“Petro-Currencies” Replace Petro-Dollar

Petro-Dollars (courtesy Google Images)

Every so often, I propose a theory that’s new (to me, at least).  When I do, my initial presentation of that theory is often clumsy and incomplete.  This isn’t surprising.   If the theory offers a new insight, it takes time to learn how to explain it clearly.   However, over time, if the theory comes to seem valid, my presentations of that theory become more refined and easily understood. 

Today, I present another theory with language that’s at least clumsy (some might say, “half-baked”).   I don’t like to present texts that seem clumsy even to me, but I have to do so to not only to try explain the theory to my readers, but also to explain it to myself.  More, I must make the presentation because I know that some of my readers will make comments that will help me to better understand if the theory is probably true or probably false and thereby help me to make clearer presentations in the future.

In essence, I can’t seem to take this theory any further without help from my readers.

For today’s theory du jour, I propose that while the former global monetary system from A.D. 1971 to A.D. 2001 was based on the singular “Petro-Dollar,” in the past two years it’s been replaced by a new system based on several “petro-currencies”.  The fiat dollar is no longer the only currency that can purchase petroleum, but with the reemergence of the US as an oil exporting nation, the fiat dollar has gained some value as one of several “petro-currencies”. 

The emergence of the several “petro-currencies” might explain the last 20-month decline in the price of gold.

 

Gold Fundamentals

Reverse of the American Buffalo gold coins (Photo credit: Wikipedia)

After eleven years of up, up, up, gold has been down, sideways, or down since it peaked at $1,900 in August of A.D. 2011.  Last week, we saw several consecutive days of gold falling between $10 and $24 per day.  On Thursday, gold fell below $1,550 and left many wondering how low gold can go.  Confidence in gold was badly shaken.

Société Générale S.A. is a French multinational bank headquartered in Paris.  It’s France’s second largest bank and the no. 8 bank in the European zone.   So it didn’t help to restore confidence in gold when Kitco News posted an article entitled “Societe Generale Sees Gold Under $1,400 By Year-End”

$1,400 gold!  Two weeks ago, I would’ve dismissed such predictions as silly.  But, last week, I began to wonder if maybe $1,400 gold was possible.

According to that article,

 

Fractional-Reserve Banks are Inherently Risky

The expansion of $100 through fractional-reserve banking with varying reserve requirements. Each curve approaches a limit. This limit is the value that the money multiplier calculates. (Photo credit: Wikipedia)

A few of us have foreign bank accounts.  Many of us wish we had foreign bank accounts.  No one would want the inconvenience of a distant, foreign bank account unless they didn’t trust their domestic banks or government.

In virtually every case, the primary motive for seeking a foreign bank account is our distrust in domestic banks.  Because we fear the loss of our wealth to domestic inflation, high taxes or perhaps confiscation by our own government, we seek to deposit our funds in the “safety” of foreign banks.

However, the “Cyprus Crisis” has taught us that foreign banks may be even more dangerous than domestic bank accounts. As a result, we should rethink our desire to open or maintain an account in a foreign bank.

For example, TheEconomicCollapse.com published an article entitled “Words Of Warning: Get Your Money Out Of European Banks”:

“If you still have money in European banks, you need to get it out.  This is particularly true if you have money in southern European banks.  One thing has become abundantly clear: at least some Cyprus depositors are going to lose a substantial amount of money.  Personally, I never dreamed that they would go after private bank accounts in Europe, but now that this precedent has been set it should be apparent to everyone that no bank account will ever be 100% safe ever again.

“Without trust, a banking system simply cannot function, [however] trust in the European banking system has been shattered and that people need to get their money out of those banks as rapidly as they can.”

 

 

Confiscation to Supplant Inflation?

Location of Cyprus (Photo credit: Wikipedia)

I wrote this article last Friday.  Events are moving so fast and unpredictably in Cyprus–first left, then right, then up, then down–that whatever you write may be compromised in just hours or days.  

Therefore, some of the article I penned on Friday is not necessarily accurate this Monday.  Nevertheless, there is a valid point to this article: there is now evidence that the governments of Cyprus and the EU are now sufficiently desperate to resort to open confiscation of bank accounts and pension funds to keep their fiat-money, Ponzi-scheme afloat.   The first implication is that it may no longer be safe to store all of your savings in a conventional bank account in Europe.

The big question is How soon will the US emulate the European example?  I’ve heard reports that Obama is in the process of dramatically increasing the number of IRS agents.  If the reports are true, you can bet that one of the new IRS agents’ primary tasks will be to discover the bank accounts of delinquent taxpayers and confiscate whatever currency they can find therein.

Confiscation from bank accounts may be on the verge of at least supplanting inflation as gov-co’s favorite means of robbing the public.

Here’s the original article:

 

Fall of Another Empire of Debt

A comparison between Germany’s Wiemar Republic (which laid the foundation for the Hitler regime and WWII) and the current US gov-co and economy.  The video is not profound, but it’s informative and good.

video    00:06:42

 

Lions ‘n tigers ‘n macroeconomic consequences—Oh my!

We’ll need more than Ruby Red Slippers to get out of our current economic mess. (Photo credit: Wikipedia)

The Washington Times reports in “White House ups rhetoric on dangers of sequester,” that:

 

“The Obama administration amped up its offensive Sunday with Republicans over the $85 billion in across-the-board federal spending cuts scheduled to kick in Friday, releasing fresh warnings of a ‘real impact on people’s lives’ . . . .”

The federal government is projected to spend about $3.54 trillion in 2013.  The “sequester” laws scheduled to kick in this coming Friday will reduce that spending by $85 billion or about 2.4% of the entire budget.   Apparently, if government spending is cut by 2.4%, the sky will fall.

 

The Root of All Evil

The following video offers a compelling argument that all modern wars are initiated by and for the owners of the world’s central banks.  Michael Rivero (the video’s author) speaks a little too fast, but he makes good sense.  If you listen to this video often enough to learn and understand the argument and evidence, you’ll understand more about this world’s current reality than 99.9% of the American people.

The video implicitly points towards the spiritual basis for the bankers’ wars:  the love of money.  The Bible, of course, declares at 1 Timothy 6:10 (KJV) that the “love of money” (not money, itself) is the “root of all evil”.   And who loves money more than the private, central bankers?  In the name of central bankers’ love of money, we kill foreign nations and and they kill us.

video      00:43:44

 

A new Gold Standard is being born?

Campaign poster showing William McKinley holding U.S. flag and standing on gold coin “sound money”, held up by group of men, in front of ships “commerce” and factories “civilization”. (Photo credit: Wikipedia)

Ambrose Evans-Pritchard is an English journalist. (What else could he be with that name?)  He’s intelligent, well-educated and a fine writer.  More, he has so much courage that, during the G.W. Bush administration, his articles on Bush were so insightful and aggressive, that he was forced to leave the United States.  I respect that.

However, he recently published an article entitled “A new Gold Standard is being born?” that included one insight that that I found exciting, and a couple more that strike me as lame.

Mr. Evans-Pritchard observes,

 “The world is moving step by step towards a de facto Gold Standard, without any meetings of G20 leaders to announce the idea or bless the project. . . . My guess is that any new Gold Standard will be sui generis, and better for it.”

In other words, Evans-Pritchard believes that a new, “de facto Gold Standard” is already emerging as one nation after another begins to rely on gold rather than fiat dollars to purchase oil and settle international trade accounts.

No government, central bank, or G20 spokesman has (as yet) “officially” declared a new gold standard.  But Evans-Pritchard believes that a new gold standard is nevertheless evolving “naturally” from the wreckage of the world’s present fiat currency system.

Evans-Pritchard’s observation that the world may be “naturally” gravitating to gold—without official sanction or permission—strikes me as prescient.  I think he’s right, and if he is, that means:

 

College Student Debt

dump the debt (Photo credit: Friends of the Earth International)

Student debt is now so great that much of it may never be paid.  I suspect that the enormity of student debt will make the younger generation only that much more sensitive to the issue of unpayable debts, and predispose them to refuse to pay the National Debt.

Education is important, even crucial.  Over the past 40 years, Americans have shopped (on credit) until we have just about dropped–into a national or even global depression.  Through it all, we’ve neglected to continue to educate ourselves and we’ve certainly failed to provide  adequately for our children’s educations.  There will be a national price to be paid for our educational failure.

I don’t believe the young people will ever be able to repay the national debt that’s been foisted on them by their irresponsible politicians and parents.  In fact, when it comes to making good on the government’s National Debt, I believe the kids ought to tell the gov-co and senior citizens, “Screw you–you made the debt; you enjoyed the “free lunches” purchased with that debt; and now you want us, your children and grandchildren, to spend our lives in debt bondage in order to pay your debts?!  To hell with that!“

 

Is the Era of “Cheap Food” Over?

Combining demonstration in Little Casterton, Rutland, Great Britain. An american Case combine pulled by a Caterpillar tractor, these were used just after WW2. (Photo credit: Wikipedia)

The Sovereign Man recently posted and article entitled, “The Era Of Cheap Food Is Over” which declared in part,

“There are only a few people who get it: the era of cheap food is over.

“Global net population growth creates over 200,000 new mouths to feed ever single day. Yet supply of available farmland is diminishing each year due to development, loss of topsoil, peak production yields, and reduction in freshwater supply.

“Then there’s bonehead government policy decisions to contend with… like converting valuable grains into inefficient biofuel for automobiles. Paying farmers to NOT plant. Banning exports. Etc.

“Of course, the most destructive is monetary policy. The unmitigated expansion of the money supply has led to substantial inflation of agriculture commodities prices.

“These fundamentals overwhelmingly point to a simple trend: food prices will continue rising. And that’s the best case. The worst case is severe shortages.”