Could central bank intervention make gold go to many thousands of dollars?
*JSMineSet, by Jim Sinclair, March 23, 2008:
The Financial Destruction Of The Average Man
"This weekend’s meeting of four heads of central banks communicates the
size of the OTC derivative disaster. It is a system that is broken. A
bailout will require the printing of trillions of dollars worth of
monetary stimulation making Bernanke’s helicopter drop look like chump
change.
The dollar number of pending derivative bankruptcies is the size of the
mountain of garbage paper issued by just those who are to be bailed
out. That number is greater than the total world economies.
There simply isn’t enough money in the world for central banks to buy
up the mountain of worthless paper sold by those who need bailouts; all
of which made fortunes for their directors, officers and key people.
When an OTC derivative fails to perform, notional value becomes real
value.
The notional value of all OTC derivatives exceeds $500 trillion.
Credit default swaps (OTC derivatives) alone account for over $20
trillion dollars of notional value and are failing. Major dealers in
these items, Lehman and JP Morgan, had their debt downgraded last week.
Maintaining the AAA rating on debt of public companies primarily
issuing default swaps as credit guarantees is a sick JOKE of
fabrication. This is a JOKE that in all probability will lead to
litigation that destroys the rating companies.
You can be absolutely sure that all the biggies have their money out.
No one mentions these firms being bailed out are the ones who created
this disaster, making billions for their economic sin. You can be sure
the big boys have their money out of the now on-the-rocks international
institutions.
No one mentions that bailing out the bankers will leave the average man
victimized and paying for the pleasure of the economic rape.
Meanwhile Derivative Traders (salesmen of perdition, not traders) and
their hedge fund managers are all in Greenwich Connecticut with their
hundreds of millions and billions, now retired playing tennis on their
indoor courts at their waterfront mansions as the mess deepens."
Conclusion:
"Because of the unthinkable size of the problem it is impossible to
construct a Resurrection Trust to buy all these worthless and never to
be anything but worthless items.
Should any item surface to do this it will destroy all the National
currency of the central banks that participate.
If there were an attempt to construct such an entity with the
cooperation of the USA, the US dollar would go much lower than .5200.
Gold would go to many thousands of US dollars.
Anyone who last week assumed the problem was over and we would be
improving from there on out is simply nuts."
*This information is solely a highlight of the opinion of a third-party publication and is incomplete. Please subscribe to this publication for the full and timely opinion of the author and call a Monex Account Representative for any additional up-to-date information. This is not an offer to buy or sell precious metals. Investors should obtain advice based on their own individual circumstances and understand the risk before making any investment decision.
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