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Today, I want to share a very well written article by one of our clients, Mr. Larry Myles (inkworks@shaw.ca).  He publishes his own newsletter which goes out to several thousand readers and is a strong Miles Franklin booster.

Dr. Antal Fekete responding to the contention that gold remains a barbaric relic of the past.

What our stubborn leaders refuse to acknowledge; folks around the world are voting to decouple their personal finances not only from the US dollar, but from dollar denominated assets. Every time someone buys even one silver coin or gold wafer they are voting against fiat currency.

The global movement to own gold and silver bullion is neither a fad nor a temporary trend; it is the new reality of individuals striving to take back personal responsibility of their own futures.  Reason: the human need that is driving the accumulation of gold and silver is trust. As humans we need to harbor trust in our store of wealth. As it stands we do not trust our leaders or their overprinted paper money.  Instead we choose to insure our future by purchasing and taking possession of physical gold and silver; followed by investigating with the intent to invest, in publicly traded junior gold companies.

As gold ascends, the business of gold gains momentum…

As the business of gold gained momentum, our critics were quick to scoff; A simplistic plan and one without the necessary sophistication to compete in our complex, post-modern age. I responded to (only) one of the most vocal of the anti-gold analysts by reminding him that by being so absorbed with the contents of his hopelessly stale-dated Das Glasperlenspielian box of financial formulae that he had forgotten the true definition of money. Gold is not an investment, gold is money; we trust gold.

I am proud the business of gold investment stratagem is simple. It is unsophisticated. It is easy to understand and it is as close to a sure thing as you will ever experience in a financial market environment. What I also know for sure; over the last 2,000 years each and every brand of fiat currency ever devised by any government anywhere on the planet has been battered, abused and devalued before suffering an ignominious death.

Just because paper money has historically (and consistently) proven to be an abject failure does not appear to faze our leaders.  Take for instance a recent comment made by Ben Bernanke: “Gold is out there doing something different from the rest of the commodity group”. And he goes on to say, “I don’t fully understand the movements in the gold price, but I do think there’s a great deal of uncertainty and anxiety in financial markets right now and some people believe that holding gold will be a hedge against the fact that they view many other investments as being risky and hard to predict at this point.”

I guess no one has the heart to explain to poor befuddled Ben that millions of people have moved on and appreciate gold as more than just a commodity. They understand that gold and silver are ‘currency metals’. Currency, Ben! I will try it again; gold is money, and the folks trust gold.

When a program succeeds, it is only a matter of time before it is emulated by others…..

Going “all in on gold”…

I have no idea if Thomas Kaplan of Tigris Financial Group ever read either my business of gold report or my above mentioned November report; probably not, but stranger things have happened.

All I know is eighteen months later, Thomas Kaplan comes up with pretty much the same plan and the reaction is night and day different. Kaplan’s pro-gold comments go internet viral!  The man is praised as being a bold visionary.

Then again, Kaplan is not exactly small spuds.  When he says that he has reached the point where the only asset he has confidence in is gold, people listen. I guess it does not hurt that he is a hard working billionaire to the power of two, and when he says he is ‘all in’ on gold, his words weigh.

According to the low-profile Kaplan, Tigris Financial and a few affiliates have bought up gold properties in 17 countries on five continents. Tigris subsidiaries have a stake in gold mining companies, including small gold juniors that have yet to go into production.

At the end of the day, all that matters is that both of us are firmly committed to the business of gold; as we are obviously working out of the same recipe book. Buy and hold physical gold and invest in publicly traded junior gold companies.

Chasing dollar denominated assets is a waste of time and energy. The ONLY sector of the market that makes sense to me is gold and silver juniors. Very soon that is where all the action will be. You could have taken my word for it nearly two years ago, but hey…that’s okay. Why not ask the folks at Tigris Financial; they are a bit late to the party but no one is going to call them on it.

Chasing dollar denominated assets is a waste of time and energy. The ONLY sector of the market that makes sense to me is gold and silver juniors. Very soon that is where all the action will be. You could have taken my word for it nearly two years ago, but hey…that’s okay. Why not ask the folks at Tigris Financial; they are a bit late to the party but no one is going to call them on it.

Remaining in the business of gold….

The Keynesian Theory versus Reality

No matter which ‘ism’ works for you, it is important to realize that John Maynard Keynes was not really anyone’s friend.

His disdain for the regular folk was legendary.  Yet it is the Keynesian Economic Theory that every leader in every civilized country follows! The man considered the greatest cheerleader for debt and inflation, J. M. Keynes, clearly understood the mechanism of currency debasement and its effects on society. As he wrote in 1919:

[T]he best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth.

Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become ‘profiteers,’ who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat.

As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.

An opposing point of view and one that I personally subscribe to:

Is there a way….Yes!

What You Always Wanted to Know About Gold

Or at least the narrative has started: “To say that the gold standard is not practicable is the same to say that honesty is not practicable, and Constitutions are made to be blithely ignored when convenient. The American Constitution, for example, mandates a metallic monetary standard for the United States in the clearest possible language. Opponents of the gold standard have never been able to muster up the moral fortitude to amend the Constitution so as to formalize the abolishing of the gold standard.” Dr. Antal Fekete

Gold Close to Boiling Point – McEwen

Rob McEwen hopes we manage to avoid the “darkest hour” describing fearsome parallels between the Weimar Republic to the United States of today. Interview with The Gold Report.

The Gold Report: We see a lot of troubling scenes on the global economic landscape-from the bailouts in Europe to ever-increasing deficit spending in the U.S. to talk about a housing bubble about to burst in China. What’s your view of all of this turmoil?

From time to time I will share my due diligence efforts with you. Considering the amount of subscriber interaction I enjoy, I do not think I have to mention this; but I will anyway – if you have any questions, never hesitate in contacting me. Our strength continues to come through the sharing of information; keep the anecdotal information coming!  As always, buy gold on the dips.