Fed up with the Fed

Centrally planning the ENDGAME

The Big Endgame Element

The following letter to the editor from Dr. Paul ran in today's [Feb. 29, 2008] Wall Street Journal:

"I was delighted to read in Judy Shelton's op-ed, "Security and the Falling Dollar" (Feb. 15), that at long last the security implications of the dollar's collapse have made their way into the mainstream media. The dollar's strength (or lack thereof) has been of paramount concern to me, and the subject of many of my statements over the past several years. Decades of manipulation by the Federal Reserve have benefited the government and certain politically-connected firms, while gradually destroying the purchasing power of middle-class Americans. Despite numerous warnings in the past, it is only now at a point of acute crisis that Washington insiders are beginning to awaken to the reality of the end of dollar hegemony.

"While I desire reform of our current monetary system, my own proposals have not been as all-encompassing as Ms. Shelton's suggestion to return to a Bretton Woods-style system. Her recommendation, though, that gold backing should make up a component of a future monetary system, is one that we would all do well to heed. My own legislative proposals focus around eliminating the taxes and laws that dissuade individuals and institutions from using gold as currency or as a backing for currency. By allowing market processes to determine the issuance of currency, we can allow individuals to decide for themselves what currency they wish to use. This would lead to a gradual reintroduction of sound money and avoid the market shocks that occur when monetary decisions are mandated by government fiat."

Rep. Ron Paul (R., Texas)
Washington

Source: RonPaul2008

Merry Fiat Christmas!

Plan B in reserve

The U.S. dollar is at an all-time low, even when compared against the hapless Canadian loonie. Five years ago, a loonie was worth 60 cents. Today, it's worth $1.12 and climbing. Yesterday, WorldNetDaily reported that the Chinese are considering abandoning the U.S. dollar as their national reserve currency. WND quoted Craig Smith's assessment of the consequences of such a move by Beijing on our economy:

"If that were to happen, all bets are off, and we will be in a depression that makes 1929 look like child's play, or we will experience Weimar Republic inflation as the dollar makes extreme moves toward devaluations." [...] On Tuesday, the U.S. national debt topped $9 trillion for the first time in history, according to the U.S. Treasury Department's daily accounting of the national debt. Nine trillion dollars! The number is so staggeringly high that it exceeds our ability to comprehend it in monetary units.

Million, billion, trillion – in financial terms, for most of us, it means a lot of money, really a lot of money, but that is about as specific a picture as most ordinary people can grasp. [...] Over the past few years, there has been growing public concern about the emerging "Security and Prosperity Partnership" plan that some say is really a "deceptive roadmap" to a coming North American Union and a new, unified currency tentatively called the "amero."

The feds steadfastly deny such a plan exists, even as it opens the borders to Mexican truck traffic, widens the I-35 corridor from Mexico to Canada and, counterintuitively, refuses to tighten the borders with either Mexico or Canada, despite both logic and widespread public demand.

All of these things have brought me to believe that powerful forces outside of our government – like the shadowy international Money Trust members of the "Bilderberg Group" – made a decision to force the formation of the North American Union along with the amero. There decisions have been instituted in the past via the Trilateral Commission, which is the dba for the nefarious Conference on Foreign Relations. Destroying the American dollar could force the crisis that would force the creation of the North American Union. To quote the title of a book of the 1960s era, "None Dare Call It Conspiracy."

Source: WorldNetDaily, 8 Nov 2007

Gold: Menace II fiat society

Gold’s catalyst on Friday was an impending sense of doom in US financial markets. “Forget what the Federal Reserve says about being neutral on policy and the news that the labour market grew at double the rate expected by economists in October,” writes Michael Mackenzie in the Financial Times. “What matters is the unwinding of the great credit trade. This is ensnaring more and more financial institutions and threatens to make life very difficult for policymakers as the risk of a dollar crisis looms.”

It seems to us the dollar’s been in crisis for about five years now. But maybe it’s become more acute lately. New lows on the greenback could equal US$1,000 gold. And it could happen faster than you can say “jingle bells”.

Source: Dailly Reckoning

Austrian School of Common Sense

The Crack Up Boom

Ludwig von Mises (1881-1973 ) was a notable and highly respected economist and a major influence on the modern libertarian movement. He has been called the "uncontested dean of the Austrian School of economics". The Ludwig von Mises Institute is named after him. The Ludwig von Mises Institute is a libertarian academic organization engaged in research and scholarship in the fields of economics, philosophy and political economy. It generally advances a view of government and economics expressed by Ludwig von Mises. The Institute is funded entirely through private donations and does not consider itself a traditional think tank. While it has working relationships with individuals such as U.S. Representative Ron Paul and organizations, it does not seek to implement public policy and has no formal affiliation with any political party (including the Libertarian Party), nor does it receive funding from any. The Institute also has a formal policy of not accepting contract work from corporations or other organizations.

Von Mises believed that significant credit expansion created business cycles. He continually warned of the dangers in inflation which can lead to hyperinflation and of the importance of governments and central banks not resorting to massive credit creation and the printing presses in order to prolong an artificially induced economic boom.

"The course of a progressing inflation is this: At the beginning the inflow of additional money makes the prices of some commodities and services rise; other prices rise later. The price rise affects the various commodities and services, as has been shown, at different dates and to a different extent. This first stage of the inflationary process may last for many years. While it lasts, the prices of many goods and services are not yet adjusted to the altered money relation. There are still people in the country who have not yet become aware of the fact that they are confronted with a price revolution which will finally result in a considerable rise of all prices, although the extent of this rise will not be the same in the various commodities and services. These people still believe that prices one day will drop. Waiting for this day, they restrict their purchases and concomitantly increase their cash holdings. As long as such ideas are still held by public opinion, it is not yet too late for the government to abandon its inflationary policy.

But then finally the masses wake up. They become suddenly aware of the fact that inflation is a deliberate policy and will go on endlessly. A breakdown occurs. The crack-up boom appears. Everybody is anxious to swap his money against "real" goods, no matter whether he needs them or not, no matter how much money he has to pay for them. Within a very short time, within a few weeks or even days, the things that are used as money are no longer used as media of exchange. They become scrap paper. Nobody wants to give away anything against them. It was this that happened with the Continental currency in America in 1781, with the French mandats territoriaux in 1796, and with the German Mark in 1923. It happened with the dollar in 1973. It will happen again whenever the same conditions appear. If a thing has to be used as a medium of exchange, public opinion must not believe that the quantity of this thing will increase beyond all bounds. Inflation is a policy that cannot last."

Ludwig von Mises, The Theory of Money and Credit

Source: Gold Investments Market Update

Bend it like Bernanke

In this 1982 movie based on a novel by William Styron, a young mother on her way to a Nazi concentration camp had to make a horrible choice - which one of her two children would she send to the gas chamber and which one would she save? This is where the Fed finds itself today. They are on a tightrope between two horrible choices. 1) Raise interest rates to defend the dollar and choke off price inflation. This would cause huge problems with the mountain of debt our country has piled on and would crush housing or 2) lower rates to save the credit bubble, knowing price inflation will increase as the dollar falls and all those cheap imported goods and commodities rise rapidly in price.

The first choice involves playing with a deflationary depression similar to that of the 1930’s as the money supply is held in check and debt defaults skyrocket forcing mass foreclosures, bankruptcies, closings of banks, and widespread loss of capital as the stock markets crash. The latter choice would force the government to inflate and most likely hyper inflate the currency - essentially destroying it as they pay off existing debt with dollars worth far less in terms of purchasing power. Based on comments by Fed Chairman Ben Bernanke and current monetary policy, it appears as though the choice will be made to sacrifice the currency. This choice will likely result in hyperinflation and the destruction of the US dollar as the world’s reserve currency.

[...] Even with the level of globalization that we have seen over the last 20 years, these are still very dramatic changes to the current world order. There needs to be a catalyzing event to move toward this world structure. With a Biblical worldview in mind, I would propose the following as a possible scenario. I am not called to speak this as a prophetic word from God.
As the US economy goes through economic and social turmoil, we lose global influence. Politically we are dealing with our own problems and we leave the world stage as a global policeman. Our US dollar is no longer the world’s reserve currency after being destroyed via hyperinflation. It is replaced by a regional currency similar to the Euro, which includes Canada, the US and Central America. The new “Amero” replaces the US dollar, the Canadian dollar and the Mexican Peso. During this time, the same thing happens to Asian currencies – they consolidate. This takes us one giant step closer to a single world currency. The US hegemony is no longer an issue, and there would instead be 3 or 4 regional world currencies.

As currencies consolidate, so will governments. Witness how the sovereignty of European countries has been destroyed as their governments are slowly consolidated in the name of economic progress. With this step complete, the stage is thus set for a one world currency and one world government.

by Doug Tjaden, September 8, 2007, SilverStockReport.com