Investment Rarities Incorporated
History |  Q & A  |  Endorsements  |  Portfolios  | Flatware | Gold Coins  |  Silver Coins  |  Contact |  Home


Jim Cook



Every once in a while I switch the TV channel from Fox to CNBC to see what the liberals are saying.  After listening awhile I get a deep sense of hopelessness and foreboding for our country.  The most important thing for the left is giving money to people.  They are happy to see the growth of food stamps, disability payments, housing subsidies, free healthcare and all the other welfare benefits.  They utterly fail to see the damage it is doing to the recipients.  Whole cities that once flourished have deteriorated into rotting eyesores populated with shambling hulks of chemically dependent drones.  These people are no longer employable.  They have become incompetent and helpless and the liberals can’t see that it’s their doing.

..Read More »

The Best of Jim Cook Archive

Best of Aubie Baltin
August 30, 2011
archive print

The reality is that the FED is stuck in failed Socialist theory and will be seen to have very limited long term capability of control highlighted by a complete loss of
the public’s confidence. They will show impotence when faced with CREDIT DEFLATION like we and the world have never seen.


As the powers that be continue to grapple over how and who is responsible for the AAA Rating being lowered, the pile of bills due keeps growing exponentially larger. Prices for almost everything we buy, especially food and energy, is slowly but steadily increasing in price. What they should be concentrating on is how to limit spending and drastically reduce regulation in order to allow the FREE MARKET to work by investing and creating jobs.

It was my estimation that the Debt Ceiling Bill (like the ECB and IMF’S 146 billion Euro Bailout) is only a stopgap measure that is doomed to fail from the start. You have noticed how both Gold and the Markets’ have voted?  None of the real problems were even addressed let alone repaired. Has the time finally come where “They” and “WE” must finally address our REAL PROBLEMS or can they still stall thinking about any unpleasant thoughts a little while longer? Most probably, they don’t know what any real potential solutions are.

Since the problems are no longer one of LIQUIDITY, but more of a long term structural problem that has not even been looked at yet, could it be marking the beginning of the end of the EUROPEAN UNION?  Is Europe and the US heading for outright Stagflation to be followed by Deflation and Depression? To me, it all looks like a Keynesian House Of Cards and just like all houses of cards, it must eventually come tumbling down.


The FED was also supposed to be in "control" in 2007 as the 54% decline by the Industrials began and it was not until the market and the economy hit their natural cyclical bottoms that these declines were halted. Of course, once the lows were made, the Obama and the Fed took credited for having saved the world. Fact is the Fed was not in control then, nor are they in control now. Bernanke has absolutely no long term foresight. How could he since he is married to a proven failed ECONOMIC (Keynesian) philosophy. The FED merely reacts to the natural cyclical forces of the market using a system that has been proven over the last 75 years not to have ever worked. In doing so, their reactions ultimately only serve to make matters worse. As an example, it should be obvious that the FED’S reactions after the 2002 low created not only the housing crisis and sharply rising commodity prices, but was also responsible for the credit crisis and the eventual collapse that made the decline into 2009 worse than the initial problem would have been had they done nothing and allowed the markets to correct themselves. People desperately want to think that someone is in control and that "they" won't let this or that happen. Fact is, "they" are never really in control and all "they" do is react and in doing so, "they" only serve to exacerbate the problems and this time is no different. As the markets moved down into the 2009 lows, the Fed pulled out all the stops and literally threw in the kitchen sink to keep things afloat. But the fact is the markets moved into their natural cyclical lows and once these counter-trend bounces have run their course, we should see that once again, all "they" have done is make matters worse.

There is” No Such Thing as a Free Lunch”. The price for keeping Interest Rates artificially low for extended periods of time must be paid for in the end. Unfortunately the end is a lot nearer than anyone now is even considering.

Market participants clearly hoped the E125 billion orchestrated bailout of Greece would be the end of Europe’s sovereign debt worries. Once again the markets have voted. They say these small economies (States) “don’t matter”, but we know better.

The Greek crisis (and the other European debt crises yet to come) is merely a precursor to the "real world" debt crisis of 2010-2012. (We say "real world" because a crisis among developed nations will dwarf the "emerging-market" debt default cycle of the late 1990s.) Likewise, both the emerging-market crises of the last decade, the Internet Bubble that followed, and the Real Estate Bubble after that were all merely stepping stones towards the ultimate collapse of the world's untenable, Fiat paper-backed monetary standard.

Many of the world's developed economies have been fueling very limited growth and their standard of living with foreign debts. This growth and the asset values created under the euro standard are unsustainable for the simple reason that debt service cannot be made and creditors are no longer willing to extend these debts on reasonable terms. These problems have no simple answers. They will spread from creditor to creditor and intensify as the market realizes these defaults are unstoppable. The next major country likely to experience a credit crisis is Italy, which has enormous exposure through its banks to Eastern Europe the US Banks and Asia. Italy's public debt totals €1.7 trillion – seven times the size of Greece. Italy is the world's third-largest sovereign borrower. It cannot be bailed out by the EU without help. – it is simply too big. Meanwhile, it cannot possibly hope to pay back its debts as long as it remains in the EU. In fact, Italy has been in recession almost since the day it adopted the Euro: Its economy has grown by a total of 0.54% over the last decade. The total public debt to GDP will soon surpass 120%. At that point, they will no longer be able to pay just the interest and it will become progressively more difficult for Italy to extend its foreign debts because all of the foreign creditors will know these debts will never be repaid. A default and devaluation will be the only way to restart Italy's economy.

Finally… what should you do about all these risks?

  • Hold plenty of Gold and Silver bullion.
  • Short financial stocks.
  • Hold cash in sound currencies.
  • Buy farmland.
  • Buy energy – during its corrections.

Don't believe a word anyone from the banks or the government says.