Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Letter from my Dad (May be important)
Mar 03 | KB's Dad

Posted on 03/03/2006 7:59:26 AM PST by Killborn

Edited on 03/03/2006 8:11:35 AM PST by Admin Moderator. [history]

Hi Guys,

I hope everyone loaded up on gold (now up 50%)and silver (up 85%) and is happy, because the flip side is very gloomy. The dollar continues to lose value and the resulting decline in American wealth looks like it will cause class warfare. Whether it is only economic warfare making everyone poor or whether it develops into physical violence is still not clear.

Greater than 93% drop in the greenback -

Since the US government decided to use central planning to control interest rates instead of the free market and the gold peg, the dollar has lost more than 93% of its value. For centuries the dollar value of gold hardly moved. Then politicians created the FED early last century.

Do you remember $35 an ounce? I do, and now it's $570. When Alan Greenspan went before congress last year, he was asked how was the US Government going to be able to finance its obligations regarding Social Security (i.e. pay retirement checks).

Greenspan's answer was that it was no problem, they would just issue Government checks. When the senator looked confused, Greenspan added, 'the problem is whether these checks would buy anything of value'.

The economically challenged senators still didn't get it. What good is a monthly check for $10,000 if a loaf of bread costs $10,000.

At his State of the Union speech, Bush lamented he couldn't get Social Security reform through congress. The Democrats, led by Hillary Clinton cheered.

I hope that tape is replayed when retirees riot over their worthless SS checks. But, at least this gives us someone to blame.

Americans aren't saving for their retirement, instead they are going ever deeper into debt, confident the Government will give them a nice retirement check.

Both Republicans and Democrats are spending like drunken sailors. No worries mate, we'll just borrow some more.

Now that Americans aren't saving enough to finance this debt, we have to borrow from foreigners at the rate of $2 billion a day.

The amount of wealth we will have to transfer to these foreigners to repay this $8 trillion debt will bankrupt a whole generation. Unless, of course, we just issue worthless Government checks and inflate away the value of the dollar.

But who are our central planners going to blame. There must be someone. How about Wal-Mart. Maryland central planners are going to force health care costs for employees, their spouses, children, parents, relatives, pets, etc. onto Wal-Mart. Maybe we can have a windfall profits tax to pay for our debt.

The central planners in Russia and China never let windfall profits happen. Maybe we just won't let foreigners spend the dollars they so foolishly accepted. We can call it National Security and not let them buy Unocal and not let them operate our ports. When they stop accepting our dollars, we can be happy with all our paper money, happy and poor.

I still think the best protection from our central planners are hard assets like gold, silver, oil sands, gas, etc. Then you don't have to worry when they let the printing presses roll.

Tom


TOPICS: Culture/Society; Your Opinion/Questions
KEYWORDS: bahog; buymygold; goldbuggery; goldgoldgold; goldshillery; takethegoldmineshaft; vanity; yukoncornelius
Navigation: use the links below to view more comments.
first previous 1-20 ... 41-6061-8081-100101-115 next last
To: Blzbba
These were very good investments that my grandfather was able to pass to my father then to me and my brother (2 of them).

However, with the discovery of the S.S. Central America and the recovery of its cargo, their value has dropped some.

Still worth hanging on to.

81 posted on 03/03/2006 9:08:20 AM PST by RSmithOpt (Liberalism: Highway to Hell)
[ Post Reply | Private Reply | To 34 | View Replies]

To: Diana in Wisconsin

I got my awakening around that age. There is hope. :)


82 posted on 03/03/2006 9:08:31 AM PST by Killborn (Pres. Bush isn't Pres. Reagan. Then again, Pres. Regan isn't Pres. Washington. God bless them all.)
[ Post Reply | Private Reply | To 78 | View Replies]

To: bobbdobbs

That's what I figured.


83 posted on 03/03/2006 9:12:50 AM PST by Killborn (Pres. Bush isn't Pres. Reagan. Then again, Pres. Regan isn't Pres. Washington. God bless them all.)
[ Post Reply | Private Reply | To 79 | View Replies]

To: RSmithOpt

Howdid the value drop with the discovery of the ship?


84 posted on 03/03/2006 9:13:44 AM PST by Killborn (Pres. Bush isn't Pres. Reagan. Then again, Pres. Regan isn't Pres. Washington. God bless them all.)
[ Post Reply | Private Reply | To 81 | View Replies]

To: Killborn

My situation is considerably better. I gather you have no answer for my question re inflation.


85 posted on 03/03/2006 9:15:57 AM PST by paul51 (11 September 2001 - Never forget)
[ Post Reply | Private Reply | To 80 | View Replies]

To: paul51

That question stems from a misunderstanding. When you commented on the 8k and the fact that you were earning much more than that, I was curious as to whther this marked increase is an improvement or stems from inflation.


86 posted on 03/03/2006 9:19:12 AM PST by Killborn (Pres. Bush isn't Pres. Reagan. Then again, Pres. Regan isn't Pres. Washington. God bless them all.)
[ Post Reply | Private Reply | To 85 | View Replies]

To: ansel12
I'm just glad my friends that have been touting gold for decades, but never seeing it payoff, finally see some good news, too bad they wasted all those previous years.

Yep. Gold did zip for over 20 years. Now it has had several boom years, it probably is the worst time to jump in. Well unless you love investing when something hits the top. Last year Warren Buffet lost over $300 million betting against the dollar. The dollar hasn't exactly been weak lately.

87 posted on 03/03/2006 9:21:12 AM PST by Always Right
[ Post Reply | Private Reply | To 13 | View Replies]

To: Killborn
When you commented on the 8k and the fact that you were earning much more than that, I was curious as to whther this marked increase is an improvement or stems from inflation.

That is precisely my point when I refer to the comments of the price of gold increasing from $35 per oz to $500+ over the same period. Since I asked the question twice and you have no answer, I'll assume you don't know, which is OK.

88 posted on 03/03/2006 9:22:19 AM PST by paul51 (11 September 2001 - Never forget)
[ Post Reply | Private Reply | To 86 | View Replies]

To: Diana in Wisconsin
[I'll pay you double their value in precious metal content, and pay you in gold.] Uh...no thanks. ;)

Which confirms my point that things are valuable because people think they are, rather than some inherent value in a quantity of metal.

This whole issue of Gold is rather like a religion. People get all wound up over it, one way or another.

The bottom line, if I were preparing for some future Y2K doomsday, I think I'd rather have a granary full of rice and MREs than a bunch of gold. You can't eat gold.

89 posted on 03/03/2006 9:22:36 AM PST by narby (Evolution is the new "third rail" in American politics)
[ Post Reply | Private Reply | To 47 | View Replies]

To: paul51

Econ is not my strong suit. could inflation affect the price of gold and other valuable minerals?


90 posted on 03/03/2006 9:24:59 AM PST by Killborn (Pres. Bush isn't Pres. Reagan. Then again, Pres. Regan isn't Pres. Washington. God bless them all.)
[ Post Reply | Private Reply | To 88 | View Replies]

To: Killborn

Could, and does.


91 posted on 03/03/2006 9:26:55 AM PST by paul51 (11 September 2001 - Never forget)
[ Post Reply | Private Reply | To 90 | View Replies]

To: Killborn

Based on the last 3 years, gold has been one of the best investments around. Based on the last 25 years, it has sucked. Gold had been flat for nearly 20 years. Now may not be the best time to jump on the gold bandwagon. If you want to cherry pick data, why not look at Gold in Jan. 1980? Gold was $840 25 years ago. Today it is around $570. It is easy to pick dates to make gold look better than it is.


92 posted on 03/03/2006 9:28:24 AM PST by Always Right
[ Post Reply | Private Reply | To 1 | View Replies]

To: Individual Rights in NJ
Gold has always and always will be, worth value.

If that's your motivation, then I'd think that property would be a better purchase.

I too remember when gold was significantly higher than it is today, because there was a rush on gold that began after the Shah of Iran was deposed on Nov 4, 1979. But I don't remember when property values plunged that much. Maybe 5 or 10% for overbuilt houses in Houston in the early 80's, but I never remember land prices declining at all.

Can gold be dug from the ground today for less than it's current market value? If so, then I'd say it's overpriced already, and merely being artificially speculated up and is guaranteed to fall.

93 posted on 03/03/2006 9:28:31 AM PST by narby (Evolution is the new "third rail" in American politics)
[ Post Reply | Private Reply | To 51 | View Replies]

To: narby
Gold is only valuable because people think it is. Which is no different than a paper dollar, which is valuable because people think they are.

Until they figure out a way to print gold they are different. The main reason gold is going up is the 8-10% increases in the money supply and anticipation of future increases.

94 posted on 03/03/2006 9:30:43 AM PST by palmer (Money problems do not come from a lack of money, but from living an excessive, unrealistic lifestyle)
[ Post Reply | Private Reply | To 36 | View Replies]

To: paul51

Interesting. Is that why gold costs so much now?


95 posted on 03/03/2006 9:31:11 AM PST by Killborn (Pres. Bush isn't Pres. Reagan. Then again, Pres. Regan isn't Pres. Washington. God bless them all.)
[ Post Reply | Private Reply | To 91 | View Replies]

To: Always Right

I guess he is looking more at stability than returns.


96 posted on 03/03/2006 9:32:06 AM PST by Killborn (Pres. Bush isn't Pres. Reagan. Then again, Pres. Regan isn't Pres. Washington. God bless them all.)
[ Post Reply | Private Reply | To 92 | View Replies]

To: narby
Can gold be dug from the ground today for less than it's current market value?

Many mines have presold their output, plus even with all known reserves there's only some 2 trillion worth of gold and lots of paper money to chase it. As for your general thesis that it will peak and crash? Yes absolutely it will do that again, but you might be surpirsed at the height of the peak.

97 posted on 03/03/2006 9:33:57 AM PST by palmer (Money problems do not come from a lack of money, but from living an excessive, unrealistic lifestyle)
[ Post Reply | Private Reply | To 93 | View Replies]

To: narby

I agree. Did you read my post about preparedness above? I just collect the quarters because it's fun, not as an investment. The only gold I own is in the form of jewelry. My other investments are real estate (bought my first house in my early 20's) and land and a balanced IRA retirement fund. (DH & I are self-employed, but took full advantage of 401Ks while we were wage slaves, then rolled them over.)

But the silver has been very good to us. Dad and I have speculated in the commodities market for years; coffee, cocoa, grains, etc. It's not for the faint of heart, that's for sure, and we never play with money we can't afford to lose. DH won't "play" with us either, LOL!

Some people like casinos, we like speculating. :)


98 posted on 03/03/2006 9:38:07 AM PST by Diana in Wisconsin (Save The Earth. It's The Only Planet With Chocolate.)
[ Post Reply | Private Reply | To 89 | View Replies]

To: Killborn
I guess because it [gold] has a bit more utillity than paper.

Really? I know they plate some chip leads with it and make jewelry. But jewelry can go out of style, and does, and very few people "need" gold.

While paper has plenty of utility. You can print books with it. It can store information in print at low cost for centuries with no power required and no "format" obsolescence.

Japanese make walls with paper. Kids wad it up and make paper mache. And lots of freepers use the NYTimes paper for bird cage liner and fish wrap.

I'm sure I can come up with a great many more examples. Paper is very utilitarian. Much more than gold. It's just that paper is easier to produce, and that's all. End of story. Big deal.

Bottom line is that things are valuable because we think they are. There are very few things in these times that we *must* have and are difficult to get, which makes them inherently "valuable".

99 posted on 03/03/2006 9:38:49 AM PST by narby (Evolution is the new "third rail" in American politics)
[ Post Reply | Private Reply | To 59 | View Replies]

To: narby

That makes sense. But what about its stability?


100 posted on 03/03/2006 9:45:34 AM PST by Killborn (Pres. Bush isn't Pres. Reagan. Then again, Pres. Regan isn't Pres. Washington. God bless them all.)
[ Post Reply | Private Reply | To 99 | View Replies]


Navigation: use the links below to view more comments.
first previous 1-20 ... 41-6061-8081-100101-115 next last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson