Gold And Silver Still Glitter

Posted by on October 18, 2010 at 3:32 pm.

On May 12, I posted a blog concerning gold and silver. At that time gold was 1241.00 an ounce and silver was 16.91 an ounce. Today gold price reached an 1371.00 an ounce and silver is over 24.00 an ounce. I remain covinced that gold and silver are still great buys. The Federal Reserve and other central banks continue to devalue their fiat currencies. Gold and silver are real money. There is a finite supply of both. Whereas, there is an infinite supply of fiat money. Currently all of the world’s central banksters are racing to devalue their currency. This is truly a race to the bottom. In an effort to jump start their economies central banksters continue to devalue their currencies. This should continue to push ther price of commodities higher for the foreseeable future.The Federal Reserve is pushing hard for inflation. Why not? They love all of the interest they collect on the national debt. So when the number one phony money creator in all of the world says they want inflation, I think we should believe them. Do you think China holds most of U.S. government debt? Think again.
Biggest Holders Of US Government Debt:

RANK HOLDER AMOUNT
$ BILLIONS
1 Federal Reserve 4,785.0
2 Mutual Funds 769.1
3 China 776.4
4 Japan 711.8
5 Other Investors 629.7
6 State & Local Governments 550.3
7 Pension Funds 456.4
8 United Kingdon 214.0
9 Oil Exporters 191.0
10 Caribbean Banking Centers 189.7
11 Brazil 139.8
12 Insurance Companies 126.4
13 Russia 119.9
14 Depository Insititutions 107.3
15 Luxembourg 104.2

The Federal Reserve holds 6 times as much U.S. government debt as the Chinese. Debt is the real problem: http://www.martinarmstrong.org/files/Nice%20Try%20but%20No%20Cigar%2010-9-2010.pdf    there is a not enough money in the world to pay off existing debt. As I have stated before that is the plan. In an effort to keep the game going the Federal Reserve is about to begin another round of massive money printing called QE2: http://www.financialsense.com/contributors/asha-bangalore/markets-expect-qe2-to-result-in-higher-inflation  Even in an deflationary environment, (which is still a distinct possibility) gold and silver should outperform other assets. In the event of total economic collapse they would perform very well as a store of value. The total debt held by our government, private individuals and institutions is and will be impossible to pay back in real dollars. The only way out is to print money and a lot of it. The recent fall of the dollar and skyrocketing commodity prices is a warning sign that fiat phony money is losing it’s value and real money (gold and silver) are going to increase in value. I especially like silver even with it’s recent rise, it still seems to be a very good buy. To those who say that gold is a bubble, the fact is that only 5.4 billion dollars worth has been purchased by private investors. http://jsmineset.com/  5.4 billion certainly does not constitute a bubble. With such a small amount invested in gold, I think it has a long way to go before we could call it a bubble. This post should not be seen as advice to purchase or sell any precious metals or securities. When making investment decisions you should seek a qualified finacial adviser. 

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