Post by
senator123 on Feb 21, 2005 12:02pm
For sure
If it is true that the central banks are disposing of their gold (or have done so) through leasing activities with the likes of JP Morgan etc. there is one more round on gold price fixing to come.
How much gold does the worlds central bank have to dump into the market to supress the gold price? Lots or course and it is all on the books as if it was worth only 35 an ounce. They want you to believe that the gold must be sold to realize the gain in its value. You and I know this is not true - they simply have to revalue the gold - they do not have to sell it. If they do sell the gold who would benefit? The only ones that would benefit are those with massive short possitions. This would allow them time to cover at least a critical part of their positions and stave off a complete financial breakdown the world over. And of course the powers that be want everyone to beleive that the purpose of selling the gold is to aleviate third world debt. What nobler cause could there be?
The only reason the world bank was created in the first place was to protect the likes of JP Morgan from all those massive non performing third world loans they made and the profits that went along with it - or least the profits they could show on their balance sheets that is. Interest on many of those loans were never paid - they just lent them more money to pay the interest. Instead of letting the financial system purge such scum from the face of the earth they rewarded them creating another layer of debt creation to make it possible for the defaulting third world countries to once again make those non performing debts perform.
If these gold short positions are as large as GATA says they are there will be one very large and very concentrated effort to cover those positions in some manner. My guess is that an agressive move by the world bank to sell gold will happen - it will happen with a massive supply so that the likes of JP Morgan can buy the kind of volumes they need to to aleviate the financial crises which is sure to occur without those positions being unwound. One only need to consider the impact of 800 dollar gold to realize how serious this problem is and the certainty of a financial callapse that would occur. Lets not kid ourselves - something will be done and it will not be done with your welfare in mind.
I dont think that there are very many people out there that beleive inflation is dead. ( what idiot can not see it - go get your car fixed - a 90 dollar an hour shop rate will open the eyes of most people if they want to see it) I dont think that there are many people out there who dont think the US has to undergo a inflationary cycle in order to solve its fiscal problems (is there an economist out there right now not telling people the US dollar is going to correct) But most people are oblivious to its concequeces in their own lives. In the past their wages went up to make up for it so they thought what the hell - what difference does it make - my house is worth more anyway so who cares. Is this round of inflation going to be any different?
But the last time this occured in a big way we had Japan causing the trade embalance - this time it is China - 10 times bigger - 10 times less efficient yet remarkably more competative. Let the China currency appreciate 100% - the inmprovements in efficiency alone will more than make up for it. This would double the wages for all those factory workers in china who would in turn spend it driving prices up even higher.
There are very few people who dont think that China is the one to watch out for. They have a lot of wild cards and they are developing more wild cards as time passes. They tell their people to buy gold not US dollars - they are trying to spend their US dollars to buy assets that will supply them with the resourses they know they need to have. They partner with those willing to take risks in their country to develope competing resourses. These guys are dangerous. They have a business mentality that you and I can not afford to take for granted - they will slice and dice anyone they can. These guys are hungry for money and wealth and operate from a completely difference mind set than we do. Japan was a lot better global partner than China will ever be.
I can only say - be prepared because the poop is going to hit the fan before the decade is out. And it looks to me like the US (being in the low lying area) is going to have a major sewer back-up after the 1.3 billion people in China decide to flush.