dimanche 7 août 2011

Gold, silver and deep winter of the entry of the Dollar



We have trained over the past 30 years to wait for the impossible.
Here's the story: growth and prosperity are perpetual, expected and required. Wealth is a right and everyone can and should be a massive and aggressive consumer. All mainstream and Government planning and analysis should be framed, filtered and massaged with this expectation as a predetermined result. On the contrary, all evidence should be rejected as simple sideways moments in the long walk to the richness of pandemic.

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 It is one of these such huge lies and ridiculous, it passes the truth because so many repeat the fantasy regardless of any historical validity or logic or parallel. Take a moment to examine how impossible is and then contemplate the nature seasonal and cyclical of all life and all Earth and human processes.
We firmly concluded what is called the Cycle winter, which is characterized by the "death" to leverage Active paper (the dollar and its many derivatives denominated) and retirement in "real" physical things, usually called hard assets. It is very easy to understand the hard assets such as gold, silver, producing lands, commodities in General, etc., because they are things of universal value need and represent therefore a preservation of value. In short, everyone must be these items (cattle, wood, eggs, oil) or these assets are of eternal value, at all times and in all places, regardless of the Government Decree (gold, silver, copper, etc....).
What is the story based on reality?
Prosperity leads to demand more and without end of prosperity. This is done by exponential growth in the public and private debt, leading to unsustainable levels of debt. And the real kicker is this: the debt is more taken to create opportunities but to maintain the status quo and maintain our fantastic and deny the reality. Anyone who has crossed a bankruptcy knows exactly how it plays. As the crunch of the economic implosion limits your options you anything to maintain what you have come to be regarded as "normal." Continue to do everything except obviously - accept your loses and returns to scale and withdraw to a sustainable level.
There are two diametrically opposed and completely opposite stories. On the one hand, you have economy recovering, government policies are correct and work, and the consumer citizen is back on the treadmill buying and spending, or at least directed this way. The contrary story is that the world is undermined and soaked to the bone with a debt, there is no plan or policy the possibility of a plan or a familiar model of growth that may facilitate this massive debt repayment and the amount of cut backs and austerity required is beyond the will of all democracies Western.
If you are emotionally and psychologically committed the first story, you continue to store all your faith and wealth in the formal system and their fiat paper currency. This is why our current system is known as an economic confidence model - you have confidence in the fidelity of the Government and economic management. If you feel the second story matches what you see and experience (or notice that there is a strong possibility that this is even partially true), you take your money in the system, on a percentage basis and place in assets such as gold and silver (known as hard-asset money) because it is very likely that a crisis occurs massive financial-currency-debt. It's a retirement in what is called an economic model of value.
And for the record it is mathematically and historically certain, in fact, it is a 100% probability, that the system of the U.S. Dollar will fail. To be even more clear the current paradigm has already failed and the final collapse is guaranteed by a cancer estimated debt to 100 000 billions of dollars of world-wide. This means the failure of paper currency, and it is financial winter of our discontent. It is just and natural course of nature and reality.
Players (IMF, World Bank, the bis, etc.), have finally come to the conclusion sane and focused on the reality that there is too much debt and that it is no way on Earth this debt can be repaid. They know that this scenario has only two results: severely indebted countries will be allowed to fall - and the standard of living of their citizens will be overwritten or the system global fiat will suffer a catastrophic failure.
 

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