Tuesday, May 4, 2010

Shadowstats John Williams--Buy Gold

If you've never visited Shadowstats.com, don't wait another minute.  John Williams does a great job of showing us "what's behind the curtain."  For just a taste of his thinking, though, check out the following.  In the first paragraph he makes it crystal clear that inflation is the only way out for our government.
"Now to put that into perspective, if the government wanted to balance its deficit on a GAAP basis for a year, and it seized all personal income and corporate profits, taxing everything 100%, it would still be in deficit. It can't raise taxes enough to contain this. On the other side, if it cut all government spending except for Social Security and Medicare, it still would be in deficit. With no political will to contain the spending, eventually the government meets its obligations by revving up the currency printing press."

If that paragraph doesn't make you a little queasy, please read it again.  Of course he did leave out the option of default, but which will Washington prefer, an outright admission of failure, or a thinly veiled swindle?  Later in the article he points out how tranparent and politically inspired are everything we hear out of D.C.  Remember when we had to have the bailout or unemployment could top 8%?  Now that we sprung for that, all we hear is nonsense along the lines of "green shoots."
"You are getting happy news from governments, central banks, financial markets, Wall Street analysts and the popular media, which does tend to cater to Wall Street."

Finally, he gives his thoughts on wealth preservation (that's preservation, not getting rich!)
"In terms of preserving the purchasing power of your assets, the best thing I can think of is physical gold."

Please check out the entire article on Mineweb.com if you have time, and again, be sure to check out Shadowstats.com.


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