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What If We Never Left The Gold Standard? Part II

Gold Commentary

Part I ended by challenging readers to engage in a difficult, mental feat: imagining sanity. Our present pseudo-reality (dubbed “the New Normal” by the Corporate media) has been so insane, for so long, that few of us have any recollections at all of living in even quasi-sane societies.

More specifically; we live in an upside-down world where virtually all commerce is conducted by swapping worthless scraps of paper (“fiat currency”) for valuable goods and services (or doing so “virtually”). Engaging in commerce where one exchanges value-for-value (i.e. exchanging valuable money for hard assets and services) is now a totally alien concept to the members of our societies.

So imagine sanity. Pretend that we have been sent back in time, to when we had both honest government (enforced through “the golden handcuffs” of a hard, gold standard), and honest money with which to conduct our commerce – gold and/or silver currency. Readers have had a few days now to prepare for this ‘journey’, so hopefully you’re now ready for that leap.

As sophisticated readers understand (and readers of previous commentaries); a hard gold standard enforces fiscal discipline upon governments. They must be able to back all of their spending with gold, thus practically eliminating any/all debt-financing. It is little different than a law requiring governments to “balance their budgets”.

This is a policy for which many right-wing pundits have clamoured for years/decades, yet (strangely) these same pundits (except for Ron Paul) never demand a return to a gold standard. Why not create a monetary system which physically enforces the law (i.e. a balanced budget)? It can only be because these “balanced budget” zealots on the Right are being less-than-honest about what their own “balanced budget” policies really represent.

Putting that aside; with a gold standard mandating balanced-budgets, we have a self-correcting, sustainable economic system. This is another concept which will be totally alien to almost all readers. Simply mention the phrase “sustainable development” in our societies; and one will immediately be pigeon-holed by the entire (ultra right-wing) business community (and media) as being some sort of left-wing radical and/or “environmentalist”.

In the New Normal; “sustainable development” is considered insane. By logical necessity; this means our entire Establishment subscribes to the mantra of unsustainable development: deliberately creating (and managing) an economic system which we know – by definition – cannot survive. This is the only path of (supposed) “sanity” for those living in the Wonderland Matrix: more insanity.

In the world of our gold standard, however, we have sustainable economies as well as sane societies. But it only starts with balanced budgets. Balanced budgets mean no debt. No debt means no interest payments (to the parasitic One Bank). No interest payments means our governments get to (productively) use 100% of every revenue-dollar they receive. This introduces readers to yet another concept which will be alien to all: efficient government.

Why have our governments gotten more and more “inefficient” each year? One reason is because every year they waste a larger and larger percentage of every revenue-dollar making interest payments to parasites. All of these massive, Western bond-debts are fraudulent (and thus legally unenforceable), but that is (and was) a topic for another commentary.


What If We Never Left The Gold-Standard? Part I

Gold Commentary

We live in an insane world. This isn’t an assertion, merely an obvious statement of fact. My own commentaries have dubbed this insane world “the Wonderland Matrix”. The Corporate media has deviously given it the euphemism “the New Normal”.

Neither “world” makes any sense whatsoever. The essential difference between the Wonderland Matrix and the New Normal is that the analysis which accompanies my work on the Wonderland Matrix provides us with the only explanation of why we live in a world which makes no sense. Conversely, the New Normal simply/inanely postulates the totally discredited cliché that “this time it’s different”.

In both the Wonderland Matrix and New Normal we have total perversity; black is “white”, down is “up”, and bad is “good”. In the New Normal; the fiction-writers of the mainstream media tell us that the U.S. economy is once again the envy of the world, thanks to what they call a 5+ year “economic recovery”, which is already much longer than any normal economic recovery (back when the world was sane).

The fiction-writers tell us that lots and lots of “new jobs” have been created during this (supposed) economic recovery, more than 5 million, to be precise. Yet the percentage of Americans who actually have jobs has fallen from 66% to 63.5%, and there haven’t been so few Americans working in that economy (on a percentage basis) in more than thirty years. It makes no sense.

The U.S. cars-and-highways economy is notorious for being the most rapacious gasoline-guzzler the world has ever seen. Yet official U.S. “gasoline consumption” numbers from the U.S. government report the U.S. economy is now only consuming 1/3rd as much gasoline as when this “recovery” began. It makes no sense. One could go on and on and on (as has been done in previous commentaries), but the (real) picture is clear: a world of insanity.

In general terms, the mission of writers such as myself is then also clear: to attempt to restore some degree of sanity to the world in which readers live. On a practical basis, my own strategy has been consistent since first beginning to publish economics-based commentaries: expose/debunk the Wonderland Matrix, and provide readers with analytical glimpses of what a “sane” world should look like – in many cases by simply reminding people of what our own “world” did look like, when it used to be sane.

In this respect, my “mission” has recently been aided by a question from an inquisitive reader: what if we had never left the gold standard? Exploring hypothetical scenarios is often a trivial (if not tedious) exercise, but not when we hypothesize sanity in the world. In that case; clearly the exercise is elevated to providing a realistic (if not superior) alternative to the current insanity.

The fiction-writers (and the “expert” economists who prostitute themselves on their behalf) tell us that a return to a true gold standard is absolutely impossible. Why? Because it would require our governments to manage our economies in a responsible and sustainable manner.

In the New Normal, this is not possible. It’s only “possible” for our (corrupt) governments to manage our economies in a (totally) reckless and (hopelessly) unsustainable manner, which has now brought every major Western economy to the literal brink of inevitable bankruptcy.

Clearly leaving the gold standard has not brought us the economic “nirvana” promised by the bankers (and their expert economists). Ceasing to manage our economies in a responsible/sustainable manner, and choosing to manage our economies in a reckless/unsustainable manner for the last forty years has rendered all of these economies insolvent. Who could have predicted that? Certainly not the economists.


The End of the Paper-Gold Market?

Gold Commentary

An important subject in precious metals markets which does not draw enough attention from commentators in this sector are the inherently fraudulent paper-called-gold (and paper-called-silver) “products” which the bankers peddle to the foolish. Numerous, previous commentaries have drawn attention to various facets of this fraud.

However, my own reporting on this subject changed dramatically, beginning in the spring of 2013. Astute readers will recall that this marked the beginning of an extraordinary series of events. First the One Bank (and its lackey politicians) introduced the world to its newest form of serial stealing : the “bail-in”.

This had both tremendous direct and indirect relevance to precious metals. Indirectly, big-money investors (often dubbed “the Smart Money”) had now been alerted to the fact that (as stated in the title of a commentary) “no paper [asset] is safe from a bail-in”. Instantly, this elevated both the status of gold and silver as safe-havens, as well as igniting additional demand for these metals.

But there was also a direct effect on the precious metals sector: awareness that the bankers’ paper-called-gold “products” (primarily the notorious bullion-ETF’s) were now themselves potential targets in one of the One Bank’s future, bail-in mega-thefts. This awareness sparked a massive exodus out of these fraudulent bullion-ETF’s, an exodus which nearly turned into a (terminal) stampede.

Such a stampede was only averted through the bankers themselves soaking-up millions of units of their own, bullion-ETF’s – in order to create the illusion of some degree of stability in these funds. They soaked-up so much of their own, fraudulent paper that these permanent mega-shorts actually became “net long” in the gold market at one point.

Even with the bankers buying millions and millions of units of their own bullion-ETF’s, the carnage was unprecedented. The largest (and most-fraudulent) of the gold bullion-ETF’s, the SPDR Gold Trust (more commonly known by its trading symbol “GLD”) saw its holdings collapse from over 1350 tons in the early part of 2013 to less than 800 tons by the beginning of 2014, a total plunge of more than 40%.

This massive liquidation of paper-called-gold (in a world where the “paper gold market” is at least 100 times larger than the real gold market) caused an inevitable plunge in the price of (paper) gold. This sudden drop in price, in turn, triggered the most-dramatic global stampede into real, physical gold ever seen in the world.

At one point, China and India alone were importing gold at an annualized rate of 4,000 tonnes per year, despite the fact that China itself is the world’s largest gold-producer (and little if any of that gold ever leaves the country). Subtracting China’s own production; these two nations alone were importing roughly double the total, annual, global mine-supply.

This unprecedented spike in the buying of real, physical bullion (in markets which the bankers couldn’t corrupt with their paper-called-gold fraud) so terrified the One Bank that it was forced to engage in the heavy-handed blackmail of the government of India. It coerced that government into a near-total embargo on gold imports through a savage attack on India’s currency in global FX markets.

Yet despite torrid global demand for gold throughout most of 2013, there was no recovery at all in demand (and holdings) of the bankers’ fraudulent paper-called-gold. Despite the shills in the Corporate media calling “bottoms” in this market like it was the U.S. housing sector, nothing has been able to entice chumps back into these paper-fraud funds.


Silver: The Irresistible Force

Silver Commentary

Close followers of my work may have detected what seems to be a conundrum, if not an outright contradiction in my writing. Having been the first to write about our Hostage Markets of the last 3 ½ years; it was recently asserted (in my June 19th column on precious metals) that gold and silver are about to break-free of this crime paradigm. Call this “the irresistible force”.

On the other hand; my latest commentary for Sprott Money states categorically:

we now have an abundance of evidence to conclude that the One Bank will never (voluntarily) allow gold or silver prices to rise by any significant amount.

Given the relentless, absolute, choke-hold which the bankers have exerted over both the gold and silver markets for the last 40+ months; it is easy to visualize this obstacle to legitimate markets as the (proverbial) “immovable object”. This sets up the eternal, and equally proverbial question: which side will win when the Irresistible Force meets the Immovable Object?

Let’s begin with a (simple) mathematical/theoretical answer to this question. The Immovable Object is a force of inertia (i.e. mass alone), and can thus be mathematically described as an object of infinite mass. Conversely, the Irresistible Force is a mathematical product.

Based upon kinetic energy; the Irresistible Force can be mathematically characterized as (infinite) mass X (infinite) velocity, or simply “infinity squared”. We now have a theoretical answer to our conundrum. Clearly infinity squared must prevail over (mere) infinity. The Irresistible Force trumps the Immovable Object.

The task of this commentary is thus to prove that reality will reflect this theory. The time-frame stipulated in The Daily Grind for this process to transpire was 12 – 24 months. While this may not seem imminent enough for impatient investors who have been (among) the victims of these Hostage Markets, “immovable objects” are not displaced overnight.

Here readers need to understand the specific dynamics involved: the (short-term) crime paradigm of the bankers, and the (long-term) fundamentals of these markets, which provide precious metals with sufficient economic “kinetic energy” to justify the title of Irresistible Force. It may seem absurd to describe the multi-decade manipulation of the silver market as a “short-term” phenomenon. Readers simply need to adopt a larger perspective.

The contest of the Irresistible Force meeting the Immovable Object epitomizes the phrase “eternal struggle”. Such ultimate clashes of great forces take many, many years to develop; many, many years to play out. The genesis of the current paradigm dates back over a century, and has been chronicled in great detail in Charles Savoie’s “The Silver Stealers”.

To understand the reason behind the One Bank’s obsession with absolute dominance over the gold and silver markets requires understanding the minds of the bankers, themselves.

Give me control of a nation’s money and I care not who makes the laws.”

-          Mayer Amschel Rothschild

The ‘logic’ here is the logic of the criminal. Controlling a nation’s printing-press allows a corrupt Possessor of such power potentially unlimited wealth, and the power (via banking) to plunder the wealth of others. The relentless hollowing-out of (nearly) all the wealth of the Western world proves both the existence of this crime-strategy and its extreme effectiveness as a tool for financial crime.


Bridges Collapse As The West Drowns In Debt

International Commentary

A recent headline in the mainstream media caught my attention due to its dramatic nature. It spoke of “bridges crumbling” in the United States (along with its highways rotting). The media drone then attempted to explain why these bridges/highways were being allowed to crumble, despite borrowing rates which are “the lowest since 1969”.

The explanation given was totally false: that (supposedly) U.S. state and local governments were “repaying obligations by the most on record”. This is propaganda nonsense, since what it directly implies is that state and local governments would have to be recording the largest budget-surpluses on record. Mathematically, this is the only possible way to retire debt by a corresponding amount. Those surpluses do not exist.

In fact, what the Liar from the mainstream media was really pointing out is that state/local governments are making the largest interest payments on record, the result of the “unprecedented deficits” acknowledged within this piece of mainstream propaganda. This allows us to provide the real answer to the question: why are “bridges crumbling”, in the U.S. (and across the rotting West) despite the lowest borrowing-rates in 45 years?

The answer to the question is simple arithmetic. Our bridges, our highways, indeed, our entire economies and societies are falling apart because governments (at all levels) are drowning in debt. When governments (at all levels) are making the largest interest payments on record (but never paying-off any principal) it means less dollars left over for spending on useful/necessary services, and infrastructure investment/maintenance.

Because these governments are now all permanent debtors, and their interest payments simply get larger every year; it is mathematical proof that these governments are now already past the point-of-no-return on their indebtedness. As a matter of the simple arithmetic of “compound interest”; it is no longer a question of “if” governments across the West will default on their debts – merely when.

Western governments (most-obviously the U.S.) are insolvent endemically, thus the worsening decay of our infrastructure (and economies/societies) will never stop its downward spiral. Rather, this downward cycle will worsen, exponentially, until we have a collective Debt Jubilee, and simply erase debts which are now too large to ever be repaid.

Debt Jubilee is a regular event throughout history, going back to (literally) biblical times. It is based upon one of the constants of human behavior: that governments (good and bad) will place short-term expediency and popularity ahead of long-term fiscal prudence. The result is a multi-thousand year litany of governments (of every shape and form) digging themselves into (debt) holes from which they can never be extracted, resulting in Debt Jubilee.

But the story of the West drowning in debt is more than a story of governments. This endemic indebtedness extends throughout our populations. There are two reasons why individual members of our societies are drowning in the highest levels of personal debt in our history.

The first reason is that the Corporate propaganda machine has made taking on debt a virtue. In every previous generation; taking on “a second mortgage” was the ultimate indicator of personal, financial shame. It proved that (barring some personal calamity) the borrower had not been managing their finances responsibly – and thus had committed the Cardinal Sin of financial management: taking on unnecessary debt.


U.S. Neo-Cons Seek To Rewrite Iraq History (Again)

US Commentary

What is the one thing more reprehensible than the saturation-lies which emanate from the mainstream media, our servile governments, and (of course) our banker overlords on a daily basis? The (bogus) Revisionism which follows it, which seeks to explain, excuse, or simply erase those preceding lies.

Within this general category of Revisionism; one sub-category stands out as an especially despicable form: the war-Revisionism which is an endemic component of the One Bank’s propaganda campaign. Clearly the only thing which could possibly be more-evil than war itself is to attempt to “excuse”, “explain”, or simply erase the worst episodes of history.

This is especially true given that those entities with the strongest motive to engage in such vile Revisionism are the entities originally responsible for either perpetrating or provoking those wars. As such, it was the ultimate in repugnance this week when Bloomberg trotted-out the Bush Neo-Cons, architects of the Iraq War – and then allowed these career-liars to blame the (corrupt) regime which succeeded them for the mess they created.

Here history (real history) is unequivocal. It was these neo-cons who were solely responsible for creating all of the conditions which supposedly justified their invasion of Iraq. It was the neo-cons who fraudulently fabricated the pretext for invading Iraq. It was the neo-cons who brutally and incompetently bungled every aspect of the subsequent invasion/occupation, from a tactical and strategic standpoint. And it was the neo-cons who made their own “deal with the Devil”, in order to whitewash a thin veneer of “victory” over their humiliating defeat.

While George Bush Jr. is the Cowboy Bully who loved to take credit for “taking-down Saddam Hussein”; it was Junior’s daddy, George Bush Sr. (and the neo-cons of his era) who created Saddam Hussein. Imposing Hussein upon the people of Iraq as their “strong-man” (puppet) was supposedly the antidote to the “radical” government in Iran.

His role was at least to militarily preoccupy – if not engage – Iran, and to that end, Western neo-cons supplied Hussein’s puppet-regime with any-and-every piece of nasty military technology in their own arsenal (with the exception of nuclear weapons). Indeed; it was only because it was the neo-cons themselves who had originally supplied Saddam Hussein with all of his “weapons of mass destruction” that the Rest of the World took them seriously when they lied about what he supposedly still retained.

Backtracking even further; what made the government of Iran “radical”? After the U.S. overthrew the democratic government of that nation, and planted the brutal/corrupt “Shah” on the throne of Iran (as another of its Oil Puppets); Iranians not only had the audacity to remove that Thug from power, but they have resisted the endless/subsequent efforts (by the U.S.) to install a new Puppet-Thug in his place.

When Hussein, himself, decided to cease playing the role of Oil Puppet for the U.S.; it became the new obsession of the neo-cons to remove him from power, and install a more dutiful (and grateful) Puppet in his place. They fabricated a pretext for war, and then perpetrated an invasion which was tactically/strategically incompetent – even by the standards of the same military (and same neo-cons) which previously brought the world “Vietnam”.


The West Needs Shorter Leaders

International Commentary

Historically, those committing serious financial crimes were often executed for their transgressions (or sentenced to some similarly suitable punishment), and one nation (China) currently punishes its own financial criminals in this manner. Another commentator, Jason Zweig, has neatly summarized the history here:

The history of drastic punishment for financial crimes may be nearly as old as wealth itself.

The Code of Hammurabi, more than 3,700 years ago, stipulated that any Mesopotamian who violated the terms of a financial contract – including the futures contracts that were commonly used in commodities trading in Babylon – “shall be put to death as a thief.”

In medieval Catalonia, a banker who went bust wasn’t merely humiliated by town criers who declaimed his failure in public squares throughout the land; he had to live on nothing but bread and water until he paid off his depositors in full. If, after a year, he was unable to repay, he would be executed – as in the case of banker Francesch Castello, who was beheaded in 1360. Bankers who lied about their books could also be subject to the death penalty.

In Florence during the Renaissance, the Arte del Cambio – the guild of mercantile money-changers [i.e. bankers] who facilitated the city’s international trade – made the cheating of clients punishable by torture… [emphasis mine]

The rationale for applying this ultimate sanction to the most-serious financial crimes of today is simple. Even a modern-day Gun Nut, fully armed with quasi-military weapons can snuff-out the lives of no more than a few dozen innocents with their senseless slaughters.

Conversely, in our modern era of endless/unpunished financial mega-crimes; the victim-counts run much, much higher. A single Financial Criminal (i.e. banker) can financially devastate the lives of thousands, or even millions. Collectively, today’s Financial Criminals are directly responsible for the 100+ million permanently unemployed victims (across the West), what their parrots in the media call “the New Normal”.

In reality; it is the $trillions which the Financial Criminals have cumulatively plundered in their endless frauds which has hollowed-out our economies to the point where the phrase “full employment” is now nothing but fantasy-words which issue from the mouths of lying politicians. It is this hollowing-out (through financial crime) which has also cut in half the standard of living for hundreds of millions more across the Western world, transforming our Middle Class populations into the Working Poor.

Individually, millions more Victims have suffered total financial devastation (i.e. bankruptcy) at the hands of the Financial Criminals. Foreclosure-fraud, stock market fraud, pension fraud, LIBOR-fraud, and assorted other, serial crimes have left a wake of financial carnage unprecedented in human history.

Then there are the mass-lootings of the bankers. When the reckless gambling of these Big Banks spins so totally out of control that they blow-up their own financial system(s); the Big Banks can (and have) looted wealth by the $trillions. The Big Banks on the losing end of these reckless, gigantic, and generally illegal bets are indemnified by the people, so that the Big Banks on the winning end can be paid off.

The travesty and fraud and crime here is that both sets of these Big Banks are mere tentacles of the One Bank, a financial monolith which not only controls virtually all of the world’s Big Banks, but 40% of the entire global economy, according to the mathematical modeling of a trio of Swiss academics. The “gambling losses” are a fraud, massive paper-shams where one Big Bank tentacle incurs some gigantic, financial liability to another tentacle. Only the stealing (from us) was/is real.


Belgium: Money-Laundering Toilet For Unwanted Treasuries

International Commentary

Yet another, massive fraud was uncovered in the U.S. Treasuries market recently, this time through the diligence of the ever-astute, Paul Craig Roberts (along with Dave Kranzler). While this clumsy money-laundering operation was briefly mentioned in a recent commentary which further exposed the fraud/lies associated with the Federal Reserve’s (phony) “tapering”, there is much more which needs to be said here.

As Roberts and Kranzler note in their original piece, the simple numbers involved make it clear we are dealing with a pathetically transparent money-laundering operation:

From November 2013 through January 2014, Belgium with a GDP of $480 billion [supposedly] purchased $141.2 billion of U.S. Treasury bonds. Somehow Belgium came up with enough money to allocate during a three-month period 29 percent of its annual GDP to the purchase of U.S. Treasury bonds.

As Roberts also notes; Belgium is another one of the West’s Deadbeat Debtors, with a (large) national debt, a budget deficit, a trade deficit, and a current account deficit. It didn’t have any money to allocate to the purchase of U.S. debt – let along forking-over 29% of its GDP in a mere three-month period. The supposed “purchase” is not only (economically) impossible for this debtor-government, there could be no possible legitimate purpose for such a (relatively) massive accumulation of any foreign debt.

It is a prima facie fraud, and thus (inevitably) a money-laundering operation. “Somebody” gave the Belgian government the currency to fund this sham-transaction. However, many notable questions remained unanswered in that original piece. Among the most important of these questions are the following:

1) From where did the ‘money’ come to fund this purchase?

2) Why did the U.S. government (apparently) feel compelled to engage in such a clumsy money-laundering operation?

3) Who dumped over $100 billion of U.S. Treasuries onto the market, in the span of less than a week – which necessitated this emergency money-laundering operation to prop-up the Treasuries market?

4) What will eventually become of these (fraudulent) bonds on the books of Belgium’s government?

In the original Roberts/Kranzler article; they strongly suggest who slipped the Belgian government enough funny-money to fund this purchase: the Federal Reserve. But this is only half an answer. Where did the Fed get the $141 billion, to (purportedly) fund this money-laundering operation?

This money-laundering took place at precisely the same time the Fed was claiming to be beginning the “tapering” of its own money-printing. As with Belgium’s deadbeat government; the Fed also did not have $141 billion simply “lying around” which it could allocate to that money-laundering operation, at that time. From where did the money come?

The Fed has not reported the creation of that amount of new/additional currency. It has not sold-off (supposed) “assets”, from which the proceeds could have been used to fund that (illegal) money-laundering operation. Indeed, the Fed itself is simply a massive toilet for worthless/fraudulent Wall Street paper. Ergo, if the Fed did fund this money-laundering operation, then it must have done so with unofficial – i.e. counterfeit – currency.

Of course, it wouldn’t necessarily be the Federal Reserve which counterfeited the money to fund this laundering of U.S. Treasuries. As Roberts, himself, notes; this purchase took place through the “Euroclear securities clearing system”. Thus it would be simpler (and therefore more likely) for this counterfeit currency to be (phony) euros originating from the ECB rather than (phony) dollars from the Federal Reserve.

As regular readers know; the European Central Bank is nothing less than a partner-in-crime with the Fed in perpetrating these endless monetary crimes/frauds, and both are instruments dedicated to serving the One Bank. With the Fed (very publicly) claiming to have started “tapering” its own money-printing; the bankers would have likely found it more discrete to use their European tentacle for this particular crime.


U.S. Hyperinflation Warning, Part II

US Commentary

Readers of Part I may still be somewhat confused, or at least less-than-convinced. They saw the chart showing the Federal Reserve’s (official) money-printing. It is an extreme, absurd, and totally out-of-control exponential curve: a classic representation of a hyperinflation-in-progress.

They may have also delved into the references provided which indicate how/why the U.S. dollar is already worthless, according to several different metrics of analysis. However, “hyperinflation” means a currency literally plunging to zero in value, while the (official) inflation statistics indicate ‘mere’ double-digit numbers. There is (to put it mildly) a large, mathematical gulf here.

But it was also explained to readers how hyperinflationary episodes are “confidence events”, not economic events – which explains why the (worthless) dollar still has an exchange-rate above zero. In fact, the currencies of the Western bloc are now all nothing but paper scams (or “cons”), and in any “con”, confidence is an extremely frail entity.

Those knowing their history will know that the term “con man” derives from the original vernacular “confidence man”. The reason? Success or failure of the “con” was wholly/entirely dependent on acquiring and maintaining the confidence of the Chump(s). And Western currencies are very clumsy, transparent cons, indeed.

Even apart from the abysmal economic fundamentals of these Western, paper currencies; the monetary fundamentals of these paper currencies dictate their worthlessness. There are only two ways for any money/currency to have (real) value.

The legitimate way for a currency to acquire value is to be “backed” (by gold or silver, our only monetary metals), in which case its status is elevated to (real) “money”. It can be backed directly, such as with gold and silver coins, where the metal is literally in the money. It can also be indirectly backed: paper notes, backed by physical (audited) gold or silver “reserves”. In this case our money/currency would be units of value.

The illegitimate way for a (paper) currency to acquire value is to attach cost to it, i.e. to “borrow it” into existence. In this case, as essentially IOU’s, our currencies are mere units of obligation. The paper retains value only as long as the issuer of the currency remains solvent, and can thus (theoretically) redeem those IOU’s. This is the way the now-fraudulent Western currencies used to be created – but no longer.

Today, in our era of “quantitative easing” (which is a euphemism derived from a euphemism), our worthless paper currencies are simply conjured into existence, neither backed nor borrowed. They are not “units of value” (money). They are not “units of obligation” (quasi-legitimate currency). They are simply units, with no possible fundamental basis for value.

Compounding this worthlessness; the major Western economies are now all insolvent, and thus no longer able to back the (previously issued) units of obligation. All of their paper is now worthless. However, this is only the beginning of the U.S. dollar’s problems.

As noted in Part I, (in theory, at least) the Federal Reserve could ‘pull the plug’ on its money-printing, but this would trigger a devastating collapse of almost unimaginable proportions (also detailed in Part I). The point is that those Armageddon-like consequences are so catastrophic that they would undoubtedly shatter confidence in the dollar, and thus cause the very collapse-in-value of the dollar that the Fed would be trying to prevent.

The Federal Reserve (and the U.S. government) is already well past the point-of-no-return. The monetary/economic damage already caused by their past crimes/fraud has made any form of economic salvation impossible. This is what makes any significant official inflation (and the erosion of confidence which comes with it) so dangerous. The U.S. dollar is perched upon the ultimate “slippery slope”.


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