MONEY: We need to return to Constitutional money — gold and silver

Sunday, November 7, 2010
Quantitative Easing Just Got Easier
Nicholas Nigro

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This roundabout way of printing money will, apparently, guarantee only one sure thing that you can take to the bank: the further weakening of the once Almighty Dollar and a corresponding rise in critical commodity prices because of it. Translation: From the grocery store to the gas pump, those who can least afford it will pay more and more for basic necessities. But I imagine the government measuring sticks will continue to tell us that we are living in a period of very low inflation for the foreseeable future, and that we should be more concerned about the prospects of deflation.

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What “they” have fooled everyone into thinking is that a “dollar”, a “Federal Reserve Note”, that green piece of linen cotton “paper”, is actually worth something tangible. In elementary economics, we learned that humans transferred from barter to money because money had certain useful characteristics. Most notably it permitted the butcher to trade directly with the candlestick maker without trading with the baker first. From whence all the good things that the division of labor provides — specialization.

Quoting from my favorite novel (Mine!) “Money is a matter of functions four, a medium, a measure, a standard, a store.” He repeated that four times like poetry. “Six Characters in Money: Portable – Durable – Divisible – Uniformity – Limited Supply – Acceptability.” CHURCH 10●19●62 (Vol 1) 978-0-557-08387-9 page 110

“We, The People” have forgotten that. As well as the Dead Old White Guys Constitutional admonition that only gold and silver should be money. Along with a bunch of other stuff, like the Bill of Rights, Declaration of Independence, and a general dislike for oppressive Gooferment.

So, now, the politicians and bureaucrats are riding high on the hog and the taxpayers have been laid low. Like the host of a parasite weakened to near death.

Gooferment is the meme that kills people. It’s time to awaken from our economic nightmare and throw out the FED and return to “Constitutional money” — gold and silver. And watch the global economy rebound when the world isn’t paying the “inflation tax”.

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GOLDBUG: Never ask a gold bug for comments!

Friday, October 16, 2009

Buying Gold?

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We may or may not face serious inflation but I would like to hold as much gold as possible either way. It might cost me a couple bucks more for the same thing but worst cast I will just laugh about that when I buy for less in a few months.


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Gold — bullion; not “collectibles” — currently has a 10% premium. Silver seems to be about 12%. (Palladium is an “interesting” play; rarer than platinum, but priced 60% below gold?) Unfortunately, that’s a lot of “commission” to pay. (A loan shark’s vig?) In the past it was as low as 2%. A mutual fund with a 10% load would be found unacceptable; why should we treat bullion any different. Hold it for 10 years and it doesn’t feel as bad.

The other consideration is what are your protecting against. In an “orderly” inflation scenario, other investments may “surf” the riding tide of inflation (i.e., real estate; stocks). In a “disorderly” inflation scenario (e.g., hyperinflation like Rwanda or pre-WW2 Germany), then you want the bullion coins in your possession. (Or, where you can get to them in a pinch.)

Bottom line: In hyperinflation, bullion coins will overcome the premium in a heartbeat. But what’s the probability of it happening? Tough call.

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