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Certain characteristics of crumbling empires are
historically recurring, and pattern recognition practitioners are thus
informed and so forewarned. Their discourse is labeled contrarian,
hysterical, strident or radical, depending on the source of criticism, who
seldom survive the subsequent reality to be told “I told you so”.
Thats not the point anyway.
Napoleon
in Russia, Rommel in North Africa, the Japanese at Pearl Harbour. The Romans,
the Incas, Vikings, Mongols – all representative of empires whose
downfall was precluded by geographic overextension of the armed forces, one
of the aforementioned ubiquitous characteristics of regimes whose days are
irrevocably numbered. And then currencies: the German Mark, the Italian Lira,
the Zimbabwean dollar – diluted and inflated to astronomic excess
– another sign of a civilization on the brink of decline, and perhaps,
collapse.
Literature
assures us that a nation who refuses to learn from the mistakes of previous
generations is bound to repeat them. That legacy is now before us.
The
surest symptom of a country who has lost the ability to objectively and
correctly assess its position in the global pecking order and thus act
appropriately is when they begin to abandon allies because the allegiance is
no longer convenient.
Does
this sound like anyone we know?
In
the news from Egypt, an American-originated declaration of Mubarek’s
impending resignation and departure is resoundingly refuted by that embattled
leader. The United States Federal Reserve announces it will buy
“back” $97 billion in debt, according to MarketWatch, who goes on
to state the Fed has bought “$397 billion in U.S. debt since August”.
The world’s most powerful nation in the 20th century has in the 21st
passed its prime and is suffering horribly from dementia. Its like watching a
faded starlet in Hollywood try to strut down Rodeo Drive, a laughingstock to
passers by, but she convinces herself that she’s still ‘got
it’.
How
does the central bank of a nation $14 trillion in debt keep coming up with
money to buy its own money? Is it not supremely revealing of the extreme
depths of delusion to which this so-called bank and its governors have now
descended? The fraud inherent in this perpetual shell game is obvious to all
except the hucksters moving the shells around and the dupes naively trying to
follow the pea shell in the hopes of winning a prize. The audience knows
there is nothing under any of the shells.
The
concentrated ownership of mainstream financial media among six major U.S.
corporations is evident in the perpetual fact-warping that now passes for
news. Any measly percentile of fabricated statistic is seized upon as rosy
evidence of a return to robust economic health, while the plethora of
legitimate indications to the contrary are completely ignored.
The
defacto collapse of American influence over the Middle East is ominous for
Israel, gathering frigates and aircraft carriers of the U.K./American allied
forces notwithstanding. If the solution in Egypt is to be democratic and
moderate, it will be under the impetus of the Egyptian people forthwith, and
no American proxy will be legitimized. Bu continuing to meddle in the
politics of the region, the United States galvanizes new enemies among those
formerly who only harboured a distaste.
Authoritarianism
has come to an end in Egypt for the time being. The outcome of what looks
like will be free and fair elections will determine who is in charge of the
very large and entrenched system of violent domestic control. Mubarek might
be gone, but the secret police apparatus is intact, and will pass in one form
or another to the next government. Should fundamental Islam prevail, the
might just be a step into darkness, as opposed to towards light.
Russia
has an authoritarian regime and no democracy. The wall came down but state
control is now back in force, stronger than ever, as evidenced by that
nation’s propensity for violence towards journalists and dissenters.
And
what is the difference between the clashes with students in Beijing in
Tiananmen Square and the protests in Tahrir Square in Cairo? The main one is
that whereas in Cairo, the army sided with the people, in Beijing the army is
fanatically aligned with the leadership.
Gold
Doesn’t Care
The fact that gold’s price performance in the last 40 days or so
digresses thoroughly from its normal course during times of mid-east
instability amid severe monetary and price inflation is pure evidence that
either the price of gold is directly manipulated by banks, or that the
coordinated campaign of disinformation by the Big 6 media division of the
U.S. Treasury has finally become so fine tuned as to hypnotize recipients of
its message. In either case, $2 billion in redemptions of Gold ETF GLD makes
one wonder what has changed fundamentally to justify such a sell-off in a
month where global instability and inflation are robust?
Or
have those with a vested interest in the appearance of a stable dollar
realized that they could use the billions of dollars in quantitative easing
to directly influence demand for and thereby price of gold by incrementally
building large holdings in gold ETF’s and then dumping them in
compressed timelines to help generate severe price swings?
How
very ingenuous to use the strength of gold’s demand and price metrics
to undermine those very same dynamics! Buy up ETF shares with dollars
fabricated out of thin air, then dump the built-up position in a single month
to drive superficial dollar demand and coincident gold aversion. Whoever
dreamed that up should get the congressional medal of honour and go straight
to jail
These
short term machinations aren’t relevant in the long run however, and
only provide buying opportunities for those building a store of value in
precious metals. Pundits speculate on an impending day of default for the
U.S. dollar, when to sovereign bond holders, that day has come and gone, and
the big players are tip-toeing to the exits accumulating gold as they go.
When we finally shine the light on them an acknowledge the default has
already occurred, the gold and silver price explosion to the upside beyond
$2,000 will begin in earnest.
James West
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