To paraphrase JP Morgan’s (the man) 1912 testimony to Congress: “Gold is money, everything else is credit.” JP Morgan, 1912
The question you’ll need to answer for yourself is “what alternatives are there for big investments right now?” The stock market, residential real estate market and bond markets have been inflated into bubbles of historic proportions. The Fed has created a financial market Frankenstein of Biblical proportions.
Commodity inflation is raging now, and eventually this will transmit into soaring food, energy and capital/consumer goods price inflation. This dynamic is just getting started. It will soon get worse, as the Treasury earlier this month released its plan to flood the financial system with cash by reducing its balance on its general account at the Fed by $1.229 trillion. This was money printed by the Fed and transferred to the Treasury via “QE.” Yesterday, Fed Chairman Powell reiterated the Fed’s commitment to continue printing money for the foreseeable future.
The Fed is preparing the public for another big round of money printing after the Treasury cash is absorbed into the banking system, where it will be used to service delinquent/defaulted commercial, residential and corporate debt in an effort to prevent a banking system collapse similar to 2008.
The banking system began unraveling again in August 2019 as evidenced by the Fed’s reimplementation of QE/money printing disguised as “term repos.” With the term repos rapidly increasing in size and duration by February 202, the stock market crash and virus crisis gave the Fed the proper cover to attempt a “kill shot” at the problem attacking the Too Big To Fail bank balance sheets.
The recent jump in the size of the Fed’s balance sheet indicates that the “kill shot” didn’t work. And the non-performing loan problem will get worse after Biden just extended the foreclosure/eviction moratoriums – again – and with rising corporate and personal bankruptcy filings. More money will be printed to keep the banks “insulated” from the deteriorating assets on their balance sheet.
The precious metals sector has performed remarkably well over the last 12 months despite the overt and obvious efforts of the Fed, in conjunction with the Treasury’s Working Group on Financial Markets, to hold down the prices of gold and silver. The current effort of the “Plunge Protection Team” to cap the rise of the precious metals is destined to fail.
The Fed’s inability to hold down yields at the long end of the Treasury curve, despite being by far the largest owner of the 10yr bond issue and buying Treasury bonds on a daily basis, signals that the Fed is starting to lose its grip on controlling the markets. Rising yields and a falling dollar will be the double-tipped “pin” that pops the asset bubbles.
As this process unfolds, there will be immense damage inflicted on dollar-based financial assets. Those lucky enough to get out of the door before the herd tries all at once to exit will look to gold and silver as the best alternative to preserve wealth. This will trigger another big bull move in the precious metals sector. Gold and silver currently embody both positive investment potential and wealth preservation. But your motive to buying them should be more heavily weighted on the latter.
MONEY VS CURRENCY-
In 1788, Thomas Jefferson wrote:Paper is poverty. It is only the ghost of money, and not money itself.”
Money is UNENCUMBERED, Currency is not. Currency is not MONEY! However MONEY can be used as currency. All currencies ever created have always reached their intrinsic value of $0. There are still some newly created currencies that are still in use but they ALL have lost most of their value in just a few decades. Take the US FEDERAL RESERVE “NOTE” for example (which is not MONEY); it has lost over 90% of its value in just 100 years!!! Currency is not MONEY, but Money can be used as currency. Today’s FIAT Currencies are nothing more than a “Note Of Debt”- They have Monetized debt! All monetization schemes throughout history have failed! Gold and Silver are MONEY, have been for 6000 years, and silver is money under the constitution. In all that time they have held their relative value (even after centuries of manipulation)! During Roman times the Romans paid their workers an ounce of gold a month and it is said that an ounce of gold could buy a nice Toga and shoes. Today, could you survive on an ounce of gold (2500$ Canadian) if you had to, and could you buy a nice suit and shoes for that? The answer is yes, now that’s retaining value- after thousands of years!
Gold is a Tier 1 regulatory capital asset with supreme collateral precedence over foreign currencies and treasuries!!!MONEY IS FOR PRESERVING YOUR WEALTH, CURRENCY IS FOR SPENDING IT!
GOLD AND SILVER ARE “MONEY” EVERYTHING ELSE IS JUST CURRENCY! Education is the way to FREEDOM! FREEDOM from our financial oppressors! FIAT is currency created out of thin air in a fraudulent Fractional Reserve System, and if you think that is responsible; YOU ARE DELUSIONAL!
7 characteristics of REAL MONEY(1) It must be durable, which is why we don’t use wheat or corn or rice (although they have used rice as currency).(2) It must be divisible, which is why we don’t use artwork.(3) It must be convenient, which is why we don’t use lead or copper (too cumbersome).(4) It must be consistent, which is why we don’t use real estate.(5) It must possess value in itself, which is why we don’t use digits.(6) It must be limited in the quantity that is available, which is why we don’t use aluminum or iron (too plentiful).(7) It should have a long history of acceptance, Gold and Silver have been used for 6000 years.Only GOLD and SILVER fit all seven characteristics.Mr JP Morgan himself put it so precisely and succinctly: “Money is Gold, and nothing else”.https://www.goldmoney.com/research/goldmoney-insights/what-did-jp-morgan-mean
“For the naive mind there is something miraculous in the issuance of fiat money. A magic word spoken by the government creates out of nothing a thing which can be exchanged against any merchandise a man would like to get. How pale is the art of sorcerers, witches, and conjurors when compared with that of the government’s Treasury Department!” — Ludwig von Mises.
And now Gold is being re-monetized;
Brandon White: Gold re-monetization is much closer than many realize
There are two mistakes one can make along the road to truth -, not starting, AND not going all the way.” … Buddha
You have have to shake your head at how well the banksters create and stick to a narrative to deflect attention from their market rigging. As you said, commodities are skyrocketing, foreboding bigtime inflation. But since yields are creeping up a teensie bit, real rates are rising, they say, so sell gold and silver. Only problem is the facts don’t fit the narrative because real yields are plummeting, as inflation is escalating rapidly, and demonstrated by rising prices for commodities and stocks.
But the narrative is what counts and, after all, somehow they have to get out from underneath their shorts, because only they know how massive the leverage is on real physical out there. And it must be enormous – more-or-less a kill shot, should prices takeoff.
This has been a very controlled and deliberate takedown of gold, so they also must be very worried about physical unavailability breaking their scheme, should they go too far. I can’t understand anyone trading in the paper market, after what we have witnessed over the years. Other than the bond-gold pair, I don’t see any other correlated trade worth having. And the bond-gold pair trade, I think, is one contrived by the banksters, since history shows the gold price increases with rising yields, when inflation is escalating.
12:25 CST Thursday March 4th. Can any one tell who is selling
one ounce Gold Eagles @ 1693.85. Bueller, Bueller? Anyone ?
Best idea – don’t be fooled by crooks , stick to the gold and silver as long as you can.
There is nothing cheaper, Masters using every tool to discredit gold. We must be close to the bottom. They must be very desperate.