THE DIFFERENCE BETWEEN THE BANKSTERS
AND THE REAL WORLD
"Golden-Trumpet"
Alan Greenspan DOES NOT live in the world you and I do. It's imaginary. He is "Sir" Greenspan. He professes to believe in the principles he wrote in his gold essay. However, in the real world he has betrayed those beliefs. He's like Doctor Robert Stadler in "Atlas Shrugged." Dr. Stadler was a character Ayn Rand wrote to show how corrupt a person could be.
Since we live in the real world, I thought I would point out the differences between us and the Banksters like Alan.
Let's look at the Federal Reserve view of gold. The official price of gold is $44.00 an ounce. You or I have to pay around $390 - $425 or so. It is rumored Alan reads Gold-Eagle. If he does, I want to ask him this:
"HEY ALAN, HOW ABOUT LETTING THE REST OF US IN ON THIS $44.00 AN OUNCE DEAL?"
No? Guess that deal is just for your friends. Okay, what are some other differences?
Inflation! In particular, inflation measured by the Consumer Price Index (the CPI)
The CPI does not include food, gas, housing, and other prices out in the real world. Another cost left out are taxes. We would be shocked if all the taxes we paid - visible and hidden - were accounted for. Sure there are "tax-cuts," but as Robert Ringer said: "All tax cuts are illusions! There is no such thing as a tax cut; there is only a change in the manner in which the money is extracted. Were this not true we would be paying less then we were 10 to 20 years ago. Think of all the tax-cuts we have been blessed with."
Taxes and the missing costs of living are some of the reasons we have inflation and have to pay more.
Since the CPI underestimates several real world prices by omission, I am going to use another index, one I created. For my inflation rate, let me use just one item. Lobster!
Around November 2002 last year, a supermarket started to sell luxury goods: lobster. I couldn't believe the price. $7.99 a pound and they would even cook it for you while you shopped. Believe me, I ate good!
Since lobster is highly perishable, it has to be air-freighted. It's spendy but the store was efficient enough to match East Coast prices, air-freight and all.
Then came Gulf War II. The government broke previous high spending records. Gas prices shot up as did freight rates. All this was reflected in the price of lobster. After four 4 months, it went up to $13.99 a pound, an increase of $6.00 or 75%. No more cheap luxury eats for me.
Some things are going down. They are either being produced with extreme efficiency or over-produced. An example is the auto industry. The United States, Japan, and others know how to make cars. It is a mature industry. There are far more cars than needed. New and Used Cars can't be moved and lose value. The short-term solution is "No-Interest" loans. To me, while they keep the plant open, those loans are an illusion. Which leads to my next point: Interest.
Those no-money, no-interest loans used to move vehicles have lots of service fees and other hidden costs. You end up paying far more.
When I get my ride, I will pay cash or gold. No hidden interest costs for me!
The Federal Reserve interest rate is 1.00%. All the rate cuts didn't work. Good luck finding a mortgage rate that low. The cheapest I've heard is about 10%. Since I don't qualify, let's look at some other interest rates.
We're talking about people who live in the real world, and where I live it, that world is poor. What is the interest rate is for poor and working class people? I went into one of those payday loans places. These payday loans are required to post the annual interest rate. In the smallest print possible, I saw the annual interest was 985%. And if you can't pay, they are quick to haul your sorry self into court.
Now I've pointed out some differences, you're wondering: "What's in it for me?"
Money! A lot of money! Real money, too.
Anytime there is difference between prices, there has been a way to make a buck off it. Usually, that has been reserved for the banksters or insiders. They get the seigniorage. But if there is a financial crisis, the money tends to flow from the fat cats to the wise ants who saw what was coming. In other words, they will be paying us!
When the price of gold and silver reflects what the paper dollar is really worth, we will make money. Reverse seigniorage. Here are some other ways:
1. Buy real estate
It will be no longer at hyper-inflated prices but a bargain hunter's dream. However, you will only be able to take advantage if you have gold or silver. Real Money! You may have heard the story how a German bellboy in 1920 was tipped a gold coin maybe worth $20.00. By the end of the German hyperinflation he was able to buy the same hotel he worked in. Expect real estate prices to go from a $1000.00 in currency to a silver dollar.
2. Start making gold loans
I am not talking about the phony gold loans made through bullion banks. This is the gold I said earlier was priced at $44.00 an ounce. That gold is gone. Only the Banks haven't been forced to stop making loans. Once they stop "lending" or they run out, the price of gold will reflect real world prices and explode. With no gold available from "Easy Al and his bullion banks pals" there will be a tremendous rush to get gold. Everybody will want to buy, but you being smart enough to buy before the rush will be smart enough not to sell but to loan your gold. A true loan.
Before Roosevelt grabbed the people's gold, gold loans were common. In fact, J.P. Morgan loaned and saved the U.S. government with gold. The government became bankrupted because of the crash of 1907, The Rich Man's Panic.
You can bet J.P. got his gold back and a lot more. You can do the same. A lot of folks follow the investment strategy of Warren Buffet. What I am saying is instead of following the current Wall Street leader, do some historical research and follow the leaders of the past. Beside studying J.P. Morgan, it might be good to read Jesse Livermore's book, "Reminiscences of a Stock Operator," written by Edwin Lefevre.
3. Sponsor a new political party
The people who lobby and fill the campaign chests do so expecting tremendous payoff. We can do the same and the payoff will be priceless. The payoff will true liberty.
When this country's money system collapses and/or there is total chaos, historically that is the time to change the political system. "He who has the gold makes the rules." Let make the rules then! Start a new party. We'll be rich enough.
One of the complaints in forming this country as a republic, was it was formed by rich men. Of course it was. What people don't realize is wealth, freedom, property, and beneficial social order are all tied together. Lose or compromise any one of them and eventually you lose them all. That in my opinion was the major fault of the Constitution. Too many compromises.
Instead of "Life, Liberty, and Property" as Jefferson wanted, we got "the pursuit of happiness."
Instead of "No state shall issue any money but gold or silver," we should have had, as in the first draft, "Neither Congress nor any state shall issue anything but gold or silver."
Remember, one problem was the Continental Congress issued bills of credit - paper money - as well as the states. The currency that First Congress issued was a far bigger problem then the paper issued by the states. The Congresses that followed just gotten worse.
We will have to clean Congress of the current political parties.
Both the Libertarian Party and the Constitutional Party are far better than either the Republicans or Democrats. However, if they get into power, they will soon be as corrupted as those in power.
I think a totally new party would be best. One that really isn't a party but individuals providing the least government possible. One based on the Articles of Confederation, and the best of the Constitution. Something that offers far better gold protection from inflation then Article I Section 10 Clause 1.
Also it would be nice to have a far stronger Bill of Rights and a simpler form of impeachment. If the politicians don't follow this new combined Articles of Confederation/Constitution they get thrown out immediately. Impeachment would be just to see if they should be reinstated.
Now I've have pointed some differences between the bankster's world and the real world, you should not be like Alan Greenspan and live in your own world. Greenspan, as a former follower of Ayn Rand should know:
"You ignore reality at your own peril."
28 November 2003
"Golden Trumpet"
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