maverick

Attention Gold Bugs: Hyperinflation or Deflation?

Gold doesn't default, and it won't go to zero either. 5,000 years of history says so. We'll see deflation for a while, but does anyone really believe they can sell enough Treasuries to cover the bailouts? No way. They will have to print as well. And that actually does debtors a favor and punishes those that loaned recklessly. If the debtor can remain employed, he can pay back the predatory lender with devalued dollars. We are seeing deflation from demand destruction, but inflation will take over when they finally get the banks to stop using the bailouts to clean their books and actually lend. Not for cars and houses, but the short-term letters of credit that cover imports. Worst Buy and Detroit are in trouble, but people still want bananas. Gold may indeed go lower, but anyone holding none is just plain foolish. Read the GLD prospectus and you won't touch it with a ten foot pole. Their gold is uninsured. They won't guarantee the purity of the bars. The operator of their depository may not even be bonded. And who operates GLD? The same thieves who got us into this mess. CEF is far safer.

Gold’s 'Grand' Illusion

If things get that bad it won't be the people with the food in control, it will be those who have guns and ammunition.