For What It's Worth

According to the International Monetary Fund’s Official World Gold Holdings report, the U.S., at December 2007, held 8,133.5 tonnes of gold, or 75.3% of the world’s central bank holdings. That’s 261.5 million troy ounces, valued at $209.2 Billion at US$800 per ounce.

Fannie and Freddie will be run by the government indefinitely, with the government investing up to $100 billion in each of the government- sponsored enterprises to keep them solvent, among other measures announced over the weekend.

Hanky Panky Paulson claimed when announcing the Fannie/Freddie bailout that it was necessary to prevent a "crisis of confidence" in the US Financial System. Hank buddy, if there wasn't a crisis of confidence already, there may never be. The statistics above regarding the US Gold Reserves are shocking...and quite revealing.

At a value of $800, the US Treasury hoard of Gold is ONLY worth $209.2 BILLION? That's it? Of course through government sponsored suppression schemes it is today worth less than that, but it certainly isn't worth much on the big government balance sheet.

The US prior to the Fannie/Freddie takeover had $5 TRILLION of debt. With these two twin manufacturers of toxic mortgage waste now on the governments books, the nation has effectively doubled it's debt to $10 Trillion. And the Gold held (supposedly, nobody knows for sure, it hasn't been audited since the 1950's) by the US is barely worth $200 Billion?

The US debt is now 50 times greater than the value of it's Gold...if it has any. FIFTY TIMES GREATER! And Hanky Panky Paulson was worried about a crisis of confidence in the US Financial System. PEOPLE! This is far worse than a crisis, this is a CATASTROPHE!

On CNBC on Monday morning, when asked about how big the Fannie/Freddie bill might be, Mr. Paulson replied, “We didn’t sit there and figure this out with a calculator." I guess not.

By choosing to absorb Fannie and Freddie onto the US Governments books, Hanky Panky Paulson has effectively devalued the US Dollar by 25 times. And yet everyday now for the past eight weeks the "value" of the US Dollar has been rising?

The US Gold holdings, and for the sake of argument we will assume they have the Gold, DO NOT even cover the $100 BILLION Hanky Panky Paulson has promised each of these black holes. It is beyond absurd to even pause for a moment and believe that this government bailout of Fannie/ Freddie has averted a crisis. The US Government is flat broke, and the US Dollar is worth less than NOTHING. How much longer must this charade of financial life support be allowed to continue?

Consider this: If all the Gold in the US Treasury were to have a value equal to the governments $10 TRILLION debt, Gold would have to equal $37, 250 AN OUNCE. You read that right. The price of Gold would have to rise 50 times over to equal the value of the government debt. Yet the price of Gold is falling. Why?

I'm convinced it's falling, at the governments behest, because the US Government wants, no needs, to have the world believe that the safest place for it's money is in US Treasury Bonds and thus the US Dollar. If foreign nations stop funding the US debt, the US will cease to exist. What escapes me is why the rest of the World doesn't see that they are just flushing their money down the toilet by "borrowing" it to the US Government. Does the rest of the World really need the US? The rest of the world is a whole lot larger than the USA. The USA is less than 10% of the world population. We use 25% of the World's resources. The World could get along just fine without us. Yes, the US Government owes a lot of money to the rest of the World. And I'm sure the rest of the World would like to get their money back, but I don't see how giving a country more money is going to get you the money back you may have already lost.

What is really most amusing to me in light of these shocking and revealing statistics, is the US Government's determination to keep the "value" of Gold from rising. By suppressing the rise in the price of Gold, are they not suppressing the value of the single asset that will save them from becoming a third world beggar nation? What happens to people that don't pay their debts? Some go to jail, some live on the streets, and some get beat up, or killed. I doubt the rest of the world is going to sit idly by while the US Government rips them off. Nothing good is going to come out of this "game" Bumbling Ben and Hanky Panky Paulson are playing with the World Financial System. Life in America, as we've known it, is over now. Begin to accept that. America was broke before September7, 2008, and she was a whole lot broker the day after.

Have you ever pushed a beach ball under water? I'm keeping my bets on Gold and Silver.