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  • hapiwondrer hapiwondrer Apr 10, 2012 2:25 AM Flag

    Interview with B. Masters

    The following is a quote from: “Gold - A Reality Check” by Brian Bloom, 8 April 2012

    “…It seems to me that there has been an element of irrationality creeping into GATA's thought processes:
    In its April 7th publication entitled: What's the central bank endgame in gold? The following observation appears: "I think their [the Central Banks] primary concerns are about maintaining the value of their currencies, government bonds, and general equity markets while gradually inflating their unpayable debts away and keeping the mere rabble of their citizenry from figuring out what's really going on, which would be the end of Western central banking."

    Reality check: Inflation requires a double sided entry. When you print money, you "lend" that money to the recipient you don't "gift" it to the recipient. How can one inflate debt away if the very act of inflation creates more debt? That's like arguing that we can empty the hole that's full of water by pouring more water into it. Debt cannot be "inflated away". It has to be repaid or reneged on; or serviced in perpetuity. It is self evident - even to a 15 year old - that if the debt mountain grows to the sky, the debt will become unrepayable. It will be reneged on. DOES GATA HAVE SUCH A LOW OPINION OF THE IQ OF THOSE IN THE FED THAT IT THINKS THE FED CANNOT UNDERSTAND THIS? Alternatively, is GATA so cynical as to believe that the Fed can understand this axiomatic logic and is deliberately moving to ensure its outcome?

    If one accepts the glaringly obvious fact that it's physically impossible to inflate the debt away by creating more debt, then one comes to the inevitable conclusion that the Fed does not have an end game on anything, including gold. It is living on a day-to-day basis. All it is attempting to do is "buy time". The market will decide the end game and GATA represents one (minority voice) in the market. A stopped clock is 100% correct twice a day. That's about as accurate as GATA has been. Like many people, they got the timing of the turn in the gold market correct. Like many people, they called the bull market in gold correctly; full marks to them for that.

    But the world has changed. One's thoughts need to adapt to that change. Theirs hasn't. …”

    Beware of people like this who post their opinions on gold boards. GATA does point people in the right direction, but those who suggest that they should temper their view of the value of commodity based money because a central bank will come to its senses fail to note that this has not taken place since the founding of the Federal Reserve System. They are indeed driving the world towards a planetary one-world fascist system of government. All those who are the real owners of the central banks because of their immense wealth do indeed consider the rest of humanity as “rabble” whose reduction in numbers must take place through strategies they have designed.

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    • An added comment to the above is a fallacy in Brian Bloom’s understanding of fiat money (or an attempt to misinform those that believe what he has to say).

      “…When you print money, you "lend" that money to the recipient you don't "gift" it to the recipient. …”

      When “money” is printed IT represents debt because it has no backing. Further, the interest charged on whomever becomes “indebted” is infinite, because paying interest on worthless money is essentially division by zero.

      Further, fiat money IS debt because it is presumably “lent” based on the fact that it is a storage receipt on commodity money, which in reality does not exist, hence the value of this fiat money is zero. The fact that people BELIEVE that it is money does not change the fact that it is not. It just means those who believe it is "money" have been successfully "conned".

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