Why Buy Gold or Silver?
Morgan silver dollar
The dollar and other currencies are not necessarily doomed if they print 3X or 4X the amount of fiat money because they are only covering the electronic money that was created and lost through gambling in derivatives by financial institutions.
To give you some background information, at the end of the Cold War in 1990 it was recognized by some policy advisers that there was not enough money in circulation to support the recovery of Russia and Eastern Europe to avert a major crisis. At that time, the central bankers refused to print money to avert the impending crisis. Consequently, it was decided to price and allow derivatives to create electronic money. This resulted in the creation of trillions of dollars of new electronic money that was used to help the world avert a crisis and to grow the world’s economy.
Unfortunately for all of us, derivatives have been abused. They should be tightly regulated.
Thus, the Federal Reserve is printing money to cover the losses of electronic money by financial institutions. This will result in massive inflation if derivatives are regulated and controlled.
If derivatives are not brought under control, then additional losses may result, and the world’s financial house of cards will fall. We seem to have very strong indications that the giant Ponzi game is failing. Printing money actually only treats the symptom and not the cause. The root cause is the abuse of derivatives.
The fact that gold is going up against the dollar but not so much other currencies is a measurement of confidence in those currencies and governments. Since Germany and others in the EU do not want to increase inflation to fight deflation based on their historical memories, it is not surprising to see the dollar down against gold.
However, the currency issue with respect to gold is a sideshow of the real more serious issues being played out in Washington D.C.. Obama and his congress are saddling the US with some really big debts and adding even bigger ones to thatover which they are papering. Jobs are declining in response to actions being taken by politicians in Washington, because the private sector is moving capital out of the US.
gram scales
The next and final bubble to burst will be gold. History says it will. Gold is neat but you can’t do anything with it except cash it in for money to do something else with. When people start to head for the cash register, the price will plummet as viciously as the stock market. It always has. It always will. The slower ones will be left holding the losses and the gold bug rhetoric. I’d rather take my chances with inflation.
Gold Buckles
Anyone want to unload some gold and silver, I’ve got this really awesome greenish paper! The world loves it! It’s, it’s, its . . . almighty! Hail the $! HA! I’ve known the $ was toast for 2 years now, there was a spark of hope B4 that. All common sense is out the window.
Gram Scale