Tag Archives: Gold

Protection from a currency collapse, by Alasdair Macleod

Good advice on protecting yourself from a currency collapse from a man who has been warning of it for some time. From Alasdair Macleod at goldmoney.com:

While markets seem becalmed, financial conditions are rapidly deteriorating. Last week Jamie Dimon of JPMorgan Chase gave the clearest of signals that bank credit is beginning to contract. Russia has consolidated its rouble, which has now become the strongest currency by far. The Fed announced the previous week that its balance sheet is in negative equity. And there’s mounting evidence that we have a nascent crack-up boom.

Russia now appears to be protecting the rouble from these developments in the West, while previously she was only attacking the dollar’s hegemony. China has yet to formulate a defensive currency policy but is likely to back the renminbi with a commodity basket, at least for foreign trade. If it is taken up more widely by the members if the Shanghai Cooperation organisation and the BRICS, the development of a new commodity-based super-currency in Central Asia could end the dollar’s global hegemony.

These are major developments. And finally, due to widespread interest in the subject, I examine the outlook for residential property values in the event of a collapse of Western fiat currencies.

The mechanics of an apocalypse

Against the grain of the establishment, for years I have been warning that the world faces a fiat currency collapse. The reasoning was and still is because that’s where monetary and economic policies are taking us. The only questions arising are whether the authorities around the world would realise the dangers of their inflationary and socialistic policies and change course (extremely unlikely) and in that absence in what form would the final crisis take.

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Five Warning Signs the End of Dollar Hegemony Is Near… Here’s What Happens Next, by Nick Giambruno

The dollar may lose its place, giving way to the ultimate money: gold. From Nick Giambruno at internationalman.com:

It’s no secret that China and Russia have been stashing away as much gold as possible for many years.

China is the world’s largest producer and buyer of gold. Russia is number two. Most of that gold finds its way into the Russian and Chinese governments’ treasuries.

Russia has over 2,300 tonnes—or nearly 74 million troy ounces—of gold, one of the largest stashes in the world. Nobody knows the exact amount of gold China has, but most observers believe it is even larger than Russia’s stash.

Russia and China’s gold gives them access to an apolitical neutral form of money with no counterparty risk.

Remember, gold has been mankind’s most enduring form of money for over 2,500 years because of unique characteristics that make it suitable to store and exchange value.

Gold is durable, divisible, consistent, convenient, scarce, and most importantly, the “hardest” of all physical commodities.

In other words, gold is the one physical commodity that is the “hardest to produce” (relative to existing stockpiles) and, therefore, the most resistant to inflation. That’s what gives gold its superior monetary properties.

Russia and China can use their gold to engage in international trade and perhaps back the currencies.

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Gold As Cheap Today As In 1971 at $35, by Egon von Greyerz

Sooner or later people will turn to gold and silver as honest money to replace their rapidly depreciating fiat currencies. From Egon von Greyerz at goldswitzerland.com:

“Specie (gold and silver coin) is the most perfect medium because it will preserve its own level, because having intrinsic and universal value, it can never die in our hands, and it is the surest resource of reliance in time of war.”  – Thomas Jefferson

Since no current President or Prime Minister nor any Central Bank Chairman understands what money is or the relevance of gold, we turn above back to history and Thomas Jefferson, America’s third president for a proper definition.

Jefferson also understood that “Paper is Poverty, It is only the Ghost of Money, and not Money itself.”

As the world economy goes towards an inflationary depression exacerbated not only by epic debts and deficits but now also by war, the significance of gold takes on a whole different dimension.

So let’s dissect Jefferson’s statement:

“(GOLD) Will preserve its own level”

Gold is Constant Purchasing Power. As such, gold doesn’t go up in real terms. An ounce of gold today buys a good suit for a man just like it did in Roman times.

The graph below shows gold as constant purchasing power at the 100 line whilst all the currencies are crashing to the bottom.

All currencies are continuing to lose value against real money although it never takes place in a straight line. With higher interest rates & inflation, higher deficits & debts, poverty, cost of wars and increasing pressures in the financial system, the currency debasement will now accelerate.

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Doug Casey on Whether the “Everything Bubble” Has Finally Found Its Pin

Sneak peak: it has. From Doug Casey at internationalman.com:

International Man: Recently, large tech stocks lost over $1 trillion in value in just a few days. Many of these companies have been trading at insane earnings multiples for a long time.

Has the bubble finally popped?

Doug Casey: It actually started popping about a year ago—but now people are starting to notice that lots of these stocks are down not just down 50%, but 75%, and 90%.

Several classes of stocks are getting hurt particularly badly. One is the zombie companies that took advantage of low-interest rates and overleveraged. They borrowed a lot of money in order to pay dividends and buy back shares. The borrowing had little to do with growing the actual business. Now they can’t pay back the debt they’ve taken on since interest rates have gone up.

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Financial war takes a nasty turn, by Alasdair Macleod

The real was is monetary and financial, and Russia and China are winning. From Alasdair Macleod at goldmoney.com:

The chasm between Eurasia and the Western defence groupings (NATO, Five-eyes, AUKUS etc.) is widening rapidly. While media commentary focuses on the visible side of the conflict in Ukraine, the economic and financial aspects are what really matter.

There is an increasing inevitability about it all. China has been riding the inflationist Western tiger for the last forty years and now that it sees the dollar’s debasement accelerating wonders how to get off. Russia perhaps is more advanced in its plans to do without dollars and other Western currencies, hastened by sanctions. Meanwhile, the West is increasingly vulnerable with no apparent alternative to the dollar’s hegemony.

By imposing sanctions on Russia, the West has effectively lined up its geopolitical opponents into a common cause against an American dollar-dominated faction. Russia happens to be the world’s largest exporters of energy, commodities, and raw materials. And China is the supplier of semi-manufactured and consumer goods to the world. The consequences of the West’s sanctions ignore this vital point.

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The West – A Vicious Cycle of Self-destruction, by Egon van Greyerz

It’s hard to point to any one thing Western governments are doing that isn’t suicidal. From Egon von Greyerz at goldswitzerland.com:

“The first panacea of a mismanaged nation is inflation of the currency; the second is war. Both bring a temporary prosperity; both bring a permeant ruin. But both are the refuge of political and economic opportunists.”

Ernest Hemingway

As the West is standing on the edge of the precipice, there are only unpalatable outcomes.

At best the world is facing a hyperinflationary depression later followed by deflationary depression.

But sadly there is today much more at stake as the West is frenetically escalating the sound of war drums against Russia’s invasion in Ukraine.

THE WEST HAS NO DESIRE FOR PEACE

As the global economy reaches the point of collapse, countries get the leaders they deserve. There is today no leader or statesman in the West who can stand up to Putin in order to negotiate peace. Biden sadly neither has the vigour, nor the ability to play any significant role in solving the conflict. Also, he has the neocons pressurising him to attack and defeat Russia. And Biden’s rhetoric against Putin is certainly not conducive to peace, with words like war criminal and genocide. Biden mustn’t forget that just in the Vietnam war, the North Vietnamese and Viet Cong are estimated to have lost one million soldiers and two million civilians. Unprovoked wars are of course always senseless whoever starts them.

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The Schrödinger euros, by Jorge Vilches

The EU’s leaders want to pay Russia for its exports with Euros that are deposited in European bank accounts that Russia can’t access. Yes, it really is that stupid. From Jorge Vilches at thesaker.is:

What ? Payment in Rubles ?? Unthinkable, don´t even mention the word say EU officials and authorities.

Instead, Europe has formally demanded to pay for Russian imports with Schrödinger euros as explained below.

So it´s high time for psychiatrists to step in as the livelihood of 800 million Europeans depends on whatever this incredible set of un-elected delusional EU leaders decide. Let´s get this straight folks: the EU does not want to pay in Rubles – or gold — because it is playing cutie by pretending to “pay” for Russian imports for free. Be it natural gas, or oil, or coal or whatever Russian, instead of really “paying” the EU pretends to pull a “print & deposit + freeze & hide” wise-up gimmick. To make it clear for any audience, the above would be the equivalent of you pretending to “pay” at the check-out counter of any store with a photo of a fully sealed box that you say contains “money” that you will keep hidden at your home – unopened — as long as you want. Please allow me to explain the EU trickery in layman´s terms

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The Ukraine Conflict Is Just a Sideshow, and We Are the Real Targets, by Brandon Smith

Is the Ukraine-Russia war the next step in the globalist plot to run the world? From Brandon Smith at birchgold.com:

Way back in 2014 I wrote an article titled False East/West Paradigm Hides the Rise of Global Currency. I was inspired to cover the issue due to three specific trends which at the time were concerning.

The first trend was the increased mention within globalist circles of something called the “Great Reset.” Christine Lagarde who, as the head of the IMF at the time, was suddenly throwing the phrase around in press interviews and in Q&A events at the World Economic Forum. This appeared to me to be a rebranding of the “New World Order” agenda which establishment elites had been known to mutter about in moments of rare honesty. It indicated a concerted push towards global centralization in the face of economic and social decline within nations.

The second trend which I noted was the shift of Eastern nations into a more open partnership with global banks, including the IMF’s inclusion of China in the Special Drawing Rights basket system, and in the case of Russia, Goldman Sachs becoming deeply entrenched as an “economic adviser” to the Kremlin.

The third trend was the inexplicable rush by both Chinese and Russian central banks to buy up as much physical gold as possible. To my mind, the only reason for China and Russia to buy up precious metals was as a hedge against inflation and currency collapse; specifically, as a hedge against the collapse of the U.S. dollar as the world reserve currency. This could be precipitated by the BRICS (Brazil, Russia, India, China and South Africa) nations and others dropping the dollar in global trade, or by an economic war in which using the dollar became untenable for eastern countries.

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The failure of fiat currencies and the implications for gold and silver, by Alasdair Macleod

Fiat currencies are going to their marginal cost of production—close to zero. That should increase the allure of Real Money, gold and silver. From Alasdair Macleod at goldmoney.com:

This is the background text of my Keynote Speech given yesterday to European Gold Forum yesterday, 13 April.

To explain why fiat currencies are failing I started by defining money. I then described the relationship between fiat money and its purchasing power, the role of bank credit, and the interests of central banks.

Undoubtedly, the recent sanctions over Russia will have a catastrophic effect for financialised currencies, possibly leading to the end of fifty-one years of the dollar regime. Russia and China plan to escape this fate for the rouble and yuan by tying their currencies to commodities and production instead of collapsing financial assets. The only way for those of us in the West to protect ourselves is with physical gold, which over time is tied to commodity and energy prices.

What is money?

To understand why all fiat currency systems fail, we must start by understanding what money is, and how it differs from other forms of currency and credit. These are long-standing relationships which transcend our times and have their origin in Roman law and the practice of medieval merchants who evolved a lex mercatoria, which extended money’s legal status to instruments that evolved out of money, such as bills of exchange, cheques, and other securities for money. And while as circulating media, historically currencies have been almost indistinguishable from money proper, in the last century issuers of currencies split them off from money so that they have become pure fiat.

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NATO´s internal gold war, by Jorge Vilches

You think anyone within NATO trusts the British and U.S. government tallies of gold in their custodial accounts? From Jorge Vilches at thesaker.is:

Brexitology focused keenly on UK fish but fully ignored the EU´s gigantic gold reserves supposedly still vaulted in custody at the Bank of England. Adding insult to injury, a UK-EU no-deal financial services crash-out divorce went by almost unnoticed… not only without the bang of the still postponed “financial equivalence” protocol… but also without a mere whimper from specialized media and Remainers. Now, the Ukraine crisis with its new payment requirements for the badly needed Russian oil & gas…overlapping with essential yet unfinished Brexit business…will necessarily evolve into a vicious NATO internal gold war. Paraphrasing James Carville spiced with some traditional British flavor, “It´s the bloody gold, stupid” [Refs.1+ 2]

Rule Britannia

As UK Prime Minister Boris Johnson would have it, the physical repatriation of the EU gold supposedly still vaulted in London would “mightily” affect the future of Europe with very deep, high-voltage political impact both sides of the English Channel. In this scenario No.10 Downing Street would easily negotiate the EU gold bullion availability only under specific Brexit conditions favorable to the UK. Actually, doing this could turn out to be absolutely necessary and should go far beyond the enormous intrinsic value of the EU gold supposedly still vaulted at the BoE. Let me explain.

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