We Don’t Have Honest Money

By Greg Hunter’s USAWatchdog.com 

My nephew, Luke, called me the other day vexing over the materials used in our coins.  He is a finance major in grad school and was researching money when he discovered that pennies were 97.5 percent zinc and nickels were mostly copper with only a nickel coating.  He told me he was going to start saving every pre-1982 penny he got because, after that, the mint stopped using 95% copper in the coin.  Luke told me the copper in a pre-1982 penny was worth more than two cents.   I told him, “Pretty soon the mint will have to punch coins out of plastic if the price of metal keeps going up.”  Then I asked, “Do you know why prices are going up?”  Luke said, “Yes, it’s because the Federal Reserve and its monetary policies.”  I was shocked and proud all at the same time!  It looks like he’s actually learning something in business school.  Currently, it costs about 1.8 cents to make a penny and nearly 9 cents to produce a nickel.  The government is considering cheaper metals to bring the cost of making coins down.  (Click here to see what our coins are currently made of.)   

It is said, when empires fall, one of the first signs of decline is a debasement of the currency.   Long before the Roman Empire fell, its leaders debased the currency.  The debasement was small at first, but over time, precious metals were watered down and coin sizes shrank.  For example, silver coins ended up having so little silver in them they became unpopular and shunned.  A debased Roman currency brought, what else, inflation.  Sound familiar?   

I have been asking myself for years “Why can’t we have honest money?”  We little guys are forced into the stock market to save for retirement and to stay ahead of inflation.  It now looks like the 401k is not such a good invention or investment.    

By and large, working people are pushed into 401k’s.  In the right business cycle with the right demographics (as in lots of baby boomers investing in stocks at the same time, such as the 80’s and 90’s, when business and inflation were relatively stable), the 401k is a not a bad deal, especially when you consider that companies often match or contribute funds to make the investment plan advantageous to participants.  But in the wrong part of the business cycle (aging baby boomer population and big government bailouts), the 401k can provide some gut wrenching lessons about “investing.”  People are painfully finding out that these plans have not been such a good “long term”  deal.  The S&P 500 has gone nowhere in more than a decade. Today, it’s back to 1998 levels.  (Click here to check out a chart of the S&P 500, and see for yourself.)   

This does not account for companies whose share prices have been wiped out or bankrupted.  A few examples spring to mind, such as AIG, WaMu, Wachovia, Bear Stearns, GM, Chrysler, Fannie, Freddie, Lehman, Enron and World Com.  The NASDAQ is still less than half its all time highs.  Also, factor in a more than 30 percent drop in the U.S. Dollar Index, and how are people in 401k’s making money for retirement?  The short answer: They are not!!!   

If you would have simply invested in money markets (and taken the company match) back in 1998 with your 401k, you would have been hit with inflation, but at least you would have a positive nominal return.  Most people did not take that route. I think the little guy is going to take another big hit to his retirement fund. 

Now, to help fund the continuing multi-trillion dollar bailout of Wall Street, the Fed is getting ready for another round of “Quantitative Easing.”  That means “printing money” to us simple folk.  This time, it is reportedly for a trillion dollars.  So, getting any kind of return on cash will be impossible to do because the Fed will be printing it faster that you or anyone else can save it.   

Nobel Prize winner Milton Friedman said it best, “inflation is always and everywhere a monetary phenomenon.”   Printing lots of fiat currency is debasement, and it will produce inflation the same as it did for the Romans.  If you are an investor, then the stock market and all its risks and rewards are for you.  But if you are a saver, then maybe you should consider other options such as gold or silver coins.  That is honest money, and you can still get it, at least for now.

Comments
  1. MarkM

    Hey Greg,

    “Those who do not remember the past are condemned to repeat it.”
    George Santayana

    Monetary policy is eigth grade level math. It is not that difficult. “Inflation is too many dollars chasing too few products.” Unknown author.

    We will know when our economy recovers when inflation takes off. Bernanke claims he will restrict the money supply when the recovery starts. Won’t that curb the recovery? Either way, we are screwed.

    Ultra high interest rates or huge inflation. We can’t avoid those outcomes. We are talking eigth grade math here; their are no magic tricks that can be used to fix this academic-made problem.

    Academics are the problem; November 2 is the cure. Vote for anybody but Democrats (fire the neo-Marxists from gubmint).

    markm

    • Greg

      MarkM,
      This November is going to very important Your are on target about that!!!
      Thank you for the comment.
      Greg

  2. Phillip McKreviss

    Greg, can u recommend any other investing options besides gold/silver coins, to help protect/profit from the coming inflationary wave ? what about buying stocks of large,solid resource/oil/ag companies ? thanks for a great informative site ! Phillip

    • Greg

      Phillip,
      The problem here is systemic. I am leery about protecting large amounts of your money in a (stock) market where naked short selling is allowed to run wild. This is simply equal to government sanctioned theft. Almost any stock, no matter how good, can be knocked down by manipulators. That said, the 2 brokers I like are Scottrade and Edward Jones. They have little to no exposure to OTC derivatives, but again the problem is systemic. Meaning, the whole system can seize up and go down–poof. I don’t think you are fully grasping that concept Here is what Economist John Williams (who has not made an incorrect call since I’ve been following him for the last 3 years) said in the post on USAWatchdog.com Sept. 15th, “According to economist John Williams at shadowstats.com, all the money pumping by the Fed is creating a big downside problem. In a special report released Monday, the headline read “Systemic Stability: Tap-Dancing on a Land Mine.” The report goes on to say, “Pardon the use of the Aerosmith lyrics in the opening headers, but the image of tap-dancing on a land mine pretty much describes what the Federal Reserve and the U.S. Government have been doing in order to prevent a systemic collapse in the last couple of years. Now, as business activity sinks anew, much expanded supportive measures will be needed to maintain short-term systemic stability. Such official actions . . . likely will trigger massive flight from the U.S. dollar and force the Federal Reserve into heavy monetization of otherwise unwanted U.S. Treasury debt. When that land mine explodes — probably within the next six-to-nine months, the onset of a U.S. hyperinflation will be in place, with severe economic, social and political consequences that will follow.”
      .
      Please read the entire post and look at some other recent posts. There will be a systemic failure of the system I just do not know when. I would hate to try to get my money out of a brokerage when this whole thing goes down. If you do use a brokerage, do not do it as protection you might regret it.

      Thank you for the comment and question.

      Greg

      • George

        What good would it be to have a billion US Dollars if: A) the government takes it or b) its worthless. The Turkish Lira was 5,000 to the U$D in 1990 and it was 1.8 million to the U$D by 2003. They were using the monetary policy we are using now. Think about it

  3. Fred Moeller

    Greg,

    A fine article. There’s a book out there “Money and Man” by Elgin Groseclose. I highly recommend it to people as a first step to understanding money. It chronicles the rise and fall of civiliztions over the millenia via the debasement of the coinage. What is hsppening today in the USA is just a depressing replay of what’s happened so many times before.

    I live in a major metro area of well over a million people. I read this book in the mid 1970′s and I was only the second person to check it out of the library even though it was written in 1934. So there’s a long way to go in general understanding. Thank God for the internet.

    Keep up the good work ….. Fred M.

    • Greg

      Fred Moeller,
      Thank you for giving us this info.
      Greg

  4. Rick

    Gold isn’t the answer either, since it cannot be added to the money supply evenly, or in step with productivity elsewhere. In a world in which the population continues to expand and continues to increase in productive capacity, the money supply has to also be able to expand-the problem is in who or how this is regulated, too much money created at once leads to inflation. Too little leads to deflation.

    This doesn’t mean Gold isn’t a good thing to own now, in times of economic contraction nothing holds it’s value as well. And nothing is as transferable from one place to another.

    • Greg

      Rick,
      Gold is at least part of the answer. That is why every central bank holds gold. I can also appreciate your point, but I think gold will have to be revalued a lot higher than most can imagine. Thank you for your comment.
      Greg

  5. Paul Siemsen

    Of all the coins currently minted, the nickel is the only coin whose intrinsic metal value is near or greater than the value of the coin itself. It is composed of 75% copper and 25% nickel, and as their prices rise so rises the metal value of the nickel, which is close to six cents these days, as reported on coinflation.com.

    In 2008 the US Mint introduced a bill to allow a change in the nickel’s metal composition. The President’s 2011 budget calls for the nickel to be reformulated to reduce production expenses. I have seen no date for the mint to change the nickel’s content, but I sense it will happen within a year.

    Saving nickels dated prior to a changeover has some merit. If our devalued currency and coins ever collapse, the copper/nickel version of the nickel coin could prove to be useful in trade just as the older, truly silver coins could prove useful in that situation. They would be valued more than coins composed of less valuable metals. In addition, saving nickels is safe, because at the very least each coin will always be worth at least a nickel.

    • Greg

      Paul,
      Thank you Paul. It would be very bulky and difficult to store enough nickles to live on and trade with but you are right you would never lose money. I like silver much better it is still a deal. It can also be bulkey but worth so much more per coin than a nickel.
      Greg

  6. mariah haveen

    As Bill Still puts it in the movie The Secret of Oz, it’s not what backs the money, it’s who controls the supply. Remember King George and the talley sticks….who cares if pennies aren’t copper? the problem is that the money comes from THE FEDERAL RESERVE, A PRIVATE BANK, WITH INTEREST CHARGED TO THE PEOPLE.

    It amazes me to see the fuss over gold and metals when it’s about the Fed.

    And now the Senate is ramming through a food facism bill called The Food Safety Act, S 510. Facism at its best.

    • Greg

      Mariah,
      You are right, it is all about the Fed. Pointing out the that pennies are not copper is just another way to show the Fed is debasing our currency. Gold and silver is the only way to protect your assets in a Fed inflation world.
      Greg

  7. Wayne

    Your article reinforces what many have seen coming for some time. Recently, I was explaining to my kids that anyone who who invested 10K in gold a decade ago has seen their investment grow to over 30K whereas as you point out the S&P has been basically flat over this time frame. Along with John Williams, people like Bob Chapman, Jim Sinclair and Gerald Celente have also been very consistently and correctly calling attention to the smoke and mirrors, fluff and nonsense being pumped out by gov’t policy makers and their friends in the national media……kudos to your great site.

  8. Jan

    It is easier to sleep at night when you have insurance and that insurance is a little gold and silver. The best anyone can do is make certain you have extra food, personal care products and prescriptions on hand. Greg has been wisely advising readers to pick up a few “extras” when shopping. Know the shelf life and proper storage techniques and you can survive and take care of your family. Be prepared to beat inflation or food shortages.

    Novemeber is important, but does it really make a difference? I have been involved in my state legislature since 1993. The minute a newly elected representative walks through the door of the statehouse, they get hit on one side by thier caucus and the lobbyist on the other side. The good intentions are extremely difficult to fill. They can’t accomplish anything their first term, so they need to get re-elected. They can’t accomplish much their second term, so they need to get re-elected and the beat goes on. By the time they can accomplish anything they have long forgotten those campaign promises.

    There is so much more than just our elected representives, banks and Wall Street destroying the country. I suggest you visit Guidestar.org pick a non profit and review their Form 990′s. Do some more research and see where they get their funding. Who sits on the Board of Directors? What other boards do they sit on? Poke around and look for lawsuits against government or businesses they file.

    Trust me, the non profits are the Trojan Horse. We’ve been had.

    • Greg

      Jan,
      Insurance is right, and it does not expire. Thanks.
      Greg

  9. Robert Hamburger

    Greg,

    Gold and silver would be honest money; what we have now (Federal Reserve Notes) is a sham. I’d like to think that when Obama, Bernanke, and Giethner sit together, there’s enough knowledge of history in the room that they understand there will be consequences to their print and indebt policies. I spoke to this issue last week, writing about the Wizard of Oz, on my blog – http://www.hamburgersstand.com/299/299/ .

    Good article. Thanks!

    Robert

    • Greg

      Robert,
      Thank you for the comment and link.
      Greg

  10. Richard D

    Great article; I very much agree with your assessment that the average investor will take another hit to his/her retirement plan somewhere down the road. Could be next week, could be in two years…but another blowup is certainly coming.

    I find it comical that the typical advice (pushed by fund companies and brokerages) to every worker in America is simply to “diversify across asset classes, stay the course and voila, you’ll retire with a substantial nest egg.” How naive!! Having at one time played the races for a living and being a gambler who understands the concept of risk and reward, I know all too well that earning money is alot harder and takes much more skill than simply rebalancing one’s portfolio twice a year. People need to educate themselves about investing (or trading, whichever suits them best) and take responsibility for their own decisions, rather than rely upon some fund manager whose interests may or may not allign with their own.

    • Greg

      Good advice Richard.
      Greg

  11. David Conrad

    You have been correct all along Greg. Only those with “real” coins (gold/silver) will be okay at the end of the day.

    David

    • Greg

      Thanks David. I think Luke is getting it too!!
      Greg

  12. Rachael

    First, let me say that I am frustrated with our economic situation and if I sound biting, I apologize in advance!

    I don’t understand why you think gold is such a great choice. If everything crashes, so will gold my friend! Do you not see this???

    Here is what I mean in a nutshell – - who cares at the point of no return…aka total economic collapse!

    How will I feed my family???? Who is working in the supermarket at this point – if the economy is in total collapse? No one! And if there is someone working there, is there any food in the store? And why would they accept gold at this point? What will they do with it? They can’t spend it on anything if the whole economy collapses. It will be absolutely worthless until some sort of economy is restored.

    Get it? So what if I have gold (silver, pennies, nickels, hundred dollar bills, diamonds and connections with the chiefs of staff) – we are talking survival and you are talking about gold.

    Let’s say we don’t have full collapse. How will I pay my utility bills with gold – pending the utility companies are still operating and/or are still staffed?

    Do you get my point? The only answer (which isn’t doable by the majority of Americans) is to live off the grid and stockpile enough supplies to live on for years – which is still no guarantee.

    I would really appreciate a reply with more than – great point, thanks for the comment or your always welcome here Rachael.

    • Greg

      Rachael,
      Alright, here’s your answer. I do not know how this will turn out because we are in uncharted waters. No country on earth has ever had this much debt, produced this much currency and blew up when the world used its money as the reserve currency. The closest example we have is The Weimar Republic. (Germany around 1920) Of course Germany did not have a world reserve currency, so the comparisons are limited. I do know that the people in Germany were a lot better off with Gold as a store of value when the currency hyper-inflated. You should study this time frame. When you say, “I don’t understand why you think gold is such a great choice.” To me, this means you are ignoring 5 thousand years of human history. Gold is a time tested store of value, period. This is not a point of debate, but a fact. Do you think we will not have another currency to replace the dollar? We will. I don’t know what that will be, but there will be a replacement for the buck at the very least as a reserve currency for the world. I don’t know how you will feed your kids or pay your bills but I do know you will be a lot better off holding gold (or silver) than holding inflated dollars. If you scroll through this site you will find many articles that deal with what is coming for the country and currency. If you cannot afford gold, buy silver. It is a deal, although one should hold both. As far as my short comments go, I write extensively every week on this site. I basically get my say and want the people who comment her to have theirs without me getting in the way. So I make short simple comments at times to acknowledge that I actually read what people write to me. I am sorry you are frustrated but we all. Whatever you do don’t give up. Keep preparing any way you can. Thank you.
      Greg

      • Rachael

        Thank you very much for your reply Greg! I really do appreciate it. Again – I am sorry for my tone. I am very frustrated with our situation. I would love to say current situation, but it seems to be ongoing for so long that it gets me very upset to think about the future for our children and grandchildren,. What have ‘We’ the American people allowed our government to do to them? Thank you again.

        • Greg

          Rachael,
          I am not upset at all with you. It is very frustrating for me to navagate what is going on. This is like rowing in the ocean in the dark. I hope we all hit land sometime in the future.
          Greg

          • Chris

            In answer to why gold, I believe it was Gary North who said something to the effect of gold not being something to make money on during a hyperinflation but having an asset after the hyperinflation that has value and can be used to invest. Please, take solace and rest assured that throughout history many have been through what we are going through now and contrary to popular opinion it is not the end of the world. What has been done is what will be done and there is nothing new under the sun.

    • Luke

      If there is total economic collapse then there is the chance for a rebirth of economics after the collapse. Pre-Collapse fiat money would be replaced with post collapse items of value. The real question is there going to be a total collapse? We could have hyper-inflation without a total collapse or inflation period. Ultimately that inflation would cease to exist. The fiat currency used before would no longer hold any value. The gold/silver will still have value.

      If your betting on a total collapse and very dark times for civilization due to a number of issues including rising population, post peak oil, general resource decline, warming climate, etc etc then food and securing proper shelter should be of top priority as well as ways to arm your family or friends. Even in a scenario like this gold/silver could easily become trade-able resources that store value. Fiat money would be worthless except to the most ignorant people.

      • Greg

        Good stuff Luke,
        Greg

  13. Mark

    A nation’s money is its economic foundation and its lifeblood. It is either sound or it is not. It is either honest or dishonest.

    If a nation’s money is sound and honest, so too will be its society. If it is unsound and dishonest, so too will be its society.

    • Greg

      Mark, OTE and M Smith,
      Thank you all for adding meaningful info to this post!
      Greg

  14. OTE

    I think part of the confusion arises from value v purchasing power. When the big shake-out comes, it doesn’t matter what the value is in dollars/shekels/euros or lira. It is all about what can you trade gold/silver for. The purchasing power is all that matters. So what if gold is $50 in new dollars and you can buy a new car for $500.

    Too bad so many people don’t recognize the purchasing power of gold and silver. Except for short periods of manipulation, PMs have retained purchasing power.

    One aspect that bears repeating is that goods will become unavailable for a period of time. Loss of faith in the currency of the day will effectively cause goods to be removed from commerce. How can anyone price goods for sale when the costs of the inputs to replace the inventory are unknown, but the supplier/manufacturer is sure of what might be an explosive increase in costs?

    Therefore we are faced with having personal stock of goods on hand and hopefully some extra for barter. In the inter-rim, prior to establishing a more honest currency, barter will be the normal course for local commerce.

    Just glad I live so far from the general population aka cities. The cities produce no basic goods aka food, fuel and just how is a disfunctional local, state or federal government going to keep the potable water running through the pipes?

    For too long we slapped a fresh coat of paint over inflation by substituting cheap imported goods from China, etc. May you live in interesting times (chinese proverb or er curse?)

  15. M SMITH

    Greg,americans are not prepared nor to they understand what the fed & our own gov is doing,the MSM being owned by the elites wll not help them but will only steer them away from the truth of whats coming very soon. Here is a blog that explains how inflation & hyper-inflation works. I hope it helps your readers,thank you Greg for your work to get the real truth to as many as possible! “http://fofoa.blogspot.com/2010_09_01_archive.html”. There is 3 post on hyper-inflation on the Sept links. All 3 are great reading,but number 3 puts in simple terms that anyone can understand.

  16. KD

    Voting for any candidate based only on their party is how we got into this mess. Remember Bernacke was first appointed by Bush, who also initiated the banker bailouts. Let’s vote for candidates who oppose the Federal Reserve’s staying under private control and not requiring any audits.

  17. M SMITH

    KD, Ron Paul has been trying for years to get at the fed,but the others in congress only started to support him not long ago,but Franks & Dodd shut that down.DR Paul has been shunned by the MSM & Progressives, but he has made a huge part of Americans wake up to what is really gong on in DC,the fed & congress. KD,”Greg” is helping all of us to find the data,info,real truths that our gov & MSM will not do! As the Progressives gained more power, americans suffer from the courts, a case in point is the illegal imprisonment of Martin Armstrong,”The Number 1 Political Prisoner in the USA”,you may find about this man at http://www.ArmstrongEconomics.com, It’s a True story of just how corrupted our regulators,gov,fed are! I hope you find time to read about one of the smartest economics minds alive today. Always it good to check http://www.jsmineset.com 3 or 5 tmes a day, he’s for real. Jim thinks highly of Martin’s work & I see why. My best to all!

    • KD

      M Smith,
      Thanks for the interesting links. However, just as not all Republicans are the same, Progressives are not all the same. One progressive economist that I respect is Webster Tarpley. You might want to check out his website and especially his 2 page summary on what we need to do to save the economy (under the tab “emergency program, stop the depression” at the top of the page).
      http://tarpley.net/

      I also have great admiration for Ron Paul, although I disagree with him on some issues besides the Federal Reserve being out of control.
      KD

  18. Bob

    The history of gold , in the gold rush days tells us the location of the supply lines of food and other needs sit the value of gold. The reason I say gold won’t save us is because people will go completely insane, when there living with no laws, no food , long lines and no hope. It’s a no win deal nothing like this in history a one big globe mess. I understand some will find security having some gold around. I just hope the little people sale there gold before the big boys. I’ve seen other silver run ups and people holding it to long. Buy everything GOLD ,guns, ammo , seeds, horse leather,farm tools, buckets, post hole diggers, cross cut saw. Hell buy a hardware store that’s were the gold ends up. Thanks Greg PEACE

  19. Jonn

    If what some of you are saying comes true, the hoarding gold will not be the answer. The Government will issue gold confiscation orders and you will be forced to sell gold back to Government for a nominal value. Moreover, it will not be safe to keep gold in a bank safe deposit account or at home. You would be better off buying a home with land fit for grazing and cultivation, has a natural water source and with an off the grid energy system. To my mind, America will recover but it will take time and it will not happen evenly – some regions will recover more quickly than other places. Gold has gone up but so too have some stocks, not only in the US but in some foreign markets too. Better still, stay positive and don’t listen to the cheerleaders of doom. Many of these dark voices are making money by exploiting fear and ignorance.

  20. David Conrad

    Greg – you and I have talked about this for years …. and disagreed about it. Unfortunately, I agree with much of what Rachael has to say …. and again, you and I have disagreed about this for quite some time.

    If there is total collapse of the economy and untimately – God forbid – the nation, then I doubt that Gold will be worth anything.

    Bullets and canned food will. They will be very valuable. Bullets will protect you from those who would steal your canned food.

    Simple, but sadly – true.

    • Greg

      David,
      To say gold will not be worth anything is to ignore a 5,000 year track record of gold being a store of value and MONEY. Why do you think all central banks hold gold? Yes, ALL hold gold and are buying more. If the country does have a financial collapse do you really believe that we will never have another currency? Do you think it will be Mad Max time for ever and we will return to the Stone Age with guns and can food? I don’t see the future that way. We will get through this painful process someday, and the future will be brighter someday. The people who have protected their wealth with SOME gold and silver will get through it a lot better than the people who don’t. Good luck with holding only beanie weenies and bullets.
      Your friend,
      Greg

  21. Patriot Watch

    Tell your Nephew Greg “I Got my JAR”

    • Greg

      Patriot,
      I am saving pre-1982 pennies now too!
      Greg

  22. Randolph Miller

    I bought gold for the first time recently. I never considered gold an investment because it just sits there and does nothing, but it’s worth a try.

    • Greg

      Randolph,
      As long as you bought coins and have debt on them you will be fine and have a never-ending insurance policy to boot.
      Thank you for sharing.
      Greg

  23. BRIAN

    Hey Greg. Wonderful read once again….so for us “ignorant folk” who have always felt that our money is best kept in our pocket, in order to buy gold i just go to scottrade and say “hey! i wanna buy some gold!!?” And how would someone who makes say….40,000 a year buy any kind of substantial amount when its at nearly 1300 and ounce?? Sorry for asking this here, but i feel like you would give me your best and most honest answer…unlike a broker. thanks!!

    • Greg

      Brian,
      I am a simple guy to so we are alike. Do not go to a broker. The only gold folks on a budget should hold are gold coins. The other way you can play this are silver coins. DO NOT BUY a GOLD or SILVER ETF. Buy coins. Silver is a real deal right now. It is still 60% below its 1980 all-time high. You can buy what is called “junk” silver. “Junk” is any silver coin dated 1964 or earlier. These U.S. silver coins are 90% AG. You can also buy silver U.S. Eagles but the commissions are higher. You can price gold and silver Eagles at Kitco.com to give you a ball park as to what you should pay over spot price to get the coins. Junk silver has a lower commission price. You can Google this stuff. Try and find a local dealer and walk in and get your product. Some states, such as New York, do not charge sales tax if you buy more than $1,000 dollars worth of coins. If you can not afford to save, just start buying what you can and put it away and just pay the tax. You can avoid the tax if you buy online but you still pay shipping and other charges, so it is a toss up on tax or shipping. You may want to try and store food, motor oil, filters or anything you might need. At the very least we will have big inflation and what you buy now will be more expensive in the future. I hope this helps you.
      Greg

  24. billwald

    MarkM Wrote,Monetary policy is eigth grade level math. It is not that difficult. “Inflation is too many dollars chasing too few products.” Unknown author.”

    Exactly why there is inflation. The three trillion dollars just invented is not chasing consumer products. It will probably end up in Swiss banks. It buys power over us serfs, not more consumer goods.

  25. angryinadk

    Precious metal money is a good idea , but I keep hearing rumours of gold confiscation by the government.The government has to be able to pay foreign debts, but with a worthless dollar, the peoples gold looks good. Especially if the people were forced to trade it for worthless dollars or worse, some special issued chit.

  26. Davis

    But there is some honest money. Its called gold and silver. After CFTC Comissioner Bart Chilton anounced that if the CFTC did not start to take action on the manipulations in the PM markets he would start speaking directly to the public about it the rumers began to swirl around the COMEX that charges were going to be filed against JP Morgan-Chase. The longs and hedge funds smell blood in the water and have been demanding delivery of physical, rejecting roll overs and high premium cash settlements. Only problem is JPM and HSBC are taking a beating leasing and buying to cover their shorts. Given that the banks are desperate to prevent the decoupling of physical PM from paper PM JPM and perhaps HSBC my find themselves the sacrificial lambs put forth to forstall the slaughter of the rest. Combine this with the Robo signing fraud growing by the day one has to wonder just how far past the election they can kick these two cans down the road. The combined weight may just push some of the TBTF institutions over the edge and drag the rest of the economy with them.

    • Greg

      Davis,
      Gold is good!! Got gold?
      Greg

  27. Serapis

    This article is right, and I would like to point out that it’s not too late to convert paper investments or cash into physical precious metals. Even though they might strike the average person as expensive, the masses haven’t caught on to buying them yet. Although there are commercials for gold on TV and radio, only a small percentage of people actually pay attention. I am relatively young and I continue to see friends my age pump money into 401ks and retirement plans in order to get the company match. It’s not their fault — they’re doing exactly what the education system trained us to do (time value of money and so forth.) The problem is this model only worked with a U.S.-centric paradigm that could afford to sustain massive deficits and could strong-arm other countries with foreign policy. From WWII to around 2000, America had no real competiton. Europe and Japan were destroyed and the rest of the world was under the veil of actual communism. Now, you have billions entering the middle classes, and the NYSE is not where you want to be. People like my friends think we’re just in the next inning of the ball game, they don’t realize the season has ended. At some point the masses will catch on and try to convert FRNs to PMs, at that point it will be too late to buy them.

  28. alfiesaden

    hi there – is it just me !! can any one explain why when i type in the yahoo browser “usawatchdog.com” i get a different site yet whe i type it in google its ok? could this be a bug in my system or is any one else having same probs ?
    alf

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