Thursday , 25 July 2024

Financial War of Musical Chairs Is Underway – Here’s How to Play the Game

What is taking place around the world these days is analogous to the children’s game of Musical Chairs, whereGold-bars-on-100-and-50-dollar-bill everyone is happily going round and round at the beginning of the game but knowing that at some point the music will stop and that if they don’t have a chair to sit in they will be out of the game!  I see Precious Metals (PMs) as being the chairs and, when the current financial music stops, those without PMs will be left holding nothing but paper money and history is full of examples of paper money suddenly becoming worthless!

So says SeniorD, the primary commentator on the hundreds of economic, financial and investment articles posted on (Your Key to Making Money!) and (A site for sore eyes and inquisitive minds) in this exclusive submission to

SeniorD goes on to say:

Because China (and probably other countries like Russia and India) are not providing “full disclosure” about their gold acquisitions or the total amount of gold they now hold, their actual amounts could easily be far different from what they have said publicly.  These amounts could be very important should the US$, which is now the world’s reserve currency, suddenly became challenged by one or more of these countries that also have very large gold holdings.

Imagine if Russia, India and China (RIC) decided to “pool” their gold reserves, in an Asian gold depository similar to Fort Knox.   Together, they could promote replacing the US$ with their new gold-backed RIC currency!  Even suggesting this would have huge implications in the financial world and cause many countries that are our long time trading partners to start asking questions about not only their US$ holdings but their own gold holdings and especially if they are being held in other countries’ depositories.

While this might sound far-fetched, it is in no way different from any other takeover where those that position themselves beforehand, reap huge profits afterward.  There is really little that any one or more countries could do to keep this from happening, since most of their central bankers (and all their well-connected friends) would immediately protect themselves by acquiring all the available gold that could be had.

Globally, many investors would become much wealthier, while many others would lose vast sums overnight as paper-backed currencies all had to adjust their value to the RIC.  Large countries like the USA could threaten to stop trading in anything other than US$ but then those countries like China that are now holding large amounts of US$ would simply  start spending them as fast as possible, if they had any left; since they would have been already reducing their US$ positions before promoting their RIC currency.

U.S. Losing Economic War with China

I believe that the USA and many of its financial supporters are losing an economic war against the Chinese (and their supporters) and the value of the US$ will indicate how the battle is progressing!

If the Chinese are successful in getting their currency used instead of the US$ then things will be very different in the future, especially for those relying on the US$.

China Adding Allies to Circumvent Use of the USD

We are witnessing a financial war where China is now adding allies to circumvent the use of the US$, which makes China’s currency even more valuable!  Every trade that happens without the US$ will only make the next trades easier to do.  China now has the global reach to undercut just about any trade and they have continued to add to their PM stocks while at the same time helping to lower the value of PMs worldwide.

It may sound counterproductive but from China’s vantage point, depressing the value of PMs now, only allows them to acquire more at better prices while at the same time acknowledging that what is low today (for PMs) can become much higher tomorrow. When the correction comes (aka the fall of the US$) look to PMs to be THE commodity to have!

When the Music Stops Those Not Sitting on PMs (i.e. holding Fiat Money) Will Be Out of Luck!

I believe that what we are seeing when we study current PM charts is that PMs value is being manipulated, as never before which makes sense if you believe that the big banks are trying every trick in the book to force PMs lower so they can obtain as much gold (and other PMs) as they can before what they are doing becomes general knowledge!

Deep Throat advised “Follow the money”;  I therefore believe that if China and Russia and others are still acquiring PMs then so should all long-term investors.

Imagine just this one scenario; the U.S. stock market climbs while other foreign banks buy PMs at discounted prices, until the US$ stops being the world’s reserve currency. Overnight PMs would skyrocket, the US$ would plummet and all those not in on the “deal” would suffer as their portfolios’ value became a small fraction of their previous worth.

The End Of The World As We Know It (aka TEOTWAWKI )

For too many Americans TEOTWAWKI has already happened! The meltdown of the financial system and the government decision to bail out the BIG’s instead of Main Street and the American middle class was TEOTWAWKI.

The next attack on what is left of middle American wealth is happening now with the call for reducing or eliminating Social Security and/or Medicare!

President Obama must stand strong and cut the military budget and/or the military black budgets or America will suffer a financial civil war between the haves and the have-nots.

The Global Economy Is Collapsing! Got Gold?

The global “economy” is now nothing but a biased shadow of what it was a decade ago as the central banks continue to print money overtime and enable their countries ultra-wealthy to sell gold using naked shorts, which has the effect of scaring small to medium investors into selling their PMs because of fear and/or need.

As the numbers of those with money to spend continually decline, thanks to current monetary practices, the global “economy” will continue to collapse, which at some point in the near future cause the current fiscal version of the fiscal-musical chairs game to end with those only holding flat money left out of PMs recovery!

Gold Is Insurance Against Dramatic Loss in Value of Fiat Money

I view PMs, like I do insurance; you purchase it because if something unexpected happens, you don’t want to be able to pay the entire bill for it yourself.  Yes, until that something happens you are paying for your insurance (think not making any money from the money invested in PMs), but that amount is small compared to what you might lose should disaster strike (dramatic loss in value of flat money) which would then require you to accept a huge reduction in the value of your portfolio.

You purchase insurance because if something unexpected happens, you don’t want to pay the entire bill for it yourself.  Yes, until that something happens you are paying for your insurance (you do not make any money from the money invested in PMs while you hold it), but that amount is small compared to what you might lose should disaster strike (consider a dramatic loss in value of flat money) which would then require you to accept a huge reduction in the value of your net worth ( loss to your portfolio because you have no gains in the value of your PMs to offset the loses to your flat money.

What percentage of your income do you spend yearly to “own” Insurance? Perhaps the same percentage should be used for your PM holdings in your portfolio because, after all, how many readers consider having no insurance as prudent?

The USD Is Approaching a Tipping Point In Value

There are now too many other BIG fiscal “players” in the global marketplace for the US$ to continue to stay THE worldwide standard forever; and when little by little deals are made in other currencies, the US$ will begin to slip at which time PMs and their value vs. the US$ will also change dramatically in what I call the US$ tipping point.

Depending upon what causes the shift in the US$’s value (a war vs. a new ongoing resource transaction for oil sales), PM’s value will respond accordingly!  Think of this as a 1-2 combination fiscal punch that will leave those holding only US$ reeling, while at the same time, those still holding PM’s will remain much more secure than ever before.

Central Banks United In Pushing PMs Lower

I believe that we are now in a period that is unique in history, in that the central banks and their governments are working together, as never before, to push the value of PM’s downward in order to prop up their continued printing of ever more “flat” money (aka paper money) that in reality now  has little actual value.  I see this “united effort” as an agreement between these same central banks that will allow them some additional time to re-position their own holdings, so that they all can not only add additional PMs to their own holdings (at a discount) but at the same time remove as much PMs as they can from as many small to medium investors as possible, which will make PMs even more valuable in the future since most of it would then be held by these same central banks.

A great analogy is the children’s game of musical chairs, where everyone is happily going round and round at the beginning of the game but knowing that at some point the music will stop and those without a chair to sit in will be out of the game!  I see PMs as being just the chairs, when the current financial music stops, those without PMs will be left holding nothing but paper money and history is full of examples of paper money suddenly becoming worthless!

Adding to this situation is the fact the these same central banks are now still adding gold and possibly silver, at depressed prices, to their own portfolios, which should be seen as giant waving red flag for all investors, because they are telling us one thing while doing the exact opposite thing themselves!  In reality, they are just issuing statements, supported by ever better looking charts, illustrating numbers being generated by these same central banks/governments, to justify the value of their own “strong” currencies while at the same time allowing only their biggest players to use newly printed paper money to short PM’s value.

Question: If you are playing poker in one town and you are starting to think the game is rigged, do you really want to end up holding only the house’s chips that are good in just one town or something of real value like gold and silver coins which are accepted in every town or some of both?

What Our Fiscal Future Might Look Like

Could the Fed and the big banks actually be planning on the US Dollar tanking? Consider this, they have the entire world now investing in the US Dollar and we have been printing US$ as fast as possible to keep up with the demand.  Personal credit has tightened its hold on those still in the middle class, while the big banks are getting their money at almost zero interest.  Now ask yourself why the Fed and Congress have allowed this to happen.

Could the following scenario unfold. one day very soon?:

  • The value of the US$ plummets, but not before the central banks and the big banks scoop up all the available gold and other PMs they can, to limit their own losses.  When the financial dust settles, both of their positions are vastly improved compared to where they are today.
  • The central banks, now with their vaults full of PMs bought at bargain prices as compared to 6 months ago, agree to comply with peoples demand for a gold standard.
  • The big banks would be only too happy to devalue the paper US Dollars value (say 100 old US$ = 1 new US$ (USN$) since they will be paying back all US debts with USN$ pennies instead of US$.  Imagine the Fed and Big Banks a hundred times or more powerful than they are today!

By the way, if you think conversion from US$ to USN$ will take long enough to give you some warning, so you can also convert your money to PMs, think again!

I’m predicting that:

  • USN$ will be implemented over a Sunday evening followed by a Bank Holiday the following Monday, and Tuesday if necessary,
  • electronic conversion “cash” credits will be used until all physical cash conversions are verified as factual.

agents of the Treasury, working with DHS and local law enforcement, to maintain order, would then determine on a case by case basis, by looking in every safety deposit box, that everyone’s stash of cash.

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