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Is Gold a Blooming Rose or a Prickly Thorn?

by Douglas V. Gnazzo. June 15, 2005

Rose Photo
Rose Photograph

THISTLES AND ROSES

Passion purple, thistle pricks,
Flower blooming, nature's tricks,
Thorns that pierce if you try to pick;
This awesome weed, a rose to mimic.

Love presented as a rose;
Cupid's bow with pointed arrows.
Unaware, the thistle grows,
Away from you, his love now flows.

Tricksters both, these flowers bold,
With thorns that prick, passion unfold.
Purple thistles, roses red,
Where love had bloomed, now thorns instead.

[Gloria Sarasin]

The red, red rose, so beautiful and beckoning, but beware the prick of the thorn. But all of life is thus the same, without risk there is no reward. The challenge is to measure the risk versus the reward, and to proceed accordingly, when the time is right. When is the time right? When the measure is right.

Ah the time, especially the right time. That is always the question. Remember those first dances of our youth. The girls lined up on one side of the gym, and the boys on the other. Should I ask, or shouldn't I? Will the answer be yes or no? Will he ask? And what shall I say? Questions, questions. Is now the time, or isn't it?

As we proceed through life we learn, nothing ventured nothing lost, or is there? As nothing ventured, nothing gained, as well. Is it better to have tried and lost, then to never have tried at all? Questions, questions, always remain.

Perhaps the knowing of the questions, is as important as knowing the answers. Might the quest be as important as the goal, as could the quest and the goal, be one in the same?

Learning a New Word

While reading a very good article the other day, I came across a word I didn't recognize, and it was such a cool word in a very cool article I thought I would share it.

The author of the article titled Apophenia, Collective Unconscious or? Brian Bloom, cited Wikipedia as the source for its definition and explanation:

Apophenia is the experience of seeing patterns or connections in random or meaningless data. The term was coined in 1958 by Klaus Conrad, who defined it as the "unmotivated seeing of connections" accompanied by a "specific experience of an abnormal meaningfulness".

Conrad originally described this phenomenon in relation to the distortion of reality present in psychosis, but it has become more widely used to describe this tendency in healthy individuals without necessarily implying the presence of neurological or mental illness.

In statistics, apophenia would be classed as a Type I error. Apophenia is often used as an explanation of paranormal and religious claims. It has been suggested that apophenia is a link between psychosis and creativity. [http://en.wikipedia.org/wiki/Apophenia]

After the very good definitions as above, the author offers a quick synopsis of the collective unconscious of Carl Jung's, which was very good as well. As he stated that:

"The collective unconscious refers to that part of a person's unconscious which is common to all human beings. It contains archetypes, which are forms or symbols that are manifested by all people in all cultures."

Which is a very good definition, and similar to those as seen elsewhere in Whence & Pence, Part 8: The Grounding. From metaphysics the article then goes into an analysis of the gold/dollar index – very cool. Not too many people can link metaphysics with financial investments. I was quite impressed.

A nice chart of the gold/dollar index was provided that showed what appears to be a potential upside breakout. The author then asked just what such a breakout might mean. Very astutely he mentioned that it might not mean anything at all, as it may end up being a false breakout. Once again, I was quite impressed.

A Giant Leap Into Metaphysics

Mr. Bloom then continues on by returning to the far out field of metaphysics and quantum physics combined, and now I'm really getting impressed. We read:

"Collective Unconscious is incapable of being measured by formalized statistical techniques, and for this reason it is not (yet) taken seriously in scientific circles. Rather, it is regarded as more apposite to the field of metaphysics.

But there is a principle that flows from Quantum Physics, known as the "Correspondence Principle" - first proposed by Niels Bohr in 1923 - that may yet change this perception. "The conditions under which quantum and classical physics agree are referred to as the correspondence limit, or the classical limit.

Bohr provided a rough prescription for the correspondence limit: it occurs when the quantum numbers describing the system are large, meaning either some quantum numbers of the system are excited to a very large value, or the system is described by a large set of quantum numbers, or both." [Correspondence principle]

I am still very impressed by the depth of insight the author has into what are not only some very complex subjects, but also by the inclusion of discussion on the even more complicated interrelationships between various fields of science and thought involved in the subjects under discussion; however, I must admit that I'm not sure I agree that the collective unconscious can be measured or understood by statistical techniques, or by science in general.

As previously discussed in Whence & Pence, Part 11: The Bounding, science is the study of the laws of nature. There is the very strong possibility, that man's inner essence, is beyond nature, and hence, beyond science and the limited understanding that any science offers.

Nature has a beginning and an end. Science is finite. That which is, never changes – that which changes, never is. There is that which is beyond science, time, nature, and change – thou are that. At least, one should allow for the possibility of such, why needlessly limit ourselves?

What's This Got To Do With It

Mr. Bloom then asks the very profound question, as to what any of this mumbo jumbo involving metaphysics and quantum physics, etc. has to do with the gold dollar index. His answer is that

"As demonstrated above, logic dictates that the breakout in the gold dollar index does NOT imply a return to a gold standard, and neither does it imply a move to jettison the US Dollar and embrace gold as a currency." [Bloom - Apophenia, Collective Unconscious or?]

I'm not sure exactly what Mr. Bloom is referring to when he says demonstrated above, but I assume it is the following, as I couldn't figure out what else was above that might be referring to:

"Apophenia needs to be considered. Is there a logical inverse nexus between the two counters? If gold is genuinely the ultimate alternative currency to the US Dollar, then apophenia will not apply here. But the reader is urged not to jump to conclusions.

Can we really envisage a situation where we walk into a grocery store and pay for a loaf of bread with a minute fraction of an ounce of gold? Clearly not! Gold in and of itself will never be a generally accepted currency again. That is a matter of objective impossibility.

The only way forward for a currency linkage of some sort will be a gold (or other) 'standard' - with some form of linkage between government issued pieces of paper and gold (or other).

Should this situation eventually manifest, then the value of the piece of paper should depreciate relative to gold in the event that the pieces of paper become relatively more plentiful than the amount of gold to which they are linked.

Thus, if we were ever to re-embrace a gold standard, the inverse nexus should not only remain; it should be precise - with gold rising by exactly the same proportion to the fall in price of the paper currency. It follows that the breakout of the goldollar index is not a sign that we are moving towards a gold standard; and to see this outcome as implicit in the goldollar breakout would indeed be the result of apophenia."

As has been shown in previous articles, gold is not an alternative currency to the dollar, if by the dollar Mr. Bloom is referring to Federal Reserve Notes, which are not dollars, but dollar bills, and there is an important distinction.

The dollar as represented by paper fiat Federal Reserve dollar bills is an alternative currency to gold. This has been repeatedly shown in the Honest Money Series, in GOLD: Sovereign of Sovereigns , and in Silver IS Money series.

Silver and gold coins were the original form of money according to the Constitution. To this day there has never been a constitutional amendment to change it. Therefore it still stands as the Supreme Law of The Land, regardless whether the people or the government abide by it.

I agree with Mr. Bloom's statement that "the breakout of the goldollar index is not a sign that we are moving towards a gold standard; and to see this outcome as implicit in the goldollar breakout would indeed be the result of apophenia."

Going back to the original definition, we find the last part reads: "In statistics, apophenia would be classed as a Type I error. Apophenia is often used as an explanation of paranormal and religious claims. It has been suggested that apophenia is a link between psychosis and creativity."

Now if we click on Type I error we find:

"In statistical hypothesis testing, a Type I error consists of rejecting a null hypothesis that is true, in other words finding a result to have statistical significance when this has in fact happened by chance. A test with high specificity has few Type I errors. The symbol for the probability of a Type I error is α ( alpha) and is sometimes described as the size of the test." [Wikipedia]

Which is why I agree with Mr. Bloom's statement that "the breakout of the goldollar index is not a sign that we are moving towards a gold standard; and to see this outcome as implicit in the goldollar breakout would indeed be the result of apophenia."

At the same time, however, it is also why I believe that to then say "gold in and of itself will never be a generally accepted currency again. That is a matter of objective impossibility", and that "the only way forward for a currency linkage of some sort will be a gold (or other) "standard" - with some form of linkage between government issued pieces of paper and gold (or other)", sounds like a case of apophenia to me, or at the least jumping to conclusions, but perhaps I have it wrong.

It should be recalled that the constitutional standard called for silver and gold coin and no paper currency or bills of credit. The original silver standard and the bimetallic monetary system of gold and silver coin is still on the books, and is the Supreme Law of The Land.

Only a constitutional amendment can change the constitution. Whether the public and or the government follow or do not follow any particular mandate of the Constitution, has no bearing on the fact and point of law that the law still stands.

Our existing monetary system has devolved from the original hard money system of the Constitution, and the Original Coinage Act of 1792, to the present paper fiat dollar bill of ill repute, which is a completely different entity from the constitutional definition of a dollar.

The dollar bill is a piece of paper, backed by promises. The dollar of the Constitution is a specific defined weight of silver.

Is the time right? Yes it is. Remember those dances, remember the feeling in the pit of your stomach as your walked across the floor, coming ever and ever closer to possible rejection. It's all just part of growing up. Now other things give us that funny feeling, but we still walk across the floor.

The Constitution should be adhered to and followed. Either that or it should be amended, by the people, for the people and according to the people's constitutional, legal, and lawful due processes of law, reserving all rights to We The People.

What is the right measure - honest weights is the measure, at least that's what it says in the:

Constitution - The Supreme Law of The Land

Lest We Not Forget

Pick the Rose and Bypass the Thorns

While The Blooming Lasts

© 2005 Douglas V. Gnazzo

About the author: Douglas V. Gnazzo writes for numerous websites and his work appears both here and abroad. Just recently he was honored by being chosen as a Foundation Scholar for the Foundation for the Advancement of Monetary Education (FAME).

Disclaimer: The contents of this article represent the opinions of Douglas V. Gnazzo. Nothing contained herein is intended as investment advice or recommendations for specific investment decisions, and you should not rely on it as such. Douglas V. Gnazzo is not a registered investment advisor. Information and analysis above are derived from sources and using methods believed to be reliable, but Douglas. V. Gnazzo cannot accept responsibility for any trading losses you may incur as a result of your reliance on this analysis and will not be held liable for the consequence of reliance upon any opinion or statement contained herein or any omission. Individuals should consult with their broker and personal financial advisors before engaging in any trading activities. Do your own due diligence regarding personal investment decisions. This article may contain information that is confidential and/or protected by law. The purpose of this article is intended to be used as an educational discussion of the issues involved. Douglas V. Gnazzo is not a lawyer or a legal scholar. Information and analysis derived from the quoted sources are believed to be reliable and are offered in good faith. Only a highly trained and certified and registered legal professional should be regarded as an authority on the issues involved; and all those seeking such an authoritative opinion should do their own due diligence and seek out the advice of a legal professional. Lastly Douglas V. Gnazzo believes that The United States of America is the greatest country on Earth, but that it can yet become greater. This article is written to help facilitate that greater becoming. God Bless America.

Contact Information

Douglas V. Gnazzo | Honest Money Gold & Silver Report, LLC | Canton Center, CT USA | E-mail

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