Evidence shows that the U.S. money supply trend is in the early stages of hyperbolic growth coupled with a similar move in the price of gold. All sign point to a further escalation of money-printing in 2012…followed by unexpected and accelerating price inflation, followed by a rise in nominal interest rates that will bring a sovereign debt crisis for the U. S. dollar with it as the cost of borrowing for the government escalates…[Let me show you the evidence.] Words: 660

So says Alasdair Macleod (www.goldmoney.com) in edited excerpts from his original article*.

Lorimer Wilson, editor of www.munKNEE.com (Your Key to Making Money!) edited the article below for the sake of clarity and brevity to ensure a fast and easy read. The author’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. Please note that this paragraph must be included in any article re-posting to avoid copyright infringement.

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Macleod goes on to say:

The one chart which defines the background to all the events [that will unfold] in the coming years is the Mises Institute’s True Money Supply (TMS) for the US dollar. TMS consists of cash, checking accounts and no-notice deposit accounts, as well as a few other minor cash balances. It represents the actual cash and electronic cash in the system that is instantly available for purchases of goods and services, and the chart goes back to 1959.

The Hyperbolic Course of the True Money Supply

The dotted line [in the graph above] is the exponential growth trend, in other words the maximum rate of growth that can continue for ever. This trend was valid until mid-2002…[at which time the] TMS began accelerating at a faster rate telling us that TMS growth [had] entered a hyperbolic phase when the Fed eased rates in the wake of the dot-com collapse. Put another way, TMS is already hyperinflationary.

Bear in mind that economists are now telling central banks to accelerate monetary growth even faster to offset the tendency for bank credit to contract. They see no other way to avoid a bank balance sheet implosion with all the deflationary consequences that implies. [As such,] the prospects for 2012 and thereafter are for TMS to continue its hyperbolic trend…[as it] supply funds for a government deficit completely out of control. Also bear in mind that when such a trend becomes established it becomes almost impossible to stop, since the whole debt-based economy and the banking system would collapse.

The Hyperbolic Course of the Price of Gold

The chart [below] shows gold’s established hyperbolic course…[as] put together by Armand Koolen… In Koolen’s words, the hyperbola fits in with the official gold price in the early 1900s, the revaluation to $35 in 1934, the onset of the secular bull market in 2001, the bottom in October 2008 and its approximate track since then.

His discovery is interesting. Singularity for this curve, or the point where the gold price goes to theoretical infinity, is in February 2014, only 26 months away. Unless this long-term trend is somehow broken, gold is also telling us the dollar is heading for hyperinflation.

It would be a mistake to vest magical powers in such an extraordinary discovery, but given [that] TMS itself is showing signs of going hyperbolic we must sit up and take notice… [It will prove to be virtually impossible] to stop printing money at an accelerating rate [as evidenced by the fact that when the ECB showed a reluctance to do so it threatened]… to collapse the eurozone. Will the Fed pull the trigger on the US economy or chicken out? The answer is clear.

What Does the Future Hold?

We can expect:

1.  a further escalation of money-printing in 2012…
2. followed by unexpected and accelerating price inflation
3. nominal interest rates will then rise at the market’s behest
4. bringing a sovereign debt crisis for the dollar with it as the cost of borrowing for the government escalates…

*http://www.goldmoney.com/gold-research/alasdair-macleod/money-supply-explosion-will-lead-to-accelerating-inflation.html

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3. Continuing High Unemployment = More Money Printing = Higher Gold & Silver Prices

 

The Federal Reserve has a dual mandate set by Congress of maximum employment and stable prices. During Chairman Bernanke’s most recent press conference he indicated that the Federal Reserve has done a better job of maintaining price stability while falling short of fostering maximum employment. [As such,] we believe the Federal Reserve will continue to increase the monetary base and weaken the dollar as long as unemployment remains elevated. While the economy (measured by real GDP) and the unemployment rate have not benefited from a substantial increase in the monetary base, the price of gold and silver have benefited from money printing. We believe this statement is quite important for monetary policy and for investors. [Let us explain further.] Words: 388

4. The U.S. is Headed Toward a Complete and Utter Collapse of its Financial System

 

The U.S. is headed inexorably toward a systemic failure, a complete and utter collapse of the financial system. TARP and all the other machinations have not improved the underlying insolvency of the banking system. They have, however, deferred a collapse and ensured that it will ultimately be worse. [Let me explain.] Words: 1385

 

5. There Are 2 Ways Out of Global Economic Mess – Hope for One of Them & Prepare for the Other

 

 

It all comes down to this: We have to match growth to debt. If we can’t create miracles from growth, we have to consider inflation to reduce the value of our debt. [Those are the] only two ways out of our current global economic mess – innovation and inflation. As the saying goes, we should hope for the best (more innovation) and prepare for the worst (higher inflation). [Let me explain why that is the case.] Words: 1195

 

6. Alf Field’s 7 “D’s” of the Developing Disaster Revisited

 

When the supply of something is increased sharply relative to demand, the value of that commodity will decline. If the supply continues to increase rapidly and indefinitely, then that item will become worth less and less, with the potential to finally become nearly worthless. This is the Developing Disaster facing the US Dollar and the world. This is the factor that could become the single most important criterion in investment allocation decisions and possibly even for individual financial survival…[Let me explain this further by reviewing the 7 major problems facing the U.S. (and thus the world) and how they all will lead to problem #7 - devolution.] Words: 1520

 

7. New Boom-bust Cycle Risks Hyperinflationary Depression and Much Higher Gold Price – Here’s Why

 

 

It is my view that the world has entered a new boom-bust cycle driven by oil prices. Oscillating oil prices – as opposed to credit cycles – will repeatedly stimulate and crash the highly levered global economy. Governments have not recognized this new cycle, and as part of a fruitless effort to retain control over deteriorating real growth and rising unemployment central banks will print more and more money, risking a hyperinflationary depression (stagflation at best). [As such,] the only respite for many investors is gold. [Let me explain.] Words: 925

 

8. Why Negative Real Interest Rates + Stimulative Money Supply = $10,000/ozt. Gold

Question: What do you get when you mix negative real interest rates with stimulative money supply efforts by global central banks? Answer: An exceptionally potent formula for higher gold prices that could send gold to the unimaginable level of $10,000 an ounce. [Let me explain further.] Words: 1049

9. Niall Ferguson: U.S. Playing “Russian Roulette” Assuming Interest Rates Will Remain Low

Countering Krugman’s argument that today’s low interest rates show that no one is worried about lending money to us and, therefore, that we should borrow and spend our way to prosperity, Ferguson argues that today’s interest rates are irrelevant. When countries get into trouble, he says, they get into trouble quickly – the way Greece and…

10. Debt Bubble: We’re in a Dangerous New Phase – Here’s Why

 

The head of the International Monetary Fund, Christine Largarde, said Friday the world economy is entering a “dangerous new phase.” Lagarde is referring to a debt bubble, the likes of which the planet has never seen before, and the possibility that it could all unravel at any moment. Uncertainty over the debt crisis in Europe is what caused the Dow to crash more than 300 points at the end of last week. What is Lagarde going to do about the debt problem? Words: 1752

 

11. Brace for Impact: U.S. About to Go Off a Financial Cliff!

 

 

The kind of impact [our economy is] going to have will not be like flying into the side of a mountain. It will be the kind of crash that skids over land, clipping trees and buildings until the plane ends up wingless in a smoldering heap. I just hope the fuel tanks don’t ignite when the long rough ride is over. [Let me explain.] Words: 832

 

12. Another Economic Collapse and Great Depression are Coming! Here’s Why

 

 

It really is hard to find the words to describe the true horror of the national debt of the U.S. The U.S. government has been on the greatest debt binge in all of human history, and a day of reckoning is coming that is going to be so painful that it is going to shock America to the core. We have lived so far above our means for so long that none of us really has any concept of what “normal” is like anymore. The United States has enjoyed the greatest party in the history of the world, but now this decades-old party is ending and the bills are coming due. Our current system is headed for an inevitable collapse. There is no way of getting around it – a horrific economic collapse is coming [and] it is going to change the world. You better get ready. [Let me explain further.] Words: 1771

 

13. America’s Future: Growing Deficit, Shrinking Economy, Imploding Dollar and Exploding Inflation

 

 

The new [debt ceiling deal] legislation will add $2.4 trillion to the $14.3 trillion national debt in a little over a year – and we don’t even start saving money until after the debt reaches $16.7 trillion! This bill doesn’t even cut the deficit. It just slows the growth of government spending to around 8% a year! So, even if Congress cuts $2.1 trillion out of the budget over the next 10 years, we will still be running annual deficits of more than $1 trillion…[That means that in addition to a deficit that will continue to grow we can look forward to a shrinking economy, an imploding U.S. dollar and exploding inflation. Some future! Let me explain.] Words: 827

 

14. What Would USD Collapse Mean for the World?

 

I came to the conclusion several years ago that it was just a matter of time before the world realized that the relative functionality of the U.S. dollar was about to go belly up – to collapse – and that that time happened to coincide with that fateful date all the prophecies are going crazy about – 2012! Words: 881

 

15. The U.S. Dollar Crisis is About to Accelerate! Here’s Why

 

 

If the debt ceiling deal agreement is fully implemented [it is only going to exacerbate America's financial and economic woes and accelerate the demise of the U.S.] Dollar Standard which is inherently flawed and increasingly unstable. Its demise is imminent. The only question is will it be death by fire—hyperinflation—or death by ice—deflation? Fortunes will be made and lost depending on the answer to that question. [Let me explain how the collapse of the dollar could well unfold.] Words: 944

 

2012  and the US Dollar Collapse

I came to the conclusion several years ago that it was just a matter of time before the world realized that the relative functionality of the U.S. dollar was about to go belly up – to collapse  – and that this time happened to coincide with that fateful date all the prophecies are going crazy about – 2012! Words: 881

So said Chris Laird (Prudentsquirrel.com) in paraphrased comments from his original article* which Lorimer Wilson, editor of munKNEE.com (Your Key to Making Money!), has further edited ([  ]), abridged (…) and reformatted below  for the sake of clarity and brevity to ensure a fast and easy read. The author’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. Please note that this paragraph must be included in any article re-posting to avoid copyright infringement. 

Laird goes on to say, in part:

I find this coincidence remarkable because, were the USD to actually collapse, just think of the many economic and political disasters that would indeed unfold. The U.S. economy would stop dead for a period of time and the rest of the world, hitherto dependent on the old industrial/consumer economic model, would have to find a new economic paradigm to plan their economies.

A USD collapse means the entire structure of the world economy would collapse for a period of time, with a collapsed supply chain, among other things. The world would also go through cataclysms politically during that period. That usually leads to massive wars, starvation and mass homelessness around the world. Interesting. That’s the same stuff being prophesied in many of the numerous 2012 prophecies of various major religions! That is quite the coincidence. The demise of the USD will collapse the entire world economy and lead to collapsed policies, and then a massive world war. Yep, it fits like a glove.

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Of course, some people cringe at an analyst such as myself talking about ‘religious bunkum prophecies’ but consider that I am a mathematician and also a former Oracle database systems engineer. I’m not exactly some dreamer. I certainly know the analytical methods. So, why am I saying this stuff then? How can I combine prophecies with analytical methods? Well, for one thing, I have a thinking paradigm where ‘if it works, it must be true, don’t leave out weird things in analysis, insisting only on some calculation based prediction’. That’s what chartists do. I don’t. Everything must be analytical to lots of people, and that is totally wrong often! The trouble with being analytical all the time is that there are times, and this is proven, where chaos enters the picture and everything changes. Chaos, by definition, is not predictable…

What Would Happen in a USD Collapse?

• The U.S. and Western economies would all face insolvency simultaneously, with the U.S. first in line.
• The entire Western industrial/consumer/credit economy would fall apart so fast it would make your head spin. The supply chain would stop and stores would empty quickly.
• The USD would fall over 50% in one week’s time and then temporarily stabilize before its final last gasp…
• Worldwide currency panic would set in paralyzing what’s left of the world economy which means the ‘emerging markets’ would stop dead too.
• China would have a revolution, or go into military mode, which would be even worse.
• A one-world currency would be demanded and implemented.
• Asia would fare fare horribly…If Western consumerism goes away, then the entire foundation of the Asia macro economy would instantly crash and stop cold. Do you remember what happened that fateful last quarter of 2008, after the Lehman debacle, and the world banking system almost collapsed en masse? Exports from China and Japan for example collapsed over 30%! Don’t think economic demand cannot stop on a dime, because we already had one very scary case of this in 2008. So, all the pundits aside, Asia would get killed too economically. The big question is, could they successfully adapt to a new economic paradigm before they had their own revolutions? I do not think so.

It would be a dark time worldwide.

*http://www.thecomingdepression.net/survival-tips/new-world-order-by-2012/

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Editor’s Note:
- The above article consists of reformatted edited excerpts from the original for the sake of brevity, clarity and to ensure a fast and easy read. The author’s views and conclusions are unaltered.
- Permission to reprint in whole or in part is gladly granted, provided full credit is given.

Buy Gold and Silver Now As the Ultimate Store of Wealth

The consequences of decades of abuse to the system of credit in the United States are coming to a head and the gray clouds that loom over the skies of the dollar are growing bolder by the day and darker by the minute. The cold hard fact is I expect the U.S. dollar to ultimately collapse within 24 short months. Words: 682

So says Greg McCoach (www.wealthdaily.com) in an article* which Lorimer Wilson, editor of www.munKNEE.com, has reformatted and edited [...] below for the sake of clarity and brevity to ensure a fast and easy read. Please note that this paragraph must be included in any article re-posting to avoid copyright infringement. McCoach goes on to say:

Investors have been shuffling currencies around faster than a game of three-card Monte as the true value of world’s paper money is being exposed but in the end, the only real winners would have walked away from the table long ago, their pockets stuffed with the only currency that really matters – gold.

Gold is Still Dirt Cheap!

The collapse of the U.S. dollar will likely push gold prices to over $5,000 an ounce [which] means that, even at $1,400 an ounce, gold is still dirt cheap. [As such,] every investor should own gold right now as the ultimate store of wealth that will protect hard work and savings.

As the world begins to learn the true nature of the world’s funny money, masses of new buyers will come flooding into the gold market and this surging demand will be the catalyst that launches the price of gold into the stratosphere.

Most investors are unaware, but the gold market is incredibly small. There have only been about 175,000 tonnes of gold ever mined [which amounts to] only 0.9 of an ounce of gold for every person on the planet. That’s why they call it precious… [and] when the oceans of fiat money suddenly try to take a part in the gold market, the law of supply and demand will fundamentally force prices much higher.

Don’t Put All Your Eggs in the Gold Basket

1. Silver

While the price of gold will soar and get most of the attention, it’s silver that typically outperforms gold, dollar for dollar invested. In certain instances, when gold prices have doubled, the price of silver has outperformed gold by a factor of more than six-to-one!

Editor’s Note: Don’t forget to sign up for our FREE weekly “Top 100 Stock Market, Asset Ratio & Economic Indicators in Review”.

Investors should also consider owning silver in preparation for the time [when] the government declares a “bank holiday” as the crisis in the banking sector exacerbates. During a bank holiday checks and credit cards would no longer be accepted as payment for goods and services [and silver coins would be ideal for]  buying day-to-day items such as bread and prescriptions drugs.

2. Cash

I also recommend keeping some cash on hand at all times. I’m not recommending stuffing the mattresses; but it’s probably smart to keep a few thousand dollars in 1s, 5s, 10s and 20s around the house. U.S. Silver Eagles would also be very useful in such an event, as they are considered legal tender in the United States and could be used to purchase groceries.

Conclusion

The early adopters — those who wisely purchased their positions in gold and silver before the masses come — will sleep well at night while others fret as they watch the purchasing power of their savings evaporate like water in the Sahara.

*http://www.wealthdaily.com/articles/the-us-dollar-will-collapse-in-24-months/2886