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Jim Cook

 

RUNAWAY SOCIAL SYMPATHY

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.

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The Best of Jim Cook Archive

 
Best of Richard Russell
September 6, 2012
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The national debt of the US is now well over $16 trillion and growing at the rate of over one trillion dollars a year. It can never be paid off through the "normal" means. Paying off by normal means would entail a huge, really killer boost in taxes and a brutal unmerciful, slashing of entitlements.

The only way the US's debts can ever be seriously addressed is to devalue the dollar.

The US owns the world's greatest hoard of gold. Here's what I think the authorities have to do. They should unilaterally, overnight raise the price of gold to a high value, maybe around $10,000 an ounce. Thus, each dollar would be worth one ten-thousandth of an ounce of gold. This would allow our enormous debt to be paid off with vastly devalued dollars.

This would be inflationary, since everyone who owned gold would own a pile of devalued dollars. The huge increase in the number of dollars would drive prices up, and that would work against the current forces of deflation.

Nations owning gold would in turn (in order to compete) -- devalue their own currencies, and thus be able to pay off their own "impossible" debts. In the end, a new world monetary system would have to be established, but the terrible problem of a planet choking on debt would be solved.

I think this is the only way the world-debt problem is going to be solved. It will, in the end, be solved by devaluation (as Roosevelt did in 1933, when he suddenly and unilaterally raised the price of gold from 20 to 35 dollars an ounce). Interestingly, we now hear an increasing amount of talk regarding gold entering the world monetary system. Furthermore, I think we are going to hear even more about gold in future months. Smart, wealthy, well-informed investors will start accumulating gold. (Soros and Paulson are doing it already. I don't doubt that Soros has inside information.)

I also believe that the US will, in due time, start backing its currency with part-gold and the dollar will be convertible into gold at around $10,000 an ounce. This will render the dollar the most wanted currency in the world.

I believe the Chinese are onto the same idea. But as of now, China does not own as much gold as they desire, which is one reason China has rushed headlong into the gold business -- China is currently the world's biggest producer of gold. It is also why China is encouraging its own people to buy and accumulate gold. China knows that gold is the future of the world monetary system.

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