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Is America unaware of what’s going on its southern border, or does it need that excuse to close the borders and lock in Americans – and their assets? That question is as far as we take you with that, and you are on your own to decide.
-The Dines Letter
Andy Hoffman’s “Rants” are now being emailed separately in the afternoon. You can view the archive of his “Rants” on the Miles Franklin blog here.

If you are wondering why gold and silver prices are stuck in a rut you can lay blame on the MF Global situation as longs are being liquidated by the Trustee to facilitate cash settlements and with 150,000 customer accounts frozen the vast array of potential buyers are unable join the feeding frenzy.

In addition, the CME is raising margin requirements this week and also adds to the liquidation of gold and silver. This should come to an end quickly.

Whenever I find myself in a conversation with someone who is unfamiliar with gold, inevitably, they refer to gold as “an investment.” I bet many of our readers still think of gold as an investment. Gold is not an investment! Gold is money – the standard to which all currencies are measured. So, when gold rises in dollars or euro the reality is that the dollar or the euro are losing value against the standard, gold.

Once that simple fact sinks in, it makes sense to calculate your “wealth,” not in dollars but in ounces of gold (and silver). It also becomes clear that how much you pay for gold is not a critical issue. After all, what you are doing is TRADING dollar, at their current value vs. gold, for gold. I started seriously buying gold in 2001 below $300 an ounce. I have purchased gold all the way up and my most recent two purchases were at spot $1,750 and $1,779. Would I rather buy gold at $300? Of course, but that’s no longer possible. It cost what it costs. My goal is to convert dollars into gold (and silver) whenever I have an extra supply of dollars. Keep the following quote in mind: “He who has the most gold wins.” I’m not sure that the word “wins” is appropriate, but if you have enough gold set aside, at least you are unlikely to LOSE.

There are any number of (misinformed) advisors who will give you a litany of reasons why gold is a bad investment. Don’t waste your time considering what they have to say. It will only make you crazy and keep you from doing what you should be doing, which is to convert dollars into gold. That’s all you need to do, and it is not complicated. Do that, and you will be a part a very small group of people who “get it,” and who will avoid the pain of the coming dollar devaluation or worse, hyperinflation. Which one it will be is up to our politicians. My guess is it’s the latter.

One of my oft-published concerns is that the standard of living in America has been on the decline for several years now. Good jobs just aren’t there for a majority of the kids who are graduating from college.

Wall Street Journal:
One in six of today’s currently unemployed – 2.4 million people – has a bachelor’s degree. The unemployment rate for recent college grads is 10.7%. More than 14% of Americans between 25 and 34 (5.9 million in all) are living with their parents, up significantly from before the recession. Nearly a quarter of them have bachelor’s degrees. Having a college degree no longer guarantees a rising wage or a shot at the American dream. That is contributing to a widespread sense that the US economy isn’t working any longer for the bulk of Americans.
-David Wessel, Wall Street Journal, 27 Oct 11
Five Min. Forecast:
Current figures from the Bureau of Labor Statistics (BLS) peg the unemployment rate of the general population at 9%. Among veterans, it’s 12.1%.
And among the youngest veterans, under 25, the figures are jaw-dropping – both in the absolute number and the rate of growth from a year ago.

Widen the scope a bit, and the numbers are still ugly: Among veterans aged 18-34, unemployment grew from 12.6% in October 2010 to 16.6% last month.
And of course, those are the official unemployment figures – not including the folks who can get only part-time work or who’ve given up looking for work.
San Francisco Chronicle, Oct 11
Fifty percent of US workers earned less than $26,364 last year, reflecting a growing income gap between the nation’s rich and poor. The number of people making $1 million or more soared by over 18% from 2009, the Social Security Administration said.
San Francisco Chronicle, 9 Nov 11:
“It’s hard to call it a recovery, with unemployment about as bad as it was at the recession bottom.” William Dunkelberg, chief economist at the National Federation of Independent Business, on the group’s latest survey of confidence among small-business owners.