Mwana Africa - A New beginning

Let's hope, if this next piece is in any way accurate, we find "Silver" in our next foray into mother earth.


RICH GUYS AND PRECIOUS METALS
by The Mogambo Guru

To show you a living, breathing beautiful benefit of
having silver as money, Bernard von NotHaus of the
Liberty Dollar organisation announces that because
silver has gone up so high in price, the base has
doubled.

In essence, if you had a Liberty Dollar silver ounce
with "$10" on it, representing a suggested buying power
of ten bucks, the very next day you would instead have a
silver Liberty Dollar with "$20" engraved on it! You
doubled your buying power when conducting business in
Liberty Dollars!

He also says: "But wait! I contend we do not have
inflation..."

Here he sees me rising up in my seat to come up there
and slap his face for saying something so stupid, so he
hurriedly goes on to laughingly explain thus:

"I can remember over 50 years ago that I could buy four
gallons of gasoline for a dollar. At that time the
dollar was backed by silver. And that same amount of
silver will still buy four gallons of gas today! That
just proves silver money holds its value."

Hahaha! Exactly right! Now I feel foolish for doubting
him!

Speaking of precious metals, something weird, I mean
really weird, is happening, as a reader of George Ure's
UrbanSurvival.com site notes when he writes, "Just a
quick note for you and your peoples. Last night the
COMEX gods gave a small notice of margins being raised
in our precious metals. Margins as of tonight will be
33% higher in gold, from $1,350 to $2,025. Silver will
be raised to $2,363 from $2,025."

What in the hell could this mean? I have no idea, and I
am petrified that someone would ask me. Just in time,
the reader saves my bacon and explains: "Whenever this
happens, the markets for the precious metals correct (go
down). For the conspiracy theorist (me and you), it's
the only way the big boys can slow down the demand. I
know you don't give advice, but being a stock and
commodities broker for 15 years, this little tidbit is a
money saver. Get ready to buy physical gold and silver
at discount prices from today's price."

And speaking of weird, the chart of gold lease rates is
really weird and dramatic!

Tom Griess, proprietor of the TheChartstore.com, made an
appearance at FinancialSense.com by posting his essay
"Gold vs. US Dollar Index" - which clearly shows that
the dollar has completely divorced itself from gold. His
chart shows that whenever the dollar got out of line
with gold, it was the dollar that corrected, not gold.
In short, my bet, based on this chart alone, is that the
dollar is going to take a big, big dive pretty soon,
which is only appropriate for a currency as worthless as
the US dollar.

In case you were absent from class the day they went
over this, if the dollar goes down, then either the
price of gold must rise, or everybody else on the planet
must agree that the price of gold should be down for
them, too. It's a mathematical imperative. Word to the
wise: not everyone in the world is as stupid as we
Americans.

He finished his essay with exactly what I have been
saying, "History wants to tell you a story." Hahaha!
Perfect!

The best part - and this is why you should be buying
gold - is that the price of gold is being held down by
governments because it reflects so bad on them, giving
you a bargain, as Alex Wallenwein explains in his 'Euro
Vs. Dollar Currency War Monitor'. He writes:

"Gold is 'manipulated' for sure, but that's a very broad
term. The US would generally like to keep it down.
Europe wants it to rise, but slowly, very, very slowly.
The Chinese like it cheap - and so do the Arabs. It
allows them to buy more of it for less money.

"In the end, what is really happening? Europe and the US
are wasting their precious resources and general
confidence-capital to try and keep its price under
wraps, somewhat at least - and the Chinese and Arabs are
the real beneficiaries.

"Those two blocs just love gold manipulation - and they
have no interest in ending it. The Arabs have benefited
from it for the longest. They've been using expensive
dollars to buy cheap gold for decades now. Then come the
other Asians. They still have a cultural affinity for it
that has not quite been bred out of them - yet. But
during the 1990s Asian Contagion currency crisis, they
all dutifully sold their gold to their governments and
bought US treasuries instead, except for the mainland
Chinese. They were anecdotally reported to be buying it
wherever anyone was willing to sell it: in Africa, in
Europe, in the Middle East. You name it, they were
there, crawling all over the place, hungry for that
yellow stuff."

Now, I am not saying who, but this looks like somebody
is gearing up to declare their money to be on a gold
standard, so that their currency would have instant,
permanent value. And how do you say, "How can I serve
you, master?" in Chinese?

Well, alert reader Ford C. says it is, phonetically,
"Lei yiu mut yeh low see."

The way things are going our children and our
grandchildren may find that phrase very handy.

But we are not here to bandy Chinese supplications
about, but to listen to me run my big fat mouth about
gold being suppressed. How much is the price of gold
being held down? Steve Sjuggerud writes that adjusted
for inflation, gold was above $1,400 an ounce in 1980.
In sterling, adds Adrian Ash of The Daily Reckoning, the
metal's £300 spike would be worth £858 today. But notice
that gold is still only selling at about a third of
that!

"We're in a bull market in gold," writes Sjuggerud.
"It's a secular bull market, which is just a fancy way
of saying the general uptrend will stay in place for
many years. And we're only near the beginning."

Well, what about silver, for which I have been pounding
the table as the freaking Buy Of The Mogambo Century
(BOTMC)? Well, Jason Hommel of the SilverStockReport.com
writes, "About 95% of the gold ever mined in human
history still exists in above ground, refined form. In
contrast, about 95% of the silver ever mined has been
consumed by electronics and jewellery. A silver ring or
silver necklace, for example, costs about $50/oz. to
$100/oz., and thus, the silver is not recoverable, nor
recyclable at a profit to the silver jewellery buyer
until we exceed those prices. So, gold is going to
skyrocket in price, due to the central banking change
from selling to buying [but] silver is going to
skyrocket in price much more than gold, due to the
silver shortage."

And it is not just eastern nations and foreign nationals
that are buying gold. Robert M. went to Boca Raton and
reports that the herding behaviour has started showing
up in precious metals, and the coin shop he visited was
sold out of Platinum Eagles. The lady running the coin
shop says, "There has been rip-roaring business there in
Palm Beach County. Those rich guys have been coming in
and buying physical precious metals."


Regards,

The Mogambo Guru
for The Daily Reckoning