Wednesday, May 26, 2010

Trend Watch - Wealthy Getting Out of Currency

Wealthy getting out of fiat currency - very predictable! 
Fiat currency is at the tipping point.  Now that lending has been peaked because debt saturation is maximized beyond anything ever seen in human history spanning all the way back as far as one can go, it is time for the next great play.  What can the bankers do now except transfer wealth over to themselves by inflating the money supply to pay off nominal digits on their balance sheets?  It is a simple game really.  Imagine if you could print unlimited amounts of paper that others considered to be "money".  Why would you worry about debt?  Just keep printing additional money and keep buying up real assets.  Those who can't repay you will have to forfeit their collateralized assets to you.  No risk, high reward, devaluation of currency, transfer of wealth.  This is the new game for moving past the post-peak of debt saturation.  After that game is played, then there is another game that comes into play historically, and that is war.  Yup, after the wealth is consolidated into the hands of the few then there is only one easy way to distract and work the masses for nearly nothing.  You need a big enemy abroad and a widespread all consuming war, as patriotic as possible, with weapons sales to both sides.  That will last about 4-years or so historically. And then after all the death and destruction has played out, the new game starts all over again with newly printed currency, perhaps even a new constitution and a renewed appeal for rebuilding.  The same people behind the currency printing press remain in control.  New presidents come in like frontmen selling the story they are told to sell.  We get to vote for either side of the false paradigm "left" or "right", both boots of the same banking con game. 
Can we break free from the above predictable cycle?  Yes we can.  If we refuse to participate in their money system, we rob them of their ability to rob us.  And we keep power at the local level more while also preventing power from being consolidated.  Simple really.  Wish I thought of it but actually, this has always been common knowledge.  The founding fathers of the US were all into this stuff. 
- Tate Ulsaker
(below ripped from Eric King's site...

Richard Russell - Wealthy Getting Out of Fiat Money II


Eric King: Here is a sneak peak from the most recent issue of Richard Russell's Dow Theory Letters, dated May 26th: "Yet in the background big money, wealthy investors, are seriously worried.  In their hearts, they don't trust fiat currency."  Richard Russell is the Godfather of the newsletter business, and recently he has been chronicling the fact that the wealthy are shaken. Their confidence in fiat moeny and other paper assets is disappearing.


Russell goes on to say about the wealthy:


"They are familiar with the history of fiat currency, and they know that no fiat currency has ever survived for long.  Therefore, these people  are buying items of intrinsic value — gold, silver, platinum, gems, top quality art, rubies, jade, beach property, collectables."


Russell is also noting massive demand for gold:


"Germany's greatest fear is inflation, as per the 1920s.  Headline in the May 16 Financial Times — "GERMANS LEAD GOLD RUSH FRENZY.  We have some extraordinary sales to German customers," says Deborah Thomson, the Rand treasurer.  "The refinery which usually sells 2,000 coins to each customer at a time, said that last week it received an order from a German bank for 30,000 coins.  Another banks requested 15,000 coins."


Regarding auctions, Russell writes:


"Yet diamond prices have been surging.  Wanted art objects and paintings have been setting record prices."


This is exactly the type of action one would expect to see during phase II of a secular bull market in gold. Always ignore the noise, the day to day and week to week action and keep your eye on the big picture, the big trend. Follow the big money. The big money wants hard assets such as gold.


Very few human beings can stay invested for the entire duration of a secular bull market; they simply don't have the stomach for it. Don't lose your position and fail to stay invested because of the frailty of your emotions.


Eric King

King World News


For more Richard Rusell go to Dow Theory Letters or CLICK HERE.

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