“We are pleased to announce the signing of the Treaty for the
establishment of the BRICS Contingent Reserve Arrangement (CRA) with an
initial size of US $100 billion. This arrangement will have a positive
precautionary effect, help countries forestall short-term liquidity
pressures, promote further BRICS cooperation, strengthen the global financial
safety net and complement existing international arrangements.... The
Agreement is a framework for the provision of liquidity through currency
swaps in response to actual or potential short-term balance of payments
pressures.”
Parallel phenomena are trickling their way up from the darkness in
monetary sentiment. It may be symbolic for now, but the politics in the U.S.
with the symbolic and the organizing structure of alternative reserve
currencies represent yet another shift toward a phase transition in dollar
confidence.
The BRICS and Their $3 Billion
Ultimately, these BRIC- sovereigns are acting the same as any prudent
investor.
They are diversifying. They are venturing out as a natural consequence of
the dollars fading preeminence.
They are attempting to reduce dollar exposure. But they are also testing
the limits.
They can't do it too fast, or they will miss the opportunity.
And then there was this...
End the Fed whispers, political limits of printing coincide with the final
frontier of fiat.
Earlier this week, politicians proposed a bill that would limit the powers
of the Federal Reserve.
The actions this week by House Republicans indicate that there is a
legitimate risk that the Fed "may reach the political limits of money
printing."
This is a bit late and purely symbolic.
The Fed is fully captured by the Treasury.
Politics will not stand for deflation - as it would destroy the banking
system and the elite oligarchs.
It is the same issue with the debt ceiling. The debt ceiling can never be
permanently removed without triggering the end of what is left of dwindling
confidence in the dollar.
Everyone knows we are in a currency war - but no one "wants" to
understand in a visceral way.
But it’s too late. Bailouts will happen again to the surprise of everyone,
including lawmakers.
Confidence is like skin in the game and the current financial system is
the poster child for the absence of flesh.
Which isn't much of a stretch considering that the entire house of cards
is based on debt and confidence to begin with.
The inflection point will come and change everyone's perspective all at
once.
At this point it is like attempting to explain certain phenomena that can
only be experienced on a personal sense in order to fully embrace it.
I have spent a lifetime in the ocean, surfing in large swell conditions.
My home beach is a typical beach-break set up. Exposed to open ocean
energy. Waves break along outer sandbars and come straight in toward the
beach. The journey to the outside where wave energy first reaches outer
sandbars is often a brutal ordeal.
One faces rolling trains of exploding energy in sets of 10 or more a few
seconds apart - and no channel around them.
It requires a lot of patience, endurance, and a bit of strategy and luck.
Much like being a long term physical precious metals investor enduring
decades of blatant manipulation and very little reward.
The rest of the world has a different idea of surfing. Dreams of lifestyle
and a different idea of money and currency.
The rest of the world partakes in a point break, where waves gently wrap
around an elbow of land and anyone can access the impact zone by paddling
around the inside.
This can be dangerous because too soon people often find themselves in a
situation that in reality is much different than what they originally planned
for.
Mike Tyson is often attributed with the expression "Everyone has a
plan when they step into the ring...until they get hit in the face."
There is an advantage to paying dues - with skin in the game; especially
when it comes to the phase transition.
The Black Swan will be like the first punch in the face. Most think they
will see it coming and have time to react. The reality is always different.
All of the bubbling exuberance we see - what appears to be a slow
tributary often relegated to the fringe, is just part of a larger phenomenon.
The fall of paper currencies will occur gradually and then arrive all at once
in one big confusing geometric collapse that no one saw coming except for a
tiny few.
http://www.silver-coin-investor.com/
