Es lohnt sich für eine Zsfg immer zum Ende des Textes zu scrollen - aufgrund des interessanten Zitats stell ich den mal hier rein:
"Commodity inflation is now starting to run away to upside -- and how much longer gold and silver et al. can be kept in check from a price perspective in light of that, remains to be seen. Not much longer, one might suspect. And once the precious metals are freed from their price shackles, the rest of the commodities complex will surge even higher as well.
I'll leave it to another Brit...now [Sir] Peter Warburton...whose paragraphs I've quoted in this column countless time over the years, most recently about a month or so ago, to have the final word on this.
In his now-famous essay from 09 April 2001...twenty years ago next month...headlined "The debasement of world currency: it is inflation, but not as we know it"...Warburton has this to say:
"What we see at present is a battle between the central banks and the collapse of the financial system fought on two fronts. On one front, the central banks preside over the creation of additional liquidity for the financial system in order to hold back the tide of debt defaults that would otherwise occur. On the other, they incite investment banks and other willing parties to bet against a rise in the prices of gold, oil, base metals, soft commodities or anything else that might be deemed an indicator of inherent value. Their objective is to deprive the independent observer of any reliable benchmark against which to measure the eroding value, not only of the U.S. dollar, but of all fiat currencies. Equally, their actions seek to deny the investor the opportunity to hedge against the fragility of the financial system by switching into a freely traded market for non-financial assets.
It is important to recognize that the central banks have found the battle on the second front much easier to fight than the first. Last November, I estimated the size of the gross stock of global debt instruments at $90 trillion for mid-2000. How much capital would it take to control the combined gold, oil and commodity markets? Probably, no more than $200bn, using derivatives. Moreover, it is not necessary for the central banks to fight the battle themselves, although central bank gold sales and gold leasing have certainly contributed to the cause. Most of the world's large investment banks have over-traded their capital [bases] so flagrantly that if the central banks were to lose the fight on the first front, then their stock would be worthless. Because their fate is intertwined with that of the central banks, investment banks are willing participants in the battle against rising gold, oil and commodity prices."
That strategy may have been fine and dandy up until a year or so ago, but now it's a roadblock to the much higher inflation rate that the world's central banks need to inflate away the debts that are certain to bring the world's governments to their financial and economic knees at some point.
Now long after it's "best before use" date, this is the scheme that the powers-that-be are trying to unwind -- and it remains to be seen if they can pull it off without doing irreparable damage to the rest of the financial system in the process.
And as I've said before, by leaving the resolution of this Frankenstein monster of a Gordian Knot to the very last moment, its outcome now threatens to bring down the paper world that has been carefully constructed since Nixon "temporarily" took the U.S. off the gold-exchange standard back in August 1971.
All we can do is sit back and watch as they attempt to unravel it -- and wonder whether we should wish them luck or not.
How did it come to this?
I'm still "all in" -- and I'll see you here on Tuesday.
Ed" |
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