bowman711

Gold Is Set to Regain Its Shine

The Government has to borrow the money for all these bailouts. First, they swap the financial institutions worthless and near worthless contracts for dollars. Then the Government 'packages it all up' and sells them as Treasuries to China and other countries, or to you. So, when you are putting your cash into Treasuries, you are essentially buying the junk that the financials just gave up on collecting! The only difference is that the Treasuries have 'the full faith & credit' of the government behind them. But, the Government doesn't create anything (except trouble!), so it is impossible for the Treasuries to become stronger due to the increased production of something (anything) creating wealth.

If it were an honest choice between Treasuries and gold (or silver, to a lesser extent), gold would win hand down. The Government knows, of course, that rational people would choose gold over their 'fiat Treasuries' backed by their increasingly worthless fiat dollars. So, they have been systematically driving the apparent value of gold down with massive naked shorting of gold. In short, they do what they know best - 'print' paper gold and flood the gold market with it to give the impression that the value of gold is also going down! To a great extent, it does fool many if not most of the people.

But, you can't buy gold anywhere right now, or you are very lucky if you do manage to find a coin or two to buy. I'd guess gold dealers, with the limited supply they can lay their hands on, give preference to their regular customers. But, where is the gold that normally would be moving in the gold market? I can think of a couple of possibilities. First, with the price so artificially low, gold producers are either 'mothballing' mines or not selling what they produce in the hopes of getting much more when gold finally breaks free of the Government manipulators. Second, it could be that the Government's 'Insiders' - which likely would include China and other buyers of Treasuries - are siphoning off what gold become available at the artificially reduced prices.

We don't know how long the Government can keep its 'hands' on gold, but we do know that at some point people will discover that their Treasuries are worth about as much (maybe I should say, as little) as the Government's paper money. When that happens, there likely would be revolution against the Government as gold skyrockets back to where it should have been all along. I think the main reason Lehman wasn't also bailed out like Bear Stearns and Freddie/Fannie is that foreign buyers of Treasuries are balking at buying more Treasuries backed, not really by the 'full faith & credit' of the government, but by junk paper.

We are living in very interesting times. I probably wouldn't be a bad idea to stock up enough staple foods to last months if not a year. Who knows what will happen if/when the people realize the Government has duped them all this time.

20 Guidelines for the Individual Investor

Can anyone ever have too much information? You may or may not agree with this or any other article, but you are likely to find affirmation to what your believe, or you may disagree with one or more points, and this also increases your over-all knowledge. I am a 'world class' expert in my area, and when I read a book in my topic's area I already know or disagree with 99% of the book. But, I read them for that 1% kernel of new information or new slant that I hadn't thought of. So, I'd suggest reading this or any article with that in mind. No matter how much of an expert you are in any area, you can always find something new that you didn't know, or maybe see the same area from a different perspective from what you have ever viewed it before. It all increases your experience and knowledge.