Today is my 67th birthday and I cannot really believe it. When my Dad died in October, he was 93. I was reflecting on the changes he experienced from 1915 until 2008. Woodrow Wilson to "W" Bush. I am happy that he was spared BO. Unfortunately, we will not.
If BO has his way and the printing presses run off another trillion dollars or so of monopoly money, we will wind up just like Zimbabwe. They just announced that they will issue a new Zimbabwe "dollar" that has 13 zeros "removed." They ran out of room on the paper currency for all those pesky "0's." By the way, 50 billion Zimbabwe dollars buy one loaf of bread. That's what happens when governments are allowed to play monopoly with the money supply.
To be really fair, all of the blame for the debacle to come cannot be blamed on BO, it is just the historical fact that he will be at the helm of the USA Titanic when it strikes the iceberg. And we know that the Captain is always at fault.
When I was at Norfolk Academy in the 70's, we had a Board member who was a very savvy guy. He told me to never trust banks and the government to take care of the money supply. Now this guy was a banker..and he therefore really knew what he was talking about. He told me that he always had 25% of his assets in hard money (READ: GOLD)
"Don't invest all of your eggs in the dollar denominated system basket," he advised, "because historically, "fiat" currencies will fail. It is just a matter of pinpointing the when." And the "when" officially began at the time Nixon separated the dollar from any tie to gold. The currency's fate was sealed. "Fiat" is a Latin phrase which means ..."let it be done." And when government runs the presses, that is just what happens. Economic activity doesn't create the $$, but, it is the will of political parties who say "poof ...let it be done"....and it is done. That is why the dollar is doomed.
Acctually, Bernie Madoff hasn't done any thievery greater than what the government does by creating hyper inflation through the printing of fiat currency. They rob the thrifty..they steal from the poor schmuck who trusted in their treachery and tried to save and invest. The one who has all of his eggs in the government currency basket is the loser. The one who says, "to Hell with the system," and buys a little gold as long as someone will take his paper dollars in the exchange, he is the winner.
A few years ago, it took 40 ounces of gold to buy the DOW. Today, it only takes around 10. Will it come to a point that it may only take just one ounce?.... You know where my bets are.
Happy Birthday, America
Thursday, February 5, 2009
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