Marc Faber: Gold is very cheap

Marc Faber again goes on record saying gold is very cheap right now.  His reasoning?  Currency debasement (i.e. government money printing) is the only way out of the Great Global Debt Ponzi and so the more debt there is, the greater the need for governments to print new fiat currency out of thin air.  As funny money continues to be printed, people flee the fiat currency scam into real money which is gold (and to a lesser degree silver).  Thus, the value of gold as measured in a particular fiat currency is directly proportional to the amount of debt denominated in that currency.  The more sovereign debt there is for a particular country, the higher the price that gold will trade for in the fiat currency of that country.  This analysis rings true with me.

Faber is in no way fooled by the political con men and the big noise they are making on TV these days.  These con men don't really plan to lower either the deficit or the debt because if they do then the debt Ponzi will collapse.  So, like any good con men, they are making more unkeepable promises on top of the last failed promises but the new Wimpy Promises are no more valid than the last ones.  In terms of deficit reduction, token short term cuts will be made and token longer term cuts will be promised.  However, when it comes time to actually follow through with the promises that could actually change anything, the markets will fall apart in anticipation of the loss of government backing and government will have to delay the back end loaded reductions indefinitely.  Period.  In Faber's words, "They’ll iron out something with lots of compromises and with spending cuts that are backloaded, in other words they won’t happen immediately.  As we go along say in three or five years time when these spending cuts should occur and when the tax increases should occur, nothing will happen...".

What Faber predicts will happen is nearly 100% guaranteed to happen because the only other course is to come clean and tell the truth.  Honesty is a last resort measure for con men.  I have been writing this same thing for years now: politicians are caught up in the scam too. If they tell the truth then they don't get re-elected.  At some point telling the truth could even threaten their lives as angry people who have been lied to take up arms against the establishment. 

So what does Faber think people should do to protect their wealth?  He says, "They can invest in Canadian dollars, Australian dollars, New Zealand dollars, Singapore dollars and so forth.   But basically the ultimate currency and the ultimate safe asset is gold and silver."

I say that all fiat currency is a scam and that it is ridiculous to think that Canadian or Aussie or any other fake currency is going to stand while the Euro, Dollar and Yen collapse.  Let's say I put all my stored wealth into these currencies before the crash.  Who is going to take them after the crash?  Who in the US has ever even seen Canadian, Australian or Japanese fiat currency?  How would they know it is real?  How would they know how to value it?  Bottom line is that if the big major fiat currencies crumble then the entire global fiat currency scam will crumble along with them.  Now, think instead if you put your long term savings in gold and silver coins.  Seriously, close your eyes and take a second to envision this scenario.  Now, ask yourself who in the world would NOT want to take those coins in exchange for stuff they themselves might have in excess (i.e. food, clothing, services of all kinds, etc.)? 

It's clear that the question is completely flipped on its head when talking about honest money vs. fake government-promise "money".  Instead of funny money holders begging people to accept colored paper of no real value in trade for their valued goods, those with excess goods will be begging you and other real money holders to spend your real money on stuff that they have too much of.  In other words, with honest money you do not have to become an agent of the con.  You do not have to convince anyone that something that has no value indeed has value.  You don't have to convince anyone of anything at all.  When you lay your gold or silver coin on the table, shop keeper's eyes will get wide.  They will recognize the honesty of real, historical, commodity money which cannot simply be conjured from thin air at the whim of con men.

Again, I caution against a panic move of any kind.  This situation could take some time to play out and there could and probably will be significant turbulence.  The right way to handle the transition into gold and silver money is to do so over time in a measured fashion.  Just make it a habit to save for retirement from now on into gold and silver instead of into 401k or IRA accounts which you will never be able to extract the purchasing power back out of.  Forget all the noise and the commotion.  Move through Kubler-Ross gracefully and arrive at the acceptance stage without too much pain.  The governments of the world have been lying to us all along.  Is that really so hard to accept?  The only mechanism to distance yourself from their lies is to not use the fiat currency which is the basis of their lies and of their power.  Gold is the safe place over the long term.  If you still don't get it, re-read Alan Greenspan's explanation of it that he wrote in 1967 before selling out to the military industrial complex, and by so doing, betraying the people of the USA and of the world.