Silver and Gold in a World Where "We Owe It to Ourselves"

Perhaps the greatest indicator that the end is near for a fiat currency is the return of the clarion call:

"We owe it to ourselves!". Such is the ultimate capitulation and politically unifying mantra. Once the

debt ceiling is raised literally, figuratively once and for all, the great gates of fiat money velocity will be

opened wide.

The Ultimate Rationalization

An entire monetary science was born from the phrase "we owe it to ourselves". That economic growth

comes from credit expansion, and not through the actual production of good and services, has become

empirical fact. Along with it has come the age of broken promises to pay.

And ultimately it is we who have made these promises by allowing the actions of our government. Yet

all of these promises will go unfulfilled because we "owe it to ourselves".

On the nature of debt money

The fact is that most people in a position to make investment decisions today were raised in a world

where understanding the origin of money didn't matter. Most people, rich and poor, live under the

assumption that the exchange of money completes a transaction with no loose ends.

But today there is nothing literally behind the money-except a promise to pay. Accepting a promise to

accept a debt. Here we have a basis of money that circulates today.

Obviously, it is so far widespread-cutting across the board from public to private and world wide. The

growth of an untethered money supply does far more damage to the poor and elderly. It enables those

positioned best (or closest) to the money the advantage of using it to accumulate assets that must be

continually offered as collateral.

The Final Default

For almost a century, the west has made promises and calling them ‘money’. The United States now

owes more than $17 trillion and all other nations have a similar history. Many nations have issued even

more relative to population.

Default or bankruptcy will be the ultimate mechanism by which these unfinished transactions (held by

creditors or bond holders) will be finalized. Via credit expansion, new debt has been piled on top of old

and we've reached the limits of this expansion facility. Whether it is caused by the rise of interest rates

or the collapse of overnight lending from collateral scarcity is a moot point.

And the timing is impossible. The current fiscal debates and debt ceiling expansion may signify the end

but for the political posturing which seems more about using any crisis for the advantage.

We owe it to ourselves to live in reality, rooted in all of life's joys and difficulties. While time will be the

ultimate unknown, indications that the basis for money velocity has been captured can be read in the

world of social memes. In a confidence based system of money, the equivalent of a reverse jubilee has

been unleashed in the ultimate shedding of responsibility. With that sentiment, so goes the currency

representing it. The time to prepare with some amount of precious metals and other survival assets was

yesterday.

For more articles like this, including thoughtful precious metals analysis beyond the mainstream

propaganda and basically everything you need to know about silver, short of outlandish price

predictions, check out http://www.silver-coin-investor.com