Now is the time to screw your head on straight and asses the current situation for what it really is. In hard times are some of the best opportunities. Why suffer when you can profit from the economic collapse. All it takes is a little bit of common sense and
voila, you have financial sense. I take my hat off to the
Financial Sense News Hour team for sharing with me a wealth of information since I started listening to their podcasts in late June. They have truly helped me to see things for what they are, and have helped me to understand how to profit from
things and to get out of
paper.
For some crazy reason, our government thinks that they can fix the problem by doing the same thing that caused the problem in the first place: PRINTING MONEY.
Who prints the money?
The Federal Reserve System
.
The Federal Reserve System is a private banking cartel that prints fiat money (money backed by nothing but debt) as it desires. It can literally wipe out your wealth with the flick of a pen. When the government wants money for something, instead of raising taxes, they go say "Hey! Bernake! We want some more of that good stuff!" And you know what Bernake says, "Sure thing! Just pass this bailout for the banks and keep the system propped up so we can continue to profit from risky bank loans that make us money from interest on money that we created out of nothing." So The Fed prints a whole bunch of money, trades it with the government for government backed bonds, general Treasury Bills, and BOOM, as in the case of the last bailout, 800 billion dollars rushed into the economy, created from nothing.
What this essentially does is increase the money supply and devalue the currency. The more you hold on to your dollars, the more purchasing power you loose. And as time moves on, there will be many more bailouts to come. It is predicted that when all is said and done, the Fed will have printed 5 trillion dollars. This is not an unreasonable estimate since the Feds balance sheet was $897 trillion in August of 2008, then on October 15 it was expanded to $1.8 trillion., an increase of 103% in two months. Quoting
Jim Pupplava, "The Fed's balance sheet looks like a hockey stick." And boy is that scary. I don't think that there hasn't been such a rapid expansion of the money supply since FDR put in place his public works programs during the Great Deppression. And I don't wish this on any nation, but I think another Great Depression is what we are in for.
We never learn from our mistakes, and we are making the same mistakes that we made in the 1920s and '30s. In the 1920s, the roaring '20s, there was a period of prosperity. The Fed created an artificial boom by over-inflating the economy and loaning tons of money to many entrepurneurs and new companies. However, all artificial booms come to an end, and this ended in a contraction of the money supply, leading to a bust period. Hence, a stock market collapse. Here there was a brief period of deflation as asset values declined and there was a mass attempt at the liqidation of assets, causing a hording of dollars as the dollar rose in relation to asset prices (the same thing we are seeing today). However, one must see the man behind the smokescreen. When FDR became president, he started printing money without end to fund all of his socialist-esq programs. Today, the Fed is printing trillions of dollars to fund the bailouts. In fact, both candidates have $1 trillion worth of spending programs, and this is likely to be on top of the many trillions more that will be deemed "neccassary" to "rescue" the financial institutions.
Ultimately, the average joe has no say in what the government does. If it wants to create money, it will do so to maintain its elite status, at the expense of the American citizens. But this all sounds terrible! There is no hope!
Ahhh....that's where you are mistaken. With every bad there is good. When wealth leaves one person, it has to shift to another. And it will shift to those who own tangible assets. Gold and silver have stood the test of time and have always proved to be safe-heavens in times of financial unrest, and especially in times of hyper-inflation, which we are likely to see once all of this money printing hits home. Gold and silver have ALWAYS outperformed inflation and are assets that no portfolio would be complete without. With these undervalued prices due to government manipulation to give the dollar one last death rally, precious metals are truly a steal and a bargain.
Do what you can. Unfortunately, we can't all back up the truck. I wish I could, I really do. But, I do what I
can. This month I bought 20 ounces of silver. But it's 20 ounces more than I previously had. Sure, I wish I could buy 1000 ounces, because I know what a steal the price is, but hey, I got some more, and
that's what counts. So go out and be proactive! Add to your position, or take this great opportunity to start accumulating!
Remember, it's not what you say, but what you do.
Happy thoughts,
Sam
Tags:
Investing, Federal Reserve System, Printing Money, Inflation, Financial Sense, Bernake, Bailout, Treasury, Great Depression, Gold, Silver, Precious Metals, Opportunity, Roosevelt, FDR, Stock Market
by Dr. Douglas N. Graham, more people would understand the rewards of eating sweet fruits and greens. When has any doctor suggested against eating more fruits and vegetables, I've just never heard of it. When I got my annual physical in August, the doctor said to keep doing whatever I was doing because I was perfectly healthy. Now all I have to do is to place myself in a suitable environment (1000 miles north or south of the equator) and I'll be in fairy tale land. Until then, we have Bloomington, IN.
