Real Wealth #211 01/15/2009
Economic conditions here in the United States – and for that matter worldwide – continue to erode. Federal Reserve Chief Ben Bernanke this week said that while an expected U.S. fiscal stimulus package could provide a "significant boost" to the economy, the government may need to inject more capital into banks and consider steps to clear the financial system of toxic mortgage-related debt.
"Fiscal actions are unlikely to promote a lasting recovery unless they are accompanied by strong measures to further stabilize and strengthen the financial system," Bernanke said at the London School of Economics.
The fact is the Banking System worldwide is in dire condition and many, including JPMorgan Chase chief executive officer Jamie Dimon, have warned the worst of this financial crisis lies ahead.
President Obama takes the oath of office in just 5 days; and it’s abundantly clear that he is willing to spend Trillions of dollars to bolster the economy and back stop the banking system. A chorus of extremely credible economists and financial analysts are insisting this monetary creation will not have a long term impact on inflation. Right now they look like they’re correct.
There’s definitely a deflationary impact caused by the series of economic crisis that we have seen in the past year. We see it in stock, real estate and even energy values. The deflationary impact has forced even holders of gold to sell and kept the price of gold under $1,000.
But anyone with common sense has to understand that creating $3 Trillion, $5 Trillion, even $10 Trillion in newly printed money and debt instruments worldwide will eventually either cause a substantial inflation problem or the worst possible crisis: a monetary collapse.
I’ve written several issues of the Gold & Energy Advisor titled the “Death of the Dollar” over the past few years. The U.S. Dollar, as well as the Euro and dozens of currencies around the world, are literally going to be murdered by sheer fraud, mismanagement and politicians.
I have never believed that the worst case scenario would unfold all at once. Instead, I believed the path to hyperinflation and monetary collapse would be slow and agonizing. This means a two or three year path that includes a deflationary fake-out, fought off with Trillions in government spending and bailouts is the more likely course to the worse case scenario. This appears to be clearly the road we are on.
There are a few water shed events that lay shortly ahead that could act as a catalyst for a world-wide monetary panic. The first two are very obvious. Commercial Real Estate and Corporate Debt refinancing this year could literally break the “bank”. With home foreclosures surging 81% in 2008, and more than a half million jobs being last per month the danger is immense
In environment like this it’s mandatory that you hedge your financial survival by owning gold. In the event of a monetary collapse, gold will be one of the very few forms of wealth that will remain reliable. Owning physical gold could well be the difference between economic survival and desperation for most people. The reality of this has yet to sink in to most. Anyone have the guts to make this case right now are being treated with the same contempt that those who warned in late 2007 that a real estate crisis was developing and could lead to a banking collapse.
I’m so convinced the danger of a monetary collapse and that gold is so important to own that I have asked my staff to make physical gold available to our clients at less than the mint charges. Right now the U.S. Mint is selling 1 ounce Gold American Eagles for $1,129.00. My staff has been instructed to shave our price to the bone to make sure that every subscriber has the opportunity to buy physical gold. My staff has been instructed to under sell the mint on raw one ounce American Eagles.
The current dip in the price of gold is another short term buying opportunity. In fact, right now for about $75-$95 more than the mint charges for raw coins you can my staff can arrange the delivery of Gem Uncirculated MS70 FLAWLESS U.S. Gold one ounce American Eagles, certified and graded by NGC.
To take advantage of this offer please call 1-866-697-GOLD (4653) ext. 1406
Keep in mind you can place Gold American Eagles in most IRA accounts. So, if your looking to protect your nest egg, buying physical gold for your IRA is one of the smartest ways to protect ones self.
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