Gold

[Guardian]

Aya, there is a reason the common folk of ancient Mexico called gold "The gods excrement".

I think the word is "teocuitlatl?"

The old Aztec "gods" (Lizzys) demanded gold to help anchor them here. I'm under the impression that without the ability to blend themselves with Nature, sticking around was/is rather difficult for them. ;)

 

[go2]

BTW, there's not some deeper part of you actually planning on being helpless and dependent in the years to come, is there?

Hi Bud, I am just laughing. No, I had to make an essence promise to the "dog" if it would stop complaining and trying to make decisions it could die with its boots on.
Your following paragraph sums up my conviction.

Most of the time, I feel like I have within me everything I need to be able to survive. In other words, no matter how high your pile of gold, you will always need something. If I find out what this and supply it, we can swap, because I live in a non-zero sum game Universe.

While we meet on this thread I want to thank you for sharing your Work here, I begin to feel hope for the first time in decades observing men and women Work. I read the thread Taking Back The Language: Discerning Unconscious Identification after Anart pointed out that I have traded my sword for a veiled dagger yesterday. That shock and your thoughts have certainly contributed to who I am and what I see. I sense the interior struggle moved to a new battlefield last night. Thank you, Anart.

 

[Neil]

Wishful thinking or a conscious scam?

Well that is a whole other can of worms and I wasn't even going to go there. Counterfeiting is another whole layer of problems designed to trap people in the safety their physical wealth supposedly affords them. On one level, it is probably just opportunisitc bussinesspeople trying to make a quick buck on the gold fever. On another level, a lot of that money is probably being siphoned up to the PTB who will pull the wool over the eyes of the semi-aware population as they use the fake gold to accumulate more real gold. On the ultimate level, maybe 4D STS is trying to preoccupy the semi-aware population with a narrow mindset, convincing them that gold will give them the freedom to survive what is coming down the pike, when instead the Wave will actually shake things up quite a bit and they will be totally lost. Maybe this slow release of subtly distorted data coming through the alternative media is meant to create belief systems that will be shattered with each successive shock to the system. After so many shocks, transmarginal inhibition sets in and maybe the Lizzies think that there won't be anyone left with critical thinking faculties when they give us their utopian system which will sound great on the surface, but will have a few small twists that make all the difference.

Well, as I see it, scarcity does and doesn't exist.

Well, that kind of clears up a gray area in my post. Scarcity certainly does exist here and now, but it's true essence seems to be a lesson that one can move past once one understands.

I'm placing my bet on some kind of nature-inspired fractal generator or whatnot.

Well, an interesting thought exercise would be to ascertain why Stonehenge was built the way it was. I think the physical arrangement was like the keyboard on a computer. Unlike a compter which does billions of calculations per second when a command is inputted, the processer for Stonehenge was the consciousness that was using it. This comes back to Laura's "equal work" hypothesis about STO technology. STO does use technology, but only technology that balances the amount of work done by the machine and by the consciousness. The example used was a spinning wheel. Since Stonehenge seems to be a supercomputer of sorts, the consciousness demands to actually use it must have been enormous, probably too much for any one individual. Maybe such technology could only be operated by groups such as Gurdjieff's 200 conscious beings. So after you have the physical interface and enough people with the Being required to operate the machine, you must have the Knowledge to get the desired results. I'm almost certain this is knowledge of hyperdimensional physics, because manifesting something from what we perceive as nothing or getting it from nowhere seems to be very much against the "rules" of 3rd density, but commonplace in 4th. Lastly, the device needs to be built in a location where there is a window to 4th density so that one could access hyperdimensional energies. Of course, if you are already in 4th density, I guess it is much easier. I think that's basically how it works, but I don't know the nuts and bolts mechanics of it, so to speak.

go2-Well, I can't really disagree with what Professor Fekete says in principle, but I think he's missing the bigger picture here. There is no real reason to bring the USD into this because we all know that it's crap. It's just a piece of paper with green ink on it, period. I see two discussions here, one regarding whether you should buy gold to prepare for the economic collapse, and the other is more of a philosophy of economics on the viability of gold as a unit of societal exchange. For the first question, I think it is a good idea to have a few ounces of gold at your disposal if you can afford it. The evidence suggests that the financial system is teetering on collapse and people are looking for a viable alternative to the doomed paper markets. Gold is a natural choice due to its reputation. If one finds themselves in a situation where their currency is suddenly useless, gold adds a nice degree of flexibility to still make purchases in a somewhat normal manner. So you and Fekete are absolutley right about it's durability, marketability, etc. However, I will caution here that having pounds and pounds of gold in one's vault is delusional. The only reason you would want so much gold is because you want to come out of the collapse better than you went into it, to profit from it. There is reason to believe that this collapse is different from prior collapses and there isn't going to be a recovery, as such. As the collapse goes on, gold will have some desirability because of it's durability, marketability, and perhaps shinyness, but people are going to be more concerned with things they actually need. As other members have pointed out, gold is pratically useless, and in the case of a total infrastructure collapse, gold is just one of many things that could be traded for value. Sure, the PTB really don't like the idea of people having gold because it requires a lot more effort to take away. The PTB can impoverish most of the world with a few keystrokes on a computer, but in a gold based system they have to physically come and confiscate everyone's gold, which can be arranged by the way. You see, you can cut down a tree with an axe or with a chainsaw. You'd prefer to use the chainsaw, but you'll use the axe if you're out of gas. You could say that the advantage to gold, the ONLY advantage to gold, is that it is more difficult to control and steal, thus giving an added layer of protection, but it is far from being safe.

For the second point, I would say that gold is a horrible choice to base one's economy on. I think we need to examine this issue of scarcity a little more closely. If the supply of goods and services combined with population grows faster than the supply of gold, then the value of gold must increase or the economy must stagnate. My bet is that the gold supply would be vastly outstripped as to cause consistent deflation which encourages hording. In fact, I think that if secrets guarded by the PTB were to be released regarding cutting edge science, China's "miraculous' growth rate of 10% would seem rather passe. You have a situation where if human creativity was allowed to flow freely, economic growth could be incredible. If gold is being "saved" and not spent because of its increasing value, then the velocity of money will trend toward zero and you'll have recessions, unemployment, and all of that. You could enact laws to mitigate the effects and prevent people from accumulating too much gold or holding on to it for too long, but how will you enforce them? You will need a large agency that keeps track of gold transactions and has the authority to confiscate gold from offenders. We're already back to the idea of a central bank, and this is just to keep your system stable beyond a couple of decades. Then what's to say that these "enforcers" won't decide that their pay is too low and skim a little off the top of their arrests? Over time, they could form their own club that has enough clout to influence the direction of the system in a way they desire. You see, while gold does not allow for the egregious fraud a paper system does, it is far from an ideal currency or even a good one. Now what if scarcity doesn't really exist? If the hyperdimensional realm does indeed provide for an abundance of everything, there is no reason for anything to have value at all, at least in the monetary sense. When there is plenty of everything for everybody, why use money? People can just go and get what they want because no limits exist. At that point, money is just dead weight to carry around. In fact, the concept of "payment" would only be a self-limiting concept. People would be able to just give and receive freely because they know that the resources that they need will always be there. I will add here that this system can only work in an STO society. As soon as the concept of personal gain or being of a higher class than someone else enters the society, there will be an energy imbalance that will cause the system to collapse as they siphon off more and more energy and cause the rest of the people to doubt each other. If this Ponerology isn't recognized by the society at a very early stage, it will infect and destroy the entire system. At any rate, even if you did theroretically create an economic system with neither inflation or deflation, full employment, and a high standard of living for all with gold as the base monetary unit, by the time your society reached these milestones gold would be irrelevant other than for artisitc or decorative uses.

So I think we can conclude here that money does not exist in the absence of scarcity. Money is the product of STS lies and is therefore inherently STS. Although one could reboot the financial system with gold and philosophize all day about an eglatarian monetary system, no such can ever arise because money creates stratification and elitism as part of its very nature. It's like trying to create a black hole that doesn't "suck." The best system we have ever known would probably be the barter system. In the barter system, there is no money per se, and value is assigned based on the specific need and circumstance. There is no central enforcement authority or an elaborate infrastructure needed to create a balanced self-sustaining system, just honest agreements between two parties. Of course, we have to get ourselves to the point where we can be sincere with ourselves and others and conscious of our connection with the universe before we could create a boundless and equitable economic system, but if there is hope in any defined economic system, I think it is some form of the barter system.

 

[Buddy]

On the bottom line, does it really matter what the "unit" of exchange is? As long as people who want to live, agree on some standard unit like "one hour", or "one token", or "one whatever", people can apply their creativity, work, and prosper...individually and as a community. The wider the participating community or network, the wider the available market and the easier it is for a given individual.

As we speak, there are communities where baby sitting co-ops have been formed. People are trading time for tokens, or exchanging baby sitting services for "hours" of same on a reciprocating basis. This is just one example of what is possible when people get creative.

When money/gold is unavailable for large groups of people, individuals wanting to eat, tend to adapt to whatever system is agreeable to everyone as long as some "standard unit" is agreed upon and can be counted on.

If that's the type of situation similar to where we are headed, so be it. I'll be doing what needs to be done. :)

 

[SeekinTruth]

[...]
go2-Well, I can't really disagree with what Professor Fekete says in principle, but I think he's missing the bigger picture here. There is no real reason to bring the USD into this because we all know that it's crap. It's just a piece of paper with green ink on it, period. I see two discussions here, one regarding whether you should buy gold to prepare for the economic collapse, and the other is more of a philosophy of economics on the viability of gold as a unit of societal exchange. For the first question, I think it is a good idea to have a few ounces of gold at your disposal if you can afford it. The evidence suggests that the financial system is teetering on collapse and people are looking for a viable alternative to the doomed paper markets. Gold is a natural choice due to its reputation. If one finds themselves in a situation where their currency is suddenly useless, gold adds a nice degree of flexibility to still make purchases in a somewhat normal manner. So you and Fekete are absolutley right about it's durability, marketability, etc. However, I will caution here that having pounds and pounds of gold in one's vault is delusional. The only reason you would want so much gold is because you want to come out of the collapse better than you went into it, to profit from it. There is reason to believe that this collapse is different from prior collapses and there isn't going to be a recovery, as such. As the collapse goes on, gold will have some desirability because of it's durability, marketability, and perhaps shinyness, but people are going to be more concerned with things they actually need. As other members have pointed out, gold is pratically useless, and in the case of a total infrastructure collapse, gold is just one of many things that could be traded for value. Sure, the PTB really don't like the idea of people having gold because it requires a lot more effort to take away. The PTB can impoverish most of the world with a few keystrokes on a computer, but in a gold based system they have to physically come and confiscate everyone's gold, which can be arranged by the way. You see, you can cut down a tree with an axe or with a chainsaw. You'd prefer to use the chainsaw, but you'll use the axe if you're out of gas. You could say that the advantage to gold, the ONLY advantage to gold, is that it is more difficult to control and steal, thus giving an added layer of protection, but it is far from being safe.

For the second point, I would say that gold is a horrible choice to base one's economy on. I think we need to examine this issue of scarcity a little more closely. If the supply of goods and services combined with population grows faster than the supply of gold, then the value of gold must increase or the economy must stagnate. My bet is that the gold supply would be vastly outstripped as to cause consistent deflation which encourages hording. In fact, I think that if secrets guarded by the PTB were to be released regarding cutting edge science, China's "miraculous' growth rate of 10% would seem rather passe. You have a situation where if human creativity was allowed to flow freely, economic growth could be incredible. If gold is being "saved" and not spent because of its increasing value, then the velocity of money will trend toward zero and you'll have recessions, unemployment, and all of that. You could enact laws to mitigate the effects and prevent people from accumulating too much gold or holding on to it for too long, but how will you enforce them? You will need a large agency that keeps track of gold transactions and has the authority to confiscate gold from offenders. We're already back to the idea of a central bank, and this is just to keep your system stable beyond a couple of decades. Then what's to say that these "enforcers" won't decide that their pay is too low and skim a little off the top of their arrests? Over time, they could form their own club that has enough clout to influence the direction of the system in a way they desire. You see, while gold does not allow for the egregious fraud a paper system does, it is far from an ideal currency or even a good one. Now what if scarcity doesn't really exist? If the hyperdimensional realm does indeed provide for an abundance of everything, there is no reason for anything to have value at all, at least in the monetary sense. When there is plenty of everything for everybody, why use money? People can just go and get what they want because no limits exist. At that point, money is just dead weight to carry around. In fact, the concept of "payment" would only be a self-limiting concept. People would be able to just give and receive freely because they know that the resources that they need will always be there. I will add here that this system can only work in an STO society. As soon as the concept of personal gain or being of a higher class than someone else enters the society, there will be an energy imbalance that will cause the system to collapse as they siphon off more and more energy and cause the rest of the people to doubt each other. If this Ponerology isn't recognized by the society at a very early stage, it will infect and destroy the entire system. At any rate, even if you did theroretically create an economic system with neither inflation or deflation, full employment, and a high standard of living for all with gold as the base monetary unit, by the time your society reached these milestones gold would be irrelevant other than for artisitc or decorative uses.

So I think we can conclude here that money does not exist in the absence of scarcity. Money is the product of STS lies and is therefore inherently STS. Although one could reboot the financial system with gold and philosophize all day about an eglatarian monetary system, no such can ever arise because money creates stratification and elitism as part of its very nature. It's like trying to create a black hole that doesn't "suck." The best system we have ever known would probably be the barter system. In the barter system, there is no money per se, and value is assigned based on the specific need and circumstance. There is no central enforcement authority or an elaborate infrastructure needed to create a balanced self-sustaining system, just honest agreements between two parties. Of course, we have to get ourselves to the point where we can be sincere with ourselves and others and conscious of our connection with the universe before we could create a boundless and equitable economic system, but if there is hope in any defined economic system, I think it is some form of the barter system.

On the bottom line, does it really matter what the "unit" of exchange is? As long as people who want to live, agree on some standard unit like "one hour", or "one token", or "one whatever", people can apply their creativity, work, and prosper...individually and as a community. The wider the participating community or network, the wider the available market and the easier it is for a given individual.

As we speak, there are communities where baby sitting co-ops have been formed. People are trading time for tokens, or exchanging baby sitting services for "hours" of same on a reciprocating basis. This is just one example of what is possible when people get creative.

When money/gold is unavailable for large groups of people, individuals wanting to eat, tend to adapt to whatever system is agreeable to everyone as long as some "standard unit" is agreed upon and can be counted on.

If that's the type of situation similar to where we are headed, so be it. I'll be doing what needs to be done. :)

I think some of the deep issues of the problem of freely exchanging among people have been touched on pretty well. We should probably separate mid/short term from long term probabilities.

In the long term, I think there's a pretty high probability that gold will be essentially almost useless. In the mid-term -- the transition -- it could serve some very well to not be caught in a situation that could wipe out all their ability to move freely and purchase what they need.

Let me just make an obvious point to help reduce approaches that are too black and white. We ARE STS living in an STS realm, dominated by STS powers that are very powerful relative to those below them in the STS realm. So ANYTHING can be used for control, domination, deceit, hording, etc. -- whether it's some monetary system where the "money" is made of paper or metal -- or false "science" or false "religion," EVERYTHING is used as a weapon by the PTB. Right now, we still need to function to a certain extent within this system. Just because the financial-econo-political system is a corrupt system for control and domination -- basically used as a weapon -- doesn't make paper or any metal inherently "evil" per se. Just like true science and religion have huge value and benefits that are prevented from being accessed and utilized by the PTB.

As far as recommending to buy gold to others, well, that all depends on your financial situation at the present moment. If you have significant savings, it's probably a good idea to have some gold for when the paper currency system collapses to make the transition to continue to be able to get what you need. I would say if someone has cash savings of at least say $25,000 to $50,000 or more which they will not need to spend in the relatively near future, it might be a good strategy to get some physical gold. Maybe 15 to 30% of cash savings kept as physical gold as a sort of insurance.

If, on the other hand, someone doesn't have even that much cash savings, then it's a totally irrelevant thing to think about. Even for someone who has $50,000 or $75,000 savings, there are always some risks in buying physical gold (such as manipulation of the gold market and counterfeiting, etc.) so it should be approached the same way as buying an insurance policy: some insurance firms are more corrupt than others.

Anyway, the issue of gold, like everything else, is about being able to get from "here" to "there." We are living in an STS world in the process of collapse. We are working to choose to transition to an STO realm, but we must get there from here. I don't thing we can really predict what will come in handy for the transition with very high accuracy. So if you have some savings in the form of cash that will not be spent shortly, should you convert some of that into physical gold? It might be a pretty good thing to look into as an insurance policy to have your savings survive the collapse of paper currencies in the immediate aftermath.

Oh, and barter will definitely come into play as well.

 

[go2]

It becomes clear, through the fog, that the PTB are prepared for the end of USD reserve currency. The pieces of the puzzle are unveiled to those who connect obscure hints and speeches from the giants of money with wealth to store beyond the reach of the avaricious and the reckless. We may not like the reality of this world, but it behooves us to study and prepare for possibilities of a different future.

Gold is returning to center stage as the wealth reserve and currency of settlement between nation states, Central Banks, wealthy individuals, and many of small means, especially in India, China, Germany, and the Islamic world. Actually nothing has changed behind the curtain where simple people have continued to insist on using gold as the measure and store of wealth and value, since who with a memory and experience will trust another for long with promises-to-pay tomorrow for goods and services delivered today.

Below is an article collecting the pieces of this puzzle in a coherent essay a layman can decipher. The USD denominated assets will soon be devalued against gold. One who has surplus today would be well advised to study this situation and prepare. That being said, this scenario is only one of many possibilities of world change. The world has endured many catastrophes in its long history and gold has endured through these changes as man's preferred store-of-value.

History and loss convince many that value storing and value measuring functions of money will be separated from the transactional fiat currency printed by governments for convenient taxing and exchange of goods and services. This development will likely constrain government and corporate elite's power to loot the surplus of working men and women, as people will be able to place after tax surplus earnings into gold which cannot be printed or created or devalued in the manner of the USD promises-to-pay. I think Option 2 of Mr. Kosares essay is the likely outcome of the USD collapse. If mankind has a future, gold will recapitalize tomorrow.

How Gold Became Politically Correct
Submitted by Michael Kosares on Tue, 25 Jan 2011

"When the monetary history of the year coming to an end is written decades from now, the headlines of European debt crisis and Federal Reserve's adoption of QE2 may turn out to be mere footnotes to the bigger story: 2010 could be a watershed marking the beginning of the end of the dollar-based, Western-centric monetary system." -- Randall Forsyth, Barron's

"We wish to highlight not all but some of the 'fears' that keep us awake at night, and illustrate why right now is not the final act for gold. 2011 could be an explosive year for this most illustrious of metals. . .We believe withstanding a lack of gold standardisation, gold has a firm place in modern portfolio management and in accounting procedures."-- Hinde Capital, None Shall Sleep 2011

by Michael J. Kosares

It all started very quietly with a little-known speech in May of 2008 by Benn Steil, a highly respected policy insider at the the Council on Foreign Relations. The CFR is generally considered the font of establishment thinking on foreign and international economic policy. Steil's speech had to do with gold -- an unusual subject for someone so prominent in the CFR. His proposal? That gold should be restored to a central role in the international monetary system.

Steil's proposal had an immediate impact. Reports began to filter into the markets that certain central banks were beginning to accumulate gold bullion as part of their reserves. Some went about their acquisitions quietly. Others pursued their interest in the open. India, for example, made a highly publicized 200-tonne purchase from the International Monetary Fund. Simultaneously, traditional gold sellers, like many of the European central banks, shelved selling plans. Sales under the Central Bank Gold Agreement came to a standstill. It was about this time, too, that reports began to surface of a very strong developing interest in gold bullion among major hedge fund operators.


By 2010, policy notables like Robert Zoellick, president of the World Bank, Thomas Hoenig, president of the Kansas City Federal Reserve, Randall Forsyth of Barron's magazine and Indiana Congressman Michael Pence, an oft-mentioned contender for the 2012 presidential sweepstakes, had come public with their own support of a new role for gold in the world's monetary system. Hoenig stated that the gold standard is a "very legitimate monetary system." Pence suggested that "the time has come to have a debate over gold, and the proper role it should play in our nation's monetary affairs. A pro-growth agenda begins with sound monetary policy."GoldStandard1

Zoellick wrote in Financial Times that gold should be looked upon as a means to stabilizing the global monetary system. In January, 2011, former Fed chairman Alan Greenspan noted in a Fox Business interview that "There are numbers of us, myself included,who strongly believe that we did very well in the 1870 to 1914 period with an international gold standard." Suddenly, and to some inexplicably, gold had gone from hopelessly out-of-style in policy circles to highly fahionable. Gold, in fact, suddenly had become politically correct.

The new role for gold narrows down to two options covered below. The first is to return to a fixed-price gold standard similar to the post World War II Bretton Woods arrangement. The second is for gold to take on a role similar to the one it now plays in the European Union. In either instance, the best-positioned investors, for reasons outlined below, will likely be the owners of the physical metal itself, although those who own the right gold-mining companies could also gain significantly over the longer run, as the need for sizable new production becomes increasingly apparent.

Option #1 - Bretton Woods II, the traditional gold standard

Recently Alan Greenspan surfaced as probably the most prominent advocate of the gold standard. "We have at this particular stage a fiat money," he said, "which is essentially money printed by a government, and it's usually a central bank which is authorized to do so. Some mechanism has got to be in place that restricts the amount of money which is produced, either a gold standard, a currency board, or something of that nature." Without it, he warned, "all of history suggests that inflation will take hold with very deleterious effects on economic activity."

Much of the discussion on a return to the gold standard has centered around resurrecting Bretton Woods, which was the operating monetary system from just after World War II to the early 1970s. Under Bretton Woods, the price of gold was fixed at $35 per ounce and all the currencies, in turn, traded at fixed exchange rates relative to the dollar. This arrangement broke down in 1971 when president Richard Nixon closed the gold window. Continued redemptions at the $35 benchmark eventually would have depleted the U.S. gold reserve. Nixon declared that "we are all Keynsians now" and the world went on the fiat money system that is still in operation today.

To make a gold standard work today, the metal would have to be valued at a very high dollar price to address the imbalances already existing in the world's reserve system, and to make it possible for the new system to function smoothly and equitably. If, for example, one were to value the U.S. gold reserve high enough to cover the U.S. national debt of over $14 trillion, gold would have to be benchmarked at over $50,000 per ounce. To cover the external U.S. debt of $4.3 trillion, it would need to be valued at $16,500 per ounce.

Though $50,000 an ounce, or even $16,500 an ounce, may be significantly more than would be required to restore order in the monetary system, too low a price would recreate the same problems which caused the abandonment of Bretton Woods in the first place. To make a gold standard work, policy-makers will be called upon to choose a price that would bring balance between the roughly 8000 tonne U.S. gold reserve and the massive dollar reserves that have built-up all over the globe. To be sure, it is unlikely such balance would occur in the current price range.

Beyond the pricing problem, a return to a fixed gold standard presents additional challenges. The essential reason for a gold standard is to restrict governments' ability to run deficits and print money. When politicians consider the problems faced by countries like Greece, Ireland, Portugal and Spain during the recent European sovereign debt crisis, they will not fail to note that in each instance those nation-states had relinquished their monetary sovereignty to the larger European Union. The options to run deficits, print money and debase the currency as a means to an end were off the table. Those who read their history texts carefully will be quick to point out that the gold standard offers major benefits, like a low inflation rate, balanced trade accounts and a strong currency. However, for all its benefits, it also conjures up images of deflationary depressions and financial panics, which would imply the kind of economic chaos that plagued the world economy intermittently under the gold standard before World War II.

In an imperfect world, no monetary system is without flaws. There are tradeoffs, imperfections, and a downside no matter what kind of monetary architecture is employed. Recognition that there are limitations to any monetary system might be the strongest argument for gold coins and bullion as an evergreen portfolio item. In the end, the gold standard is prone to deflationary breakdowns and the fiat money standard is prone to inflationary or stagflationary breakdowns. In the era of the nanny state, it is not too difficult to guess which of the two poisons is more palatable politically, and that is why a true Bretton Woods II accord is unlikely to get beyond the talking stage, despite the endorsement of luminaries like Alan Greenspan.

Option #2 - The European Union's mark-to-market model

The more likely, and probably preferrable course, of action is for governments to use gold in a fashion similar to that employed by the European Union in 1999 when it introduced the euro. Robert Mundell, the Nobel Prize winning economist and "the intellectual father of the euro," advised the European Central Bank (ECB) to use gold as part of its reserves. By doing so, he reasoned, it would offset the dangers of holding national currencies capable of being debased. In other words, he recommended that the ECB own gold for the same reasons any individual would.

The European Union took his advice. Its gold reserves proved to be a bulwark and an example amidst the currency wreckage during gold's run-up from €246 per ounce in 2001 to €1055 per ounce at the end of 2010. From 30.5% of Eurosystem's net international reserves in 1999, gold went to 67.1% of net total reserves helping bring relative stability to the euro currency despite the union's sovereign debt problem.

In the run-up to Chinese President Hu Jintao's recent visit to the United States, he took time off from spreading mega-doses of financial largesse among troubled European nation-states to bluntly criticize the dollar-based international currency system. Calling it a "product of the past," he suggested a new system that would be more "fair, just, inclusive and well-managed." Obviously, Hu sees in all this a stronger roll for China's currency, the yuan. More importantly to Americans, like a good many of his counterparts across the globe, he also foresees a diminished role for the U.S. dollar.

China enjoys the unique distinction of being both the world's largest producer and consumer of gold. Its attachment to the yellow metal, like India's, is deep-seated and goes back to ancient times. The People's Bank of China is on the record for advocating a target reserve holding of 4000 tonnes -- roughly half that of the United States. If we are indeed at the dawn of a new world economic order as many suggest, then China's place in it will be an important one, and its views on gold will become an important element to any discussions of a new monetary system.

When Robert Zoellick's proposal on monetary gold was published in November, 2010, it was seen by many as a call for a return to the gold standard. A close review of his remarks, however, tells a different story. Zoellick himself has said that those who read his proposal as a return to the gold standard were off the mark. Instead, he said, gold should play a role "as a reference point for market expectations of inflation and future currency value." Under such a system, if gold were not allowed to float in value against the various currencies, it could not serve as a viable "reference point." In other words, Zoellick proposed a role for gold in international currency reserves similar to the one it plays at the European Central Bank. Benn Steil too echoed the thinking of Robert Mundell in his speech delivered in 2008:

". . .if you go down the line of currencies around the world, you don't find many attractive opportunities. And that's why I say if the world were to give up on dollars and give up on euros, they'd probably go back to the old standby, which is gold. And I don't mean by gold, government run gold standard, like we had in the late 19th century. That's politically impossible. Governments will never be willing to subordinate their policies to the constraints of a hard commodity ever again... So how could gold make a revival as a sort of international money? Well, we don't actually need a government run gold standard anymore...since people have always had confidence in gold as a long-term store of value, there's no reason why it couldn't play that role."

Where do we go from here?

As you can see, the calls for gold's return are not really centered around the gold standard at all, but a role for gold as an alternative, no-strings-attached currency reserve. What would such a change in gold's official sector function mean for the private citizen who also happens to be a physical gold owner?

First and foremost, instead of gold being an enemy of the state, it would become a friend. Instead of being a pariah among some key central banks, it would become an honored guest. Instead of being sold and leased by central banks, it would come under accumulation, particularly by those nation-states which are light the precious metal (e.g. India, China and Japan).

In short, all of those things that gold labored against mightily over the past several decades would be suddenly removed. In the years ahead, that change in thinking could turn out to be among the most important baseline results of the financial crisis for economic policy-makers and for ordinary investors alike.

Thomas Kaplan (Tigris Financial Group) put it this way in a Financial Times opinion piece titled "Brace for a Perfect Storm in Gold":

"I believe the renewed appreciation of risk management is in its infancy and that gold, like stocks and bonds, will recover its relatively small, but significant historical position in the world's investment funds. Considering the tiny size of the gold market, the implications of a potential return of gold into the world's largest portfolios are enormous. For, unlike stocks and bonds, whose supply can increase to meet demand, there is not enough gold to go around at today's prices."

It could very well have been in anticipation of this landmark change in international monetary dynamics that some of the most revered hedge fund operators in the world (George Soros, Paul Tudor Jones, John Paulson, David Einhorn, Eric Mindich - to name a few) began to accumulate gold in bullion form. In some hedge funds, like Soros Fund Management, gold represents the largest position in their overall holdings. The funds with large physical holdings, in essence, are positioning themselves to become the gold banks of the future. Among other possible outcomes, if the world's nation-states were to agree to gold playing a role similar to the one described by Steil and Zoellick, gold could come under the kind of demand pressure that would send it soaring to the next level -- a circumstance that refreshes the old adage "he (or she) that owns the gold, makes the rules." That sentiment applies not just to gold-heavy hedge funds, but to the well-positioned private owner as well.

 

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It is not widely known that or how financial instruments are the preferred imperial mechanism to plunder the creative energy of humanity for the benefit of small STS elites. There is an increasing focus on and dissemination of knowledge of the master-slave reality of our lives on this planet in this age of the internet.

It can be said that these STS elites are the Evil Magicians ruling by hypnotic suggestion and myth making. The Evil Magicians obviously have great knowledge and resources to maintain control century after century. People even deny this master-slave reality exists. The war is waged by mind control. Our minds are deceived concerning the role of money in the lives of billions of human beings.

GATA has worked for decades to unearth and expose the financial mechanism of imperial control. Chris Powell published an article compiling evidence of the imperial mechanism operating through the Central Banking System by control of money. The master must control physical gold, as gold is beyond the blood letting mechanism of fiat money.

Hence, we observe a massive and sustained campaign of disinformation and legal assault on humanities knowledge of and access to gold as a measure of value and a store of value. Money is called the “root of evil”, but the truth is those who control the knowledge and creation of money are evil. Gold is not a “barbarous relic” but a means of measuring value and storing value in commerce between billions of men and women on this planet.

The return of gold to the world stage can be seen a harbinger in the battle being waged to remove the financial looting mechanism of money control from STS elites operating through government and the banking control of money. There is much more than this small piece of a larger puzzle. It is one view of the elephant in the living room. This will be my last post on this subject, as this information is now available on the internet for all who wish knowledge of the mysteries of gold and money. Thank you.

Chris Powell: And was Jerusalem builded here?

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Why gold and silver are mysteries

Why is gold such a mystery? Why is it, along with silver, kept such a mystery?

It's because the two precious metals are not only money but, from the point of view of free people, the best sort of money, less susceptible to what governments see as the most desirable quality of money -- the susceptibility to control by government and particularly susceptibility to devaluation. You can print or otherwise issue gold and silver derivatives to infinity, but not the metals themselves.

Gold particularly is kept such a mystery because it is the key to unlocking the currency markets, which long have been the most efficient mechanisms of imperialism.Many of you have heard about the looting of Europe undertaken by the Nazi German occupation during World War II. But most of that looting did not take place as it is imagined, at the point of a gun. No, it took place through the currency markets.

This looting through the currency markets was spelled out by the November 1943 edition of a military intelligence letter published by the U.S. War Department, a letter called Tactical and Technical Trends. Of course the Nazi occupation seized whatever central bank gold reserves had not been sent out of the occupied countries in time. But then the Nazi occupation either issued special occupation currency that could not be used in Germany itself or, in countries that had fairly sophisticated banking systems, took over the domestic central bank and enforced an exchange rate much more favorable to the reichsmark. Or else the Nazi occupation simply printed for itself and spent huge new amounts of the regular currency of the occupied country.

This control of the currency markets drafted everyone in the occupied countries into the service of the occupation and achieved a one-way flow of production -- a flow out of the occupied countries and into Nazi Germany.

For a few years Nazi Germany had one hell of a trade deficit -- and couldn't have cared less about it. For being in the position to print the currencies for occupied Europe, Nazi Germany never had to cover that deficit, at least not as long as the military occupation continued.

Since the United States now issues the reserve currency for the world, the dollar, the United States now more or less occupies most countries economically, even those countries that have their own currencies, since even those countries hold most of their foreign exchange reserves in dollars.

Free-trading and widely accessible gold always has been and always will be doom to the rigging of the currency markets, always will be the escape from overbearing government generally and from any overbearing government in particular. That is why those U.S. government records compiled by GATA over the years candidly discuss or advocate or describe controlling and suppressing the gold market -- and suppressing the truth itself.

The secret knowledge

The truth as GATA sees it is this:

First, gold is the secret knowledge of the financial universe and its true value relative to currencies is vastly greater than its nominal price today, since much of the gold that investors think they own doesn't exist. The actual disposition of Western central bank gold reserves is a secret more closely guarded than the blueprints for the manufacture of nuclear weapons. For gold is a deadly weapon against unlimited government.

Second, all technical analysis of all markets now is faulty if it fails to account for pervasive and surreptitious government intervention.

And third, the intervention against gold is failing because of overuse, exposure, exhaustion of Western central bank gold reserves from gold sales and leasing, and the resentment of the developing world, which is starting to figure out how it has been expropriated by the dollar system, a system in which people do real work and create real goods and send them to the United States in exchange for nothing but colored paper and electrons.

For years now the Western central banks have been attempting a controlled retreat with gold, bleeding out their reserves with sales, leases, and especially derivatives so that gold's ascent and the dollar's inevitable decline may be less shocking. Central bankers often convey part of this strategy in code; they warn against what they call a "disorderly decline" in the dollar, as if an "orderly" decline is all right.

The rise in the gold price over the last decade is just the other side of that coin -- an "orderly" rise, 15-20 percent or so per year, a rise carefully modulated by surreptitious central bank intervention.

But GATA believes that the central banks may have to retreat farther with gold than anyone dreams, and far more abruptly than they have retreated so far. We believe that when the central banks are overrun in the gold market, as they were overrun in 1968, and the market begins to reflect the ratio between, on one hand, the supply of real gold, actual metal, not the voluminous paper promises of metal, and, on the other hand, the explosion of the world money supply of the last few decades -- as the market begins to perceive the difference between the real and the unreal -- there may not be enough zeroes to put behind the gold price.

Market analysts talk about what they call "reversion to the mean." But maybe we should talk about reversion to the real.

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