The time to get your precious metals is now.
Archive for the ‘Economic War’ Category
I agree with others in the arena a basic asset protection, that EVERYONE who wishes to save some of their wealth MUST do so with some of those savings in PRIVATE MONEY.
What is PRIVATE MONEY?
It must be something that qualifies AS MONEY.
About 2000 years ago Aristotle defined the characteristics of a good form of money. They were as follows:
1.) It must be durable. Meaning it must stand the test of time and the elements. Money is a medium of exchange and a store of wealth so whatever form it takes, it must be able to handle the wear and tear of constant trading and transactions.
2.) It must be portable. Meaning it should be practical in the sense that it holds a high amount of ‘worth’ relative to it’s weight and size. In other words, it’s “worth” must be very dense. Imagine if money was in the form of lead bricks, these bricks would be very dense, but it would be a nightmare and near impossible to constantly exchange large amounts. And you can forget about carrying them around in your pockets.
3.) It must be divisible and consistent. Meaning it should be relatively easy to separate and distribute in smaller forms without affecting it’s fundamental characteristics. This concept also works in reverse in that it should be relatively easy to re-combine several divided pieces of the money into a larger, single piece. This makes houses and paintings and cars unpractical as forms of money because taking them apart would affect their fundamental characteristics. An extension of this idea is that the item should be ‘fungible’. Dictionary.com describes fungible as:
“(esp. of goods) being of such nature or kind as to be freely exchangeable or replaceable, in whole or in part, for another of like nature or kind.”
4.) It must have intrinsic value. This characteristic carries a bit of a subjective quality in that everyone views the world through a different lens and what I view as valuable may not necessarily be valuable to my neighbor, but for the sake of argument let’s just say that there is a consensus of value given to a certain material. The basic understanding behind intrinsic value is that the material carries ‘worth’ in and of itself. It does not derive it’s value from anything else. It just sits there and is valuable. This is why paper currencies with no backing will not stand the test of time. Paper currencies only derive their “value” from what is known as legal tender laws, which are in essence a threat of legal prosecution, and or force, if they are not accepted as money for payment.
This fourth point brings up the point of scarcity, which is in essence a matter of intrinsic value. Paper currencies in circulation today, such as the dollar, euro, yen, swiss francs, zimbabwe dollars, etc… they are all now purely fiat instruments. (by fiat, I mean that their use is declared by decree and usually by threat of force. Definition of fiat.) The governments that sponsor them have essentially unlimited power in their ability to create new supplies. Because of technology, it is now simply a matter of typing something into a computer and the amounts are instantly credited somewhere. So in theory the supply of dollars for instance is infinite, and it seems like lately the wizards in Washington are trying to see whether this theoretical limit can be reached. Take Zimbabwe as a practical real world example. It now takes trillions of Zimbabwe dollars to buy a roll of toilet paper.
In this video you will hear the detail about why GOLD & SILVER will increase in VALUE.
#1 Fear will Increase
#4 Weakening Dollar
#5 Overall Demand
#7 Gold is Money
#8 German Repatriation
#9 Product Simplification
#10 Probability of Collapse
The entire LIBOR issue, which is confounding to many readers IS a central issue to the general advice to get out of the markets.
The game is entirely rigged, just like a blackjack table or Roulette wheel – where the house always wins. Now read Banks for House and you have the picture.
The party is over and it is time to get out of the pool before the stink really starts to rise.
Gold for the industrial and commercial interests that can afford it and silver for everyone else. Keep your wealth in as little currency and bank accounts as you possibly can, as the MF Global case proved – you cannot count on anything you cannot OWN 100% and in your own possession. When you need currency to participate in the other parts of the economy then convert your gold or silver to currency and conduct your transaction, otherwise hold on to it.
Beyond precious metals there are a number of classes of hard assets, the main view to keep here is to NOT LEVERAGE anything to own them. If you have real estate with mortgages on it that you cannot pay out when the banks demand their note, you will end up owning nothing.
Neil Barofsky is interviewed by Bill Moyers.
Even if you know nothing of the economic crisis or anything about what may have ’caused’ the situation, the statements by Barofsky must be heard.
When you come to understand these words and what they mean for the future, you may have a different understanding of why a truly ‘private’ money system is needed.
A quote from Karl Polanyi’s book, “The Great Transformation”
The self-regulating market was a threat to them all, and for essentially similar reasons. And if factory legislation and social laws were required to protect industrial man from the implications of the commodity fiction in regard to labor power, if land laws and agrarian tariffs were called into being by the necessity of protecting natural resources and the culture of the countryside against the implications of the commodity fiction in respect to them, it was equally true that central banking and the management of the monetary system were needed to keep manufactures and other productive enterprises safe from the harm involved in the commodity fiction as applied to money. Paradoxically enough, not human beings and natural resources only but also the organization of capitalistic production itself had to be sheltered from the devastating effects of a self-regulating market.
The markets are in a state of flux right now with the commodity “currency” now coming into disrepute.
One must start to question how much longer this can continue before the ‘real’ commodities such as oil, food, water and gold are put back into a majority position?
The economic conditions are shifting rapidly in China.
More so than is commonly written about I suspect.
This report from the Real News gets into some of the reasons behind these shifts.
Note please the lack of demand for all the housing and other construction that was done in the past decade.
There is a real-estate bubble in China that will make the North American one look like a bubble gum popping were it to continue to overheat and explode.
Governments On Both Sides of the Atlantic Try to Put Lipstick on a Pig
We noted yesterday that the big banks have criminally conspired since 2005 to rig $800 trillion dollar Libor-based market.
Barclay’s chairman says that the Bank of England gave explicit approval for the manipulation.
A former Barclay’s executive – who was close to the Libor-setting manipulation – told the Daily Mail that Barclay’s manipulated Libor to make the bank look healthier than it really was, and , and the cover-up led to a slow policy response which prolonged the financial crisis.
This appears to be very similar to what happened in America. As I noted last year:
The Tarp Inspector General has said that [then-Secretary of the Treasury Hank] Paulson misrepresented the big banks’ health in the run-up to passage of TARP. This is no small matter, as the American public would have not been very excited about giving money to insolvent institutions.
(Paulson also threatened martial law if Tarp was not passed.)
As we reported last year:
[All of the big banks were] insolvent in the 1980s, but the government made a concerted decision to cover that up.
Nouriel Roubini noted in January 2009 that the entire U.S. banking system is “bankrupt” and “effectively insolvent”:
“I’ve found that credit losses could peak at a level of $3.6 trillion for U.S. institutions, half of them by banks and broker dealers,” Roubini said at a conference in Dubai today. “If that’s true, it means the U.S. banking system is effectively insolvent because it starts with a capital of $1.4 trillion.”
“The problems of Citi, Bank of America and others suggest the system is bankrupt,” Roubini said. “In Europe, it’s the same thing.”
Indeed, the American government’s zero interest rate policy is very much like the British Libor manipulation scandal … it’s nothing but an attempt to breathe life back into the insolvent banks, at the expense of the taxpayer. And see this.
And the “financial reform” laws passed in the wake of the crisis have, in some ways, actually weakened regulations of the financial markets, allowed the big banks to get a lot bigger, and have intentionally allowed fraudulent accounting (and see this).
Likewise, the “stress tests” in both Europe and America have been a total scam … a naked attempt to put lipstick on a pig to cover up the fact that the big banks are insolvent.
By choosing the big banks over the little guy – and failing to rein in the fraud which caused the crisis in the first place – the governments on both sides of that Atlantic are dooming both the financial system and the people to failure.
During the U.S. Civil War, the future of the Union was challenged by the secession of the South. The decisions were made on the battlefields where men were willing to die either for the Union or to break away from it. Who will die for the European Union? And what will hold it together when its decisions are unpopular? The concept of extended integration can work, but not without the passion that moves a Greek or a German to protect his and his country’s interest. Without that, the glue that holds nations together is missing in the European Union. The greater the integration, the more this will reveal itself.
Essentially they are offering to keep your currency from vanishing … like any of the fiat currencies have any hope of NOT doing a disappearing trick in the next decade.
Indeed the story has elements that say the coming bond issue will include NEGATIVE real returns, just imagine, we promise to loose less than you will anywhere else!
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