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October 21, 2011 / Hal (GT)

Fiat Currency is Disintegrating. Psst…. Gold doesn’t.


Something smells. There is bad news coming from all areas of the globe in relation to economies. The Euro continues to confuse, obfuscate, and blow up in the form of riots. Our government is entering into wars and wanting to spend money themselves and a supposed bill to “create” jobs (a joke to me). And through all of it gold and silver got hit. Activity today is rather choppy but up from a down day yesterday. You can follow on your own desktop with the free widget ExactPrice.

Along with all this news is the continuing devaluation of fiat currency and inflation showing up in various areas of our lives. As this screen clip illustrates today:

Dollar fade against Yen drudge report

To add to this here are few items I came across just this morn:

Unstoppable: Why this crisis will keep unfolding <- HT to @RedBlogTweets

In a complete paper money system, banks cannot be private capitalist enterprises but must be extensions of the state because the state holds the monopoly of unrestricted money creation. The banking sector is cartelized under the state central bank. To operate a bank, you need a state license that requires that you open an account with the central bank.

Lear Capital: In Gold We Trust In the Dollar We Bust:

Honestly!  Has any financial problem, arising out of the 2008 crisis been solved?  Sure we kicked the can down the road, but the real problem of uncollateralized debt has not gone away.  In fact, right now there is more of it and more keeps getting piled on.

There are two realities that must be faced.  We either need to print more money in hopes that one of these extra trillions pumped into the economy will finally be enough to kick-start it, or, we have to default on debt and wipe some of it off the books.  Great choices, eh?

I believe I mentioned this the other day. But maybe I didn’t, I was having trouble getting it to play. It’s working now and I suggest you watch it:

Nassim Taleb on the Moral Hazard and Broken Economic Structure of the Western Crony Capitalists

The Best Countries for Starting a Business Now <- Would you be surprised that America didn’t make the cut?

Sleight of hand: BofA moves dodgy Merrill derivatives to bank

London Trader – Sovereign Silver Buying, Middle-East Shortages <- via King World News:

“The price of silver has no reality to the paper market at all, absolutely zero reality there anymore.  There is extraordinarily tight supply right now in Asia.  When you order silver there is so little available at these prices, that’s the trouble.  You can order it all day long, but you are going to have to wait for it.”

Fed’s Balance Sheet not growing but not shrinking much either

Tocqueville’s Hathaway Muses About Intervention Against Gold <- Ed Steer’s Gold and Silver Daily.

John Hathaway – Gold Price Will Soar on Failed Manipulation <- I believe so, but the question is, when?

London Trader – China Bought Massive Amount of Gold Today <- You don’t say?!

“We had a major, major physical buy order today.  The Chinese bought a massive amount of physical today at the lows.”

Invest in Gold – and the Chinese Renminbi <- from Casey’s Daily Dispatch.

This is yet another sign of how fast the gold investment sector is growing in China. In 2010 investment was up 70% over 2009. In Q1 and Q2 2011 gold investment rose by 123% and 44% over the same quarters of 2010 respectively. At such a pace, the Chinese market seems to be swallowing virtually every ounce of gold it is offered. Haywood Cheung, President of the CGSE, expects their new product to boost these already-growing volumes.

Gold and silver – you need to look at the big picture

India’s gold and silver imports jump 80% to $31.1bn over six months

Annual inflation jumps higher in September

Gold’s Long Term Trend Is Up As America Commits Suicide

The New CFTC Position Limits

The Real Reason for the Uprisings <- On Occupy Wall Street. Hint.. Inflation.

Well, that’s it for today. Have a great weekend.

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