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Education Break : How Money is Created

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Published : January 01st, 2009
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Category : Editorials





I had to forward this link, which in the simplest possible form explains what INFLATION actually is.


And keep in mind when you see the money supply chart up to 2006, that since then it has literally gone STRAIGHT UP.


So far, the U.S. government has committed to $7.7 TRILLION of new money supply, and I can guarantee that number will go up significantly.


Not to mention the parabolic growth curves of the supplies of all the other major global currencies, all of which, like the dollar, are BACKED BY NOTHING.


There is a very limited supply of gold and silver in the world, and in fact the amount of silver declines each year due to consumption.


And the current capping of gold and silver has unleashed a downward spiral of gold and silver production that may not reverse for years, while in the meantime physical gold and silver demand, worldwide, has reached unprecedented levels in the history of mankind.


Watch this link and keep the above information in mind, than take a guess what will happen to gold and silver once the Cartel is overwhelmed.



a


Over the years, I have written a lot about “money,” a.k.a. the dollar, and how it is connected ultimately to debt.  However just what money is and how it is created by the U.S. government is very confusing for most people (including myself).  I came across this video a while back called “Inflation and the Dollars Crash,” which I feel does a good job of explaining the process of how money is created– I’m not predicting the demise of the dollar, although it isn’t out of the question.  The video is 9 minutes long, and I feel it is worth your time given the current financial situation.  After watching it, you will know more about how money is created than 99% of your fellow citizens.


http://www.youtube.com/watch?v=tNBX--B0Czw&eurl


P.S. Although we are currently experiencing deflation, the seeds of inflation (all the debt piling up) are being sown.  I bought more gold/silver for clients today.


Best


Steve



The Wealth Conservancy, Inc.

1525 Spruce Street, Suite 300

Boulder, CO  80302

303-444-1919

303-444-1479 (fax)

www.thewealthconservancy.com



Andrew Hoffman




Andrew Hoffman was a buy-side and sell-side analyst in the United States (including six years as an II-ranked oilfield service analyst at Salomon Smith Barney), but since 2002 his focus has been entirely in the metals markets, principally gold and silver. He has worked as a consultant to junior mining companies, head of Corporate Development and VP of Investor Relations for different mining ventures.





 



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