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The Silver Bomb The End Of Paper Wealth Is Upon Us. von MacDonald, Michael (eBook)

  • Erscheinungsdatum: 05.11.2012
  • Verlag: BookBaby
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The Silver Bomb

The Silver Bomb is not a book about some predictive financial philosophy, but rather a frank, no-excuses glimpse at the current state of things, and an honest, candid, look at logical outcomes. The prestidigitations of central banking, which have until recently been shielded from scrutiny by a cloak of pro-banking cultural bias, are laid bare within these pages. Intimidating and complex financial and historical connections, no matter how deep down the rabbit hole they first may seem to be, are plainly exposed by the application of good strong light and close inspection. Formerly unquestioned fiat currency (money backed by nothing) and fractional reserve banking policies and their inevitable and historical results are brought out in the open and revealed.

Produktinformationen

    Format: ePUB
    Kopierschutz: none
    Seitenzahl: 186
    Erscheinungsdatum: 05.11.2012
    Sprache: Englisch
    ISBN: 9781624883224
    Verlag: BookBaby
    Größe: 1424kBytes
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The Silver Bomb

Introduction

August 15, 1971: The Day the Dollar Died

40 Years of Zombie Paper

They called it the Nixon Shock.

It was the day that then President Richard Millhouse Nixon, without the consent of the Nations whose currencies had been governed since 1944 by the agreements of the Bretton Woods conference, removed the US Dollar from the Gold Standard. It will prove to be the beginning of the end for the United States Dollar and has ultimately had a large part to play in what this story is actually about, the transfer of the value of the US Dollar, and all currencies whose value is tied to the US Dollar to the hands of an ever tighter circle of beneficiaries.

The closure of the gold window was traumatic and disagreeable to the foreign holders of gold certificates that it undercut, but it was welcomed in the U.S. with public fanfare at the time. The media had made much political hay of the reports of the profits being realized by foreign "price gouger" arbitrage traders who were capitalizing on the fact that the U.S. was experiencing its first trade deficit in the 20th century. Foreign holders of U.S. Treasury bonds sensed the value-choking effect that inflation in the U.S. economy, which was standing at 4.7% in 1969 when Nixon took the presidential oath of the office, was having on the US Dollar.

The cost of the Marshall Plan for the reconstruction of twice-war-torn Europe, the new mandates of The Great Society initiatives enacted during the Lyndon Baines Johnson administration, and the cost of the escalation of the war in Vietnam had compounded to expand the National Debt. These budget deficits, combined with the climate of social upheaval of the time, which was largely anti-war sentiment, had continued to drive up inflation figures.

Nixon had been elected as a voice of reason by a war, and war-protest, weary America. The Vietnam War had been the all-encompassing topic of national interest. The press had encouraged the notion that Nixon had some sort of a secret plan for leading the US to an "Honorable Victory" in Vietnam. In November of 1968, voters endorsed the campaign button slogan "Nixon's the One", in a belief that Nixon would keep his word and end the war. The press, particularly certain print media seemed to derive great pleasure from knocking Nixon off the pedestal they had put him on. In his first year in office, he was bombarded with criticism for following the policies of his predecessor Johnson, and escalating, instead of ending the war. To the demise of his credibility, Nixon announced that the South-East Asian conflict was metastasizing across the border into Laos and Cambodia.

This combined with other factors to create a slowly rising tidal wave of economic pressures. Interest rates had not been this high since the era of Reconstruction following the end of the Civil War. By the end of Nixon's first year in office, inflation had risen to 5.84% and there was no top in sight. High interest rates were repeatedly fought to a stalemate by soaring inflation. Foreign arbitrage of the Dollar continued and by 1970, the reserves of gold in the US treasury had plummeted to less than 22% of the dollars they represented.

The Nixon shock was only the codification of what had been a long term goal of central banking. The effort to remove the gold standard had begun with the 1933 gold confiscation and subsequent devaluation of the Dollar from its historic value of $20.60 per ounce of gold to $35.00 per ounce. It is only because of gold's value as money and the fact that in 1933 other nations would not have accepted, what they have today, which is worthless paper backed by nothing, that the gold redemption window was open at all.

Since the 1933 confiscation act, it had been illegal for U.S. citizens to hold gold, but not so for foreign investors. Federal Reserve notes

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