Dynamics of the Worldwide Currency Crisis

-- Posted Wednesday, 14 April 2010 |

By: Vincent Bressler

During most of world history, financial assets have been a small fraction of total wealth.  But a number of "innovations" over the last one hundred years have created an imbalance that the world has never seen before.  Today, financial assets represent 95% or more of the total wealth in the world.  In our rigged markets, real productive capacity and resources have been valued at less than 5% of of total wealth.   This is an absurd and unsustainable situation.  The people (wizards) who can create unlimited financial assets at the click of a mouse button understand that, everyone else (sheeple) do not.  In order to hang on the their share of the "wealth", the wizards must convert their wealth.  The sequence is as follows:

1) Financial Assets -> 2) Monetary Metals -> 3) Tangible Assets -> 4) Financial Assets
Right now:

The wizards are accumulating monetary metals now, physical bullion.
The sheeple are accumulating financial assets (GLD, SLV).

During the currency crisis:

The wizards will buy tangible assets using their physical bullion.
The sheeple will buy monetary metals using what is left of their financial assets

After the currency crisis:

The wizards will buy financial assets by borrowing against their tangible assets and monetary metals.
The sheeple will buy tangible assets with cash and remain without debt.

There are plenty of opportunities if you understand this.  Don't be one of the sheeple.

Financial Assets

• Over the counter derivatives
• Market traded derivatives
• Insurance policies
• Government bonds
• Corporate bonds
• Pensions
• Social Security
• GLD, SLV, unallocated metal accounts
• Money market accounts
• Demand deposits
• Paper money

Monetary Metals

• Closed end monetary metal funds that have the goods
• Allocated monetary metal accounts that have the goods
• Physical silver
• Physical gold

Tangible Assets

• Commercial Real Estate
• Residential Real Estate
• Scrap metal
• Unskilled labor
• Quality know-how based stocks (technology, manufacturing, service)
• Quality resource based stocks (energy, food, monetary metal)
• Farmland
• Skilled labor

by Vincent Bressler
vincentbressler@yahoo.com
-- Posted Wednesday, 14 April 2010 |