Jul 21

In 1920 gold fell, then it soared!


weimar-hyperinflation

- Gold/Silver Prices Under the Weimar Republic’s Inflation (Daily Paul, Dec 21, 2010):

Stole this from another article/blogger.

Quote:

“On a closing note, because I forgot last week, I would like to share with everyone just how the price of silver and gold escalated in German Mark terms, through the Weimar experience:

Hyperinflation: Wiemar, Germany January 1919 to November 1923
[Expressed in German Marks needed to by an oz. of ag. or au.]”

Jan. 1919
Silver 12
Gold 170

May. 1919
Silver 17
Gold 267

Sept. 1919
Silver 31
Gold 499

Jan. 1920
Silver 84
Gold 1,340

May 1920
Silver 60
Gold 966

Sept. 1921
Silver 80
Gold 2,175

Jan. 1922
Silver 249
Gold 3,976

May. 1922
Silver 375
Gold 6,012

Sept. 1922
Silver 1899
Gold 30,381 Continue reading »

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Jul 18

- If This Keeps Up, They Will Have To Start Putting Armed Guards On Food Trucks (Economic Collapse, July 16, 2014):

The basic necessities in life just keep getting more expensive.  On Tuesday, Hershey announced that the price of all of their chocolate bars is going to go up by about 8 percent.  That is particularly distressing to me, because I am known to love chocolate.  But if it was just chocolate that was becoming significantly more expensive perhaps that would be okay.  Last month, it was coffee.  J.M. Smucker, one of the largest coffee producers in the United States, announced that it planned to raise coffee prices by about 9 percent.  And Starbucks has announced a bunch of price increases across the board on their coffee products.  Of course we could all survive without chocolate and coffee, but as you will see below just about every food category is becoming more expensive.  If this keeps up, could we eventually see armed guards in grocery stores and on food trucks? Continue reading »

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May 23

Inflation-Ahead

- No inflation Friday: 42.4% increase in the price of being… poor? (Sovereign Man, May 23, 2014):

One of the most intellectually disingenuous statements made by western policymakers is that inflation is tame… nonexistent.

For example, the minutes released this week from the most recent Federal Reserve policy meeting said that the Fed saw NO inflation risk in ‘fueling job growth’ [i.e. printing money].

So by their own admission, the Fed thinks they can conjure hundreds of billions of dollars out of thin air without any consequences whatsoever. Zero risk.

Every time I hear something like this it just makes my skin crawl… and I always think, “go get on a plane.”

Inflation is out there in the rest of the world. To deny its existence is massively arrogant, insensitive, and just plain wrong. Continue reading »

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Jan 14

One Hundred Trillion Dollars

- We Will Be Told Hyperinflation is Necessary, Proper, Patriotic, and Ethical (Ludwig von Mises Institute, Jan 13, 2014):

Hyperinflation leads to the complete breakdown in the demand for a currency, which means simply that no one wishes to hold it. Everyone wants to get rid of that kind of money as fast as possible. Prices, denominated in the hyper-inflated currency, suddenly and dramatically go through the roof. The most famous examples, although there are many others, are Germany in the early 1920s and Zimbabwe just a few years ago. German Reichsmarks and Zim dollars were printed in million and even trillion unit denominations.

Continue reading »

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Oct 31

- Don’t Worry – The Government Says That The Inflation You See Is Just Your Imagination (Economic Collapse, Oct 29, 2013):

If you believe that there is high inflation in the United States, you are just imagining things.  That is the message that the U.S. government and the Federal Reserve would have us to believe.  You might have noticed that the government announced on Wednesday that the cost of living increase for Social Security beneficiaries will only be 1.5 percent next year.  This is one of the smallest cost of living increases that we have ever seen.  The federal government is able to get away with this because the official numbers say that there is hardly any inflation in the U.S. right now.  Of course anyone that shops for groceries or that pays bills regularly knows what a load of nonsense the official inflation rate is.  The U.S. government has changed the way that inflation is calculated numerous times since 1978, and each time it has been changed the goal has been to make inflation appear to be even lower.  According to John Williams of shadowstats.com, if the inflation rate was still calculated the same way that it was back when Jimmy Carter was president, the official rate of inflation would be somewhere between 8 and 10 percent today.  But if the mainstream news actually reported such a number, everyone would be screaming and yelling about getting inflation under control.  Instead, the super low number that gets put out to the public makes it look like the Federal Reserve has plenty of room to do even more reckless money printing.  It is a giant scam, but most Americans are falling for it.

Meanwhile, the prices of the things that most Americans buy on a regular basis just keep going up.  The following are just a few examples of price inflation that we have seen lately: Continue reading »

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Sep 23

- Quantitative Easing Worked For The Weimar Republic For A Little While Too (Economic Collapse, Sep 22, 2013):

There is a reason why every fiat currency in the history of the world has eventually failed.  At some point, those issuing fiat currencies always find themselves giving in to the temptation to wildly print more money.  Sometimes, the motivation for doing this is good.  When an economy is really struggling, those that have been entrusted with the management of that economy can easily fall for the lie that things would be better if people just had “more money”.  Today, the Federal Reserve finds itself faced with a scenario that is very similar to what the Weimar Republic was facing nearly 100 years ago.  Like the Weimar Republic, the U.S. economy is also struggling and like the Weimar Republic, the U.S. government is absolutely drowning in debt.  Unfortunately, the Federal Reserve has decided to adopt the same solution that the Weimar Republic chose.  The Federal Reserve is recklessly printing money out of thin air, and in the short-term some positive things have come out of it.  But quantitative easing worked for the Weimar Republic for a little while too.  At first, more money caused economic activity to increase and unemployment was low.  But all of that money printing destroyed faith in German currency and in the German financial system and ultimately Germany experienced an economic meltdown that the world is still talking about today.  This is the path that the Federal Reserve is taking America down, but most Americans have absolutely no idea what is happening.

It is really easy to start printing money, but it is incredibly hard to stop.  Like any addict, the Fed is promising that they can quit at any time, but this month they refused to even start tapering their money printing a little bit.  The behavior of the Fed is so shameful that even CNBC is comparing it to a drug addict at this point: Continue reading »

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May 26


YouTube Added: 24.05.2013

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May 23

- Hyperinflation – 10 Worst Cases (ToTheTick, May 22, 2013):

I have a neat little app on my smartphone that I like to look at when I’m feeling bored. It won’t change anything in my life, but it makes me think as I see the numbers clocking up, and then suddenly stopping for a few seconds. It’s the app that tells me the how much the National Debt of each country stands at in real-time. As I sit down at my computer screen the USA National Debt amounts to $17 041 241 xxx xxx. Forgive the x’s…they’re not kisses…I tried to get the last six digits, but, there’s no point, they’re moving too fast! Speedie Gonzalez has got into that app! It works out to $54 087 per person. That’s the same value as 3 408 248 816 XXX Big Mac Meals.

Inflation is hot property today, hyperinflation is even hotter! We think we are modern, contemporary, smart and ready to deal with anything. We’ve got that seen-it-all-before, been-there-done-it attitude. But, we are not a patch on what some countries have been through in the worst cases of hyperinflation in history. Here’s the top 10 list of worst cases in history. We’ll start with the worst first…let’s think positive! Continue reading »

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May 22

- Argentine Inflation: It’s Tough When All You Get Is Lies (Testosterone Pit, May 21, 2013):

The issue of inflation is complex everywhere. Official rates are disputed. People can’t reconcile them with what they see at the store. There are different formulas and data sets, resulting in different rates, and everyone picks and chooses what suits their needs. But nowhere is the issue as “complex,” infested with lies, and shrouded in obscurity as in Argentina.

Continue reading »

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May 15

- Argentines Are Hoarding 1 Of Every 15 Cash Dollars In The World (ZeroHedge, May 15, 2013):

With the shadow (or blue) market for Argentina Pesos already devalued by an incredible 50%, it is little surprise that the population is bidding for any store of value. Demand for luxury cars is soaring (BMW sales up 30% in the last 20 months) and Bitcoin activity is often discussed as the population transfer increasingly worthless Pesos into a fungible “currency” or domestic CPI protection; but it is USD that are the most-cherished item (despite a ban on buying USD) as hyperinflation hedges. But as Bloomberg Businessweek reports, a lot of US Dollar bills are tucked away somewhere in Argentina (in stacks of $100 bills since the number in circulation has risen from 58% of the total to 62% since 2008). One table is a 2012 Fed paper on demand abroad for US currency shows net inflows to Russia and Argentina has increased by 500% since 2006 (compared to US demand up around 10%). In fact, demand for large dollar transfers to Argentina since 2006 has outstripped demand for dollar cash overall in the world. It is safe to surmise from the data (that is relatively well guarded by the government) that over $50bn is being hoarded in Argentina (or well over one in every fifteen dollars). It is little wonder that the government is furiously digging at the country’s undeclared (stashed under the mattress) wealth. Continue reading »

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Apr 05

- Kyle Bass: “Japan Will Implode Under Weight Of Their Debt” (ZeroHedge, April 4, 2013):

As the fast-money flabber-mouths stare admiringly at the rise in nominal prices of Japanese (and the rest of the world ex-China) stock prices amid soaring sales of wheelbarrows following Kuroda’s ‘shock-and-awe’ last night, it is Kyle Bass who brings these surrealists back to earth with some cold-hard-facting. Out of the gate Bass explains the massive significance of what the Japanese are embarking on, “they are essentially doubling the monetary base by the end of 2104.”

It is a “Giant Experiment,” he warns, but when you are backed into a corner and your debts are north of 20 times your government tax revenue, “you’re already insolvent.” Simply put, Bass says they have to do something and they have to something big because they are “about to implode under the weight of their debt.” For a sense of the scale of the BoJ’s ‘experimentation’, Bass sums it up perfectly (and concerningly), “the BoJ is monetizing at a rate around 75% of the Fed on an economy that is one-third the size of the US!”

What they are trying to do is devalue the currency to attempt to become more competitive while holding their rates market flat – the economic zealots running the world’s central banks believe they can live in that Nirvana – and Bass believes that is not the case, as they will lose control of rates, since leaving the zone of insolvency is impossible now. His advice, “if you’re Japanese, spend! or take it out of your country. If you’re not, borrow in JPY and invest in productive assets.” Do not be long JPY or Japanese assets as he concludes with the reality of Japan’s “hollowed out” manufacturing industry and why USDJPY is less important that KRWJPY.

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Apr 05


YouTube

Description:

In this interview with investor Kyle Bass from Day 1 at AmeriCatalyst 6th of November 2011, in Austin, Texas, Bass discloses his discussion about the economic crisis with a senior from the Obama Administration. According to Kyle Bass the basic solution coming from this senior was: “We’re Just Going to Kill the Dollar”.

Killing the US Dollar in this context means keep printing more US Dollars in order to weaken the dollar to make exports cheaper through inflation. Massive inflation might be the answer for the Obama Administration, but in the process your purchasing power will be destroyed. And because the US Dollar is the world’s reserve currency the eventual impact of inflation would have an impact that would reach far beyond those holding US Dollar assets.

Thousands of paper currencies has come and gone over the years and there is no question if the dollar, or the euro for that sake, will have its value go to zero; the question is when?

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Mar 31

- How Cyprus Exposed The Fundamental Flaw Of Fractional Reserve Banking (ZeroHedge, March 31, 2013):

In the past week much has been written about the emerging distinction between the Cypriot Euro and the currency of the Eurozone proper, even though the two are (or were) identical. The argument goes that all €’s are equal, but those that are found elsewhere than on the doomed island in the eastern Mediterranean are more equal than the Cypriot euros, or something along those lines. This of course, while superficially right, is woefully inaccurate as it misses the core of the problem, which is a distinction between electronic currency and hard, tangible banknotes. Which is why the capital controls imposed in Cyprus do little to limit the distribution and dissemination of electronic payments within the confines of the island (when it comes to payments leaving the island to other jurisdictions it is a different matter entirely), and are focused exclusively at limiting the procurement and allowance of paper banknotes in the hands of Cypriots (hence the limits on ATM and bank branch withdrawals, as well as the hard limit on currency exiting the island).

Continue reading »

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Mar 21

- Its Time to Collapse the System (Gordon Gekko’s Blog, March 20, 2013)

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Feb 28

- Trust me, this time is different… (Sovereign Man, Feb 26, 2013):

By 1789, a lot of French people were starving. Their economy had long since deteriorated into a weak, pitiful shell. Decades of unsustainable spending had left the French treasury depleted. The currency was being rapidly debased. Food was scarce, and expensive.

Perhaps most famously, though, the French monarchy was dangerously out of touch with reality, historically enshrined with the quip, “Let them eat cake.”

The Bourbon monarchy paid the price for it, eventually losing their heads in a 1793 execution.  But it took the French economy decades to finally recover.

Along the way, the government tried an experiment: issuing a form of paper money. It didn’t matter to the French politicians that every previous experiment with paper money in history had been an absolute disaster.

As French Assemblyman M. Matrineau put it in 1790, “Paper money under a despotism is dangerous. It favors corruption. But in a nation constitutionally governed, which itself takes care in the emission of its notes [and] determines their number and use, that danger no longer exists.”

Translation: This time is different. We’re different. We’re smarter. We won’t suffer the same fate. TRUST US.

Continue reading »

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Feb 05

- Argentina Freezes Supermarket Prices To Halt Soaring Inflation; Chaos To Follow (ZeroHedge, Feb 5, 2013):

Up until now, Argentina’s descent into a hyperinflationary basket case, with a crashing currency and loss of outside funding was relatively moderate and controlled. All this is about to change. Today, in a futile attempt to halt inflation, the government of Cristina Kirchner announced a two-month price freeze on supermarket products. The price freeze applies to every product in all of the nation’s largest supermarkets — a group including Walmart, Carrefour, Coto, Jumbo, Disco and other large chains. The companies’ trade group, representing 70 percent of the Argentine supermarket sector, reached the accord with Commerce Secretary Guillermo Moreno, the government’s news agency Telam reported. As AP reports, “The commerce ministry wants consumers to keep receipts and complain to a hotline about any price hikes they see before April 1.” Continue reading »

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Jan 31

- Peter Schiff & Doug Casey On Gold, Investor Cluelessness, And The “Escape From America” Plan (ZeroHedge, Jan 30, 2013):

In just under 30 minutes, Peter Schiff and Doug Casey muse on many facets of the crumbling edifice of the status quo that is our current world.From Gold’s relatively imminent rise to $5,000 and beyond, to investor ignorance of reality, Casey & Schiff swing from discussions of the US as political entity going forward to ‘escape from America’ plans for personal and wealth assets, and the realization that the biggest casualty (of US indebtedness), aside from individual liberty, is the value of the dollar – as taxing the middle class is unpopular with both parties – leaving only one route for the government – the inflation tax. Owning gold, silver, and foreign assets is preferred and while the rest of the world is also printing, the US is likely to beat them all.

People “are clueless with respect to the true state of the global economy,” with regard to inflation, fiat currencies, and specifically what will happen to the dollar. The conversation is wide-ranging and absolutely must-see as they remind market-watchers that “the whole thing is artificial,” as you can’t just keep printing money and monetizing debt without the dollar imploding with monetary policy descending (along with its trillion dollar coin) into ‘Three Stooges’ comedy.

The conversation weaves to some endgame discussions which bring Peter to discuss his father, who he sees as a political prisoner, and his views on the future…

“the biggest change that is coming to the global economy is a realignment of global living standards.”

There is something here for everyone…


YouTube Added: 30.01.2013

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Jan 12

- Hyperinflation In Action: Beer For Bag Of Cash (ZeroHEdge, Jan 12, 2013):

In May 2011, Belarus surprised its citizens by devaluing its currency by 50% overnight in an attempt to kickstart its economy, leading to swift and brutal hyperinflation. And while written narratives of the most recent episode of monetary collapse are one thing, nothing is quite as amusing, and grounding for those attempting to “value” money (such as Nobel prize winning economists writing out of their steel exoskeletal ivory towers), as watching a bag of cash be used to pay for seven boxes of beer. And nothing is quite a cathartic as spending several hours trying to count said cash – cash backed by the “full faith and credit” of the Belarus central bank…


YouTube

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Dec 15


YouTube

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Dec 13

“In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. … This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard.”
- Alan Greenspan

“By a continuing process of inflation , governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.
- John Maynard Keynes

Quantitative easing = printing money = creating money out of thin air = increasing the money supply = inflation = hidden tax on monetary assets = theft!


- First Hong Kong, Now Aussie Central Bank Gets Ugly Case Of Truthiness (ZeroHedge, Dec 12, 2012):

It seems the AsiaPac central bankers did not get the ‘shut up and print’ memo as today during another speech, an Australian central banker followed Hong Kong’s lead and pronounced quantitative easing as potentially harmful and the volatility-dampening effects of excess monetary policy as “ultimately inimical to financial stability and hence macroeconomic stability.” In the speech below Glenn Stevens (RBA Governor) provides some much-needed doses of sanity to the grossly addicted world desirous of moar money printing.

Central banks can provide liquidity to shore up financial stability and they can buy time for borrowers to adjust, but they cannot, in the end, put government finances on a sustainable course… They can’t shield people from the implications of having mis-assessed their own lifetime budget constraints and therefore having consumed too much.

Why are these AsiaPac bankers breaking ranks with the status quo? Perhaps they see a looming threat and prefer to front-run their governments’ demands to “get to work”.

Must Read:

Challenges Of Central Banking – Glenn Stevens (RBA Governor)

Monday marked the 70th anniversary of the commencement of operations of the Bank of Thailand, on 10 December 1942. Conceived under war-time occupation, the Bank has grown to be a key institution in Thailand. It is a pleasure and an honour to come to Bangkok to take part in one of a series of events to mark the anniversary, and I want to thank Governor Prasarn for the invitation. Continue reading »

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Dec 04

FT: ‘Wages Have To Be Slashed By 30-40% In the UK’


YouTube Added: 04.12.2012

Description:

In this episode, Max Keiser and Stacy Herbert investigate the black hole of debt sucking in our economies, jobs and wealth like strings of spaghetti past the economic event horizon. In the second half, Max Keiser talks to Ned Naylor-Leyland of Cheviot Asset Management about the fishy smoke signals blowing at the LBMA regarding silver contracts and about the debate between inflation, deflation, hyperinflation actually being a debate about the final denouement of paper currencies. Ned also reveals that BBC’s flagship programme, Panorama, had interviewed him and Andrew Maguire about silver manipulation and yet have never aired the episode.

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Nov 28

- The Giant Currency Superstorm That Is Coming To The Shores Of America When The Dollar Dies (Economic Collapse, Nov 27, 2012):

By recklessly printing, borrowing and spending money, our authorities are absolutely shredding confidence in the U.S. dollar.  The rest of the world is watching this nonsense, and at some point they are going to give up on the U.S. dollar and throw their hands up in the air.  When that happens, it is going to be absolutely catastrophic for the U.S. economy.  Right now, we export a lot of our inflation.  Each year, we buy far more from the rest of the world than they buy from us, and so the rest of the world ends up with giant piles of U.S. dollars.  This works out pretty well for them, because the U.S. dollar is the primary reserve currency of the world and is used in international trade far more than any other currency is.  Back in 1999, the percentage of foreign exchange reserves in U.S. dollars peaked at 71 percent, and since then it has slid back to 62.2 percent.  But that is still an overwhelming amount.  We can print, borrow and spend like crazy because the rest of the world is there to soak up our excess dollars because they need them to trade with one another.  But what will happen someday if the rest of the world decides to reject the U.S. dollar?  At that point we would see a tsunami of U.S. dollars come flooding back to this country.  Just take a moment and think of the worst superstorm that you can possibly imagine, and then replace every drop of rain with a dollar bill.  The giant currency superstorm that will eventually hit this nation will be far worse than that. Continue reading »

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Nov 25

Related article:

- Montana Lawmaker Asks To Be Paid In Gold Coins (Politico, Nov 13, 2012)

Flashback:

- Movie ‘Rollover’ (1981): World Economic Collapse – ‘The Great Depression Will Look Like Kindergarten’ (Video)


 

- Montana GOP Rep.: “Pay Me In Gold Before Dollars Have No Value” (ZeroHedge, Nov 24, 2012):

Jerry O’Neil, six-term GOP state representative in Montana, has asked to receive his salary (which at $10.33 per hour is around $1800 per month) in gold or silver. The long-standing legislator was driven to this decision by his constituents’ concerns about the nation’s massive debt-load and fears of our country’s collapse as “only so many dollars can be printed before they have no value.” The long-time Ron Paul supporter, according to Time, cited Article 1, Section 10 of the US Constitution, which says, in part, that “No State shall… make any Thing but gold and silver Coin a Tender in Payment of Debts.” State administrators have denied his request and added that “a bill could be introduced to accomplish this result.” O’Neil, like many other, believes “The Keynesian era of financing government with debt appears to be close to its demise.”

From O’Neil’s Letter (via HuffPo):

It is very likely the bottom will fall out from under the U.S. dollar. Only so many dollars can be printed before they have no value. The Keynesian era of financing government with debt appears to be close to its demise.

If and when that happens, how can we in the Montana Legislature protect our constituents? — The only answer I can come up with is to honor my oath to the U.S. Constitution and request that your debt to me be paid in gold and silver coins that will still have value when the U.S. dollar is reduced to junk status. I therefore request my legislative pay to be in gold and silver coins that are unadulterated with base metals.

Via Time:

A GOP state representative in Montana who asked to receive his salary in gold and silver coins has been rebuffed by the state’s Office of Legislative Services. Rep. Jerry O’Neil, who hails from the small town of Columbia Falls in the northwest corner of the state, sent a letter earlier this month requesting that his salary from here on in be paid in coins. Continue reading »

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Nov 21

- Is The Largest Weekly Inflow Into Bank Savings Accounts On Record, A Flashing Red Alarm? (ZeroHedge, Nov 20, 2012)

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Nov 04


YouTube Added: 14.10.2012


YouTube Added: 14.10.2012

See also:

- Interview With Former US Army Intelligence Officer And Bestselling Author James Wesley Rawles: Global Economic Collapse – Gun Confiscation – How To Survive The End Of The World – If The Power Grid Goes Down We Are In A Massive Die Off Situation Where Literally More Than 50% Of The Population Of The Country Could Die In Just One Winter (Video)

Books from James Wesley Rawles @Amazon.com:

- Founders: A Novel of the Coming Collapse

- How to Survive the End of the World as We Know It: Tactics, Techniques, and Technologies for Uncertain Times

- Patriots: A Novel of Survival in the Coming Collapse

- Survivors: A Novel of the Coming Collapse

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Oct 25

Related info:

- How To Buy Bullion (What To Ask And What To Own):

As far as precious metals go, you need to:

  1. Own actual Bullion
  2. Store it yourself (not in a bank)

Only physical gold is real. Do NOT own soon-to-be worthless paper!


- Hugh Hendry: “I Have No Idea Where The Stock Market Is Going To Be”… But “I Am Long Gold And Short The S&P” (ZeroHedge, Oct 25, 2012):

One of the best presentations at this year’s Economist Buttonwood gathering (which is still being live-streamed here), was, as usually happens, Hugh Hendry. The contrarian Scotsman, who describes his style as one where he “positions ourselves outside the accepted belief system”, managed to say in 15 minutes what takes most pundits hours, and that’s without the appendices, charts, long-winded essays, and graphs. Because when it comes to conveying ideas, simplicity always wins, and few are as good at speaking in simple, logical terms, as Hugh Hendry. Continue reading »

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Oct 19

- Bill Gross Warns “Very Likely’ Central Banks Will Cause 1987-Like Crash (ZeroHedge, Oct 19, 2012):

What takes other Political Journalism majors (and CTRL-C/V minors) pages and pages of verbose essays full of acronyms and meaningless gibberish to refute, Bill Gross asserts in less than 140 characters.

Continue reading »

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Oct 11

- Cashin Remembers Germany’s Hyperinflation Birthday (ZeroHedge, Oct 11, 2012):

Via Art Cashin of UBS,Originally, on this day in 1922, the German Central Bank and the German Treasury took an inevitable step in a process which had begun with their previous effort to “jump start” a stagnant economy. Many months earlier they had decided that what was needed was easier money. Their initial efforts brought little response. So, using the governmental “more is better” theory they simply created more and more money. But economic stagnation continued and so did the money growth. They kept making money more available. No reaction. Then, suddenly prices began to explode unbelievably (but, perversely, not business activity).

Continue reading »

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Oct 09

- Gold In Iran Soars By 23% In One Week As All Currency Transaction Tracking Disappears (ZeroHedge, Oct 9, 2012):

Just over a week ago we we were the first to shed light on the reality of hyperinflation on the ground in Iran – and subtley suggested the whole thing could be watched in real-time. Soon after, a mysterious cabal of 16 currency manipulators was arrested and the Rial jumped dramatically higher (according to official sources) – as if by magic there was no problem at all. This all sounded a little too good to be true (just like unemployment rates in slightly more controlled economies). Sure enough, by the power of social media, we now know it was too good to be true.As open-market foreign exchange rates – not just Rial-to-Dollar – have disappeared from the major currency exchange sites, as trade has reportedly slowed to near suspension after the Central Bank ‘imposed’ a rate of 28,500 Rials to the USD this weekend.

Critically, though, via EAWorldView, while the ‘real’ rate for the Irainian Real is effectively blacked out, gold prices continue to soar. ‘Old gold coin’ is now selling for 16 million Rials, up 23% from the pre-suspension 13 million Rial levels – even as the

Central Bank tries to suppress reality (especially to the rest of the world’s gaze) as hyperinflation continues – though less transparently.

Just over a week ago we we were the first to shed light on the reality of hyperinflation on the ground in Iran – and subtley suggested the whole thing could be watched in real-time. Soon after, a mysterious cabal of 16 currency manipulators was arrested and the Rial jumped dramatically higher (according to official sources) – as if by magic there was no problem at all. This all sounded a little too good to be true (just like unemployment rates in slightly more controlled economies). Sure enough, by the power of social media, we now know it was too good to be true. 

As open-market foreign exchange rates – not just Rial-to-Dollar – have disappeared from the major currency exchange sites, as trade has reportedly slowed to near suspension after the Central Bank ‘imposed’ a rate of 28,500 Rials to the USD this weekend.

Critically, though, via EAWorldView, while the ‘real’ rate for the Irainian Real is effectively blacked out, gold prices continue to soar. ‘Old gold coin’ is now selling for 16 million Rials, up 23% from the pre-suspension 13 million Rial levels – even as the

Central Bank tries to suppress reality (especially to the rest of the world’s gaze) as hyperinflation continues – though less transparently.

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Sep 28

- Quantitative Easing Did Not Work For The Weimar Republic Either (Economic Collapse, Sep 25, 2012):

Did printing vast quantities of money work for the Weimar Republic?  Nope.  And it won’t work for us either.  If printing money was the secret to economic success, we could just print up a trillion dollars for every American and be done with it.  The truth is that making everyone in America a trillionaire would not mean that we would all suddenly be wealthy.  There would be the same amount of “real wealth” in our economy as before.  But what it would do is render our currency meaningless and totally destroy faith in our financial system.  Sadly, we have not learned the lessons that history has tried to teach us.  Back in April 1919, it took 12 German marks to get 1 U.S. dollar.  By December 1923, it took approximately 4 trillion German marks to get 1 U.S. dollar.  So was the Weimar Republic better off after all of the “quantitative easing” that they did or worse off?  Of course they were worse off.  They destroyed their currency and wrecked all confidence in their financial system.  There was an old joke that if you left a wheelbarrow full of money sitting around in the Weimar Republic that thieves would take the wheelbarrow and they would leave the money behind.  Will things eventually get that bad in the United States someday?Of course we are not going to see hyperinflation in the U.S. this week or this month.

But don’t think that it will never happen.

The people of Germany never thought that it would happen to them, but it did. Continue reading »

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