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Now is the Time to Invest in something Real to Assure a Good Life
Tomorrow.
Gold surpasses $1700 an ounce after a long slumber and it is
still one of the worlds greatest bargains. Every day it is becoming
more evident that stocks, bonds, and property are going to fluctuate wildly in price for the forseeable future, while gold will remain steady or rise..
In the last half of 2005 alone, U.S. households spent well over
$500 billion more than their after-tax earnings. How is this
possible? By borrowing of course. About half of that money came from
“equity extraction.” The present home owner generation is
living off the perceived increase value of their houses. These poor
householders are starting to get a clue. They thought they really
could get rich by buying and selling each other’s houses at inflated
prices and then borrowing against it. Well, putting on the dog and
out doing the Jones' was fun while it lasted. However, if you can
still find a greater fool, now is the time to sell and find a nice
inexpensive rental accommodation, or buy one of the rapidly growing
heavily depreciated repos now on the market, and invest the rest in
gold.
You need to protect yourself NOW from the biggest one year loss
of wealth in the history of the world. Does this statement get your
attention? Many western economies have participated in this gigantic
fraud of escalating house evaluations as evidence of economic
growth, relying on greed and bogus money supply to stoke the fires
of the greater fool theory and thus give the illusion of
prosperity. As a result house sticker prices kept going up and
up in most cities, while in reality the true value has actually been
going down. Skeptical huh. What is true value you say?
Remember, world economies have been off the gold standard now for
over 35 years, ever since tricky Dick Nixon unpegged the US dollar
from gold as a means of surreptitiously stimulating a sagging
economy of the time. Adhering to the Gold Standard, the medium of
exchange backed by gold, forced politicians and bankers to be
accountable.
Money today is not based on anything tangible or of intrinsic
value. It has only a perceived fungible value at whatever level
skittish traders and speculators say it is. Politicians and central
bankers since Nixon have been free to print fiat money (a piece of
paper with numbers on it) at their whim without control or restraint
to keep their game afoot. These currencies have since been played
off each other as in a worldly game of monopoly. One clue of
impending doom is the fact that every fool with greed in his heart
can now trade currencies online.
As the unmasking of the great deception accelerates, countries
with manageable debt and natural resources will see their currencies
decline slower in relation to the US dollar, but all currencies will
decline in relation to, you guessed it, Gold.
Like any expanding bubble, there comes a point where it can
expand no more, and the subsequent resizing is shockingly fast.
These is no new economic model in play that now guarantees perpetual
prosperity or even status quo, despite what vested interests and
their spin doctors would have you believe. When push comes to shove,
paper and electronic blips won't cut it. As the saying goes, BS
walks, and the age old measure of real value called Gold, will be
what talks.
If you played this oneupmanship real estate game with your
friends and countrymen, your house is worth far less than you know.
In fact, your house is losing value daily as you may now realize.
When it becomes front page headlines, it will be too late. All the
greater fools will have already been fooled with no one left to bail
you out. Unfortunately, it will not be just the nouveau rich who
will feel the pain. Their shortsighted greed, encouraged by
unscrupulous appraisers lenders and politicos, will bring down
the rest of the economy as well, precipitating the demise of many
types of paper assets.
Americans in particular now owe far more money to far more people
than can ever be paid back. They have bigger houses, newer
cars, more electronic gadgets and a smug attitude to go with it. But
they also have more bills to pay and no more money to pay them
with. Much the same scenario as their government that purports
to lead.
The U.S. government has borrowed more money from foreigners in
the last eight years than all previous administrations since the
time of George Washington. During the current US
administration, the feds have borrowed more than $1.05 trillion from
foreign governments and banks. This is more than all the rest of the
nation’s administrations put together from 1776 to 2000. Oh, the
costs of empire building and the waging of patriotic wars to free
people so they can be more like us.
Consider the fact, that despite a flat or even negative earnings
picture in overall stocks in recent years, bonuses paid to managers
on Wall Street and high salaries throughout corporate America
including G.M., are obscene. This is but more evidence that we have
reached a late, degenerate stage of an imperial economy. The sun has
not set yet, but its final glow is about to descend beyond the
horizon.
The companies that make the most money these days are those that
shuffle money - not those that make things people want to buy. And
throughout the entire society, everyone participates in what has
become an orgy of swindle and delusion. The practitioners of this
prevarication call it salesmanship. At best it is
entertainment. Not value or substance, but mindless triviality,
delusion or false expectations. At worst, psychological manipulation
to create frivolous desire, leaving the weak minded and
undisciplined open to unbridled theft. Just add up how much interest
you are paying on your car, your house, your credit cards and
everything else you have been induced to believe is necessary for a
successful life. The barbarians are at your door and benefiting
mightily from your labors. The rich have indeed been getting richer
while the consumer blindly signs on the dotted line.
The mantra of the private sector through its advertising is ‘get
it while you can’ despite the fact that this attitude is crushing
the hopes and aspirations of the next generation. Previous
generations attempted to leave the world a better place then they
found it for their offspring. Now, the young and the unborn are
saddled with an insurmountable mountain of debt and who cares. I've
got mine you say...but do you really, when the charade unravels?
What are you going to do...who are you going to call? Be prepared
for painful dislocation and introspection.
It will be the minority of savvy and erudite investors who pause
to take notice that the emperor has no clothes. It will be the
astute who shed themselves of the attractive burdens they have
accumulated and put at least some of what is still marketable into
gold. It will be the shrewd and brave who have the resources in the
form of universally accepted coin, gold, to live reasonably well
during the shakeout and to pick up the bargains for literally
pennies on the dollar when the storm finally passes.
The fact is, most people no matter how well meaning or educated,
fail to learn from the lessons of History. They go through life with
blinders on content with petty self-interest. Nero fiddles while
Rome burns. These are among the reasons why gold is going to go up
more, no doubt, a whole lot more. Owning gold bullion or gold coins
is decidedly a happy thought.
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