Golden barometer of the future
By Craig R. Smith, CEO SATC
Nov 9, 2006

Welcome to the next stage of the dis-uniting of the United States.

While Republicans are licking their wounds and Democrats are popping their corks, a disturbing trend has been exposed: the accelerating abandonment of America's fundamental and core values.

"We may be seeing one of the last gasps of the left-right, liberal-conservative game that has under-girded the American political scene for nearly the last one hundred years," writes strategist Dennis Peacocke.

In hot pursuit of "a new direction" Americans have made their choice to spank the Republican party and give Democrats a chance. Anti-Bush- Republican sentiment swelled this fall fueled by; disappointment over ethics, progress in the war in Iraq, a government spending spree, debt and deficit explosion and the loss of U.S. jobs to foreigners.

Dennis continues, "The level of global crisis, created by the collapse of Western values demands a strategic clarity that the current left-right game is incapable of offering."

What's coming next? Political gridlock? A radical move toward political centrism? Or an entirely new agenda that transcends left-right politics? Time will tell.

USA Today reports, "Democrats' stunning electoral gains will broaden the economic agenda beyond President Bush's focus on tax cuts to more populist debates over income inequality, globalization, budget deficits and health care coverage, among other issues."

American's clearly want sweeping change, but at what cost? In a world of changing value systems, what can we count on to hold it's value in the financial world?

Welcome to the next stage of the global bull market in precious metals.

Gold and silver coins, the famous 'old world' currency are fast becoming the 'new world' currency because they offer the missing link in all paper currencies: a store of value.

The Wall Street Journal recently published an excellent commentary, "IN GOLD WE TRUST" by Mr. David Ranson and Ms. Russell of H. C. Wainwright & Co. They explain why gold prices are the truest barometer of falling public confidence and growing inflation. Here's a few key points Mr. Ranson and Ms. Russell bring to light;

* Gold is the benchmark for the value of the dollar -- not the other way around.
* The falling U.S. dollar is largely being ignored by Washington and Wall Street.
* Gold's sharp rise represents an equally sharp decline in the confidence of investors.
* Gold is the barometer of public confidence in fiat (paper) money.
* The dollar's collapse of 60% since 2001 is a body blow to capitalism.

Bottom line: The value of U.S. dollar is slowly but steadily sliding into oblivion, following the path of America's moral and political decline. The sweeping winds of political change will have little positive effect on the markets, but a further dollar decline seems unavoidable.

"The dollar is still the world's reserve currency, even though it hasn't deserved this status for a long time. The devaluation of the dollar can't be stopped -- it can only be deferred. The result could be a world economic crisis," writes Spiegel, a leading German news magazine.

Don't buy into political or economic illusions. Instead buy reality, which is reflected in the growth of precious metal prices -- which have more than doubled since 2001.

A simple solution is to convert a portion of your "paper" or confidence-based assets to into gold -- the only asset that's not someone elses' liability -- thus putting yourself on a personal gold standard.

Avoid the fallout from bursting political/economic/debt bubbles.

Most Wall Street pundits still view gold as just another commodity, yet central banks and large hedge funds have been buying gold for the first time in decades.

Gold is a true barometer of public confidence in leadership and in paper currencies. The mercury is rising in the golden barometer today because we have become one nation under debt.

Today Americans are facing a pile of unpaid debts. At the helm is a new Fed chief whose already been nick-named "Helicopter Ben" based on admitting he'd print enough paper currency and distribute it from helicopters if he needed to keep the U.S. economy from sliding into a recession.

On the top of the debt pyramid stands a mysterious "derivatives" bubble. Experts estimate this market is cresting $300 TRILLION -- six times the GDP of the whole world combined! You could say it's a bubble larger than the old globe itself, which is bound to pop. (More on derivatives time bomb).

As CEO of Swiss America I feel compelled to warn readers that rising gold prices today are a flashing signal of trouble ahead. The only way to protect ourselves from a falling dollar and rising cost of living is to own some gold.

Don’t wait to buy gold, buy gold and wait! I suggest reading more about the next phase of the gold bull market.

P.S. Here's a few dozen analysts who also see $1,000 plus gold coming soon.

Craig Smith Archives

DISCLAIMER: All of the provided information is believed to be accurate, however errors are possible. The opinions in the Commentary section do not necessarily reflect the opinions of Swiss America. Past performance of any investment is no guarantee of future performance. All investments have risk.

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