What will Happen?

September 11, 2001

As the dust clears from the World Trade Center Towers, Pentagon, and others, what will happen? I can only guess, but being a man with logic tattooed on his brain, my sense of logic tells me the following will happen, economically at least, and if you will permit, the reason why.

There seems no doubt that terrorism has reached a degree of horror that no one could have imagined. This exceeds Pearl Harbor by perhaps a hundred times, and there is no nation on which to declare war. There are strong suspicions this cowardly act was possibly financed and produced by Osama Bin Laden, but time may tell. The sight of Palestinians waving flags and throwing candy in the air as they cheer, will not help relations with Israel much, and may cause Muslim bloodshed everywhere. Neither Russia nor China like the Muslims, so this may be helpful.

First of all, the insurance industry has probably been wiped out. The claims for tens of thousands of life, fire, business interruption, injury, and other policies will surely bankrupt the industry more than a dozen hurricanes could. The City of New York will face bankruptcy, as its infrastructure has been damaged horrendously, not to mention its reputation. The question as to secondary explosions from previously planted bombs will not go away easily. The World Trade Towers had about 50,000 workers in them, and doubtlessly an equal number of visitors, tourists, delivery personnel, repairmen, etc. The death toll may take months to calculate, but it will not be pleasant. The interrupted lives, broken marriages, parentless children, bankruptcies, property losses, job losses, record losses, and a whole slew of other malignancies will linger over this nation for a hundred years.

The field of precious metals will obviously be affected, as it has today, Sept 11th, when this is being written. Gold immediately went up $28, and silver twenty cents. Where will they go from here? When a tragedy strikes which threatens the very life blood of a nation, there is usually a mass flight to safety. This tragedy will harm the nation's business immeasurably. Will this make stocks plummet? Possibly, because the depressed population will not buy, and it has been America's buying on credit that has kept it from crashing already. Christmas business will be very bad. Safety, for thousands of years, has been gold and silver, not pieces of paper with ink on them, turned out by the millions every day. Safety is tangible guns, gold, silver, a home, and low debt levels. I predict that buying will slow, and debt repayment increase.

Further, I think that Americans will become very uneasy about living and working in big cities, which are obviously open to terrorist attack. I think that big city real estate prices will go down, and thousands will seek life in the small towns, where real estate prices will go up. Is this episode the final one? I think not, and no one knows where they may strike again, but it will be at a big city, of that one can be sure.

This will be brief, as we are all too dumbfounded, outraged, and sorrowful to read much. The death of the innocents on planes, the ground, and in buildings is simply to much for a sensitive person to bear. As my book Consequences says, under the chapter titled "Neutrality," if we were a neutral nation, and weren't messing around in everyone's business but our own, no one would want to attack us. If America didn't back this and that, and send troops and aid here and there, we wouldn't have people hate us. Most of the world loves Americans, but hates our meddling government. Our support of Israel, or defeat of Saddam Hussein, probably has made this happen. Let the world do as it pleases, but bring the troops home, and keep our dollars here. I will still send the book free by e-mail if requested to do so.

In the mean time, protect yourself, because no one else will.

A one-ounce gold nugget is rarer than a five-carat diamond.

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