Precious Metals Charts

Feb 5, 2013

Economics & Trust


    In this weeks article I want to focus on economics & trust, and why they are so important. Economics are a part of our life, from the time we wake up and brush our teeth with the toothbrush we purchased, to the time we put our heads down at the end of the day on the pillows we purchased. But have you ever asked yourself... what is "Economics"? Or "how does it effect me?" No, more than likley you never have. Also, these are things your parents probably never asked either. This is because schools increasingly since the mid 1800's, almost purposefully neglect to teach these things to children in what many consider to be a conspiracy to dumb you down.

What is Economics?

Economics - The Social Science that analyzes the production, distribution and consumption of goods and services (In any given area or segment of society)

Economics are important to everyone, from the candy maker to the wall street stock broker. There are fundamentals to economics. These fundamentals are known as supply and demand. This can be analyzed easily using what is known as "Fundamental Analysis".

Supply - Is the amount of a product producers are willing and able to sell at a given price, with all other factors being held in constant. (How much product is available to be sold, without changes in a given marketplace.)

But, As we all know, markets change. Think of it in these terms for example. When the Copper sword became cheap and easy to make, the sales of spears probably declined. People aren't going to pay more money for objects that have less value.

Demand - The economic principle that describes a consumer's desire and willingness to pay a price for a specific good or service. (How much product is desired to be sold, or more simply put, how bad do you want this item.)

Now, let me be clear.... the "Fundamentals" haven't been working due to Government Intervention & Clear, some would say "Blatant", Manipulation of the precious metals markets, bond markets combined with other scandals. Due to these factors, our economy has been undermined, some would say purposfully. We are being manipulated by the "To Big to Fail" banks & other Greedy corporations.

These types of problems only lead to one conclusion... the collapse of a system that is fundamentally flawed in the first place. Ironic, considering these banks and corporations are now BIGGER than they ever were BEFORE, even after the economic crisis of 2008. All thanks to YOUR tax dollars filling the pipeline full of easy money to siphon off.

Let me illustrate my point by making sure we understand what "Manipulation" means...

Manipulation, or more accurately "Market Manipulation" - Is described as a deliberate attempt to interfere with the free and fair operation of the market and create artificial, false or misleading appearances with respect to the price of, or market for, a security, commodity or currency. (Basically, markets have their own natural forces, and anyone trying to alter those forces on purpose is going against those natural forces.)

This means someone is tinkering with the natural order of things within the free market economy. Now, let me give you an example...

If you want to build a table, and you need 10 screws to finish your project, and you don't have any, you must either make or purchase this item. Let's assume you don't have the ability to fabricate those 10 screws, you would have to go to the store and purchase those screws.

In a manipulated scenario, you tell a friend you are going to the hardware store for screws to finish your table, who mentions your need for screws to the owner of the hardware store. The owner of that hardware store then decides to empty the screws from the bins to a nominal level and inflate the prices 200% (to make a higher than normal profit) and happily sell them to you.

As the Consumer, you see the price, but you don't realize that the hardware store owner just manipulated you into paying more, because you didn't know what the price was before. Even if you did, he had the only screws in town, making him a monopoly on this item. Now, understand, the hardware store owner had tons of screws, and he will simply puts more screws back in the bins when you leave, but he did this merely to inflate the price and to make more profit. Don't like this type of manipulation? This type of activity happens more than you know.

Is Profit Bad?

Now, from a business perspective, this is "Profitable" and the main "Goal" of a company is to produce a profit. So if there was a way to predict when a customers Demand was going to increase on any and all items they produce, it would be in their best interest to gather that information, quickly and aggressively. It is the simple nature of business. If you have a smartphone, you should realize, this is being done to you RIGHT NOW!

Profit is derived from greed, and "Greed is Good" according to "Gordon Gekko". This is a character created by Oliver Stone, and portrayed by Michael Douglas. This character, and the movie he was presented in, was a wake up call for many Americans. Mr. Douglas' Oscar for his portrayal of this character goes to prove that point. I mention this Hollywood example because I think this is an example that will resonate with you.

"Greed is Good" Speech from the Movie: Wall Street

Now take this characters "Greed is Good" speech to a crowd in this movie, and chew on it, let it simmer in your skull for a while. This seemingly innocent glorification of a greedy & unscrupulous type of investor was what many in America strived to be for many years, and some still strive to be. See a problem yet? If not, you may if you ever have to deal with a foreclosure, the loss of your IRA, 401k or other form of Pension that you spent your entire life building, only to lose to one of these vipers.

How does this effect you?

Simple, every day billions of dollars are printed, every year, trillions. This unilateral overprinting of dollars out of thin air is devaluing it's intrinsic value without external help like war or civil unrest, never mind that the currency is backed by absolutely nothing in the first place anymore.

Our money used to have a set value because it was "Linked" or "Backed" to commodities like Gold and Silver in the past, but no more. The U.S. Dollar used to have a set value because the world trusted that America would keep their word, and honor the "Bretton Woods System" of finance that the worlds leading nations agreed on in July of 1944. The world had faith that the United States would never break it's word.

In hindsight, their trust was misplaced, but it made total sense to many in America and abroad, since the United States economy was founded on the "Silver Standard" which used the Silver Spanish milled dollar in 1785 during the founding of this nation. To many, this linking of a currency to a hard asset was considered a healthy thing to do. Due to this, we codified the "Coinage Act of 1792" and we linked our economy to a commodity, Silver. For the first time, we had our own money, and that money had "Value".

Today's money doesn't represent "Value" in any way due to the massive over-printing of fiat dollars by the Federal Reserves Actions. In fact, in today's society, a banker can simply click a few zero's into a computer screen and have more wealth in a matter of seconds than your entire family could produce in a lifetime, and this worries many in financial circles. And realize, the use of the term "Worry" is  massive understatement.

Several things had changed since the Coinage Act of 1792. Wars, Civil Unrest, the Industrial Revolution and several other factors caused the national economy to change over the years. This is natural, but due to these changes, and several other reasons, we allowed the Federal Reserve to take over the printing of our money. This is widely considered a pivotal change for the worse, in national economic sovereignty.

Money, Banking & The Federal Reserve

The history of the Federal Reserve is stricken with many claims of fraud, conspiracy and secrecy. G. Edward Griffin has what I and several others would undoubtedly say is the premier accounting of how the Federal Reserve was established in his book "The Creature from Jekyll Island". He states that the Federal Reserves very establishment was created in secret on an island behind closed doors, and the men involved in this meeting denied for years that such a meeting to Establish this new Federal Reserve System ever existed until after it was implemented upon its intended victims, you, the American Citizens.

The Birth of the U.S. Federal Reserve - Presentation by G. Edward Griffin

Now, I won't go into who was there, why they are important, or any of that in depth analysis, but I HIGHLY suggest you watch, and listen to the videos above. These videos will clearly explain that there was a plan, and outright conspiracy to loot the wealth of the American people. They will also point out that such a system doesn't benefit you in the long run. It also clarifies that the Federal Reserve System is a criminal &, fatally flawed concept that is a perpetual debt machine. Unfortunately, we and many other countries in today's world, subscribe to this "Fractional Reserve Banking" system of economics. And it is starting to show cracks in it's foundations.

What is Fractional Reserve Banking?

This is the most important question you can ask anyone. Try asking your local banker, enjoy the look on their face when you ask, I always do. What if I told you that your bank doesn't have your money? That's right. Imagine if you are a hard worker, a staunch saver and a dollar stacking fiend. And you have all of your money in a "Safe" in a "Bank" somewhere. What if I told you that your money wasn't really there? Would you be angry? You should be. Let me explain why this IS exactly what is happening.

The reason your bank doesn't have your money is because it is loaned out. See, banks have to loan money to make money. They are allowed to lend up to 90% more money than they have on the books in many cases, this changes due to the economic climate, but the premise is the same, they lend what they don't have. The more they loan, the more they make in interest. But they never really have that money to lend to begin with. Pretty sweet deal huh? They are legally allowed to lend more than they have. Sound like fraud? It is.

Throughout the history of the Fractional Reserve System, banks have lent money to make money. It's how the system was designed to work.The one thing that ruins the fun for them is when YOU take money OUT of the bank. When you do this it's considered an inconvenience, but when several people, or a nation full of people pull their money out at the same time, it is called a "Bank Run". This is a nightmare scenario for all bankers.

Examples of Bank Runs

4th Century B.C. - Dionysus I (The Elder) of Syracuse - Greece

Due to his rampant wars and other conquests, he owed a massive amount of debt. Due to this, he declared that all coins be collected under penalty of death. He then re-stamped (cut) every singular coin into two coins and used them to pay off his loans. This lead to no one wanting to loan him money anymore. Everyone lost faith in his money, including the citizenry. And thus ending financial prosperity in that area. (Caused by Fraud)

1620'sThirty Years War - Germany

During this period, German City States printed imitation coins of rival City States currency and infused it into the opposing City States economy. This caused uproars and riots of it's military and citizens. The military personnel simply refused to serve unless given verifiable coinage. (Caused by Fraud)

1772 - Crisis of 1772 - Scotland

In 1769 John Law Founded the Ayr Bank in Scotland. This bank was built on Inflationist schemes that caused the collapse of the bank in 1772, losing a significant amount of money. The other banks of Scotland quickly returned the Ayr bank notes to it's originator, and left the 241 shareholders of the Ayr bank to face the full brunt of the loss, of which the shareholders paid off all creditors in full. Talk about a bad business deal. This event triggered the "Boston Tea Party", which clearly explains the power that economics has on people, nations and societies. (Caused by Fraud)

1873 - The Panic of 1873 (known later as the Long Depression) - United States and Europe

This event was caused by the fall of Demand in Silver internationally due to Germany Deciding to abandon the Silver Standard. This led to inflation, speculation and rampant trade deficits. (Caused by Unlinking A Commodity from a nations Currency) Sound like something we see in toady's economy?

1914 - Schwenk Bank Run - N.Y. New York

State Bank Regulators Seized 3 banks owned by Ladisous W. Schwenk for sketchy and disingenuous accounting practices. This caused crowds of angry citizens who had money in Mr. Schwenk's banks to try to get their money out before the bank failed. (Caused by Fraud)

Schwenk Bank Run of 1914 - NY, New York

1930's - Great Depression - United States & Worldwide

9000+ banks failed due to a stock market failure on October 29th, 1929. This put the worlds economy into a tailspin and took years to recover. Personal Income, Tax Revenue, Profits and Prices dropped and international trade dropped by as much as 50% during this period. (Caused by Greed and Market Manipulation & Blatant Money Contraction by the Federal Reserve)

1946 - Potters Panic - Bedford Falls, New York

A Liquidity Crisis at Bailey Building and Loan, which turned the town into a shell of it's former self. Today the towns economy only survives due to citizens being employed by the local penitentiary which imprisons non-violent drug offenders. (Caused by Fraud)

1980's - Savings and Loan Crisis -  United States

This was the failure of 1/4'th of all savings and loan associations (747 out of 3,234) in the United States that cost the taxpayers nearly $90 Billion dollars. Some estimates put that figure in the low range of actual liability to the U.S. Taxpayers. (Caused by a mix of Manipulation, Greed and Criminal Accounting Practices)

I could keep going on, even using ArgentinaGermany or a boat load of other examples to describe what happens during Hyperinflation as well, but I think I have explained my point already. However, we need to move on and explain how everything changed, and it happened only recently considering the timeline I described above.

Nixon changed everything

On August 15'th 1971 the entire game of economics shifted again, but not in a good way. As the opening states, this article is about Economics and "TRUST". Trust is EXACTLY what everyone lost in the United States on this date in history. On this date, President Richard Nixon terminated the convertibility of the U.S. Dollar to gold, ending the Bretton Woods Agreement. This singular action put the worlds economic markets into septic shock almost immediately.

How did the Bretton Woods Agreement Work?

Simple, the other nations of the world agreed to "Peg" their currencies to the U.S. Dollar and we agreed to convert 1 oz of gold for every $35 in a collective effort to stabilize the worlds economies after years of war and other negative factors the world faced during that time period and in the past. The Vietnam War reportedly cost the U.S. $500 Billion alone, but cost us much more in human terms, but that is a tale for another Article.

With the stroke of a pen and a statement on television, we deprived the world of nearly $60 Billion dollars in gold that was owned to them. We effectively defaulted on our debt by refusing to deliver this commodity, as agreed upon. He then (some claim inadvertantly) linked the U.S. Dollar to Oil (ie Petrodollar) from OPEC nations, and agreed not to print to many U.S. Dollars during this agreement, which in recent times, we see Obama letting the Federal Reserve Print the U.S. Dollars in unprecedented amounts, rubbing other countries noses (OPEC Nations) in the fact we have a printing press and they don't. This doesn't sit well with many countries, and it shouldn't. Ask yourself, how would you feel if someone swindled you?

Nixon Terminates the Bretton Woods Agreement

Nixon's actions on this day polarized the economies of the world, and immediately placed the U.S. Dollar as the Reserve Currency of many nations. This means other nations were forced to use the U.S. Dollar as a primary tool to trade and conduct business internally and internationally in many cases. This also made economies such as those using the British Pound Sterling into free floating status. This caused massive problems throughout the worlds financial markets. It was a game changer in every sense of the word.

Trust was gone

We broke out promise. Principals should have taken precedence in this case, but they were forsaken for reasons we still don't fully understand. Mr. Nixon's decision forever cemented him as "Tricky Dick". This nickname was derived from the John F. Kennedy Campaign posters asking "Would you buy a used car from this man" as displayed below, but stuck with him due to his actions during this economic roller coaster.

John F. Kennedy Election Campaign Poster during the 1960's

We as a nation are now seen as untrustworthy due to Mr. Nixon's actions. Our country is seen as a pariah, a parasite and a leech to many in this world because of his actions. The world believes our moral fiber, and our intrinsic values have been eroded and replaced by lies, schemes and plots to overthrow the first nation they see with assets such as gold or oil. The world went from seeing us as the "City on the Hill" to an imperialistic Hegemony hellbent on taking the riches of their land, and they are wise to think such a thing, because our actions recently show just that. Can you say Iraq, or how about Lybia? I could give many more examples, but the common theme here is that these countries have oil, and if you think that is a coincidence, you're living in a fairy tale land, and you're incapable of seeing what is right in front of your face.

Is this still a problem?

When our nations economy took a nosedive in 2008, our demise was almost guaranteed. Our national debt is so large currently, that other countries KNOW we can't pay them back. They also know our history of defaulting on debt and are well aware we will do it again if we feel we have no other options. Anyone left holding U.S. Dollars when this happens will take the largest economic hit ever seen in the history of the world. Governments around the world are waking up the fact the U.S. Is bankrupt. Due to this, agreements to conduct business with commodities such as gold, oil and other Items are growing in frequency & location. The countries relying on commodity based trading show no signs of slowing or stopping this practice, and will NOT use the U.S. Dollar for the reasons stated earlier.

Nations like China, Russia, India, Iran and many others understand economics. They know that accepting U.S. Dollars leaves them susceptible to future liabilities due to our history of default, and they are unwilling to accept it again. No one with any common sense can blame them for not accepting our money. In fact, YOU should be horrified at these events and be chastising your Senators and Congressmen for spending more time suggesting legislation for stupid laws, and pushing legislation like gun control instead of focusing on the economic health of our nation.

What is going on in today's political climate is not only egregious, but tantamount to criminal when you consider that your economic security has been usurped by banks who lobby politicians to get the sweetest deals on the planet and then keep pushing for more because of greed. Understand, your economic security & personal rights are not their focus. Neither are Justice or Honor. No, The ONLY focus for politicians today is lining their bank accounts so they can win their next election. And this must be addressed openly.

How do we change this?

It goes without saying we need to mandate some serious Civics and Ethics courses throughout the United States, but this isn't the job of the Govt. No, this needs to be done by Mothers, Fathers and Family members all over this nation. Ethics, morals and Faith are jobs for family and churches, not government.

You can't blame corporations, since they are not alive, but somehow have voting rights. No one but the owners of these corporations can be held accountable for their actions. In certain cultures we see millions starving, but these companies in these areas produce useless electronics, shoes or other textiles instead of food. Does this make sense to you? At some point you have to admit that something is wrong. These companies are focusing on Profit, and not Value.

I dislike Govt, because I have studied, and see what atrocities they are capable of when left unchecked by an apathetic and ignorant population. I have learned of the the injustices Government has caused throughout history, but it is my opinion that govt's job is to benevolently oversee and manage a societies resources to the benefit of it's citizens when ran correctly. Governments like the ones I stated above, are NOT managing their cultures wealth and resources in a way that is beneficial to it's citizens. A malignful, greedy and counterproductive government is no different than the corporations & greedy banks that have crippled our own economy today.

If this is your first time realizing any of this, I am happy I could give you a new perspective to see it from. We need to wake up our friends and family. We need to heal this scar called greed that has torn across our nation, and rippled through our society. Live beneath your means, and do what you can to share information you feel is important so we can spotlight those who abuse the power, vested in them by honest, hard working citizens.

In closing, I want to leave you with a few words to think on...

"The world provides enough to satisfy every mans needs, but not every man's greed." 

I tell you these words because in tense, conflicted and oppressive times, this simple, humble and honest mans views on how to handle the beast called government were simple. He simply stopped, sat down and refused to play it's games. Even his enemies claimed they trusted him. We could all take a few lessons from this mans playbook, as his views and leadership could defiantly be used today.

Audio to this Article can be Found Here:

"Dissent is the Highest Form of Patriotism" - Thomas Jefferson


1 comment:

    I Wanna Easta Egg!! ... I Wanna Easta Egg!!

    "1946 - Potters Panic - Bedford Falls, New York A Liquidity Crisis at Bailey Building and Loan, which turned the town into a shell of it's former self. Today the towns economy only survives due to citizens being employed by the local penitentiary which imprisons non-violent drug offenders. (Caused by Fraud)"

    Do you offer a free T-shirt or an Are-You-Mad-Yet mug to readers who spot items like the above?


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