In our quest to better educate people we are always seeking a variety of ways to look at gold and silver that make it easy for people to understand as well as showing very realistic reasons for holding the precious metals in their portfolio. At this stage of the economic shift if you don’t own / posses some precious metals you really should reconsider your position. I’m not telling you to rush out load up or even acquire any, just suggesting it might be a good time to review our latest finding.
Below is a brilliant way of looking at both gold and silver that make it very easy to understand the importance of holding both metals – in our possession – and why the Federal Reserve Note, U.S. dollar, just like ALL other fiat currencies ever created, was created for the specific purpose of transferring our wealth, the wealth of the many, to the hands of the few. The Federal Reserve Note has worked perfectly in this regard.
Before you read the comment below I want to share two images with you. Both are from the Federal Reserve Bank in Minnesota. On the homepage of their website is an inflation calculator. This allows you to plug in “dollar” amounts from the past and compare them to today, thereby, showing the rate of inflation according to the “official” numbers. If we plug in the 1980 high for both gold and silver, when our economy was imploding and interest rates were close to 20%, we can see what gold and silver should be according the “official” rate of inflation based on 1980 Federal Reserve Notes. If you still think the system isn’t rigged, please explain these numbers to me.
Now, on to the comment that sparked this whole thing. I was reviewing the comments on an article I produced that was picked up by ZeroHedge and found this one, obviously, to be of great interest. It is simple, to the point and paints a picture most people can see and understand.
When Nixon took us off the gold standard in 1971 gold was officially $ 35.00 an ounce. At the approximate price of gold at $ 1,500.00 this would mean a compounded rate of 8.14% for 48 years.
Based on $ 1,500.00 the dollar has lost 97.7% of its value against gold.
If gold should go to $ 2,000.00 the compounded rate would be almost 8.8% and a loss of 98.25% for the dollar. I think that is a pretty good showing for gold.
When Nixon took us off the gold standard in 1971 silver was officially $ 1.59 an ounce. At the approximate current price of silver at $17.42 this would mean a compounded rate of 5.11% for 48 years.
Based on $17.42 the dollar has lost 90.8% of its value against silver.
If silver should go to $25.00 the compounded rate would be almost 5.9% and a loss of 93.63% for the dollar. Also, silver serves two roles, one monetary and the other industrial.
Gold and silver have no counter liability. All paper does.
