Jim Rickards Presentation / Feds 4 Options

This was a slide on Jim Rickards "Economics and National Security" presentation on 12/7/10 from the Applied Physics Laboratory of Johns Hopkins University. The mp3 and notes are posted here: http://outerdnn.outer.jhuapl.edu/rethinking/VideoArchives.aspx It is funny how a child can pick the correct answer. The presentation is over 90 minutes, but worth listening or reading as it provides a fresh perspective and different thinking than main stream media. The gold portions start about 57 minutes in. Gold revalued to $3,000-7,000 per ounce is not a pipe dream. The charts in the presentation point out that the US is gold superpower (our gold is like the Saudi's oil with 8,000 tonnes and custody of 6,000 tonnes to convert as needed) and why China is playing catch up in purchasing gold.

I would also listen to Jim Rickards recap of 2010 and predictions for 2011.

Feds 4 Options from the above interview.

1. It would not be politically correct to increase interest rates with high unemployment.
2. If they sold their assets to reduce the money supply they would be bankrupt due to mark to market losses.
3. If they continue to do the same will devalue the US dollar and its stability.
4. If they stop and do nothing, asset values will drop to real market values.

It is scary to see how we compare to Weimar Germany. The masses think when the cost of food and energy goes up; the problem is the price, when in reality the problem is the currency. Also, when the stock market is up, the increase cost of food/energy is "padded" as the stock markets gains make you "feel" like you a breaking even. You only see a 20% food/energy increase as 5% due to the 15% stock market gain.
After listening to all 3 mp3's, the fed has a wild card up their sleeve with the US being the largest hold of gold. Today's $1375 spot price of gold will look cheap in a few years, yet of we drop the $1265 in the next month, the masses will be afraid to exchange their US dollars for gold coin in fear it will "crash" while I see it as a sale to accumulate.