Silver and Gold had a few ups and downs during the year that the main stream media played as though they were huge, especially the downs. But what they have seldom mentioned and still have not mentioned is that Gold and Silver were far and away the BEST place over all to have converted worthless federal reserve notes during the year 2006.
The hardest thing about writing this is that the terms used are so baited, wall street uses terms that make it seem that "dollars" placed in "investments" grew at such and such a rate, when in fact the whole thing is basically a mirage.
For example: let us say that your investments were in Stocks on the Dow Jones Industrial 30, Well first of all, in the strictest use of the word, you did not INVEST anything, because due to your purchase or placement of your "dollars" nothing was produced. What you bought were shares in a company from other individuals, NOT from the company. In other words you bought someone else's asset, or if the other person had bought an initial offer, you bought their investment, but it became YOUR asset.
What's the Difference: When you INVEST you produce, in other words your in-go is used to produce something that did not exist before, namely a means of production, a factory, assembly line, new machinery or raw materials just to name a few. Those in turn INCREASED production, hired new people and created MORE stuff which was sold and which you then shared in the sale of as a profit on capital. When you PURCHASE an asset, like a stock that belonged to someone else, or a piece of property, or Gold and Silver or even "federal reserve notes or some other "Currency" you have not invested per say, what you have done is bought someone else's asset, it became YOUR ASSET and now you hope someone else will come along and offer you more for it then you paid, plus or minus depreciation and inflation ( Declining Dollar Parity).
By in Large Americans and America in general has not INVESTED much in the last few years. and so we have PRODUCED little. there fore our trade deficit with other countries who actually PRODUCE things and who DO INVEST has grown to frightening proportions.
( We Export far fewer THINGS OF ACTUAL VALUE then we IMPORT)
This trend will only grow and shows no sign of letting up. ( NAFTA CAFTA etc.)
OK Lets look at the stock market and what ACTUALLY HAPPENED.
According to Bloomberg online: In An article that makes it sound like stocks over all went up and were a great investment:
The S&P 500 gained 14 percent, the Dow Jones Industrial Average rose 16
percent, and the Nasdaq Composite Index increased 9.5 percent.
OK lets say you bought into thins in January 2006 and spent 10,000 FRNs in the DOW average.
10,000 taken to the BROKER, the few that I looked at the minimum was 12.50 per trade and there were a few between 50 and 100, then there is the maintenance fee for the account that can run anywhere from 20 per year ( student accounts etc.) to IRAs from 50 on up and regular accounts this is assuming of course that you make only ONE purchase and do not trade anything during the year. OK so 10000 minus 50 minus 12.50
9,931.50 actually purchasing the stocks, (Assuming that you were able to purchase a Mutual Fund containing ALL of the Dow 30 stocks, otherwise there would be a 12.50 charge per purchase per stock). NEXT STEP.. Fork over your social Security Number so the Government can TAX your increase ( if you are a tax payer) at the end of the year based upon your profit.
Your 10,000 minus fees would have brought you 1589.04 in increase. Now in order to use this increase for anything, you will need the BROKER again to sell your stock for you. OK Minus a small FEE your at about 1577 if it is sold as ONE. if there are separate sales for separate stocks it will be more.
OK now you have your 1589.04 ( Plus any dividends) and you fill out your 1040 form and pay the extra taxes on it and you at ( you fill in the number)
OK Now lets say that you purchases SILVER with your FRNs instead, Again starting with 10,000 you would have seen an increase of 45.5% in relationship to the Dollar and had your "value" in relationship to FRNS increase not 1577 as with the Stock Market, but rather $4,550.
IN OTHER WORDS your trade power with your new PROPERTY as opposed to your Paper dollar increase with your security would be almost 3 times as much. Now understand something here. The FRN when exchanged for SILVER became a piece of private property that you OWNED ALODIAL. the Stock that you put your FRN in was never yours but you were permitted to receive a "profit" from it that could only be used if turned back into FRN's and then TAXED. YOUR SILVER's trade power increased along with the increase of all other real property. In fact the value of the Silver in relationship to other real property actually increased, or at least appeared to in relationship to FRNs. Here is the wonderful thing. if you never exchange the metal back into FRN's and use it as a barter item, you will never be taxed on it. WHY, because your will be trading value for Value and you will not be engaged in "Profit" or Gain. Inflation will be a non issue for you and your PRIVACY will be absolute unless you choose otherwise.
What about GOLD? Gold was "UP" in relationship to FRNs over 23% as opposed to the dows 16%. Again put the numbers as you did with SILVER and you are still way ahead of the inflation monster.
OK Now with the GOVERNMENTS figures for inflation:
http://data.bls.gov/cgi-bin/cpicalc.pl
OK Remember your 10K in the DOW became 11,577 Minus Inflation from the Government web site calculations chart on the above web site equals 11,220.78 purchasing power in 2005 FRNs( Very conservative numbers)
However your Silver property with the same outlay has a purchasing power of 14,102.31
(if traded for goods and services listed on the inflation index) I wonder why BROKERS seldom if ever mention this to would be "investors"? Who do you suppose they actually WORK FOR?
BTW. Generally speaking Silver has a much higher trade value in relationship to real things then it does in relationship to FRN's.
Want to add more variables? Silver is tradable ANYPLACE IN THE WORLD. Dollars must be Converted for a fee to a native paper. The dollar lost 9% against the Euro this year alone, meaning that the inflation for anything trading into a country using the euro, would not be the 3% it would be at least 9%.
How to view the Dollar. The dollar is not a Dollar, it is an illusion that is quickly vanishing away, soon to be replaced with a North American coin. They are Federal Reserve Notes, which are considered promises to pay, but they offer nothing. Countries around the world that do not like us are catching on and are beginning to refuse to use our FRN's and are in fact sending them back increasing our supply and in so doing decreasing their purchasing power ( falling dollar parity- The falling trade value in relationship to all real things) What we are witnessing in America today is the total destruction of the average America to SAVE anything of real lasting value. the deception is grand and also grotesque. The dollar should be viewed as something to get rid of as quickly as possible while the general population still imagines it has any value. Trade them for Silver, Gold, Lead, Food Fuel and if possible use them to pay your taxes on your home years in advance if your area allows you to do it at the current rate. Do NOT use Banks to store any wealth at all. if they must be 'used" remember they are the beasts that are bringing your the FRN's in the first place, use them to a minimum. Do not Use them to store your Gold and Silver, you will loose your anonymity.( in the next crises the government will do as they did the last time, close the banks and drill the boxes, If you are attacked personally they will use your SS number to find your box, warrant the bank and then Drill your box to see what is in it.)
Again view the dollar for what it is, an imposed EVIL. Use them for your electric Bill, phone bill and any other "bill" for now and squirrel away the rest for the day when the Dollar will only be 'worth" the paper it is printed on.
have fun.. Look up.. your redemption draweth nigh....
IN Christ Pastor Mike
"If ye love wealth better than liberty, the tranquility of servitude better than the animating contest of freedom, go home from us in peace. We ask not your counsels or your arms. Crouch down and lick the hands which feed you. May your chains set lightly upon you, and may posterity forget that ye were our countrymen." -Samuel Adams
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