Best of the Week
Most Popular
1.The Greatest Stock Market Crash Of Your Life Is Just Ahead… – Warns Harry Dent - GoldCore
2.Budget 2016: Borrowing, Lifetime ISA, House Prices, Economy, Syria, Brexit and Stocks - Nadeem_Walayat
3.Gold Price Intermediate Top - Clive_Maund
4.Brussels Terror Attacks, Death of the European Union, BrExit Wake up Call - Nadeem_Walayat
5.Stock Market Maybe This Time is Different? - Tony_Caldaro
6.UK House Asking Prices Break Above £300k! Housing Market Paralysis - Nadeem_Walayat
7.A Big Reason Why Silver Price Is Set To Soar - Hubert_Moolman
8.The Financial Crisis Has Just Begun; Is The American Dream Is Over? - Chris_Vermeulen
9.Gold Stocks Spring Rally - Zeal_LLC
10.GLX, GLDX, Baby Gold Bull Market Stillborn? - Rambus_Chartology
Last 7 days
Derivatives Crisis Of Banks…Worldwide - 3rd May 16
Bank of North Dakota Soars Despite Oil Bust: A Blueprint for California? - 3rd May 16
Stock Market Technical Analysis - 3rd May 16
Central Banks Need a Higher Gold Price : Hello GATA - 3rd May 16
A Currency War Battle That Europe and Japan Can’t Afford To Lose - 3rd May 16
When the Truth is Found to be Lies, Confidence in Currency Dies - 2nd May 16
How Brexit Could Help All of Europe - 2nd May 16
US House Prices Outpacing Official Inflation Rate, Household Income - 2nd May 16
USD Still Declining... - 2nd May 16
Gold & Silver Rally Huge as Central Bankers & Analysts Flub - 2nd May 16
Stock Market Bounce Day - 2nd May 16
Stock Market Uncertainty Following Two-Month Long Rally - Will It Continue? - 2nd May 16
Stock Market Correction Underway "Upside Objective Reached" - 2nd May 16
USD, Yen and an ‘Inflation Trade’ Update - 2nd May 16
Gold Commitments of Traders and More - 1st May 16
The Magic of Gold Ratio Charts - 1st May 16
Consensus Forming: China Heading Back Into Financial Crisis - 30th Apr 16
The Next Technical Price Targets for Gold & Silver - 30th Apr 16
Stock Market Downtrend Should be Underway - 30th Apr 16
Gold And Silver – A Clarion Alarm Call For All Paper Assets - 30th Apr 16
US Economic Statistics LIES, LIES AND OMG, MORE LIES - 30th Apr 16
Stock Market Strong Elliott Wave Relationship is Developing - 29th Apr 16
Fed's Kaplan: Brexit to Factor in US June Interest Rate Decision - 29th Apr 16
Silver Miners Strong in Grim Q4 - 29th Apr 16
Is Silver a better bet than Gold in the Near Future? - 29th Apr 16
How to Use the CoT Report in Gold Investing? - 29th Apr 16
Sri Lanka is Intriguing: Areas to Consider for Value Investing - 29th Apr 16
Gold “Chart of The Decade” – Maths Suggest $10,000 Per Ounce Says Rickards - 29th Apr 16
Are We or Are We Not in a New Gold Bull Market? - 29th Apr 16
Silver: The “Five Year Plan” and the Great Leap Forward - 28th Apr 16
Michael Hudson: The Wall Street Economy Has Taken Over The Economy and Is Draining It! - 28th Apr 16
AUD/USD - Trend Reversal or Just a Bigger Pullback? - 28th Apr 16
A Gold Revaluation Could Transform Your Financial Status - Overnight - 28th Apr 16
Monetary Policies Misunderstood - 28th Apr 16
Gold Bullion vs Gold Miners - 28th Apr 16
OECD Suggests BrExit Would Cut Net Migration by 1.2 Million by 2030 - 28th Apr 16
MP Naz Shah Punished for Tweets Made During Israel's Genocide of Gaza Palestinian People - 28th Apr 16
Global Recession in 2016 and Beyond - The Obvious Evidence - 27th Apr 16
Why Gold Bugs Need to Stop Listening to The Fear Mongers and Start Thinking for a Change - 27th Apr 16
BlackRock’s Fink: Fed to Raise Interest Rates by Quarter Point ‘at Best’ - 27th Apr 16
Gold More Productive Than Cash?! - 27th Apr 16
Donald Trump Will Fire Janet Yellen and Be Trapped - 27th Apr 16
Money Saving Gardening by Propagating Roses From Cuttings - Propagating Rose Plants Over 2.5 Years - 27th Apr 16
Facebook Censors Pro Trump and Negative Hillary News - 27th Apr 16
This is the Era of the Democrats and Your Taxes are Going Up - 27th Apr 16
Long Awaited Gold Price Breakout - 26th Apr 16
Crude Oil Price Double Top or Further Rally? - 26th Apr 16
Madness in the Crimex Gold and Silver Trading Pits - 26th Apr 16
Britain's Prospects: GBP and BREXIT - MAP Wave Analysis - 26th Apr 16
CRB, Gold, Oil, Cotton, Coffee - 7 Must See Commodities Charts - 26th Apr 16

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Catching a Falling Financial Knife

The Age of Entitlement and Need to Own Gold

Commodities / Gold and Silver 2012 Nov 13, 2012 - 02:40 AM GMT

By: Bob_Kirtley

Commodities

Best Financial Markets Analysis Article “Cassius suggests that the people get the government they deserve”.

This can be a good thing, if (and it’s a big “if”) the people do their homework and vote based on facts, not on rumor or innuendo - Shakespeare in Julius Caesar


Many of our leaders, writers and philosophers have said similar things down the years and it would appear to be apt today. It’s time for us to admit that we vote for those who offer us the most regardless of how it will be paid for. As voters we are all for getting the economy sorted so long as it doesn’t involve our entitlements being diminished in any way at all. After all we have become accustomed to these benefits and our expectations have been raised by the political elite of all ideologies to ever increasing heights that are actually way beyond our pay station. To win an election the politicians need to be popular and they do that by promising the voter a better future without the voter having to exert himself too much. Alas we continue to fall for this three card trick in the vain hope that it will be alright on the night. Fat chance!

In the United Kingdom the Brits were intoxicated by the Blair/Brown ticket and thirteen years later the chickens came home to roost with a new coalition government implementing a program of austerity bringing with it the misery we have seen all across the southern nations of the European Union. France has elected François Gérard Georges Nicolas Hollande on a promise of a better future and already his popularity has fallen dramatically as the French electorate realizes that he just cannot deliver, further more France now appears to be heading towards its own fiscal cliff.

On the subject of fiscal cliffs the United States has its very own cliff looming with an ETA of 01 January 2013. One gets the feeling that this won’t be the best start that we have had to a new year. The reelection of President Obama means we will be in for more of the same with the only difference being that the president will not be standing for office again, so being mister popular carries less weight than it did prior to the election. So his policies of tax, borrow, print and spend will remain intact as that is what he does. More and more people will become dependent in one form or another on the government benefits and less dependent on their ability to stand on their own two feet and grasp the problem by its throat and wring the life out it. Benefits for the needy were a good thing many years ago, but today they have grown massively into a life style choice that is bleeding the very life out any economic recovery. Until government spending is cut and cut hard we can only expect the economy to stagger from one crisis to another begging for the next stimulus package which it is now addicted to.

It really is a very sad to see the United States, Europe and Britain in this mess with the only solution on the table being an increase in liquidity. This is not the remedy for insolvency and it does not improve the health of the economy.

We also have the sword of Damocles being lifted from Ben Bernanke’s head so he now has a free reign to run those printing presses as he wishes.

These two events will conspire to drive the dollar into the end zone; its demise along with a number of other fiat currencies is now almost a sure thing. In our opinion the main beneficiaries from the loss of the dollars buying power will be hard assets such as gold and silver.

As the penny drops and more and more people realize that the folding stuff is not holding its value and they will seek refuge elsewhere and when they do it will be an almighty stampede, as they will move in tandem to enter the precious metals market. As you probably already know, there are very few people who can tell you the price of gold and/or silver these days, as they are fairly oblivious to what is going on. However, as jobs disappear and the need for food stamps accelerates they will get the message that all is not well.

Gold and silver will make the headlines for record breaking reasons which in turn will induce a demand for them bordering on the irrational. This will be the first sign that precious metals are entering the parabolic phase where an unquenched desire morphs into a maniacal action thus driving prices to unimaginable new highs.

There is not a lot we can do about this other than to try and protect ourselves and those around us by taking action in the form of insurance against the ill wind that is coming our way. In our minds the best insurance is the acquisition of gold and silver as it cannot be diluted by any government and therefore will hold its purchasing power as it has done for five thousand years or so.



As for the dollar we could see it improve over the near term as money comes out of the stock market due to a number of uncertainties and returns to the sidelines. This should not be seen as a bullish sign for the dollar as that money will not remain idle for long. Once things settle down a tad investors will be keen to put their funds back to work. The interest payment derived from holding this currency is so low that it is a negative return in real terms so it will be re-deployed promptly.

Finally, if you can curtail some of your frivolous spending and live a more Spartan life style in order to generate the cash to invest in hard assets right now, this could be your saving grace. Please give it some consideration as there isn’t a lot of time left for us all to get into position and be able to ride this one out.

Have a good one.

Bob Kirtley

Email:bob@gold-prices.biz

URL: www.silver-prices.net

URL: www.skoptionstrading.com

To stay updated on our market commentary, which gold stocks we are buying and why, please subscribe to The Gold Prices Newsletter, completely FREE of charge. Simply click here and enter your email address. Winners of the GoldDrivers Stock Picking Competition 200

DISCLAIMER : Gold Prices makes no guarantee or warranty on the accuracy or completeness of the data provided on this site. Nothing contained herein is intended or shall be deemed to be investment advice, implied or otherwise. This website represents our views and nothing more than that. Always consult your registered advisor to assist you with your investments. We accept no liability for any loss arising from the use of the data contained on this website. We may or may not hold a position in these securities at any given time and reserve the right to buy and sell as we think fit.

Bob Kirtley Archive

© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife