The text below was forwarded to me a few years ago and I rediscovered it today. I've edited it to take out Australian specific references. The Squirrel and the Grasshopper story really resonated with me when I first heard it as a kid. I thought the squirrel was prudent. I’m sure other kids felt sad for the Grasshopper. I propose everyone can be divided into two groups – those who side with the squirrel and those who side with the grasshopper.
The squirrel works hard in the withering heat all summer long, building and improving his house and laying up supplies for the winter.
The grasshopper thinks he's a fool, and laughs and dances and plays the summer away.
Come winter, the squirrel is warm and well fed. The shivering grasshopper has no food or shelter, so he dies out in the cold.
The squirrel works hard in the withering heat all summer long, building his house and laying up supplies for the winter.
The grasshopper thinks he's a fool, and laughs and dances and plays the summer away.
Come winter, the squirrel is warm and well fed.
A social worker finds the shivering grasshopper, calls a press conference and demands to know why the squirrel should be allowed to be warm and well fed while others less fortunate, like the grasshopper, are cold and starving.
The media shows up to provide live coverage of the shivering grasshopper; with cuts to a video of the squirrel in his comfortable warm home with a table laden with food and informs people that they should be ashamed that in a country of such wealth, this poor grasshopper is allowed to suffer so while others have plenty.
Do gooders demonstrate in front of the squirrel's house. A Lefty Politician rants in an interview that the squirrel got rich off the backs of grasshoppers, and calls for an immediate tax hike on the squirrel to make him pay his 'fair share'.
In response to pressure from the media, the Government drafts the Economic Equity and Grasshopper Anti Discrimination Act, retroactive to the beginning of the summer, and creates The Grasshopper Housing Department. The squirrel's taxes are reassessed. He is taken to court and fined for failing to hire grasshoppers as builders, for the work he was doing on his home, and an additional fine for contempt when he told the court the grasshopper did not want to work.
The grasshopper is provided with a Grasshopper Housing Department house, financial aid to furnish it and an account with a local taxi firm to ensure he can be socially mobile. The squirrel's food is seized and re-distributed to the more needy members of society - in this case the grasshopper.
Without enough money to buy more food, to pay the fine and his newly imposed retroactive taxes, the squirrel has to downsize his home.
A 60 Minutes special shows the grasshopper finishing up the last of the squirrel's food, though spring is still months away, while the Grasshopper Housing Department house he is in, crumbles around him because he hasn't bothered to maintain it. He is shown to be taking drugs.
Inadequate government funding is blamed for the grasshopper's drug 'Illness'.
The grasshopper gets arrested for stabbing an old dog during a burglary to get money for his drugs habit. He is imprisoned but released immediately because he has been in custody for a few weeks. He is placed in the care of the probation service to monitor and supervise him.
Within a few weeks he has killed a guinea pig in a botched robbery.
A commission of enquiry, that will eventually cost $10 million and state the obvious, is set up.
Additional money is put into funding a drug rehabilitation scheme for grasshoppers.
The grasshopper dies of a drug overdose.
The usual sections of the press blame it on the obvious failure of government to address the root causes of despair arising from social inequity and his traumatic experience of prison.
The squirrel’s taxes are increased to pay for law and order, and they are told that they will have to work beyond 65 because of a shortfall in government funds.
hilarious... shall we call this forum "Aesop's Gold Chat"?ReplyDelete
The fable is slightly too long imo, but agree with the point.
Social Welfare is way out of control. It's essential in a compassionate society, which is what we must truly be, but sadly there are way too many cheats.
Good work Bron, but you're not at Aesop's level yet :-)
Sad but true Bron.ReplyDelete
Australia has become a disgrace for this sort of thing.
The world will eat itself in due course.
I liked it until it got to the drug-taking part. After all, many (most?) welfare recipients in society, including the big corporations, are not drug takers. Adding that part allows people to dismiss it as not being analagous, where as up to that point, I think, it is a pretty devastating indictment on our society today.ReplyDelete
Anonymous, I didn't write the fable, it was a chain email which I edited down.ReplyDelete
Anonymous 2 - agreed re drug taking, just presenting it as it was emailed to me.
Love your work Bron.ReplyDelete
In Australia the grasshopper would've had 10 children to collect multiple baby bonuses and child allowance payments. And then taken out a 400,000 AUD loan to collect the first home owners grant on a town house in Campbelltown.
Meanwhile the squirrel puts off having kids for 10 years until he finally pays off the mortgage
I prefer the grasshopper & the octopus - All summer long the grasshopper buried acorns for winter, while the octopus mooched off his girlfriend & watched TV. But then the winter came & the grasshopper died, the octopus ate all of his acorns & also got a race car.ReplyDelete
Is any of this getting through to you?
Then there's the old aphorism "People who live in gold mines shouldn't throw stones".ReplyDelete
"[loopholes] sometimes made it possible for millionaires to pay nothing, while a bus driver was paying ten percent of his salary, and that’s crazy. [...] Do you think the millionaire ought to pay more in taxes than the bus driver or less?"ReplyDelete
Ronald Reagan, 1985.
A hedge fund manager, who produces *nothing*, is not more worthy than my grandmother, crippled by arthritis after a life of hard work, who got a pittance from Social Security.
Let's be completely clear on who's getting welfare (banks) and who's working (workers).
The fable as I understand it is actually meant to be the Ant and the Grasshopper:ReplyDelete
Same premise, different animal kingdoms. Comparing two different insects is better ;)
Socialism isn't a problem until the country starts running out of money. Then the Govt starts by squeezing tax from the most productive, reducing the incentive to produce at all.
From there it's a downward spiral to pointlessness.
So far Australia has been very prosperous on the back of Chinese bubble blowers and enormous private debt. Once that stops growing it's a real problem. A bit like trying to unwind a ponzi scheme.
Wow. You do such a fine job of debunking the many irrational theories which abound in the PM market, calmly, objectively and clearly, yet here you are regurgitating hoary old knee-jerk political cliches without blinking. There is even a tone that indicates you feel you're being clever or funny, as opposed to unimaginative. Why not stick to the subjects on which you're well-informed?ReplyDelete
Rather than argue endlessly with your articles of faith, I'll try to reduce this down to a few bottom-line questions: Does the average dollar-a-day free-trade-zone sweatshopper work harder and longer than you? Where is their winter store? Does Bill Gates, say, work thousands of times harder than you do? Aren't the greatest freeloaders those gatherers of others' brow sweat lately known as the 1%?
decrypt_era, as I said above, I didn't write the story so the "clever or funny" tone is not mine.ReplyDelete
In any case I don't see how you interpret the story as saying rich 1% people are freeloaders. All the (admittedly cliched) modern version is saying is that the grasshopper (who could be rich or poor) wastes their income and doesn't save and that modern soceity doesn't ask whether the grasshopper caused their own misfortune and just hands out help to all. This creates moral hazard.
RE: Exclusive – Mark Cutifani CEO of $16B AngloGold Ashanti: “Major Buyers Are Finding It’s Hard To Get Physical Gold”
I'd love to see your comments on this phenomena from a Perth Mint point of view.
Per Mark Cutifani: "People are coming directly to us,” for large gold purchases he said. “People who want tonnes of physical gold, people with serious financial muscle…because they’re finding it’s very difficult to secure the volume of gold they want…That’s something we’ve noticed over the last 18 months, and it’s been increasing in the last 6 months. I think people are finding its hard to get physical gold.”
I think this is just buyers thinking they can cut out the middlemen and will save money, with no understanding of the industry and that miners don't produce saleable (internationally recognised) metal as the economics of 99.5% plus purity refining don't add up at the volumes individual mines put out.ReplyDelete
We get tyre kickers coming to us wanting physical, but often they want it on 180 day terms backed up with letters of credit from nobody banks.
As a result they might say they can’t get physical, but that’s because they don’t want to pay cash upfront. I’d like to know more detail from Mr Cutifani as to the terms he was being offered to buy his gold.
If you listen to the interview, he says that he only supplies to refineries, which means he rejected the buyers.
Thanks for the insight. Much appreciated.
Even with all the information available on the internet these days the gold and silver business just seems so opaque. Maybe because of the value of the material, participants (governments, banks, investors) want to keep everything as confidential as possible.
Maybe you can enlighten me on another subject... concerning Mr Sprott's proposal to mining companies to keep a chunk of their cash in physical silver. That makes a lot of sense from an investors point of view, but isn't the final product of most miners just a silver concentrate or maybe a concentrate smelted into dore bars? I thought most sell their production as unrefined ore to refineries who then turn it into 999+ silver. I wouldn't think holding back silver concentrate or dore bars would be a very good substitute for cash as it's not really a liquid asset like 999 silver or gold. But then, if the cash is not needed for the foreseeable future and is not going to be returned to the shareholders in the form of dividends, it would probably be best for the invertors if held by the company as dore bars. Are there many miners who actually own the whole process of turning rock in the ground into finished 999 gold and silver?
One more question. What is the general value of gold/silver in dore bar form? If the spot price reflects refined 999 metal, I assume a dore bar generally goes for spot minus a certain percent. In other words, how much does the refining process tack on to the price of 999 gold/silver. Of course minting into coins/small bars and marketing them to the public adds an additional premium over the refined 999 metal value.
OK, I'm done. No more questions. Thanks for your input.
Miners don't produce 99.9% bars, so to do what Sprott suggests they either just hold/stockpile their dore bars and only send them to refineries when they need actual cash or refine the metal and hold 99.9% bars.ReplyDelete
In either case the problem is that miners can't hold physical, they don't run vaults, so they would have to store it with someone else. Refiners aren't set up for this, they just turn stuff over, so it would have to be shipped to bullion banks to be held as allocated (with storage costs) pending sale.
As to the value add of refining, it is not much because refining is a dog of a business - worldwide there is over capacity so very competitive.