Morality, Power, Gold and You…
Top to bottom. That could accurately describe activity in the rare coin and precious metals arena. Everything from plane Jane bullion to seven figure rarities are in demand.
It has been a long time coming, and there are a few acolytes that continue to be mesmerised by banks. However, any body with any sense has realised the fraud perpetrated on borrowers. A fraud that continues to be spewed forth in the form of the mantra that debt is good for the economy.
Investment legend Warren Buffet has been quoted in the news saying with typical candour:
The recession will be longer and deeper than most people think- this will not be short and shallow.
So why do the Bank of England, ECB and Fed maintain the worst is over?
To state it clearly: the so-called “credit crunch” is too much debt on over priced assets.
By issuing, even more debt our elected leaders are throwing fuel on the fire. They are using taxpayer’s money in order to protect their own jobs by perpetuating the scam.
In recent weeks, I have seen two articles intimating that owning gold is somehow immoral. One in the International Herald Tribune: suggests that gold and oil are used by terrorists, money launderers and fraudsters. This article appeared in Fortune Magazine takes a different tack highlighting that only crazy apocalyptic survivalist are the lustrous metals true fans.
Why all the negative propaganda towards owning gold?
What could make more sense that owning a universally regarded store of value used by every culture, on every continent under every circumstance?
The answer is devastatingly simple: the acceptance of paper currencies are entirely dependant upon the trust we, the end user, place in the issuer. Once a significant minority loose the trust we enter a Weimar scenario of hyper inflation.
With the price of gold bullion rising from $250 dollars in 2001, through to $1000 last month it appears that trust is failing.
So while the central banks continue to print trillions of worthless paper notes in volumes not seen since the 1970’s, they also need to undermine the attractiveness of alternatives.
At present this is being conducted through highly publicized central bank sales, and manipulation of derivative contracts.
In recent weeks rumours of a large IMF gold sale have been confirmed. The institution will sell just over 400 tonnes of the metal.
What has not been stated is where this gold came from?
The IMF does not own any gold, all the gold in their custody is property of the sovereign central banks who deposited it. Then there is the Italian gold sale of 400 tonnes that never was, the 1200 tonnes sold by the Swiss and lest we forget, the greatest swindle off all.
British chancellor Gordon Brown (now Prime Minister) sold almost half of total Bank of England gold reserves at an average price of $270. He announced the fact four weeks before causing the metal to free fall to an all time low of $248. Less than one quarter of recent prices.
I guess my real question is just how long the bankers can and politicians keep up this charade of a debt based monetary system? Once the gold is exhausted, what will they try next?
My guess is they will use some new anti terrorism law and confiscate all privately held gold. It happened before- it could happen again.
Don’t under estimate how much politicians want to stay on the gravy train hauled by tax payers.
Leave a Reply