When Black is White, Up is Down

I think it was a Bloomberg quote "Dollar Strengthens against Euro because Inflation Numbers Rise"

It may as well have said, "Impoverished, Bankrupt Nations Currency Rises in Value against a Profitable Nations currency because the Bankrupt Nation Prints More Currency!"

We - as in planet earth - are so far down the rabbit hole of insanity, we are losing touch with the light. Not only is the U.N. close to imposing a worldwide carbon tax based on their blood thirst for control with environmental issues as the excuse, but we are begging China to guillotine us by raising the value of the Yuan.

Adding to the ridiculous landscape, gold and silver took a thrashing. It boils down to liquidity being crushed by the SIV's and alphabet soup products being revalued to their intrinsic worth - closer to naught, than what they bought!

A few trillion in derivative write downs can take a lot of central bank intervention to balance the books. Numbers like $49 billion at Citibank even catch their attention. That's how much they may lose from their books. Considering that amount of money could sink the PM markets, it certainly had an effect.

Pro's are smelling deflation.

Their wrong of course. We will have inflation and we will drown in it, but that comes later. Now the deflation threat captures their attention and inflation rears back to deliver a stunning blow in the first quarter of 2008. Oil will lead the leg up and gold and silver plus their base metal brethren will follow. They will run hard and fast before the early summer breather.

This mortgage bailout fiasco is equivalent to Soviet central planning and is destined to destitute many. Mostly the new buyers who will no longer qualify under the necessarily stricter standards, and the investors who are getting their hands shackled by big brother.

Welcome to the Orwellian Zone...where gold isn't money, the dollar goes up in value with each new one printed, the government thugs can rewrite any of your contracts, and the U.N. can both pollute more countries than any person or company with depleted Uranium yet impose a useless and demonic global carbon tax - on life itself - for no reason but control, and have people celebrate it.

Time to find a new planet to colonize. This one's headed for the crapper..

Are There any Safe Havens?

Certainly the U.S. is no longer one. Ditto Asia, Europe, or S. America. Safe means keeping what you have. Anywhere you go in the financial universe, the fiat tiger can rip you to pieces.

Ask anyone who survived the Ruble crises, or the Peso crises - Mexico or Argentina, your pick, can tell you how fast and ferociously the fiat tiger rips apart your net worth and standard of living.

While gold and silver can provide complete safety in terms of ounces owned, they cannot guarantee purchasing power and certainly not fiat currency security. They both rise and fall with the Comex waves.

Where then can someone escape the wheel of unfortune?

The answer my friend, is blowing in....
Your local superstore, hardware store, property office, sporting goods store where they sell items of the lock and load variety, and your mega-food store.

Buy the tangibles and you will have bypassed all the commissions, in/out exchanges and concerns about returns.
You will have your returns! Food to eat, products you need, items to protect all the above, and freedom from concern about what government stupidity and dishonesty will ravage your hard earned lifestyle come the new day.

Most of the times, the above advice is a recipe for disaster. Now that disaster is in our time, it is a recipe for living well.

Yes, buy gold and silver. Yes, own rare items of value and use like firearms, magazines and ammo which have provided solid returns on capital for several years now and look to do even better in the future. Yes, load up on food, storables, and items that are imported. Keep your productive, dividend paying non-financial stocks, and let the rest go back into the pool, before someone empties it.

Most importantly, I am taking my own advice in spades and could not be happier with the returns so far.

The Abyss is Open Wide

And the financial markets are blind, staggering drunk, with their shoes untied.

Not until the last major bank gets a life support shot from an SWF that is just barely off the terrorist watch list - as almost anyone of note is on - will we declare that we really have a problem with our financial system.

299 points down in half a session! That is the loudest Fed barf I've heard in a while.
Cramer and his minions are demanding more and the Fed gave little. Some, but not what the screaming child of financial markets demanded. Hence the tantrum.

Gold and silver fell hard on the news, not because we aren't in an inflationary environment, but because we are only in 3rd gear and throngs want the turbo's kicked in just as we have crested the hill and are nearing a downhill run with worn brakes.
Serious doesn't begin to flesh out this situation. Apparently the banks will not be able to stuff their coffers full enough with the spreads the Fed is decreeing for them - they need that extra 1/4 percent or their script may be called.

Gold and silver never get called. Not even by those that hate them, they are still useful without being a claim on anything other then themselves. The banks are not so lucky to be dead metal. Instead, they are closer to dead meat. WaMu has a life threatening stock collapse and financial flesh wound that is going to force it to seek loads of outside capital to get back to a sound gallop if even for no race at all. Real estate races aren't held any more in case they had not noticed. Citi already found its Suga Daddy SWF.

Were the derivative books settled to market - whatever remains of one, and all the Enron like accounting brought to light, not only would the Fed have to goose the money supply with more credit, but they would also have to slice the rates by closer to full point. That would hasten the dollar slide to windy ride down.

Gold and silver are digesting this news. There time is here and as soon as the money gets scared of the stock market, disappointed in the bond market, flailed in the falling emerging markets, the commodity/PM sector is going to look very tempting.
Shinny as a matter of fact.

Gold and silver will do what they always do in times of turmoil - rise beyond the occasion.

PreFlight Check for Gold and Silver

Tomorrow, Tuesday December 11, 2007 the Fed will declare a drop in interest rates of some magnitude - .25, .50 - and the crowds will gather on either side cheering or cursing.

The silver and gold markets will vote. UP!!

With 1.5% and 2% plus moves for the precious twins, they early votes are in.
Hyperinflation this way comes.

All the indicators - RSI, Bollinger, Stochastics, EMA's, are shouting to get ready for a significant 2 - 3 month move up in the PM's with silver potentially outpacing its big brother.

Be on board.

Before They Take Your Gold and Silver, They Come For..

Your guns. Guns and the D.C. vs Heller case now coming before the SCOTUS (Supreme Court of These United States) in February with a summer ruling expected have stolen my focus temporarily from the precious metals and commodities markets.
Seems Kramer has just become inflamed with miners like Freeport because he was ranting very persuasively about how much cash flow has and how bright there prospects are with China demanding ever more moly for stainless steel. Wrong buddy. Moly hardens steel, acts as a great lubricant, wonderful for missile and aircrafts making parts light, strong and offering reduced friction. Chromium, nickel and a few others are useful elements for stainless, but moly is not primarily used in stainless. But he sounded convincing and he is a brilliant guy who deserves respect, if not also a wide path.

Guns again. They use moly. Based on the likelyhood that SCOTUS will spank the 2nd amendment into subserviance to the New World Order league of the CFR, U.N., Bilderberg, and the taser happy goons leveling every 73 year old grandmother they already have handcuffed, I think moly will not be in much demand from the civilian firearms industry. I think all he gun owners of America are about to be gaveled into criminalhood come this June.

Gold and silver will not save us then, though lead, copper, brass, and some steady nerves might buy us some time.

Talking with semi-like minded friends - and that asks a lot of their minds - has revealed a similarity of how they are accepting this potential SCOTUS ruling to how many are viewing the fall of the dollar.

Utter disbelief and decided ignorance. They do not want to consider the options for what might happen to them if they are ruled criminals by New World Order robed criminally minded judges. They swear this will all pass with nary a dent to their world.

A dollar crash already underway has brought forth a loud yawn from the Americanus Boobus. Reality has a cold and harsh lesson for those choosing the suspended animation of denial. History shows the faces of the desperate children begging from their more desperate and confused parents for food, shelter and explanations. Little do they realize that the explanations, along with the food were all there for the taking had their parents really looked and prepared.

Deciding not to look leads down the path of not preparing.

Anyone caring to analyze the U.S. fiscal situation or the political misdeeds from an historical perspective knew the dollar was doomed. Buying gold and silver back in 2001 has more than preserved our wealth - speaking as one who was informed - it has multiplied it.

Now the same application of foresight and planning leads me to a far starker conclusion.

They are coming for our guns. Then they come for us.

Plan your escape now and act on it before the end of May. All the gold and silver in the world will not open the jail cell, nor the minds of the judges.

America will be over with thunder of the SCOTUS gavel.

Me, Gold and Silver all Flying High

Just returned from a knowledge packed conference in Las Vegas. A room full of multi-millionaires and soon to be multi-millionaires. Good, intelligent, hard-working company of all races, creeds, colors, personalities, ages, and temperments. All of these folks make their living with business in one form or another. No healthcare, lawyers, doctors (though many Ph.D.'s in physics, CS, etc.), construction, etc. All were serial entrepreneurs, so you can imagine the energy of the audience.

Interestingly, most of them where familiar with the dollar dropping and gold and silver soaring, but had not focused on it as the opportunity of a life time that it is.

While I was flying high from the conference and physically flying high from Las Vegas back to my city home base (as opposed to my farm home base) in Atlanta, I pondered what their lack of interest meant.

It meant that the rocket isn't even on the launching pad!

People this sharp being only moderately interested in the biggest story on the planet can only mean that the penetration of the publics consciousness has only just begun the second phase.

Phase One - $235, $3.50 silver
Phase Two $640 gold, $8.00 silver
Phase Three $1000 + gold, $18 + silver, hopefully $20 This is when we will quickly rush up to dizzying heights of perhaps $5000+ gold, and $100+ silver. Then eventually the word might get out on silver being really scarce, and we could vault up to $1000 silver. That would make me and many of my advisees very happy- and wealthy.


So hang on folks, the ride has really only begun.

The Pause That Refreshes

As I foresaw then foretold, both of our metal guideposts to the death of the fiat world have been retrenching since the options expiry worked the legs-out-from-under trick on both gold and silver. As it has been, as it will be for the near future, the large traders will rule the roost.

The roost still moves higher though. That's what I focus on and how I explain to those who ask my advice when the perennial question of - "Should I buy now? Is it too late, or is this the best time to buy?" All variations of the "I want to make money on this purchase instantly and for the price to sail ever higher from here, never a dip below!"

My answer is always "In a year, these prices will seem cheap."

Thus far, for the most part, that answer has been correct. The last year and a half have been treading water more or less, but still with an upward bias.

Treading or consolidation phases are there to shake out the weak hands so that just before the real action begins, all the profit skimmers have fled to suppposedly greener pastures while the stalwarts hold tight and ride to the financial heavens.

Buy late and sell early can work wonders for the right minded, calculating investor. Most of us though are better off buying early, then selling before the crowd fills the segment up. Not too early, but earlier than the crowd. The crowd still has no idea what gold and silver are doing nor do they understand why they should care.

I can do nothing but express my thoughts and be detached if people chose not to listen or decide not to participate. At least my voice and thoughts are clear on the reasons why gold and silver are destined for the pinnacle of power in the financial world once again. So long as those I try to reach have their reasons for not participating in this tectonic shift, may there plans work well for them.

Reviewing the top 3 reasons for owning gold:

1. It always holds some value, never reaching zero like every other fiat currency.
2. It is no ones debt instrument unlike all fiat currencies which are debt units.
3. It is a worldwide, redeemable, transaction unit, universal currency in all places at all times throughout history. Even when it has been outlawed, it was recognized as having value.

Reviewing the top 3 reasons for owning silver:

1. It always holds some value, never reaching zero like every other fiat currency.
2. It is no ones debt instrument like all fiat currencies.
3. It is historically undervalued and very likely to increase in inflation adjusted value much faster than most commodities.

With these slighly different considerations in mind for the dynamic duo, there is timing strategy that makes the most of these differences.

Like a rhymning song, the strategy goes:

Little bit of gold, heavy on the silver
Ride silver high, sell out for gold
Ride gold higher still.

This pattern seeks the optimal value increase from the rhythm of hyperinflation, the stagflation, then deflation. The timing is not exact, just close is all you need to be. Silver will at some point drop relative to gold. Gold will end up supreme in the currency heap. Silver will be highly valued, but not have the upside.

We are years away from needed to employ this strategy, but when the time comes, those who do ride these ways will have orders of magnitude higher returns.

Let the waves roll on!