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If one was to purchase gold and silver as insurance and track the spot price at kitco.com on an hourly or even weekly basis, one is missing the purpose entirely. Do you review your health, home, or automobile insurance policies weekly? Of course not. You review it before you purchase it, put the policy in a safe place, and bring it out when you need it.

Then there is the camp that loves to argue that silver and gold are a worthless store of value and that good stocks with good dividends are the way to protect your purchasing power over the years, to be a store of value. Stocks are a superior alternative to precious metals, they insist. Besides, Warren Buffet stated, “Gold is a barbarous relic.”

In reality, the U.S. dollar is the barbarous relic. It is worth only paper and is used as currency by faith and tradition. Gold and silver have never been worth nothing. Even more confirmation of this is here: Gold still compares favorably with stocks and inflation

There have already been eight, yes eight, devaluations of the U.S. currency since 1933. In 1933 FDR outlawed the private ownership of gold. Most people foolishly turned theirs in. When all of the gold that was going to be got (wink, wink) was turned in, FDR devalued the dollar 59%. He raised the price of gold from $20.67 an ounce to $35 an ounce. In 1971, President Nixon raised the price of gold to $38 an ounce, and in 1973 it was raised to $42.22 an ounce. Wow! That’s three devaluations. Then the U.S. government ordered the Federal Reserve Corp to eliminate the silver from the coinage, which was another devaluation. Then the slow grind of the rising money supply from 1973 to 2006 forced couples to work just to live in a similar manner as their parents. Now, we have QE1, QE2, OPERATION TWIST, and QE3, which were ALL devaluations. That is exactly what the world and in particular, the Chinese, see. Everyone that bought our bonds is losing their value because of the creation of U.S. money. That is called monetizing the debt. It’s great for us, but it stinks for everyone else.

To understand the banking world you are forced to live in, this is excellent! This is your primer to understand way more than your friends or the typical American. Arm yourself with knowledge! It is a great intro.

Experts are telling you what they are about to do! Right now, today! This brings us to the end. (I think I already said that). I have paid attention and studied worldwide macroeconomics for over 35 years. This is the first time in history where we have every nation in insurmountable debt. Most all are in extreme debt, meaning that their debt surpasses their nation’s ability to produce income or Gross Domestic Product (GDP), as it is known. The U.S. has a GDP of approximately $17 trillion. Of course, you have heard that the U.S. debt is $18 trillion. And you may have heard that the U.S. unfunded liabilities, Social Security, Medicare, Medicaid, Fed Gov Pensions, et cetera is over 240 trillion. Okay, when speaking of ridiculous numbers and concepts such as the debt, who gives a hoot. There is no proof of the validity of any of these figures, nevertheless when I go to the grocery store and buy coffee I see the difference in package sizes. Remember?

At this point, it is best to conclude by reflecting on the long career of one of the best macro economists still alive today, Alan Greenspan. As head of the Federal Reserve Corp., he was horrible. Overseeing the transfer of manufacturing capacity and manufacturing jobs to China, he did a great job of gutting the USA. Of course, not to be outdone, the witless Ben Bernanke oversaw the transfer of 100s of tons of gold to China and the purchase of the JP Morgan worldwide banking headquarters located right next to the NY Federal Reserve Corp. The building has a tunnel to the NY Fed Reserve building! The Chinese bought it for under a billion $$$ when the complex was valued at over 5 billion $$$. Hmm.

Let’s get back to Greenspan. Before he was appointed as Fed Chairman, in 1966, he wrote the following:

An almost hysterical antagonism toward the gold standard is one issue which unites statists of all persuasions. They seem to sense – perhaps more clearly and subtly than many consistent defenders of laissez-faire – that gold and economic freedom are inseparable, that the gold standard is an instrument of laissez-faire and that each implies and requires the other.

Check out the rest here.

Greenspan went on to be the fed chairman from 1987 to 2006. During that time he did not speak of gold like he did in the 1960s. However, he did deliver what we call forewarning signals at crucial times, and every time he was correct. To recognize these, one must listen to their speeches and decipher the meaning. For example:

• In the late 1990’s he stated, concerning the dot com bubble, “That this unbridled exuberance in the market place cannot be sustained”. I thought about what he meant for about a month. Then it came to me. What he was saying was that the dot com bubble was going to burst; get out! We got out one month before the collapse.
• In 2007, Greenspan said that “the housing market was frothy.” I had studied many speeches delivered by the Federal Reserve Corp. from the 60’s to 1980’s. By then I understood perfectly. In the futures market we bet that Freddie Mac and Fannie Mae were going to go lower. He was telling us that the housing bubble is about to burst, and it did.
• Now, forward to 2014. He is answering questions at the International Monetary Fund (IMF). He is getting back to his original belief that gold, and to a lesser degree silver, are money. The rest are currencies. From his meeting at the IMF, October 29, 2014:
  • “Price of Gold Will Rise”
  • Greenspan said, “The only protection against inflation is gold”, and I would add silver
  • And what about QE? He made the following comments on the subject, Greenspan: “The Fed’s balance sheet is a pile of tinder, but it hasn’t been lit … inflation will eventually have to rise.”
  • Q: Why do central banks (still) own gold? Greenspan: “This is a fascinating question.”
    • He did not answer the question, but he did point out: “Gold has always been accepted without reference to any other guarantee.”
    • What does this mean? Understanding their language, what he said was that when you accept any world currency, you are trusting that government issuing the currency can back up the value of the currency. Gold and silver require no government, no promise, and no weapons to guarantee their value. Gold and silver have always been money and always will be money. Currencies come and go.

      While Greenspan did not want to comment on current policy, he was willing to give a forecast on the price of gold, at least in a Greenspanesque way:

      Greenspan: “The price of gold will rise.”

      Q: “Where will the price of gold be in 5 years?”

      Greenspan: “Higher.”

      Q: “How much?”

      Greenspan: “Measurably.”

  The conversation continued:

• The reason this is most relevant is because many politicians think there’s unlimited money to spend. And, of course, if the Fed’s printing press is at the disposal of politicians, the temptation to use it is great. Not only is there the temptation, some politicians truly believe the Fed could and should help out any time. As Greenspan now acknowledges, these politicians have a point, but it is to the demise of the country’s purchasing power.

But what a pleasure it was to rediscover the old Alan Greenspan, before he turned his coat and forked his tongue. Back in 1966, when he still believed in free markets and sound money, he expressed himself clearly.

• “In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold in 1933.”
• If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods.
• The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves.
• This is the shabby secret of the welfare statists’ (statists believe that the state/government should control everything) tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists’ antagonism toward the gold standard
• While I and my buddies have argued for many years that there might not be such a thing anymore as a safe asset and investors may want to take a diversified approach to something as mundane as cash, Greenspan’s talk adds urgency to this message. “The dollar has lost over 97% of its purchasing power in the first 100 years of the Fed’s existence.”
• He said the promises made by the government cannot be kept. Mathematically, he said, it’s impossible.
• And not to be pointed out as a lone voice, the Bank of International Settlements issued a new warning on markets in their Dec 2014 Quarterly Review. They issued yet another warning about “the growing fragility hidden beneath the markets buoyancy”. 
• See http://us-issues.com/2015/08/05/list-of-imf-and-bis-systemic-risk-warnings/
• in their Dec 2014 Quarterly ReviewOver the past few years we have documented numerous warnings which the IMF and the Bank for International Settlements (BIS) have issued in regards to risks that exist to the stability of the global financial system. Some of the warnings come directly from IMF and BIS officials and publications. One comes from a speech by BIS General Manager Jaime Caruana. Others come from articles appearing on the IMF Direct blog. One is a link to former IMF Peter Doyle who says despite issuing risk warnings, the IMF has failed in providing early warnings for systemic crisis.

This is absolute insanity! How irresponsible of this thing called the federal reserve!

How are you going to impact your purchasing power?

Median Income Example

All income tiers added together with the median for all:

10 10 11 11 12 12 13 13 14 14 15 30 35 80 85 = 365 / 15 = 24

After the end of the year, most all household income increased. Raising the median:

10 11 11 12 12 13 15 16 17 18 18 38 42 119 120 = 472 / 15 = 31

The lower tier of households. In our example, from the graph on page 11, below $200,000:

10 10 11 11 12 12 13 13 14 14 15 = 135 / 11 = 12

After the end of the year, most all household income increased. Raising the median:

10 11 11 12 12 13 15 16 17 18 18 = 153 / 11 = 13

The top two tiers with the median:

80 85 = 165 / 2 = 82

After the end of the year, most all household income increased. Raising the median:

119 120 = 239 / 2 = 119

Now do you see why they used the median as an indicator? The top tiers influenced the median, while the bottom tiers barely had an impact! After inflation is deducted, most of the bottom tiers went backwards.

The real currency of the world has become trust.

Dallas Fed chairman Fisher stated, “Fiat money is a game of CONfidence and faith and if these are lost it is over.” (emphasis added) Did he really just admit that this is a CON game? I thought we were supposed to play our part in this grand charade and pretend it had value? What is the matter with him? What in the world does this even mean? Sadly, we are past the time in history when being honest was considered noble and right! Governments are past it, and soon people around the world will loose “CONfidence” in the current reserve currency (USD) that is over printed, not backed with commodities like gold, silver, copper, et cetera, and has a history of over 2000%+ inflation over the last 100 years, not to mention several defaults!

Perhaps the federal reserve sees the “CONfidence” waning, as they witness the velocity of USD slow!

See item J

This is one of the indicators revealing the strength and growth of an economy: the speed at which a dollar moves from one transaction to another. The more times a dollar is used to buy something, the greater its velocity and the greater the economy can potentially grow. Is this one of the reasons why we are hearing about the beauty of a “cashless” society? Are they trying to avoid the impact of a loss in “CONfidence”? The call to go cashless increases as banks and governments seek total control:

http://www.consolidatedcredit.org/financial-news/article/2113/

http://theeconomiccollapseblog.com/archives/a-cashless-society-may-be-closer-than-most-people-would-ever-dare-to-imagine

http://www.nytimes.com/2014/11/29/upshot/cashless-society-its-already-coming.html?_r=0

Is this happening only in the USA?

http://www.thelocal.no/20120508/bank-tells-customer-we-dont-take-cash-anymore

However, I am reasonable. I can accept this:

http://www.bookofjoe.com/2012/01/we-will-no-longer-accept-money-out-of-undergarments.html

By forcing people and companies to convert their paper currency into bank deposits, the hope is that they can be coerced to spend that currency rather than save it because those deposits will suffer from negative interest rates and/or fees.

This in turn could boost consumption, GDP, and inflation to pay for the massive debts we have accumulated! Then “we” can finally get out of the current economic trap. However, it’s not “we” but you– the federal reserve that has accumulated that debt! Iceland recognized that fact. It shut down the banks and arrested the bankers! How brave! How righteous!

The U.S. adopted a policy with similar cashless goals in the 1930s, eliminating its citizens’ right to own gold so they could no longer “hoard” it. At that time the U.S. was on the gold standard so the goal was to restrict gold. Now that we are all in a “paper” standard, the goal is to restrict paper.

• Paper money loses value unless it earns a return greater than true inflation. When holding it personally, it could be stolen I suppose. However, converting it into bank deposits will cost you fees and perhaps negative interest. It will also expose you to the promises of the Frank Dodd Act, exposing you to a substantial loss if the bank goes under.
• This would have grave consequences for retirees, many of whom are incapable of transacting using plastic, not to mention that they will disproportionately bear the costs of having to hold their liquid savings entirely in a bank or den of thieves.
• The very poor are messed over. This will make them more dependent, in fact exclusively dependent, on government handouts, if they are available.
• If there is an event that disrupts electronic transactions (e.g. extensive power outage, cyber attack, cascading bank failures), people in that economy will not be able to conduct business.
• Of course, enforcing a government mandate to ban cash transactions must carry penalties. This in turns means more regulations, disclosure requirements, and compliance costs, potentially exorbitant fees and even jail time.
• And of course, I saved the best for last. The banks can charge any fees, any amount of negative interest, and inflate to no end the value of your new electronic digits. What are you going to do? Put them in another bank? There will never be a bank run again! It’s good for the banking blood suckers! Their tightening of the noose for you!

Of course, they will try to further deceive the sheep by saying, “Imagine the reduction in crime that would follow if cash were to become a thing of the past.” Right!

By putting all currency accounts under either the actual control of governments or subject to absolute monitoring by governments, nations would finally possess the ability to bring to a close the “boom or bust” economic cycles that prove so deeply damaging to the world’s economies.

They could do that now with proper weights and scales, proper sound procedures, et cetera. Let’s play a game. Suppose a government that deems it is proper and right to make propaganda legal, creates critical economic figures from lies and half truths to steal, threatens punishment if you step out of line, and will throw you in jail if they do not like your speech. Hey, theyll throw you into jail if they do not like your tone! I had a step-mother like that once. They will take your currency through civil forfeiture.

Ah, what have we here? Could this be the best tool to completely control every thought, every action, every belief?

Revelation 13:17 (KJV) – “and that no man might buy or sell, save he that had the mark, or the name of the beast, or the number of his name.”

If you chose not to play their reindeer games, could they simply prevent access to your electronic account? That would make you an utter serf, a complete slave! Mission accomplished. The noose is tight enough.

Are you asking, “Is there any way out?”, or are you suffering from a typical response:

1. Maybe in third world countries but never here.
2. We have always come back from slow downs in the economy.
3. That sounds like conspiracy theory craziness.
4. Shut up! I don’t want to know.
5. I was doing just fine until you opened your mouth.
6. Where did I put those razor blades?
7. If you were closer, I would kick your behind. (I actually had a guy say that to me once, shortly after he believed.)
8. We are the world reserve currency; this could never happen.
9. Now, where did I put that whiskey?
10. …and so on.

Either way, I will finish by proving my point that there is something that has worked in the past!

The main problem with fiat currencies is that a government is trusted not to print more currency than is actually required or to be more realistic, like we have to be, not print or spend beyond your means. I did say “government”. That is absolutely propaganda garbage!

“Some [Most] people think the Federal Reserve Banks are the United States government’s institutions. They are not government institutions. They are private credit monopolies which prey upon the people of the United States for the benefit of themselves and their foreign swindlers.” – Congressional Record 12595-12603 – Louis T. McFadden, Chairman of the Committee on Banking and Currency (12 years) June 10, 1932

Currently we, or the federal reserve on “our” behalf, borrows $1 trillion per year. A government can only do this when the currency is fiat. How did it work when we had commodity based money? Inflation was kept low naturally. When the government wanted to expand the money supply, they had to use silver for the coinage and add gold to the vaults at Fort Knox, or wherever, for paper money. Then, they would print gold backed money and create additional 90% silver coinage. Here is an example of how this used to work. When backed by gold, I could go into any approved bank and trade a $10 commodity backed money for $10 worth of gold.

In 1922, I could have traded the above $10 United States Note for ½ ounce of gold. Today, that ½ ounce of gold would be $628. Again, that’s a 610% increase.

The pre-1965 dimes, quarters, half dollars, and silver dollars already contained 90% silver. You would have had the silver in your pocket or purse! If I had a silver dollar, say dated 1879 or 1925 like the two below, I would have had almost 1 ounce of silver. Today, you need to trade $14.98 of fiat currency to obtain that one ounce of silver. That is 1400% increase.

Here we see an. 90% Silver

This is a. It is 90% Silver as well.

All of the above are collector series money and coinage. To have currency insurance, you do not need something like these collector condition items. Common circulated coins are sufficient.

Now, the governments all over the world are printing currency without adding gold or silver to back their currency. The world debt is the highest in history. Boom/bust economic cycles are more dramatic, and the severity of the damage is at extremely dangerous and alarming levels as world debt grows with no underlying foundation.

In the U.S., we backed our money with silver and gold. In 1965, we stopped backing our coinage with silver. In 1971 we stopped backing our money with gold. Now our U.S. dollar is backed by the full faith and credit of the federal government, who is in debt at least $18 trillion and over $240 trillion when one includes the obligations of social security payments, Medicare, federal retirement payments, et cetera. Oh, I almost forgot about the lies, cheating, and utter disgusting filth that has become the USA, Inc. It’s sad, because I loved this country and the God-breathed Bill of Rights!

This fiat currency scheme, which the world has been on since 1971, is running out of steam. The pressures are mounting everyday worldwide. This system will be replaced by something new.

Let us continue with a 50 year review.

Defying Devaluation of the U.S. Dollar, Past, Present & Future

U.S. Silver coinage before 1965 that has been circulated, unlike the two silver dollars above, is known as junk silver. Now let us see how much pre-1965 90% silver U.S. coinage is worth by reviewing a close of an auction of “junk silver” on eBay from last year (2016 figures follow):

$2.50 Junk silver at eBay

In the above auction we have $2.50 of junk silver. That is $2.50 face value. However, the value of the silver has a higher value than that of the face value, $2.50, of the coinage. To determine the current price or value because of the silver, the best place is a recent auction close on eBay. The auction above sold $2.50 Face Value (FV) of junk silver. Let us figure out the silver value that is over and above the face value. This is the calculation:

sold at eBay auction price ‘/ divided by’ face value = the face value multiplier

$41.50 (sold at auction price) / $2.50 (face value or FV) = 16.6 is the face value multiplier (FVM). This means $2.50 in face value (FV) x 16.6 (FVM) = $41.50. That is where the auction closed.

Here is one that sold for a little more:

.45 Face value junk silver at eBay

.45 (FV) x 16.6 (FVM) = $7.47 where as the auction sold for $7.51

Here is one that sold for a bit less. Most likely because the winner had to pay for shipping at $2.04.

.50 Face value junk silver at eBay

.50 (FV) x 16.6 (FVM) = $8.30 where as the auction sold for $5.00 + $2.04 = $7.04

First, let us go back 50+ years to determine the cost of one gallon of gas.

.25 to .29 cents in 1964

1964 gasoline prices

In 1964 gasoline was approximately .25 to .29 per gallon. Prior to 1965, U.S. coinage (.10, .25, .50, and $1) were 90% silver. Beginning in 1965, the U.S. Federal Government authorized the Federal Reserve Corporation to produce the same U.S. coinage without any silver. At that time I could purchase a gallon of gasoline for approximately one 1964 90% silver quarter. This is a critical historical reference point because we need to prove if this 90% silver, U.S. pre-1965: dimes, quarters, half dollars, and silver dollars will store our value. Will they protect our purchasing power?

Today, I sell one pre-1965 quarter to pay for a gallon of gas. Will that work? .25 (FV) x 16.6 (FVM) = $4.15. Wow! It appears that the pre-1965 90% silver quarter stored” my purchasing power!

Pretend with me for a moment. Suppose that in 1965, I saved $1000 FV of pre-1965 .90% silver Washington quarters. Keep in mind that the $1000 I saved could have purchased 4000 gallons of gasoline. Let’s say I was in an accident and then in a comma for 50 years. All of a sudden I woke up, took some Geritol, and grabbed by $1000 worth of 90% silver quarters. I decided to sell all of them. $1000 FV x 16.6 FVM = $ 16,600. That’s not bad. However, I want to know how much gasoline will that buy today?

$16,000 / $4.15 per gallon = 4000 gallons. WOW! I am worth the same today as I was when I sunk into a comma!

Here are the comparisons from today:

$89.99 Face Value / $5.00 = $17.99 Free Shipping. eBay auction number: 311707224163

$29 Face Value / $1.85 = 15.68 SHIP FOR $2.99. eBay auction number: 351854254305

$141.1 Face Value / $8 = 17.63 Free Shipping. eBay auction number: 302082595619

$34.33 Face Value / $2.15 = $15.97 SHIP FOR $2.99. eBay auction number: 252556571503

We just found out that my purchasing power was the same in 1965 as it was in 2015. Oh, and one last little bit, when I traded my $1000 of 90% silver quarters for fiat USD currency, there was no tax man looking over my shoulder. You can pay the tax if you want. However, you already paid the tax in 1965. So, you wake up out of your comma, have your first beer in 50 years, and the tax man says, “Congratulations, you came out of your comma and now you owe me taxes on that USD currency.” Really? I know the correct thing to do by “law” but really? You have to make those decisions on your own.

You can do the same with gold. Gold and silver have always been money. I want to hold it until this fiat currency storm passes, until some new system is put in place. Gold, and to a slightly lessor degree silver, has one quality that surpasses any fiat investment: relentless appreciation. $1,000,000 in 1913 would be worth $20,000 in purchasing power today. (Does that mean I can write of the loss on my taxes?) That same $1,000,000, if used to buy gold in 1913, would be $60,000,000 today. I can hear the tax man come running! This is currency insurance at its best.

Okay, you say to me, I can do the same with the stock market and some bonds. I believe that there is some truth to that statement. There are always investments that will pass gold and silver, if you can pick them. However, that point has nothing to do with the fact that gold and silver have never left the owner wanting when using gold and silver as a store of value. It has never been worth zero. When used as a speculative instrument, meaning you buy it hoping that it will go up, you are at the mercy of the market. Perhaps you can call it correctly, perhaps not. The idea is to put it away and forget about it until you need the currency insurance– a bit of safety. It’s like fire insurance, I suppose.