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Friday, August 26, 2011


In the US, under GAAP (Generally Accepted Accounting Principles) the Federal Government alone has more than $75 trillion in debt and liabilities. That's over $1 million per family of four. This doesn't even mention state, municipal and personal debt - the average family of four in the US has over $100,000 in personal debt.

The next time someone tells you that the US is the "richest country on Earth" correct them. Tell them, "used to be". Now it is the most indebted and bankrupt nation on the planet.

Sure, even right now, things might not look like they are all about to collapse in the US. But they are.

One of these two things will not exist a few years from now: The US Government or the US dollar. Or both.


"the end of the monetary system as we know it"

The manipulative policies of our banking system are creating a tsunami of fiat money that is going to come sweeping thru here in a wall of water that is going to ASTOUND people in a year or so.

We have piled up debt of a number that I cannot even conceive for NOTHING. NO productivity, no infrastructure, just dumb idiot stuff that actually HURTS people and business and productivity. We have combined that with an attitude of hostility to people who are entrepreneurs enough regulatory and legal rigamarole to keep the average person from wanting to start a business in the first place. This SHOULD be pushing interest rates considerably higher, but we are artificially keeping them low by manipulating the markets (the fed buying treasuries.... esssentially printing money and lending it to the gov't for the sole purpose of keeping rates low). The banks are in such TERRIBLE shape that the printed money is kept in-house and essentially program-traded to shore up their balance sheets to make them look better than they are. It is all fake. All of it.

Reality WILL come crashing in and it is coming soon. I have said before that I don't necessarily look for an utter and complete seize up of the culture on the scale of J Wesley Rawles novels (though it could). That does not change the fact that we are going to witness the spectacular immolation of wealth, on a level and with a speed that is going to have people completely and totally amazed.

It has often been said that bullets and bread are superior to gold when everything blows up, and I agree with that. I just don't look for everything to blow up completely. I think the exoskeleton of our economy will remain, with LOTS AND LOTS AND LOTS of people both out of work and with no place to turn for "benefits." I look for cities to be quasi war zones and there to be real hunger and need. Again, think "FERFAL" rather than "PATRIOTS." In a situation like that, solid "money" is going to rule.

It doesn't have to be gold. Gold is north of 1700 an oz, and even if they do a margin manipulation to drive it down another couple hundred dollars, it is still out of the reach of many people. Silver is getting up there at 40 an oz. For many people, this has become prohibitively expensive, and I realize that. IF IT HASN'T YOU HAVE NO EXCUSE FOR NOT BUYING SOME, THOUGH. Please, for your own good, do so.

BTW, if you are spending 80 bucks an month on cable and tell me you can't afford silver, you are a dumbass. No other way to say it.

Some guys really ARE stretched so thin that silver is a hard buy, though. There are alternatives. Nickels are great but copper pennies are even better.

It takes no time, though to sort out a 25 pound box of pennies. Pre 1982 pennies are 90% copper, and the copper in them right now is worth over 2 cents. This is over a 100% return IMMEDIATELY (but deferred). Immediately, cause you have it in your hand. Deferred because you will go to jail if they catch you melting them down into copper ingots. However, this situation of the law will not last. It is a great small scale hedge......

As an aside, do you have ANY idea how difficult it is to get a 100% ROE in the financial markets? Here copper is 100% and nickels are 25% returns. I know of fund managers who would KILL for those kinds of returns.

In two to five years when a jar of peanut butter costs 20 bucks and the soviet economy looks like a roaring success compared to the USA, you will be ecstatically happy you saved those nickels and pennies (remember: pre-1982... the 1982s had a mix of some coppers and some new minted zincs). You don't have to be in a position of means to hedge yourself, and need not be saying "I would do it if I had the money."

Please, don't be saying "I had more money than I ever imagined. I wish I had put some solid money aside instead of this paper crap."

I mock and sneer a lot at some of the really dumb stuff in our society, and I really don't suffer fools well, I know. This is as serious as I know how to say it, though. We are headed for some really really bad times here, and I want everyone to PROSPER in them (it can be done!).

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