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 Are We There Yet?
(Market Update 6-7)
by Edgar J. Steele

November 22, 2006

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"If ever again our nation stumbles upon unfunded paper, it shall surely be like death to our body politic. This country will crash."
  --- George Washington, first President of United States of America (
paraphrased from a letter to Jabez Bowen, Rhode Island, Jan. 9, 1787)

My name is Edgar J. Steele.

You probably already have heard this, from both others and me, but here it is again, received over the Internet from a list member quoting an unnamed source : 

"This has long been said to be the line of demarcation for the US dollar.  Below $0.85 there is not much to support it.  Only five or six years ago it was around $1.25.  Thirty five percent is a lot of value to lose in that short period of time.  From here, further decline could be faster.  China - by its buying of the world's resources - is going to create enormous upward pressure on all commodity prices. This includes industrial metals, precious metals, grains, lumber, concrete, oil, many types of food, etc.  This comes at a time when many nations are simultaneously - and increasingly - disconnecting their economic associations from the US dollar.   Russia, China, and several other nations have announced that they will increase the amount of gold in their reserves.  These nations will buy large amounts, thus making the metal cost more.  The term 'extreme' may apply." 

Death of the Dollar

The figures given in the quotation above are the standard quoted for the dollar as in index of six foreign currencies, each weighted by the amount of trade done with the U.S.  At the moment of this writing, the dollar is at .8448 and sinking fast.  Check the following link for an up-to-date quotation on the dollar:  http://quotes.ino.com/chart/?s=NYBOT_DX&v=s

 
Since the stock market, too, is down today, you might well ask why gold and silver both closed relatively unchanged.  That would be an excellent question.  The answer, of course, is governmental market manipulation.  Can you say "Paulsen," boys and girls?  Even so, notice that silver has crept back over $13 per ounce and gold is showing renewed strength at $630.  The days of American market manipulation of the price of precious metals are coming to an end.  That is, of course, because the dollar is dying.

Aren't You Glad?

Aren't you glad you bought silver way back when first I told you to do so (at under $4 per ounce)? 

For longer-standing list members (and readers of my book, Defensive Racism), aren't you glad you bought gold way back when first I told you to do so (at well under $300 per ounce), then switched over to silver along with me last fall (with gold pushing $500 and silver beginning to nudge $8)?

Aren't you glad you continued to hold silver when it swooned after hitting $14 and everybody else called it the end of the silver bull market?  Otherwise, you would not today hold silver at $13 and showing signs of taking off again.  There is a reason they call it a bull market, you know (visualize the bull-riding event at a rodeo) and this is just the way they act.  What's more, this is just the beginning of what will come to be known as the greatest silver bull of all time.

Gold Corp: Simply Gold Plated Now

Gold Corp (GG) continues to disappoint, now having completed its non-shareholder-approved purchase of Glamis for a mysteriously over-inflated price (you gotta wonder just who got paid off and how much) and, just now, announcing that it must sell a major portion of its Wheaton silver stock to get much-needed cash. 

GG's stock price took a huge hit when the Glamis deal was sprung on us and has yet to recover fully.  It won't, not with Ian Telfer at the helm, who has proven to be nothing but bad news since he took over.  I mentioned previously that we should dump GG at the first opportunity.  It now has recovered enough for us to do so, but it may come back even more before year end.  Consider selling GG if it coincides with your tax-planning requirements.  Hell, consider selling it simply because the company now is so ineptly managed and so overtly hostile to its own non-executive shareholders! 

I notice that Gold Corp's current stock price is responding better than I expected after the Glamis deal hit the wires.  I suppose that is because most metals companies are so abysmally mismanaged and, also, because so many people buy stocks without knowing anything about a company's fundamentals.  How long GG can live on past glories is anybody's guess, but I am well aware of what happens when executives like Telfer and his crew get hold of a company. 

We've done very well, indeed, with GG moving from just under $10 at my first recommendation to $28 today (mind you, the pre-Glamis top of nearly $40 would have been a better exit point), but now it is time to move on.

Unless something comes up that seems as sure a thing as GG did to me for the first time over three years ago and silver seemed just last year, I will recommend nothing more venturesome than the gold and silver ETFs (Exchange-Traded Funds) GLD and SLV, which are the closest you can get to physical in an IRA without some pretty fancy footwork.

What to Do

By now, you should have all of your investable wealth in non-dollar-denominated assets.  Consider having half in precious metals, with at least half of that in the physical kind (up close and personal, not on deposit elsewhere).  The more paranoid among us might want to up both fractions by up to double.

First on your list of priorities, of course, is your family's safety.  If you haven't left the city, shame on you. 

Next is protection, which is what firearms and training for every family member are for. 

Next is security, even in the country.  Can you spell B-I-G-D-O-G?

Next is water (you live in the country, so you should have a well, else you better get this handled some other way). 

Next is food.  Freeze dried and nitrogen-packed stores best and is best stored in a basement or root cellar.  Have a way to conceal it on short notice.  The US government, less than a century ago, went door to door, confiscating  what it called "food hoards."

I have an extended discussion in my book on all these points.  Incidentally, WWIII and Depression II are moving along exactly as I laid out in my book.  I expect the correlation to continue. 

America's Drift Plummet into Tyranny

What surprises me is how quickly things now are moving.  The government's obvious haste to complete erection of its police state tells you all you need to know about how soon it thinks that America will become chaotic.

Those of you who, like myself, have a higher profile than average as dissenters and government critics ("traitors," to use the terminology of Bush and Cheney), need to have an escape route planned, particularly since DHS is enacting a rule to require its clearance BEFORE we can leave the country, even with valid passports. 

Already, with the ink not yet dry on the Military Commissions Act and habeas corpus still warm in its grave, I am getting reports of "disappeared" Americans.

Just like the ancient Chinese curse, we certainly "live in interesting times."  I recall being dismissed for sounding apocalyptic when speaking of precious metals and the need to play Y2K all over again.  No more.  I also recall all the hate mail I got for calling for Bush's impeachment again and again over the past few years.  No more.  I called the in-progress economic collapse when times were good and we were flying high and I was dismissed as a nut.  No more.  I said America fast was becoming a police state and I was labeled a conspiracy theorist.  No more.  Unfortunately, I have been right all along.  I regret to advise that I expect to continue being right.  America was nice while she lasted, but now the party is over.

We Have Arrived

In radio interviews, repeatedly I am asked by callers, "When?  When will all this happen?"  My answer: "Right now."  At most, we have five years before the wheels fall off completely.  More likely:  two or three.  It is quite possible that the world could be a very changed place within just the next year, even without Bush invading any more countries. 

Look around yourself at the walking wounded.  Those living on the proceeds of refinancing their homes.  Those stunned by the drop in housing prices.  Those underemployed hamburger flippers who still think they will get new jobs as engineers, architects, plumbers, electricians, lawyers or any of a number of professions and occupations now made superfluous by outsourcing, illegal immigration and Wal Mart. 

Already, many are having trouble properly feeding their children. 

Already, many merely sit, waiting for the sheriff to come and evict them from homes already foreclosed by the banks.

Already, many are counting pennies and finding themselves woefully short at month's end, with no way to make ends meet.

Record numbers of Americans do without health care while being taxed to support federally-mandated free health care for illegals. 

Record numbers of Americans stave off bankruptcy by selling all that they possess while keeping up appearances.

Record numbers of Americans are getting the first, faint hint of the coming despair.

When many more start living out of their cars and go door to door in seek of work or a handout, you will know that the riots are just around the corner.  That is when the police-state structure now in place will heave into action.  That is when Americans will begin to die in much larger numbers than now at the hands of their own government.  That is when you no longer will hear from people like myself.

If you haven't done everything I have outlined, you are living on borrowed time.  If you haven't done anything, you are out of time, I am afraid, as the things I advise take time ... years, in fact.  Do what you can with what you have, always keeping a keen sense of your priorities, but do something now!

My name is Edgar J. Steele.  Thanks for listening.  Please visit my web site, www.ConspiracyPenPal.com, for other messages just like this one.

-ed

Copyright 2006, Edgar J. Steele

Forward as you wish.  Permission is granted to circulate

among private individuals and groups, post on all Internet

sites and publish in full in all not-for-profit publications.

Contact author for all other rights, which are reserved.

 

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