your money or your life: hoarding gold with the rat men

Currency Wars.It’s not called the gloomy science for nothing.  A new book by economist James Rickards is scary stuff. Almost science fiction. It does lend oneself to Weimar like visions of the collapse of fiat currency and receiving wages on a daily basis in the form of cigarettes. Essentially, the argument is that commodities such as silver and gold are the only haven against inflation resulting from currency wars, devaluation of currencies from China, The United States and Europe. Rickard’s scenarios are presented under the categories of the Four Horsemen of the Dollar Apocalypse in a race to the bottom of currency debasement. Reading the book, there is a gleeful hint of erotic pleasure in a world of misery and a selected elite few in self-satisfaction of their little hoard of gold, yet equally paranoid for its safety and security. Still, he argument of the Fed engaging in these war games to the detriment of the public is not deceitful writing….

Rickard’s thesis is that a dollar collapse is imminent and with it the dollar denominated markets will tumble as well. Panic and hysteria will spread rapidly. It reminds one of Freud’s patient Rat Man. The obsessive compulsive who is aroused when a pot of live rats are applied to the buttocks of the victims. There is a repressive, deflationary instinct to pay debts, a live in guilt or the rat torture will resume. Disease, sex and anal absurdities lead to scenarios where rats are used as a medium of exchange and a bizarre relationship between feces and rats. Think of Albert Camus’s The Plague where rats are the inventory, the deposits in a macabre banking system. Gold is inherently deflationary. Every ounce mined since Solomon is still in existence. The obsessed gold-bug is a man who never relieves himself: a form of divinity.

…It can be agreed that  the post-WWII currency framework, Bretton Woods,  is falling apart, its harder to swallow that the dollar system will implode, implying a return to a gold backed dollar. Destruction is always red meat for the gold tigers. The most likely possibility is that America and the Fed will continue doing what it has done since the Civil War, and continue to manipulate inflation and debt to meet the current need for a means of exchange for the American and world economy. Problem is, this may eventually entail   a degree of inflation say 8-12%  that persistently impoverishes its citizens.

Perhaps, it can be asserted that  the 99%, Stiglitz’s term,  the focus of the Occupy Wall Street protest are less victims of the wealthy than of the  inflation, loss of purchasing power caused by expedient fiscal policies in Washington and accommodation of expansive debt by Bernanke and company. Last year, the New York Times reported that Afghanistan contains almost unlimited untapped mining potential in precious metals as well as being the “Saudi Arabia of Lithium.” which just adds another wrinkle to the post 9/11 world and an underlying motivation for the Rat Men to fulfill Rickard’s dollar apocalypse.

We’re in the throes of Currency War III, and Ben Bernanke has won the first offensive by flooding China with inflation. If this sounds like a geeky online game, recall how Chinese prices surged after the Federal Reserve unleashed its quantitative easing in 2009 and 2010, one of many moves James Rickards parses in his somber book, “Currency Wars.”

“It was the perfect currency-war weapon and the Fed knew it,” he says, describing how the Fed’s expanding money supply forced China to print more yuan to maintain its peg to the dollar. “China was now importing inflation from the United States through the exchange-rate peg after previously having exported its deflation to the United States.” Read More:http://www.bloomberg.com/news/2011-11-15/bernanke-bludgeons-china-with-inflation-as-currency-war-intensifies-books.html#

…In his passion to malign money-making, Keynes even resorted to calling on psychoanalysis for support…In his Treatise on Money, Keynes refers to a passage in a 1908 paper by Freud, in which he writes of the “connections which exist between the complexes of interest in money and defaecation” and the unconscious “identification of gold with faeces.” …Read More:http://www.economicpolicyjournal.com/2011/08/truth-about-john-maynard-keynes.htmla

“There is an unwillingness, rooted in ideology, to explore ways to reconcile the demonstrated stability of gold with the necessity for some degrees of freedom in the management of the money supply to respond to crises and correct mistakes,” he writes. “A reconciliation is overdue.” A fair point, though I found myself distracted a few pages late

a table presenting implied gold prices based on various measurements of money supply. The top value per ounce: $44,552. Which makes me wonder: Has Rickards been stuffing his mattress with bullion? Read More:http://www.bloomberg.com/news/2011-11-15/bernanke-bludgeons-china-with-inflation-as-currency-war-intensifies-books.html#

ADDENDUM:

This is not such a tendentious connection between patriarchy and capitalism, as can be appreciated if we turn for a moment to look at how Marx needed to go beyond “the natural properties of gold, its durability, uniformity and divisibility”  to explain why gold has come to operate as that substance which will underpin the value of money. Money as such operates as a tautological signifying system, of course: Recent Hegelian readings of Marx put it like this; money “makes the value dimension coherent by situating commodities in a common relation to a single point of view on them which is yet not among them, having been excluded from them.”

In David Mamet’s film Heist, mobster Danny De Vito screams down the phone “Of course the money’s important, that’s why it’s called money!”; but while this appeal to money as such appears ridiculous, it does not prevent economic systems trying to find ways of guaranteeing that the money’s important. An appeal to the value of gold is one way of settling this question,  but gold as such operates as “the shell of a ‘social substance’ posited in the relation of commodities and money” rather than having some natural value. In a Marxist account, then, “All commodities must exclude one commodity from the relative form in order to serve as unique equivalent. The natural body of gold is equivalent to value as such according to the commodities in relative form.”

There is an analogy, perhaps even a homology, between “gold” and the “phallus”, and the rationale for an argument that “[j]ust as gold was detached from the body of goods in order to become the only equivalent that decides on their value, the penis would be detached from the body of erotic objects to become the phallus, the standard of value.”  Even so, most Marxists do not now pay as much attention to the value of gold as Lacanians pay to the phallus. (The Workers Revolutionary Party in the UK was one exception to this, and did obsessively focus on the importance of gold and the gold standard, much in the same way that men are obsessed with the phallus.) Read More:http://www.lacan.com/symptom8_articles/parker8.html
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Zizek:The restless never-ending process of profit-making alone is what he aims at. This boundless greed after riches, this passionate chase after exchange-value, is common to the capitalist and the miser; but while the miser is merely a capitalist gone mad, the capitalist is a rational miser.The never-ending augmentation of exchange-value, which the miser strives after, by seeking to save his money from circulation, is attained by the more acute capitalist, by constantly throwing it afresh into circulation.

This madness of the miser is nonetheless not something which simply disappears with the rise of “normal” capitalism, or its pathological deviation. It is, rather, inherent to it: the miser has his moment of triumph in the economic crisis. In a crisis, it is not—as one would expect—money which loses its value, and we have to resort to the “real” value of commodities; commodities themselves (the embodiment of “real [use-]
value”) become useless, because there is no one to buy them. In a crisis, the stellar parallax: the traps of ontological difference
money suddenly and immediately changes from its merely nominal shape, money of account, into hard cash. Profane commodities can no longer replace it.

The use-value of commodities becomes value-less, and their value vanishes in the face of their own form of value.The bourgeois, drunk with prosperity and arrogantly certain of himself, has just declared that money is a purely imaginary creation. “Commodities alone are money,” he said. But now the opposite cry resounds over the markets of the world: only money is a commodity. . . . In a crisis, the antithesis between commodities and their value-form, money, is raised to the level of an absolute contradiction. Does this not mean that at this moment, far from disintegrating, fetishism is fully asserted in its direct madness?

In a crisis, the underlying belief, disavowed and just practiced, is thus directly asserted. It is crucial how, in this elevation of money to the status
of the only true commodity (“The capitalist knows that all commodities, however scurvy they may look, or however badly they may smell, are in faith and in truth money, inwardly circumcised Jews”), Marx resorts to the precise Pauline definition of Christians as “inwardly circumcised Jews”: Christians do not need external actual circumcision (that is, the abandonment of ordinary commodities with use-values, dealing only with money), since they know that each of these ordinary commodities is already “inwardly circumcised,” that its true substance is money…

…In short, capital is money which is no longer a mere substance of wealth, its universal embodiment, but value which, through its circulation, generates more value, value which mediates-posits itself, retroactively positing its own presuppositions. First, money appears as a mere means of the exchange of commodities: instead of endless bartering, one first exchanges one’s product for the universal equivalent of all commodities,
which can then be exchanged for any commodity one may need.Then, once the circulation of the capital is set in motion, the relationship is inverted, the means turns into an end in itself, that is to say, the very passage through the “material” domain of use-values (the production of commodities which satisfy an individual’s particular needs) is posited as a moment of what is substantially the self-movement of capital itself—
from this moment onward, the true aim is no longer the satisfaction of individual needs, but simply more money, the endless repeating of the circulation as such. . . .

This arcane circular movement of self-positing is then equated with the central Christian tenet of the identity of God-the-Father and his Son, of the Immaculate Conception by means of which the single Father directly (without a female spouse) begets his only son, and thus forms what is arguably the ultimate single-parent family. Is capital, then, the true Subject/Substance? Yes and no: for Marx, this selfengendering circular movement is—to put it in Freudian terms—precisely the capitalist “unconscious fantasy” which parasitizes upon the proletariat as the “pure
substanceless subjectivity”; for this reason, capital’s speculative self-generating dance has a limit, and it brings about the conditions of its own collapse.

…This “truth,” however, is not the reality of capitalism: in reality, capital does not engender itself, but exploits the worker’s surplus-value.There is thus a necessary third level to be added to the simple opposition of subjective experience (of capital as a simple mAgain—to quote Lacan—truth has the structure of a fiction: the only way to formulate the truth of capital is to present this fiction of its “immaculate” self-generating movement.And this insight also enables us to locate the weakness of the “deconstructionist” appropriation of Marx’s analysis of capitalism: although it emphasizes the endless process of deferral which characterizes this movement, as well as its fundamental inconclusiveness, its self-blockade, the“deconstructionist” retelling still describes the fantasy of capital—it describes what individuals
believe, although they don’t know it. This shift from the goal-oriented stance of consumption toward the properly capitalist stance of self-propelling circulation allows us to locate desire and drive with regard to capitalism. Following Jacques-Alain Miller, a distinction has to be introduced here between lack and hole: lack is spatial, designating a void within a space, while hole is more radical, it designates the point at which this spatial order itself breaks down the subject, this “inwardly circumcised jew” (as in the “black hole” in physics).

That is the difference between desire and drive: desire is grounded in its constitutive lack, while drive circulates around a hole, a gap in the order of being. In other words, the circular movement of drive obeys the weird logic of the curved space in which the shortest distance between the two points is not a straight line, but a curve: drive “knows” that the shortest way to attain its aim is to circulate around its goal-object.At the immediate level of addressing individuals, capitalism, of course, interpellates them as consumers, as subjects of desire, soliciting in them ever new perverse and excessive desires (for which it offers products to satisfy them); furthermore, it obviously also manipulates the “desire to desire,” celebrating the very desire to desire ever new objects and modes of pleasure. However, even if it already manipulates desire in a way which takes into account the fact that the most elementary desire is the desire to reproduce itself as desire (and not to find satisfaction),
at this level, we have not yet reached drive. Drive inheres to capitalism at a more fundamental, systemic, level: drive is that which propels the whole capitalist machinery, it is the impersonal compulsion to engage in the endless circular movement of expanded self-reproduction.We enter the mode of drive the moment the circulation of money as capital becomes “an end in itself, for the expansion of value takes place only within
this constantly renewed movement.The circulation of capital has therefore no limits.” Read More:http://control-z.com/storage/Zizek-The%20Parallax%20View.pdf

Read More:http://www.nytimes.com/2010/06/14/world/asia/14minerals.html?pagewanted=all