Best of the Week
Most Popular
1.Oil Wars 2016 - US vs Russia vs Saudi Arabia vs Iran - Nadeem_Walayat
2.Crude Oil Price Crash Triggering Global Instability, Trend Forecast 2016 - Nadeem_Walayat
3.Stock Market Crash - Last Week was The 2nd and Final Warning... - Clive_Maund
4.Stock Market Crash Apocalypse or Bull Market Severe Correction? - Nadeem_Walayat
5.TShipping Said to Have Ceased… Is the Worldwide Economy Grinding to a Halt? - Jeff_Berwick
6.Crude Oil Price Crash Catastrophe, Independant Scotland Literally Begging to Rejoin the UK - Nadeem_Walayat
7.Summers: Global Economy Can't Withstand Four 2016 Fed Hikes - Bloomberg
8.Gold And Silver: New World Order: Public Be Damned, Preferably Dead - Michael_Noonan
9.Rigged U.S. Ttreasury Bond Market Double Barreled Hidden Q.E. To Infinity - Jim_Willie_CB
10.Major Stocks Bear Market Awakening - Zeal_LLC
Last 5 days
Gold Stocks Something has Changed - 6th Feb 16
UK Interest Rates, Economy GDP Forecasts 2016 and 2017 - 6th Feb 16
Gold Price, Mining Stocks Rocket Higher - 5th Feb 16
Crude Oil Price Bottoms and Blues - 5th Feb 16
Gold and Silver: Ripe for a Recovery! China May well Change the Game - 5th Feb 16
How Pension Plans are Responding to Financial Repression - 5th Feb 16
Senior Gold Producer Goldcorp Takes Large Stake in Nevada's Gold Standard Ventures - 5th Feb 16
Tips for Smart Oil and Natural Gas Investing 2016 - 5th Feb 16
Another Corporate Giant Is Leaving the U.S. – What This Means for You - 4th Feb 16
TPP is Economic Warfare, Trade Can Make Everyone Worse Off / Governments are Stupid - 4th Feb 16
Gold and Stock Markets Inflection Points Galore - 4th Feb 16
Putin Cries Dyadya (Uncle), Is Saudi Arabia Listening? - 4th Feb 16
Gold Price Golden Bottom? Video - 4th Feb 16
Look North for Value-Priced Growth in Healthcare Biotech Stocks - 4th Feb 16 - TLSReport
BrExit EU Referendum - Britain's FINAL Chance for Freedom From Emerging European Superstate - 4th Feb 16
HUI Now Confirming Gold Price Move Higher - 4th Feb 16
Crude Oil Price Forecast 2016 As Good As It Gets - 4th Feb 16
Gold and Silver More 'Flight To Safety' Active February - 3rd Feb 16
Raytheon Company: A Defensive Stock for a Defensive Market - 3rd Feb 16
Is Silver Really a Weak Link - 3rd Feb 16
Gold to Beat Stocks 2016? - 3rd Feb 16
David Chamberlain Cameron, Britain's Last Chance for Freedom From Emerging European Super State - 3rd Feb 16
EU UK Draft or Daft Agreement By Donald Tusk to Members of the European Council in Full - 2nd Feb 16
Europe: Why It's Going to Get a Lot Worse Before It Gets Better - 2nd Feb 16
The Next Generational Bust Is Coming, Stock Market 70% Collapse - 2nd Feb 16
The Coming Stock Market Decline May be a Monster - 2nd Feb 16
S&P 500 Has Likely Entered a New Bear Phase - 2nd Feb 16
How and Why To Move Your Assets Offshore Before the Financial Collapse - 2nd Feb 16
Central Bank Created Silver Price Rally - 1st Feb 16
The Fed Is Not Hiking Rates: Risk Assets To Perform - 1st Feb 16
US Dollar and US Treasury Bonds Big Picture - 1st Feb 16
BOJ Negative Interest Rates Central Banking Crime Syndicate's War on Cash for Triggering Panic Consumption - 1st Feb 16
Elites Set to Wipe Out Stock Market Shorts Before Next Downwave... - 1st Feb 16
Stock Market A-B-C Correction Unfolding - 1st Feb 16
Nice week for Gold : It’s All about Sentiment - 31st Jan 16
Silver Price Breaks Higher on Rising Anxiety - 31st Jan 16
Stocks Bear Market Rally Underway - 30th Jan 16
Gold And Silver Current Prices Do Not Matter - 30th Jan 16
Gold Price Potential Upside 2016 - 30th Jan 16
Stock Market Bears Pulverised by BOJ Knock Out Punch, Non Technical Take Video - 30th Jan 16
Lacy Hunt: Inflation and 10-Year US Treasury Yields Headed Lower - 30th Jan 16
The Curious Case of Copper... - 30th Jan 16

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Global Financial Crisis 2016

Top 10 Reasons To Buy Gold and Silver

Commodities / Gold and Silver 2013 Sep 05, 2013 - 07:12 AM GMT

By: hiddensecretsofmoney

Commodities

Mike Maloney writes: As I have said many times before, the economic crisis of 2008 was only a speed bump on the way to the main event.  I believe that before the end of this decade there will be an economic crisis so historic that it will eclipse the crash of 29 and the subsequent great depression.  I also believe it is both unavoidable and inevitable, because it is merely the free market releasing the stored up energy from decades of economic manipulation.  Yes… bad things are going to happen, but it could be the best thing that ever happened to you.


This guide started out as “The Top Ten Reasons TO Buy Gold and Silver” and was originally drafted by some good and well-intentioned employees, but when I read it something just didn’t feel right.  It contained all the usual reasons that any precious metals dealer would point out as to why people should own gold and silver…  they’re the ultimate insurance policy, they’re private, they’re a hedge against inflation, they’re a timeless investment, and so on.  I spent lots of time trying to rewrite them but there was still something wrong.  And then it dawned on me… though they were all good reasons to own gold and silver; they weren’t the reasons that “ I “ buy gold and silver.

So here you go… a countdown of “The Top Ten Reasons That I Buy Gold And Silver.”

10. All World’s Currencies are Fiat Currencies, and Fiat Currencies Always Fail.

99.9% of the world’s population is unaware that we no longer use money… we use “fiat” national currencies.  What is a fiat currency?  Fiat currencies are faith based.  They are national currencies that are not backed by anything of value like gold, instead the government just declares that they have value and, as long as the people keep believing, they accept it… for a while.  But here’s the thing, there have been thousands upon thousands of fiat currencies throughout history, and they have all failed… 100%... no exceptions.

But there is a vast difference this time around.  Since 1971, for the very first time in history, all of the world’s currencies are fiat currencies simultaneously. 

Remember this as we progress through the Top Ten… 

ALL FIAT CURRENCIES FAIL.

9. The Current State of the Global Economy.

In my book, Guide to Investing in Gold and Silver, and in Hidden Secrets of Money, I show how societies have swung back and forth from quality money to quantity currency.  Originally, quantity currency took the form of debased coinage (gold or silver money that has been diluted by adding cheap and abundant base metals such as copper).  Then it took the deceptive form of national currencies that were initially backed by money, IE: claim checks on gold and/or silver. Once these were established, governments then could change the laws, basically making fraud legal, so they could print claim checks on gold that didn’t exist.  The next step was to sever the connection between money and currencies entirely.  

Back when we used real money gold would automatically balance all economies.  When one country experienced an economic boom they would import cheap goods from countries with depressed economies and lower wage rates.  The outflows of gold from the boom country would cause a deflation, cooling the economy, while the countries experiencing gold inflows would boom, causing their labor rates to increase, which in turn would cause the prices of their goods to rise.  This meant that trade imbalances would always automatically rebalance.  Government spending was also constrained.  If a government wanted to spend more than its income (deficit spending) it had to borrow gold from the private sector.  If the government borrowed too much it would cause interest rates to rise, which in turn would slow the economy, which in turn would cause tax revenues to fall, which meant less income for the government, which in turn would cause the government to cut spending.

But the debt based global monetary system has allowed deficit spending, trade imbalances, and bubbles to persist and balloon to levels unprecedented in all of history.  We are in completely uncharted territory.  The credit/debt bubble and the derivatives bubble threaten to take down the world economy.  The only comparison you could make is to take every great bubble in history times one million and have it burst everywhere on the planet simultaneously… It threatens to be a global financial nuclear holocaust the only financial survivors of which will be the owners of gold and silver.

8. Currency Crisis / New World Monetary System.

I am a firm believer that everything happens in waves and cycles.  So when I started writing my book back in 2005 I entered every financial crisis that I could identify into a spreadsheet, starting from the beginning of the USA, looking for a cycle, and something very dramatic stuck out at me.  I had discovered that every 30-40 years the world has an entirely new monetary system.

From that day till now I have been telling as many people as I could that before the end of this decade (before 2020) there will be an emergency meeting of the G-20 finance ministers (or something like that) to hash out a new world monetary system.  It’s normal.  No man made monetary system can possibly account for all of the forces in the free market.  They get old… they develop stress cracks… then they implode.  

We have had four different monetary systems in the past 100-years.  The system we are on today is the U.S. dollar standard.  It is an ageing system that is way overdue for its own demise.  It is now developing stress cracks, and will one day implode.  Like I said, it’s normal.  

But what is different this time around is that the last three transitions were baby-steps from full gold backing, to partial gold backing, to less gold backing, to no gold backing.  In each of these transitions the system we were transitioning from had a component that could never fail… gold.  This time we will be transitioning from a system based on something that always fails… fiat currencies.  The key component to this transition from the U.S. dollar standard to some new standard is of course the U.S. dollar.  By the time the emergency meeting takes place the U.S. dollar will be in the final stages of the terminal condition known as fiat failure.   

But the U.S. dollar represents more than half of the value of all the world’s currency.  A dollar crisis would cast doubts on all fiat currencies, and the cascading effect of loss of faith could cause the rest of them to fall like dominos.  The central bankers will try everything they can think of to keep the fiat game going, but when everything they try fails they’ll look around and say, “What worked before.”  And once again the pendulum will swing back to quality money. 

The only beneficiaries of this event will be gold and silver, and those who own them.

7. Gold and Silver Come with a Central Bank Guarantee.

My book was written from 2005 through 2007.  In it I said there would first be the threat of deflation (this came true in the crisis of 2008) to which Ben Bernanke would overreact with a helicopter drop (this came true with the bailouts and QEs) which would cause an inflation (this came true when the stock markets and real estate reflated.)   Next there will be a real deflation… a contraction of the currency supply.  This will happen when the credit/debt/bond/fiat currency bubble and the derivatives bubble begin to implode.  The reaction of the world’s central banks will be to print until deflation gives way.  I believe this will cause a hyperinflation.  A hyperinflation doesn’t require a nation to print its currency into oblivion… it only requires a loss of faith.

Click below and sign up with HiddenSecretsofMoney.com to read the rest of this article and gain access to the Info Toolkit Essentials:

© 2013 Copyright HiddenSecretsofMoney - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 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

Biggest Debt Bomb in History