Q: The question I have been exploring and wondering is: When the inevitable dissolution of our current global economy comes to its fiat end; will our economy replacement be IMF based, or BRICS based?
Of course, there are a lot of variables, but my sense of it is: the control of the economy will go towards the IMF! I lean towards this conclusion because the TPTB will want to maintain some form of control. Towards the end of their reign the TPTB will have enough awareness to usher in the new control mechanisms while they still have the ability too.
Although, I do hear a lot of talk about China and its gold holdings and all the agreements they have been making with other countries (mostly from Miles Franklin, thank you very much), but IMF seems too obvious.
The two main sources of information I read and listen too is: Miles Franklin, thank you David, Bill, and Andy, and King World News. You are both gold coins.
David Shectman’s Answer:
Thank you for your praise. We appreciate it!
You could build any scenario you wanted to here. My guess, and it is only a guess, is that China will be part of any new currency system as will the US. There is a good chance that gold will also be a part of it too, but at a much higher revalued price.
The IMF uses SDRs as an intra-central bank reserve currency. They may add the Renminbi to the basket.
The value of the original SDR was initially defined as equivalent to 0.888671 grams of fine gold which, at the time, was also equivalent to one U.S. dollar. After the final collapse of the Bretton Woods system with Nixon closing the gold window 1971… in 1973, the SDR was redefined as a basket of fiat currencies. Today the SDR basket consists of the 4 fiat currencies: the euro – Japanese yen – pound sterling – and U.S. dollar. Note there are 31.1034768 grams of gold in 1 troy ounce.
Since 1973, the IMF ‘s SDR has lost over 95% of its value to Gold bullion. No matter how technocrats or the mass media dress up SDRs in convoluted financial speak, it is basically just another fiat currency folks.
Q: Hi! I understand that at least one big bank has purchased a large amount of silver. What do you think their intention is? I was wondering if they would bump the silver on the market if the price gets to high. That would make them a nice profit and drive the price down.
Thank your so much for your news letter. I look forward to it everyday and have withdrawals on the weekend.
Andy Hoffman’s Answer:
That is pure speculation, likely from Ted Butler. There is absolutely no evidence to believe that; and to the contrary, my good friend Steve St. Angelo wrote recently of why this is highly unlikely…
Also, when referring to “banks” like JP Morgan, you should realize that at this point, they are more arms of the government (or “partners,” so to speak) than private firms. To them, gold and silver are principally competitors of the fiat currency system they dominate – to be squashed like bugs. They may well be buying metal secretly – as “insurance” against what they know is coming. However, if they were, it would be very unlikely to be in the form of 1 oz coins bought from the Treasury.
P.S. Just go to the website if you’re having withdrawals, as my (and Bill’s) countless podcasts are uploaded as well!
Q: Bill, your “Ponzi Scheme and You” article was excellent. Thanks for taking the time to take us through the system. I fear the answer is yes, but are CDs vulnerable to bail-ins, even if the banks are FDIC insured?
And if so, how would that work? Would the entire CD would be appropriated by the bank never to be repaid?
Bill Holter’s Answer:
Thanks so much for the kind words! There is no definitive answer to this question as we do not know how the regulators will react. Hopefully the FDIC limits would hold up and anything under those limits would be covered. Anything over the limits will be fair game, you may lose some, or all of this amount and it may take years to sort it out. Under the scenario of a systemic banking failure, the FDIC is hopelessly under-capitalized and cannot make good on over 1% of what they supposedly “cover”. That said, in a collapse type event, you must also wonder about the purchasing power or value of dollars.
Dollars are credit based and only as good as the issuer …a bankrupt Treasury! I believe having only funds in the bank you know you will need to pay bills and the rest in some sort of hard asset/money (gold and silver) is a more sound strategy. Why gamble the FDIC can perform and your dollars will retain value? The odds are neither will occur. Hope this helps.