THE DEMI$E OF THE DOLLAR

George Offerman

For those who believe this is unrelated, or very unrelated to legalized child killing, I want you to consider a few things first. If a country can be that jaded that it kills its most innocent without abandon, and with only a ‘show’ of a fight by the forces of good, this country is just as jaded when it comes to the prospects of using fake money in lieu of real money. Make no mistake, our paper money is fraudulent, and has been since the day it was implemented. It will soon go to its intrinsic value: $0. For those who doubt this, do a little research on the history of money, and you will soon discover that paper money has a 100% track record of failure. It is the antithesis of God’s money, which cannot be printed at will, and is limited for many reasons. Just because one does not understand this principle, or if they outright reject it, does not invalidate God’s very clear mandates on what money is and how it is to be used. If one does not want to know, then they deserve whatever comes their way as a result of this willful ignorance.

Bernanke and the FED decided to meet a day after the elections in order to facilitate their next fiasco, dubbed QE2, for quantitative easing, second edition. The rest of the world no longer has blinders on, and they are very aware that this will doom their long-term investments in our debt through U.S. Treasury notes. It has become clear to the rest of the world that we are no longer able to pay our debts, and these investments will be lost. Our creditors, lead by China are going about re writing financial systems without our input, and we will soon be left in the cold concerning our ability to purchase even the most mundane of products, no longer manufactured in our country. The pursuit of the ‘good life’ via borrowing over the past 20 + years will be coming to a very abrupt ending in the next few months to two years, and there is NOTHING anyone can do about it.

Bill Gross of PIMCO, the “Michael Jordan’ of bonds, has declared the 30 year Treasury note ‘dead’. This is a very large deal, due to the fact Mr. Gross is the most successful bond trader on the planet, and he is very in tune with the movements of large amounts of money. The reason for such a dire proclamation is due to the need to have higher interest rates for long term bonds, in order to lure money into them, coupled with the larger fact of the bond holder believing they will get their money back after the term of the bond expires. The world clearly understand they will get neither a good interest rate, and nearly all now believe they will never see their money again. The ability to fund our deficits are over, and it will be the FED purchasing bonds, to create an artificial market for this junk. But the more money they print and spend on bonds, the lower in value the current bonds become, and the less purchasing power the bondholders now have when (if) their money is returned.

This most likely will result in our over bloated numbers of dollars in print being repatriated, and say hello to hyperinflation. At that point, the only currency the world will accept from us will be God’s money: gold and silver. If one understands how little of these metals exist, they will begin to understand what prices they will attain once God’s money once again takes front and center. It has been stated that for every trillion added to the world economy, that adds another thousand dollars per ounce to the price of gold. Well, the amount that has been batted around concerning the QE2 has been anywhere from .6-3 trillion over the next several months. So minimally, this guarantees gold at $3,000 per ounce and silver at $200 per ounce, as a FLOOR. Even Jim Cramer, the maestro of paper products has been talking $2,000 gold, and mentioned on his show earlier in the week that “No one I know has gold in their portfolio, but they need to get some”.

No one with any sense can argue with the massive increase in the prices of both gold and silver in the past several weeks. These metals will continue their increase over the next several years, and attain prices that cannot even be imagined at this time. I like to tell the skeptics that mining is fairly constant in the amount of production. 2010 numbers are 82.5 million oz. gold and 704 million oz. silver worldwide. Compare that to a declaration by a banker that they will ‘create’ between .6-3 trillion DOLLARS by fiat, or declaration. Now, what is behind this ‘new’ money that gives it value? Nothing. However, if gold and silver were to ‘monetize’ these created dollars, we would be adding many zeros behind the current prices of both metals, and that is just considering the U.S. debt. But because this post is covering the dollar, we will stay focused on U.S. debt. The dollar will soon be rejected as the ‘reserve currency’ of the world. And when that happens, we will be very much like Greece, and have to have assets in which to purchase all of our foreign goods. The metals will be the only thing most of these countries will be interested in, so their prices will have to do a ‘moon shot’ in order to continue obtaining any type of goods we have grown accustomed to having.

So, here we are. We are now at the endgame of this monopoly money experiment, and the losers are the common folk. We are the ones who are going to pay the price of this folly, but we also contributed to this mess by playing the game, and buying into the scheme that we can borrow our way to prosperity. This bill is now due, and those who threw the party are attempting to sneak out the back entrance, leaving us the bill. Well, the bill needs to be paid, and paid it will be. We better prepare.