Why Standards Have Always Collapsed

Once again people are confusing a GOLD STANDARD, which is the FIXING of a price for gold, with the fact that gold is a TANGIBLE value that is freely floating in value. The former never works while the latter has been in place for thousands of years.

See Political Self-Interest Defeat Pegs & Standards

Government by Crisis & Attempting to Manipulate the Future

We are facing a very serious crisis in the year ahead. There is no changing the course of government. They will continue to borrow every year. This is far worse than printing money and it is why we will not see hyperinflation. This is actually the greatest transfer of wealth in the history of human existence. This is not Marxism, but Marxism squared. We are not taking from the rich and giving to the poor. There is no paying your “fair share” in any reasonable manner. We are taxing and spending our resources to keep the debt rolling. This is systemically destroying the productive forces within society and transferring that to the bondholders. This is why everything will collapse. It is not the leverage problem of 2007, it is the bloating of pretended pensions that all presume Sovereign Debt is less risky that corporate paper and stocks.We are in a serious state of affairs – see Manipulating the World Economy.

Gold – the Rally?

Gold rallied right up to the Daily Bullish Reversal at 1757 reaching 1757.7 closing at 1755.3. The long-term still looks quite interesting. The question that remains is just when will the Sovereign Debt Crisis hit. Europe is starting to show the ancient cracks. In Spain, there is a separatist movement brewing that is along the lines of the two kingdoms that merged to give birth to Spain – the marriage of Ferdinand and Isabella. In England there are the Euroskeptics rising calling for a referendum to withdraw from the EU. There are divisions emerging between north and south in Italy. Economics is the great engine behind civilization – its makes it or breaks it.

Against this backdrop, gold is still churning for it is the hedge against government. The problem is, they know that and are starting to pay attention to the gold trade.

See Charts:


The greatest problem we have is that liquidity is down by more than 50% still since 2007 on a global scale. Governments are getting so aggressive with taxation they are killing the global economy causing capital to just hoard. This nonsense of terrorism has created a global tax gathering process that is unbelievable. Hotels in Europe will not allow you pay a bill in cash over 1500 euros. You cannot wire 100,000 SF. The banks tell you to write a check. They call it money laundering making everyone prove it is their money and by the way, did you pay your taxes. Elliot Spritzer and the hooker was picked up as “money laundering” that prompted the investigation. All governments have money laundering agencies that cooperate among each other.

All of this is shrinking the global economy ensuring that a crisis will take place. The more governments follow every cent, the less money moves and the lower the economy spirals down. You need rising liquidity and freedom of movement of capital to create more jobs for the youth. Unemployment in Spain among the youth is over 50%. They are migrating to Brazil for there is no future in Europe.

It is the Sovereign Debt Crisis that is destroying everything. With almost 70% of national debts amounting to accumulative interest, the socialists who hate the rich cannot see what their policies have done. They blame the rich for having anything so they can grab it and do what? Pay the bond holders to keep the debt going? This is the greatest transfer of wealth that would even make Marx vomit.

Government has kept interest rates so low to reduce their deficits. But this policy has robbed the elderly of their income to retire on. Government such up everything destroying the entire economy in its wake. There are few jobs for the youth. Buying a home for your retirement is out the window. Saving money for retirement does not work. Government sucks in everything competing with the private sector. Of the $16 trill in debt, can you image how many jobs would have been created had there been no borrowing?

The city of Mainz is a prime example of what awaits us.

•By 1411, gov’t expenditure was 48% due to annuities it had previously issued.
• By 1437, gov’t expenditure was 75% going to the creditors and interest rates continued to rise.
• By 1448, Mainz was forced into bankruptcy when there were no longer buyers for its new debt to pay off the last issue.
The city of Mainz defaulted. They had raised taxes so much the rich left as they are doing today. When there was not enough revenue to pay the creditors, they sacked the city and then burned it to the ground. We just never learn from the past.
History repeats because the passions of man never change. A politician just can’t keep their hands out of everyone’s pocket. If someone comes into your home at gun-point and demands your wealth, it is called robbery. When government enters, it is called your obligation. Of course they spend and it is your obligation to pay whatever they sign for with their special interests on which you were never consulted. That is not an Athenian Democracy. That is a Roman Republican Oligarchy.


It is just amazing that there are fanatics who somehow see gold as the exception to everything as if it were some mystical thing and not an investment, hedge or market at all. They portray me with such hatred even claiming I do manipulate the world economy because I said gold would pause and that is why it has done so. Then they portray me as turning my back on them simply because I do not say it will rise every day.

Then they take credit for everything including defeating the government. To set the record straight, it was Congress that got me out of the hole. They ordered an investigation. As soon as that was done, I was released. There were people who have used my name to gather as much money as possible. I had one friend sent several thousand dollars thinking it was somehow for my benefit when it was not. I was not writing for anyone to make money pretending they needed cash to keep it going.

Anyone who does not say gold must go up every day becomes somehow a traitor. Gold is a market. Not a religion. This is about survival. Not about punishing the world. It was members of the House Financial Services Committee that ordered an investigation. It was the Supreme Court that ordered the government to explain what I was in prison for. They panicked & released me. They then passed a law that made it legal to imprison anyone for life, denied counsel or trial. I was released because if they lost before the Supreme Court, they lost that power. It was better to release me and pass a law so they can throw anyone in prison for life now with out a trial. They need no proof. Only allegations. They can now say anything. You have no right to confront your accusers.

It was the trial of Sir Walter Raleigh on November 17, 1603 where the King produced a confession written by a man he threatened and that was used in trial to kill Raleigh who was denied the right to even question his accuser. Raleigh was put to death and his trial was a sham. They took the lawyers away from Princeton Economics, appointed Alan Cohen of Goldman Sachs, and denied the right to put on any defense whatsoever. There were 240 employees denied all their rights to defend. They could not deal with the simple fact that we bought portfolios and were never managing their money.So when you cannot go to trial, you eliminate the right to one. The Constitution is dead. They have killed it in every aspect.

Thanks to Lindsey Graham you have no right to a lawyer or to a trial. Why did he champion that? The rumor was he is an alleged closet homosexual and he would be exposed if he did not eliminate the right to lawyers and a public trial. What was done to Raleigh can be done to anyone now.


Then there is Charles B. Rangel who gets caught not remembering to pay his taxes and strangely then introduces tax bills to prosecute more people for doing what he did. Curious coincidence?

Look at every Draconian bill introduced in Congress and you will see someone with something to hide introducing it. Conspiracy? Of course not. Only the government prosecutes conspiracy since it requires no proof of actually doing anything, just the thought of doing so. Next comes attempt to commit a crime that requires a physical act, and then actually committing the crime. Naturally, anyone who argues the government is conspiring against the people must be some insane nut with a conspiracy theory for government is the only group that has such credibility in these matters and is ABOVE all such nonsense for they FEEL your pain!

I respect what everyone did on my behalf and wrote to me. For that reason, I have continued to write for FREE. I am not going to tell people to always buy because it is some religion. The Japanese did that and look what happened. They never sold and got a Long Depression that will be 23 years come 2013. The Japanese lost everything with the policy of only buy and never sell. Stock brokers said the same nonsense during the Great Depression. Always buy, never sell. Average in because it will eventually go up. They have no explanation why gold declined for 19 years when money was still fiat. They hate real analysis that selling the high allows you to buy more on the lows. To ever sell is just a traitor not a real investor or trader. Absurd!

I will never forget the support I have received. I will not betray that support by putting out one-sided bullshit. That is propaganda and the government specializes in that. As for the nonsense that somehow I have “forgotten the crowd that got him out of prison” or that I am “determined to walk the halls of ivy again, doing anything necessary to make that happen. Part of that is not having a history of being rescued by the “Gold Bugs,” which he was.” To say I look “down” from “high circles” is rather dramatic. Because I wrote to Reagan in 1985 when they were forming the G5 (Plaza Accord) and warned that they would force a crash in 2 years because they were devaluing the dollar by 40% and they did not listen, then ever since they have come to realize that I cannot be bought and will always tell it like it is. That is why governments call on me because they know I will always say what is real.

The Goldbugs have to stop this nonsense. I will never bullshit the people. Someone has to say the truth. I refuse to accept any money from government ever! Strings are always attached. Someone has to stand up for when things get really bad in a few years, there has to be some voice that is heard other than those with hands out for another TARP program that lines pockets of the banking speculators with other people’s money and does nothing for the nation as a whole.

I do not cherish the position I am in. Nor did I ever seek it. You cannot plan your life in such precision. I have been forced to drink from this cup. It is not my choice. So stop the nonsense. Gold has not paused simply because I said so. This nonsense that I manipulate the world economy and gold proves it because the rally stopped when I say it would stop is just insane. It would have stopped on its own accord even if I was dead. The economy peaked in 2007 right on schedule without my saying so. Some called it Armstrong’s Revenge.

I have been introduced on Capitol Hill as the guy with the model they are trying to suppress. It seems some of the Goldbugs have joined rank with government to deny free speech with spinning nonsense. Gold will take off when it is time. That requires a global trend. Not “fiat” and other nonsense. Gold is the hedge against government. So what is the problem? They would have assassinated William Jennings Bryan.

America never locks-up people for what they do. Coxey was arrested in 1894 when he marched on Washington for walking on the grass. The whole Wizard of Oz was about his march for they were off to see the Wizard (Congress) while following the Yellow Brick Road which was the gold standard. The Tin Man was industry, the Scarecrow was agriculture and the Cowardly Lion was William Jennings Bryan.

The occupy Wall Street crowd was arrested for countless stupid violations. All the time, of course we have free speech. Right! Just like the students who were pepper sprayed for simply sitting down. Remember Kent State where they killed a student? They can kill anyone they want at any moment. Just stick a gun in their hand and say they were going to shoot. The press will tell only the government side today and the majority will believe whatever the government says. That is reality.

The government was determined to shut down Princeton Economics because of free speech. Tancred Schiavoni has ignored all requests to return original research and the library. They have done everything to silence any analysis. Why would the fanatic Goldbugs join ranks with such people? Just to stop anyone from disagreeing that gold cannot rise every single day? Spinning lies will not make gold rise any more than silencing me will prevent the Sovereign Debt Crisis. It ain’t the messenger – its the system that is collapsing thanks to perpetual borrowing with no intent of ever paying anything off. Money is not fiat – it is simply debt that pays interest as it began in 1863 with the interest rate schedule on the back to entice people to accept it.

There is a published decision by the Second Circuit Court of Appeals in New York City that acknowledges on page 97 that the judges are changing transcripts of what takes place in court. Ask yourself, why has no major press in New York reported what is a crime? Why has Congress not investigated? Why did the Court of Appeals claim it had no power to order judges to obey the law? Answer that one and you will explain why things are so bad. The press just will never tell the truth. Is this what some in gold are trying to create? Buy only and bad mouth anyone who says otherwise? We do not need Goldbugs dictating to the world like government!

Confiscating Gold & Wealth

Most people assume that Roosevelt’s confiscation of gold was unique. There are those who keep insisting that there be a return to the gold standard. What they do not realize is that such propositions are really a call to arms. Government will not return to a gold standard because it would be a loss of power and overturn the very nature of how our republics (not democracies) actually function. If politicians can no longer promise vote for them and they will give you someone else’s property, Marxism and Republicanism would collapse. Democracy was what Athens had. The head of the household went and voted as a “representative” of everyone in the house. This has been distorted saying women do not have the right to vote. The solution is you vote for a representative that has no personal connection and thus is really a professional politician. That system deprives all citizens of voting on every issue. The professional politician votes and thus you lose control of the state as was the case in the Roman Republic leading to revolution and war. A return to the gold standard would alter everything within the political structure. To create such a system means Republicanism must be replaced with a real Democracy.

Roosevelt was not the only example of a confiscation of gold. The very same took place in China in order to sustain the ability to mint coins that were valued way above their metal content (fiat).

Wang Mang assumed the position of acting emperor officially declaring his Xin (Hsin) Dynasty on January 10th, 6/9AD. Nature conspired against Wang Mang for in 11AD, the Yellow River flooded killing many that caused a great famine and a plague. This led to civil unrest as a sign from heaven. Peasants migrated south and banded into larger groups. One of these groups rose, known as the Red Eyebrows, and they were strong enough that they defeated one of Wang’s armies. This led to widespread rebellions even in the capital. They stormed the palace and in a grand last stand, about 1,000 palace guards defended Wang to the last man. The rebels then killed Wang Mang bringing an end to his brief dreams of creating a dynasty.

It was the monetary reforms of Wang Mang that reflected also the desperate times. He had installed a new denomination, the daqian, which was 12-zhu valued at 50 times that of the old Han wuzhu coin that was effectively about 20-21 times that of its metal value. He also introduced knife-shaped coins of bronze in an attempt to revive and depart from the Han coinage. This knife coinage that weighed about 16 grams and was valued at 500 of the Han wuzhu, which was nearly 100 times its weight.

He also issued a heavier version of about 28 grams valued at 5000 wuzhu that was 560 times its value with a tiny gold inlay. He outlawed private ownership of gold and he recalled all gold to be turned into the treasury as did Franklin Roosevelt in 1934 United States. With these new overvalued denominations, no doubt these were used to compensate for the confiscated gold. By the end of Wang Mang’s reign, the treasury had a significant gold supply. The knife coinage was abolished for they seem to have served their purpose in paying for the forced confiscation of gold. To help prevent counterfeiting now that coins were valued far above their metal content, Wang Mang prohibited the possession of copper and even charcoal. (Hanshu, 99B: 7b).

So you see, whenever government is in trouble, they confiscate wealth. This is why governments are becoming very aggressive currently. The United States is wiping out Americans worldwide presuming anything conducted overseas is to hide money not international business. France has virtually destroyed the gold industry by prohibiting the buying or selling of gold for cash and raising taxes to 75% have been chasing out its most productive people. The more they need money, the worse things will get. This is part of the Sovereign Debt Crisis. If you really think any government will voluntarily give up power, you are praying for an exception that has never existed in history.

This is the wave of Creative Destruction. We must collapse before we see reform. Sorry. There is no example in history where government voluntarily surrenders power without a crisis. The Roman Emperor Hadrian did not forgive taxes in 119AD without the risk of political unrest. There will be no return to the gold standard. This is all about retaining power. Historically, this has never ended nicely. So to those who say I have abandoned the goldbugs I cannot support a fiction that has never taken place even once in history. We must first collapse, abandon Republicanism and adopt real Democracy where the people vote on EVERY spending proposal and restraint on liberty, then and only then can we quietly look at restructuring the world economy. There will be no gain without the pain. History is truly the catalog of solutions. A return to the gold standard without serious unrest and collapse is a story up there with the tooth fairy.