Last week Bill Holter and I had the privilege to speak at the Sprott Natural Resource Symposium 2014 held in Vancouver, BC Canada.  We spoke in the large auditorium, 200+ packed room.  Our topic was “Only Gold and Silver are Money Everything Else is Credit.    The response was overwhelming, we extended our time on stage and then had to move with dozens of attendees following us to our booth.  We entertained questions for over 3 more hours.   Bill and I left the conference energized and committed to doing what we do at Miles Franklin, in educating our readers and clients on the importance of protecting their wealth.

It’s summer, go outside and have some fun and tune out the markets for a bit. When we experience corrections, take a deep breath, close your eyes and see the big picture. Ultimately, inflation will be the problem as the increasing pain of debt deflation becomes clear.  Janet Yellen knows that debt deflation will destroy our economy, if left unchecked. In this country, massive inflation will be the by-product of the ultimate dollar devaluation and a massive destruction of your wealth unless you have gold and silver.

Gold and silver are pure wealth, and they are money that has no counter-party liability.  History has shown us that in time, ALL paper money loses value until finally it becomes worthless. Gold however is intrinsic wealth based on 6,000 years of history. Gold can’t go bankrupt, and if you own enough you will always be wealthy no matter what the circumstances.

The bottom line is that gold and silver will go higher, in response to a lower dollar and the inflation which the Fed has little choice but to create. The Fed is out to lower the value of the dollar. For years their idea has been to inject money into the bond market, in an effort to get asset prices up, and keep interest rates low. The logic is that, higher asset prices make people feel richer, and more inclined to spend money. But if creating prosperity and wealth were as simple as printing money, then Zimbabwe would be the wealthiest nation on earth.

For many years, the willingness of the world to accept dollars has been the key to the prosperity in the United States. Think about just how crazy it is that dollars created by the world’s biggest debtor nation, with no real backing is accepted as the world’s reserve currency.

The illusion of prosperity in the U.S., for years has been fostered by the grace of our foreign creditors, and the luxury afforded us of possessing the world’s petrodollar. We also know that recently Saudi Arabia has had numerous high level talks with both Russia and China, is it not possible to think that the talk of accepting Rubles or Yuan for oil was a part of the discussions?

Either way it is becoming obvious, that overseas investors are beginning to worry about the situation in the U.S. The big money has for some time now been quietly moving out of dollars and treasuries and into gold and commodities. The big money realizes that in order to maximize their returns, they must quietly exit dollars and slowly acquire gold.

At some point, the tiptoeing out of fiat currencies and movement into gold will turn into an all-out sprint. At some point, the world will realize what a scam accepting dollars as the world reserve currency really is. Once again, this is why we own gold and silver, because when the gun goes off, it will be far too late to get any precious metals.