLION, it's just a hedge against their funny paper.  Protect your wealth with by holding SOME hard assets, that's age-old wisdom not rocket-science.

If Bernanke DOUBLES the monetary supply, the real inflation adjusted 'fair price' (LOL) for Gold rises to $2,600.  That's no gain, either: that's just CAPITAL PRESERVATION.  Until we have a new currency with a responsible govt & restraint, PMs remain a favored "Buy & Hold" - regardless the Spot Price.

Forex 1866-68, With Greenbacks!

USD$ 1 (Gold) = Fl 2.5 ; Fl 1 = USD$ 0.40 ;  
USD$ 1 (Greenback) = Fl 3.13 - 4.19  ; Fl 1 = USD$ 0.24 - 0.32

£ 1 = Fl 12. ; Fl 1 = £ 0.12

Fr 1 =  Fl 0.4717 ; Fl 1 =  Fr 2.12
M 1 =  Fl 7.0 ; Fl 1 =  M 0.1429





Friday, October 8, 2010

Russia/UK, c. 1840: Pound>Rouble Forex Cost

The Cost of Exporting Silver to Russia was 3.75%, but the overall profit (at the prevailing par) was 4.08%. The cost of shipping Platinum from Russia certainly entailed a similar cost, but with the same kind of offset arbitrage possible.

Monday, September 27, 2010


"It appears that in the seventeen-nineties large numbers of forged dollars were made in {Birmingham, UK} for circulation in those parts of the world where genuine Spanish dollars were in use, it being hoped by this device to cause trouble to Spanish trade."

Dollars were minted in the UK as token payment and where economical as specie (for merchants) among those trading English products for Spanish commodities.


New York: in March-April, 1800, T.D. DuBois produced for John Vernon 42 Teaspoons (0.55 Ozt./ea.), 30 Tablespoons (~1.9 Ozt/ea.), 18 Dessertspoons (~1.35 Ozt./ea.) and 6 Salt Spoons (0.3 Ozt/Ea.) : total weight, 106.1 Ozt (w/1.6 Ozt wastage recorded, from 107.7 Ozt Silver, delivered.

At assumed weight, workmanship (1798) on tablespoons was $ 0.25/Ozt and on teaspoons $ 0.49/Ozt

Boston, USA:

UK, 1800:


USA, 1800:


Paris Forex, September, 1800:


1800: 1 Ducat = руб 4.395 Silver ; Goin Coin руб 1,288.45 per kg.
The Albertus Rixdollar was worth руб  2.0733 ; Silver ingot руб 86.45 per kg.

1800: 1 Troy Oz. Gold (Coined, Ducat) = руб 40.08
1800: 1 Troy Oz. Gold (Ducat @ purity) = руб 40.93
1800: 1 Troy Oz. Gold (Ingot) ~ руб 40.92
1800: 1 Troy Oz. Gold (Ingot) = руб 38.61

1800: 1 Troy Oz. Silver (Coined, Albertsthaler) = руб  2.37
1800: 1 Troy Oz. Silver (Albertsthaler @ purity) = руб 2.70
1800: 1 Troy Oz. Silver (Ingot) = руб  2.69

1800: 1 Troy Oz. Silver (8 Real Peso @ purity) = руб 2.41

1800: 1 (8 Real) Peso = руб 1.2868 Silver
1800: Coin Par, 1 руб ~ S$ 0.771

1800: 1 (8 Real) Peso = руб 1.96 Paper
1800: 1 руб Paper~ S$ 0.509

1 руб = L.T. 5.20


c. 1800: The Rouble passed current at $1.