Another Cut. Whoopee!

What it took Japan 7 years to do, Greenspan and his private, mostly European owned, Federal Reserve Central Bank, has done in a year. He has cut the interest rate for the 11th time in a year, with more to come, it is rumored. Maybe we will have a zero interest buck like the yen is now, which will make us, like Japan…gasping for air, and testing the softness of the pillows in the bankruptcy area of Hades. Did the market shout for joy, escalate to previously unknown heights, and make day traders rich? Ho Hum, was the attitude, and the Dow went down. Maybe the PPT (Plunge Prevention Team) was out to lunch at the time. Maybe the team has bought so many millions of stocks, or manipulated the market so much, that their ability is seriously impaired. I wonder how many stocks the federal government owns. No one has successfully answered my nagging question, as to which item in the Constitution allows a mostly European owned, private bank, to run our economy.

In previous exercises on the keyboard, I estimated that the fed was injecting "liquidity," to the tune of $6 billion a week. I upped that to $6 billion a day in a later piece of drivel. Now the truth is out, as reported by one of America's most prestigious financial mags. Here is a sample of "liquidity" injections. 9/11 - $90 billion. 9/12 - $38 billion. 9/13 - $90 billion. 9/14 - $81 billion. I am certain that the World trade outrage is being used as an excuse for some of it, but the process continues daily. Yesterday it was close to $7 billion. On it goes, and continues to go. In other words, the privately owned, mostly by Europeans, central bank, incorrectly known as the FEDERAL RESERVE, has literally increased the dollar supply by hundreds and hundreds of billions, of late. This means that hyperinflation cannot be far behind. There is a lag time before the immutable forces of, "the more of anything there is, the less they will be worth" (Stott's law) goes into effect. But it will happen, just as it has happened with every other currency in history, when the presses rolled, and the bookkeeping entry goons went wild. Last week, I mentioned a thousand dollar Confederate bill I photographed. See it below, along with a 20 million mark German note, which in 1925, bought a cup of coffee. 4 years earlier, the mark was worth an American quarter. The Jamaican $100 dollar bill is virtually worthless, but isn't it pretty? A cup of coffee used to be a nickel in America, and now it is over a dollar. Give you a clue as to where the buck is going?

As if the above weren't alarming enough, what has now been discovered, is that a phenomenon known as "fed shred" has come upon the DC scene. Since 1987, Greenspan and his aggregation, have supposedly shredded literally thousands and thousands of documents that have to do with the fed and its actions. Leave no trail. Would an organized criminal conspiracy act differently? Maybe the fed is just such a group, if it must shred documents to cover a trail.

The obvious way to protect ones self, when the above is uncovered, is to get the hell out of dollars, if you have a surplus of liquid assets. Ounces of gold or silver, acres of land, square feet of home, or any other measurement other than dollars. The one exception, is a mortgage with a fixed interest rate. Keep it! It will be paid off with a bag of peanuts per month in a few years, and whoever issued it, can't change interest rates in the middle of the stream. The dollar, as a unit of measure, is from Alice in Wonderland. Things we buy, will go up in dollar prices almost like magic. With the lower interest, more and more will withdraw savings from banks, because the taxable interest earned is so pitiful, that it is pointless. The withdrawers will know of nothing else to do, so they may buy stocks, further strengthening the next crash that is inevitable. A client of mine left yesterday with gold and silver…on his way to the bank to clear out his CD, which was paying 2.17%. He'll place it in silver I imagine, but whatever he does with it, it won't be denominated in dollars. He raises Thoroughbred horses. Maybe his withdrawal will go into pounds of horseflesh, but it won't stay in dollars. You should act the same, because you must protect yourself by using your brain, not your custom or habit. The dollar is a shrinking measurement.

The Euro is coming on strongly. Suppose Japan, which holds over $400 billion in US securities, decided to cash them in and go Euro, or just cashed them in to give their broken economy a boost. What would that do to the dollar? Suppose the oil sheikdoms go Euro? Suppose people believe that the Euro (with no known home base or capital) is great, what will that do to the buck? After all, every single currency in the entire world, including the Swiss Franc, are merely pieces of paper with ink on them. I have a client who, when he was a child in the South, used to play Monopoly with Confederate money. Now Confederate money has huge antique value…some say dollar for dollar. In the future, Confederate money will go higher than dollar for dollar, because the dollar is being rolled off the presses by the billions, and there are no more Confederates. I remember the saying, "Save your Confederate money boys, because the South will rise again." I hope it does. That will make that shrimpy drunk, Ulysses Grant turn in his grave.

ANSWERS TO MOST ASKED QUESTIONS OF GOLD-EAGLE.COM

First of all, why ask Gold Eagle questions about the columns? Why not ask the columnists? Gold Eagle is the gracious host to us blabber-mouths who think we are the world's smartest people. Ask the columnist. Ask me! E-mail is [email protected].

1. Q. If in a safe deposit box at a bank, what happens if the bank is closed by the government? A. On the 12/11 three-month memorial TV shows, the cameras panned to a couple of fellows that were digging in the rubble with trowels. They were trying to find safe deposit boxes that came down with the bank and entire 110 storey buildings. I wish them luck, but remember, there is no insurance on a safe deposit box. Those boxes, undoubtedly contained millions of dollars worth of bonds, stocks, wills, and other valuables, which may never be recovered. Safe deposit boxes in your local bank will never be bombed, I hope, but IRS loves to seal them when someone dies, or when they believe you owe them 'money.' Since the IRS code has more words than the Bible, and since no one understands it anyway, it is very possible that some IRS bureaucrat may decide you owe him money. You protest your innocence, and the box is sealed till you win or lose. If a bank is closed by the government, I can see no reason how a safe deposit box can be connected with a bank's poor management. The box is yours, and you paid rent on it, even if the loan officer did loan his cousin Jack a million, unsecured. The point is that you shouldn't store gold and silver in a safe deposit box in the first place.
2. Q. Where do I store my gold and silver bullion? A. You store your guns in a handy place, because they are for your protection. Gold and silver are for your protection also, so keep them on your property. They are YOURS, and not for seizure by government in a safe deposit box. Use your imagination, and store them safely, telling no one where, other than one trusted person, in case you die. I once had a client who used Old Spice in a stick, for some tasteless reason. He found that Krugerrands fit perfectly in that container, so he stored them in his medicine cabinet. Just use your imagination. Buy a safe, and use it for wills, deeds, guns, (except for the ones you have handy for instant use) and gold and silver. Safes are fireproof, and theft proof, as they are too heavy to lift when you are away.
3. Q. What if government confiscates gold? A. Now hear this: GOVERNMENT HAS NEVER CONFISCATED GOLD. In 1933, FDR ordered citizens to exchange gold for paper money, but gold was never confiscated. Who followed the orders? A lot of people did, because in the midst of a depression, they couldn't afford to do without the purchasing power, but millions didn't. No one knows who owns gold and silver now, and they didn't then. There are no serial numbers on coins. What can be confiscated, are things that are registered, such as driver's licenses, guns, homes, stocks, bonds, and credit cards. NOT gold and silver, which are owned anonymously.
4. Q. What if government makes it illegal to own gold again? A. Pray for that day, because like every other "illegal" substance, those items command an extremely high price. I think that is highly unlikely, but if it did happen, you would be rich. Look at other "illegal" things, which command high prices: Drugs would be dirt cheap if they weren't "illegal." Prostitution, gambling, speeding, etc., all are very expensive, because they are "illegal." America and the world always do what they please, regardless of their "illegality." When boobs in Congress made driving over 55MPH "illegal," the radar detector was born, and we drove as we saw fit, slowing only when the little device started beeping. I have never done or even seen drugs, but I know they are readily available…at a high price of course. If gold and silver are made "illegal," you can buy and sell at very high prices on the street. Inventive, freedom loving people can find a way to do anything to protect themselves. You didn't register that gun I hope.
5. Q. How do I sell my bullion? What if I need to liquidate quickly? A. I buy and sell all the time. Sell to the firm you bought from, or sell to anyone who wants it. It's simple and fast. Selling gold and silver is no more difficult than selling stocks or bonds.
6. Q. If I keep it at home in a safe, how do I protect it? The safe is protection enough, or you can hide the safe perhaps. Hiding safes is a hundred year old skill. Behind a picture, in the attic, or in some unlikely place. Just be smart as well as secretive. My client's purchases come under the label of "Don Stott," not "Colorado Gold." If someone asks, tell them the box has tools, motorcycle parts, rare oriental mustard, or antique hat pins. Whatever suits your life style.
7. Q. Doesn't having that much wealth readily available make me or one of my family members a target for kidnapping and robbery? A. Living in a fine home, driving a luxury car, eating in glitzy restaurants, wearing expensive duds, or having someone do your lawn, is infinitely more inviting to a thief, than does having gold or silver stashed away in a mysterious or other safe place. The secret is to keep your big trap shut. Don't go blabbing around that you are smart and are buying gold and silver. Besides most people think gold and silver are worthless anyway, and a poor thing to buy. They'd much rather have your keys to the 500SL, than to attempt to find and glom onto your gold. Kidnapping? Hardly! I have been mugged on the street in Philadelphia at 3PM and left for dead. They want instant gratification and solvency with your hundred dollar bills, not your stash of gold and silver. The mentality of burglars is microscopic. They'll go after the guns and dollars, not secreted gold and silver.

Once again, PROTECT YORSELF AND YOURS, because no one else will, and this obviously includes government and the "fed shredders." Regretfully, self-protection has become a game that is being played against our own government, with our opponent being Alan Greenspan and his shredders. Now isn't this a fine kettle of beans?