The Fed Just Guaranteed $6 Gas & $4000 Gold
Written by Damon Geller
Now that QE3 has arrived, it’s more obvious than ever that a few powerful men have hijacked our economic, financial and political structure. And here’s a news flash: They aren’t socialists or capitalists. They’re criminals. The latest round of stimulus policy by the head printer-in-chief, Ben Bernanke, and the Fed is stunning in its size (in that it has no limit), stunning in its time-frame (as there is none), and even more stunning in the lie behind what it’s designed to accomplish. The bottom line? The Fed has just guaranteed $6 gas and $4000 gold.
Continued below.
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Let me explain. In this latest round of “monetary stimulus,” the Fed will be buying $40 BILLION a month in MBS (Mortgage Backed Securities) until the “labor market improves.” That is on top of the already large treasury purchases they make. That means, assuming the labor market doesn’t improve, the Fed will expand its balance from an already insane $2.8 trillion to an inconceivable $4 trillion by the end of 2013.
Bank of America analysts are saying the Fed’s balance sheet may pass $5 trillion by the end of 2014 sending gold to $3550 and oil $190 a barrel. While that may sound insane, the simple math behind the US treasury’s debt projections also place gold at over $3800 as debt swells to over $28 trillion by 2018, so BofA’s projection of $3500/oz. at that time is right in the ballpark.
So, how do you make sound wealth-preservation decisions in a world of fiscal illusion? It’s a tough question. Reggie Middleton answered it best recently; “You don’t have to an optimist or a pessimist, you have to be a realist.” In order to be a realist, you have to be able to look at real data and real information and then you simply have to use common sense. Numbers don’t lie, politicians do. I will help you with the mathematics of all this because that’s all it is. Then you can decide for yourself if you believe in math, or if you believe in magic.
Let’s start with a dose of cold, hard reality. It’s really tough to make good financial decisions when you’re being lied to. And you are being lied to. You are being lied to by our financial leaders. You are being lied to by their media. You can feel it. You can feel it when you listen to politicians and their promises on TV. You can feel it when you watch the government use scripted measures like CPI to gauge inflation that do not include food or energy, just so they can tell you there is none. You can see it in the policy decisions the powers-that-be come up with under the guise of “helping the people,” when in reality those policies are back-door bank bail-outs. You are being lied to about money and wealth protection. You are being led to financial slaughter by a pack of sociopaths at the Fed whose dual mandate is scripted as “keeping inflation in check and people employed,” but their policies say loud and clear that the dual mandate is instead to “punish savers and save too-big-to-fail banks.”
So, what is the end result of the Fed’s latest round of quantitative easing? Every month in 2013, the Fed will increase its balance sheet by $85 billion, consisting of $40 billion in MBS, and $45 billion in 10-30 year treasuries, or the natural monthly supply of longer-dated issuance. The Fed will therefore monetize roughly half of the US budget deficit in 2013.
Putting it all together, the Fed’s balance sheet will increase from just over $2.8 trillion currently, to $4 trillion on December 25, 2013.
A total increase of $1.17 trillion.
This is what the Fed’s balance sheet will look like:
And here is the price of gold relative to the Fed’s balance-sheet:
As clear as day, these charts illustrate that QE3 is truly the gift that keeps on giving if you are a holder of gold.
They call it “Quantitative Easing.” And this would be round three. The reason QE is like the gift that keeps on giving for a holder of gold is because it blatantly debases the US dollar. Allow me to illustrate:
Round one (QE1) started November 25, 2008 and ended March 31, 2010. During that 17-month period, a gallon of gas rose from $1.75 to $2.75 and gold rose from $725/oz. to $1125/oz.
QE2 was started Nov 3, 2010 and lasted seven months until June 30, 2011. During the seven months of QE2, gas prices rose from $2.80 to $3.60 and gold from $1325 to $1700. QE2 was also marked by massive global food inflation and global riots. QE2 ended June 30, and we have had no further ‘major’ balance sheet expansion until mid-September 2012.
In the last few weeks leading up to QE3 and the week after, gold rose 15%. The proof is in the numbers.
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you can’t eat gold! BARTERING IS GONNA BE THE CURRENCY! BOOZE, SMOKES, FOOD, WATER, AMO, GUNS, CLOTHING ECT IS GONNA BE THE NEW CURRENCY!. GOLD WILL ONLY BE TRADED BY THE RICH ELITE FOOLS OR MAYBE THERE HOARDING IT TO APPEASE THE RETURN OF THERE ANUNNAKI GOD.
Of course they are criminals, but not before they are psychopathic would-be bulles.
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DeHaemer recently revealed to readers a historic event that is set to take effect on January 1, 2013. In short, major banks …
http://www.thegoldstandardnow.org/…/1625-gold-standard-coming-back $14,000 Gold!
$6.00 a gallon gas
They know the US cannot exist with such a gas price. It falters now at $4.00. $6.00 would shut it down.
This story is either a lie or someone has truly gone insane or both.
This article is laughable!
Buy Gold in January 2013, at 50% discount!
At less than $1000.00/oz it will be reasonably priced.
You have no clue what kind of tsunami is coming!
Won’t happen, and if gold hits 14000 an oz, then 1 dollar will be worth a 7th of what it is today due to hyperinflation following a staged collapse. it will be kept relevant for the poor (anyone with under 1 billion compared to the elite).
The problem in the World is actually very simple, there is more food than money available to buy it, hence poverty and hunger, once all the cash money has been traded during a 24 hour period, there is a 90/10 split, the remaining food is either then binned, or if possible turned into animal or fish feed with a far longer shelf life. If there is no demand as there is no money at the till, it will sit in the warehouse and rot, as it would obviously cost money to ship it to the shop etc, a few trips like that where the product isn’t sold and everyone connected with the process of that sale would lose their business as no trade would take place.
This is modern economics in a nut shell, now think of where the money is actually going, mainly in developed countries, on telecoms, internet, beauty products, not to mention debt, travel and insurance/health. there’s your 90/10 split in basic terms. For every 100 we have to spend, our counterparts in poorer countries have 10, in many cases only 1 or even 10 cents. The divide of the globes money will always a surplus of food to cash. This ensures control and the business of feeding the nations of the world with profit, not morally feeding the inhabitants of the planet using it’s own resources, amazing. Humans are such hatefull creatures, the “if Im alright Jack” attitude that has been broadcasted into peoples minds through religion, “education” and televisionmediatechnology, has created nearly 3 generations of labotomized slaves who think they are free. Its true this saying… “you can have 46 different types of donut but when it comes to choosing your energy supplier, bank, food retailer or school for your children, your choice suddenly often narrows down to one only. That is not a choice, that’s a forced decision based upon economic fragility created by debt enslavement. It wont change and it wont get better, until us in the West have seen 1st hand cruise misslies in our streets, napalm on our land, landmines in our childrens parks and the devastating effects of War 1st hand. None of us want this to happen but it seems this hand is being forced. Non compliance by the nation is a myth, in 2012 we have to accept that 99% of humanity isn’t just being robbed of their money, they have and are continuing to be robbed of their minds. One day to be controlled my microchip and happy to be so, or so they will think after the absolute chaos that is being orchestrated now and hasn’t even really started yet.
No God or living person can stop evil of this magnitude, it has to eventually destroy itself. Look after your own, your community and those weaker than you, use non compliance politely and with respect and always remember, you are an animal, food, water, heat and love is all you need to actually live, everything is a privlidge and a bonus, one that Billions of people around the world would love to sample and who wouldn’t dream of dropping bombs on us or knowingly voting for people who they know will. That’s called complicity in murder and have a good think about that next time you see an explosion on TV or a drone strike on another human being. Romney and Obama speak of Killing on Presidential debates as if its designed to appeal to their voters, if this is the case then a nation of killers only has one conclusion, they will kill themselves and the innocents that also live amongst them. Pathetic unevolved behaviour from what’s nothing more than a badly design space bacteria that has been shaped and used for Millions of years for many different roles on many different planets, this latest representation of the Humanoid DNA is a laughing stock throughout the Universe. Ready for contact…..? Not even ready to be trusted with the planet they are on.