Economic pressures

[Danny B]

Illiquid, insolvent and busted

Ludwig Von Mises said that there is NO escape from a credit boom. Our time will come but, who knows when? There are some fresh indications.
“There have been only two instances when the NYSE Tick and stock prices diverged radically, and that was in the first quarter of 2000 and the third quarter of 2007. The third time was April of 2014,” Cook says"
Stock trader who called three crashes sees 20% collapse - Michael Sincere's Long-Term Trader - MarketWatch
The 10 year treasury rate is starting to rise and may go up by Thanksgiving. There are $ 440 trillion in interest rate swaps tied to the 10 year rate. (derivatives). Why the 10-year Treasury could yield 4% by Thanksgiving - Mark Hulbert - MarketWatch

QE was a mechanism to rescue institutional debt that was in danger of default. It was a "hail mary" effort because we had lost our job and couldn't pay. The FED printed to save the banks but, the currency inflation resulted in price inflation and we were even LESS able to pay.
"The crisis will indeed come, but it will probably have its origins in the inability of individuals, robbed of the purchasing power of their fixed salaries and savings, to pay the prices demanded from them by businesses. This is called a slump, an old-fashioned term for the simultaneous contraction of production and demand. Not even zero or negative interest rates will save the banks from this increasingly certain event, for a very simple reason: by continuing the transfer of wealth from individuals through monetary inflation, the cure will finally kill the patient."
http://www.24hgold.com/english/news-...r+Macleod&mk=1
We are BUSTED and we are defaulting.
Study: 77 Million Consumers with Credit Files Have Delinquent Debt - ACA International
M.F. Global absconded with their clients money,, something like $ 680 million. Corzine was an insider. The courts ruled that M.F. Global didn't do it intentionally so, it was forgivable. The banks are illiquid and insolvent. Keep in mind that they sweep all accounts many times a month and grab any extra money that isn't working. They are flat broke AFTER stealing all your money.

[Danny B]

Walking away from debt

GOV printed money for wars. Not wanting the little guy to get mad, GOV printed money for welfare. This money inflation caused price inflation. Because we had the reserve currency, we could export this price inflation. We just had to print to buy what we wanted. As the rest of the world built manufacturing capability, we lost our high wages. We increasingly spent future wages for today's toys. The banks extend us ever-more credit for an ever-longer time period.
" The good news is that the American economy has improved to the point where credit is much more readily available than it was a few years ago, so people have an easier time financing cars.
If you've ever financed a car, you know what a pain it is to make payments on the loan every month for four or five years. But what about seven years, or eight? " The 97-Month Car Loan Is The Craziest New Car-Buying Trend
Not to worry! They're still selling cars,,, right?

4.Americans are so broke that car dealers are having to go to extreme lengths to get new customers. Last year, one out of every four auto loans in the United States was made to someone with subprime credit.
The end result is; "Overall, U.S. households are 11.68 trillion dollars in debt right now."

21 Ways To End The Phrase “Americans Are So Broke…” « The Burning Platform
We walked away from underwater houses. We'll walk away from overpriced cars.
6.Americans are so broke that they are falling farther behind on their student loans than ever. The total amount of student loan debt in the U.S. has now reached a whopping 1.2 trillion dollars, and approximately seven million Americans are in default on their student loans at this point.
Hmmm, 7 million are in default on student loans. That's a lot of walking away.

[Danny B]

Ww III

Quite a few people have been saying that current actions are pulling us towards a new world war. Many are speculating that some huge false-flag action will set it off.
"In order for this “reset” to be achieved, however, the establishment needs a historically monumental distraction. A distraction so confounding and terrifying that by the time the public has a chance to examine the situation rationally, the elites have already tightened the noose.

I have been warning ever since the beginning of the derivatives/debt collapse of 2007/2008 that the international financiers and globalists who created the artificially low interest rates and fiat lending bonanza would one day be required to fashion a considerably dangerous event in order to trigger the final collapse of the dollar based monetary system and replace it with a new currency (or basket of currencies), along with a new centralized financial authority."
"Economic warfare alone could be extremely effective in initiating full spectrum fiscal implosion as well as mass starvation, mass panic, and mass desperation. All the signs lead me to believe that financial combat and 4th generation warfare will be used in the place of large armies and missiles."

"After the great financial war has subsided, and the people are suitably poverty stricken and desperate, it will be institutions like the BIS and IMF that swoop in to “save the day”. Their offer will be to consolidate economic control into the hands of an elite group of bankers “not affiliated” with any particular nation state, thereby insulating them from "political concerns". The argument will be that national sovereignty is a bane on the back of humanity. They will claim that the catastrophe will continue until we “simplify” and streamline our economic and political systems. They will present themselves as the heroes of the age; the ones who predicted the crisis would occur, and the ones who had a solution ready to save the day (after sufficient death and destruction, of course)."
Internationalists Are Pushing The World Towards Globally Engineered Economic Warfare | Zero Hedge

[Danny B]

Long term progress report

’46-’59 (13yrs)

Debt grew 1.06x’s ($269 B to $285 B)
GDP grew 2.2x’s ($228 B to $525 B)
’60-’75 (15yrs)
Debt grew 2x’s ($285 B to $533 B)
GDP grew 3.3x’s ($525 to $1.7 T)

’76 -’04 (28yrs)

Debt grew 15x’s ($533 B à $7.4 T)
GDP grew 7.3x’s ($1.7 T à $12.4 T)
’05 -’14 (9yrs)
Debt grew 2.4x’s or 240% ($7.4 T à $17.5 T)
GDP grew 1.4x’s or 140% ($12.4 T à $17 T

’75-’14

debt (total government obligations) grew 168x’s ($533 B à $89.5 T*)
GDP grew 10x’s ($1.7 T to 17 T)
US is Bankrupt: $89.5 Trillion in US Liabilities vs. $82 Trillion in Household Net Worth - See more at: US is Bankrupt: $89.5 Trillion in US Liabilities vs. $82 Trillion in Household Net Worth & The Gap is Growing. We Now Await the Nature of the Cramdown. - Biderman's Money Blog

[Danny B]

15 vids

There are a lot of people who are writing to wake people up. Here are 15 vids on the subject.
The Silver Liberation Blog: The Top 15 Economic Truth Documentaries
IN 2006, the U.S. comptroller general told us that it was going to crash.
DAVID M. WALKER

Comptroller General of the United States

Government Accountability Office

Washington

America's Red Ink

[Danny B]

All currencies are in danger

There are dozens articles and of vids showing/proving that all wars are banker wars. Churchill made it clear that WW II could have been avoided but, the bankers wanted it. He also made it clear that Germany was outproducing England and had to be destroyed. Historically, the underproducer State engages in currency war to try to maintain/gain advantage. Nobody wins a currency war in the end. Currency wars lead to shooting wars.
Near the end of WW II, hundreds of delegates met at Bretton Woods to create a system that would avoid future currency wars. They locked the U.S. dollar to gold and locked all other currencies to the dollar. It was a good idea and a good system. No State has enough cash for a protracted war. Bankers had always provided credit for wars. This was an attempt to limit the credit available for wars.
In a general sense, all politicians are power mad. Why would they jump into such a dirty game if they didn't have an overwhelming desire for power.
In the early 60s, the politicians and bankers started up the war cycle by overprinting the dollar. By 1971 the Bretton Woods agreement had been destroyed.
The monetary authorities who knew their stuff were aghast because it invited a new cycle of currency wars leading to hot wars.
The Euro was designed as a replacement for the dollar. MANY States around the world bought U.S. Treasury paper to support the dollar while the Euro was brought to maturity. They held their nose and bought our stinky paper that was printed with wild abandon.
Th bankers were just filled with glee and they started wars in any corner that they could find. Goldman Sachs sold poisonous derivatives to weak countries like Greece so that their economies would eventually blow all to hell,,, and crash the Euro. More details here; FOFOA

As usual, the actions of the bankers have put their own currency in danger. They seem not to care about the long run. Editorials | Mauldin Economics
The very real risk is that all currencies could be destroyed. The industrial revolution has brought so much wealth that it must be expressed/stored in paper instruments that are a claim on future productivity. The pyramid is stacked so high that it threatens to collapse in one huge default. The FED / IMF is willing to kill all competition to preserve the dollar. They risk killing all currencies. http://rt.com/business/162084-dollar...netary-system/
WE shall see.

[Danny B]

spending down our fortune

We lost our jobs and we're spending down our fortunes.
#4 From September 2013 to January 2014, the personal saving rate in the United States dropped by a staggering 16 percent.
#10 Total consumer credit has risen by a whopping 22 percent over the past three years.
#12 Overall, U.S. consumers are $11,360,000,000,000 in debt.
We're trying to maintain our standard of living by borrowing
#14 U.S. workers are taking home the smallest share of the income pie that has ever been recorded.
We're trying to compete with China, Bangladesh and the robots.
http://www.zengardner.com/the-u-s-co...eres-19-signs/
The sad fact is that many people are trying to eat and stay alive using credit. Besides this heavy downshifting, it must be remembered that FED GOV alone passes out more than $ 2 trillion in benefits in 2013.
Americans Got $2 Trillion in Benefits from Federal Government in 2013 | CNS News
Add in the money paid out by states and counties. Imagine what the economy would be like if this $2 trillion ++ had not been paid out.
FED GOV has pumped many $ trillions into the stock market. Most but, not all went to the 1%. Imagine the state of the economy if that money had not been created.

[Danny B]

Oil and silver

Back in the 60s, you could buy a gallon of gas with one silver quarter. You can do the same today. The 2 prices follow each other pretty closely.
http://www.itulip.com/images/OilvsSi...03-2006-25.gif
The Grace Report stated that not one dime of taxes goes to GOV. GOV prints all the money it wants. Taxes are just there to support the FED and act as a straw man. Our price inflation is due to the currency inflation caused by GOV. The current price of Brent Crude is over $ 100. Energy has gotten very expensive. Actually, it hasn't,,,, supporting GOV has gotten very expensive.
We passed peak, cheap oil in 2005. The oil price could be expected to go up because the easy pools are depleted.
The flip side of currency inflation is dollar devaluation. It takes more and more dollars to buy oil. Recently, the FED printed a ton of money to rescue debt that was in danger of defaulting. The resulting inflation has kicked dollar devaluation into high gear.
EVERYBODY is holding / dealing in devalued dollars. This includes the oil companies. Commodities tend to track each other. Big Oil is trying to produce ever-more difficult to find oil with ever-more worthless currency. The European oil majors are losing $ billions. American oil majors;
" The world’s leading oil and gas companies are taking on debt and selling assets on an unprecedented scale to cover a shortfall in cash, calling into question the long-term viability of large parts of the industry.

The US Energy Information Administration (EIA) said a review of 127 companies across the globe found that they had increased net debt by $106bn in the year to March, in order to cover the surging costs of machinery and exploration,"
Oil and gas company debt soars to danger levels to cover shortfall in cash - Telegraph

When we were on the gold standard, gold and currency were reciprocals. Now, that we are (for the time being) on the petro-dollar standard, currency and energy are reciprocals. Energy is a reciprocal of the financial system.

"Roger Boyd discusses the negative implications of the Self-Reinforcing Feedback Loops of Energy and the Financial System. Basically, Boyd shows how the world moved into a new economic system over the past century where the Global Financial System and Energy are now dependent on each other to survive.

According to Boyd, the fractional reserve monetary system was designed to fund future investment in the energy sector, thus enabling the global energy supply to grow. And, as the global energy supply continued grow, so did the size of the global economic and financial system."
THE UNKNOWN FACTOR: How The Global Financial System Will Collapse : SRSrocco Report
Energy IS the master resource so, it makes sense that energy and finance are tied at the hip. The FED rescued the banks with lots of printing. This inflation resulted in price inflation. In actuality, commodities stay the same but, effective wages go down. Oil consumption has fallen while oil accessibility has fallen also. The oil majors have taken on huge debt and are selling off assets. Junk-bond markets are seeing their highest outflows in history. If the perception of investors leads them to abandon oil investments too, the oil majors will default on their debt.

[Danny B]

Wrong plan

MANY writers have pointed out that the FED and Treasury are doing exactly the wrong thing.
Jim Rickards, " Reducing money printing and raising interest rates would strengthen the dollar, but they would pop the asset bubbles in stocks and housing that have been re-created since 2009. This would also put the policy problem in the laps of Congress and the White House where it belongs. The problems in the economy today are structural, not liquidity-related. The Fed is trying to solve structural problems with liquidity solutions. That will never work, but it might destroy confidence in the dollar in the process. Federal Reserve officials have misperceived the problem and misapprehend the statistical properties of risk. They are using equilibrium models in a complex system. (Ed note: Complexity Theory explores the fundamental properties of dynamic rather than equilibrium systems and how they react and adapt to exogenous or endogenous stimuli.) That is also bound to fail"
The Death (or Rebirth?) of Money: An Exclusive Interview With Jim Rickards | John Butler | FINANCIAL SENSE

OK, ho hum, we're on the road to a crash. The FED believes that it / we are dealing with an equilibrium problem.
The financial industry proves other wise.
#1 The U.S. junk bond market just experienced “a 6-sigma event” earlier this month. In other words, it is an event that is only supposed to have a chance of 1 in 500 million of happening. Billions of dollars are being pulled out of junk bonds right now, and that has some analysts wondering if a financial crash is right around the corner."
#5 The four week moving average for mortgage applications just hit a 14 year low. It is now even lower than it was during the worst moments of the financial crisis of 2008."
#14 The number of Ebola deaths continues to grow at an exponential rate, and if the virus starts spreading inside the United States it has the potential to pretty much shut down our entire economy.
I hope that y'all have put in a garden.

[Danny B]

Saving the corporations

The bankers got rid of the gold standard. This made them rich and us poor. There is a very good article showing what would have happened as far as war if we had stayed on the gold standard,,, no wars. What about the general economy?
"Forbes: “If we had maintained, since the early 1970s, the average rate of economic growth when the dollar was backed by gold, do you realize the U.S. economy today would be more than 50% larger than it is now if we had just maintained those average rates.”
Robert Kiyosaki & Steve Forbes: Destruction of the Dollar - Politics, The Unknowns about Money, and How Money Affects Your Trust

BUT, the gold is gone;
"The U.S. gold reserve has been leased out but has not left its vaults.

-- The leased gold consists only of certificates of title that have been rehypothecated many times, creating a vast supply of imaginary gold that is undeliverable.

-- If called for delivery, those certificates will be nullified by a bullion bank's claim of "force majeure" and settled with yesterday's now-much-discounted cash price.

-- The gold exchange-traded fund GLD was essentially looted of 500 tonnes last year to smash the gold price down but this cannot be done again because that gold is gone too."
Gold Videocast: Jim Rickards & Peter Schiff on Gold & Currency Wars

Martin Armstrong keeps track of EVERYTHING.
"The Sovereign Debt Crisis is unfolding on schedule. I warned at the Philadelphia Conference that half of Germany’s municipalities are on the edge of bankruptcy as was the case with Detroit. Instead of reform, no, government just increases the tax burden upon the people who they see having an endless supply of money to be expropriated for their personal glory.

Just like a small business that keeps expanding, those in government do the same thing except it consumes money never creates anything. Socialism is not about helping the less-fortunate. It is about government workers helping themselves to what you have. "
Armstrong: Big Bang – Sovereign Debt Crisis in Germany Begins
Yep, the endless legions of bureaucrats are a big segment of the free-$hit army.
Japan just increased taxes,, again. The economy fell,,,, again. History proves that this is the inevitable result but, the corporations insist on being rescued no matter the cost to the general economy.
The bankers are trying to hold on to the advantage that they have had for hundreds of years. The next part of the plan is privatization. In Greece, the banker wrote off a chunk of the debt in trade for 100 of the best beaches.
They locked up Staircase-Escalante for their future payoff.

[Danny B]

599 bottles of beer on the wall

"As of January 7, 2009 it now takes 81.8 GBP to purchase that same troy pound of sterling silver - a loss of 98.8%!"
"As of January 7, 2009 the price of a troy ounce of silver is US$11.22, representing a 89.5% drop in value!" Today, $ 19.55
"This analysis includes 599 currencies that are no longer in circulation. The median age for these currencies is only fifteen years!"
"Destroyed by hyperinflation 156 Currency destroyed through over-issuance by the government."
DollarDaze Economic Commentary Blog - Gold, Oil, Stocks, Investments, Currencies, and the Federal Reserve: The Fate of Paper Money by Mike Hewitt
After WW II, the Bretton Woods agreement brought price stability. It did NOT allow the monetary-base expansion necessary for war.
http://dailyreckoning.com/dr-content...14_MvgAvg1.png

Ed. note: Our "Jim Rickards project" is moving full steam ahead. We spoke with Jim this past Wednesday… and he revealed that there at least 30 different events that could trigger the next dollar collapse."

"Americans who had invested in gold earlier will be confronted with a 90 percent "windfall profits" tax on their newfound wealth, imposed in the name of fairness. European and Japanese gold presently stored in New York will be confiscated and converted to use in the service of the New Dollar Policy. No doubt the Europeans and Japanese will be given receipts for their former gold, convertible into New Dollars at a new, higher price."

"The Fed is attempting to inflate asset prices, commodity prices and consumer prices to offset the natural deflation that follows a crash. It is basically engaged in a game of tug-of-war against the deflation that normally accompanies a depression. As in a typical tug-of-war, not much happens at first.

The teams are evenly matched and there is no motion for a while, just lots of tension on the rope. Eventually one side will collapse, and the other side will drag the losers over the line to claim victory. This is the essence of the Fed's gamble. It must cause inflation before deflation prevails; it must win the tug-of-war. "

[Danny B]

Infaltion vs default

The Europeans (banks) are screaming for the ECB to print tons of money. The French are pushing. The Germans are holding back. The EU treaty does not allow the ECB to print to buy assets. The various treaties have already been broken so, who knows? The bankers desperately want inflation as opposed to default.
In early history, we had debt jubilees to take away the punch bowl and execute a reset. Jubilees went out of fashion and MANY States resorted to defaults to create a reset. An understanding of the nature of compounding debt shows that an interruption in the compounding action creates a huge loss to the bankers. The imposition of the Euro currency was an effort of the bankers to remove the ability of any sovereign State to execute a reset/default.

A sovereign default is specifically focused on the bankers who hold sovereign debt. Inflation, on the other hand, takes from everybody. Since the bankers created their money out of thin air, they don't really have very much invested. The inflation that they demand is not all that punitive to themselves.
They can comfortably demand any level of inflation and, they don't really lose. The corrosive action of the compounding burden goes on uninterrupted. With default, this corrosive burden suffers a break in the chain.

We see this with the FED. ZIRP is meant to keep the compounding action to a minimum so that the compounding action does not push the economy over the edge to default. ZIRP is a holding action that embraces a temporary loss to preserve the chain of compounding while inflation is put to work.

"They" are not having much success injecting inflation into the general economy. We are too saturated with debt. We lost our jobs to a low wage competitor and wages are slipping. It is very difficult to create widespread price inflation with new money if "they" can not create a wage-price spiral.
The inflation of financial markets without corresponding wage-price inflation drives a diminishment of consumption. The productive sector of the economy is crashing at the same time that the bankers require a generous contribution out of our pockets to create the inflation necessary to avoid a default.
So, while our contribution is necessary to maintain an unbroken chain of compounding interest, the extraction of our contribution pushed us closer to the default that they hope to avoid.

[Danny B]

Th fake recovery... problems in China

Y'all have been told many times that the recession is over and the economy is recovering. Money printing has been put to work to fix everything. Here is the Case-Schiller index (housing) divided by the FED balance sheet;
http://confoundedinterest.files.word...ng?w=878&h=584
Here is the S&P 500 divided by the FED balance sheet;
https://confoundedinterest.files.wor...ng?w=795&h=528
THIS IS YOUR RECOVERY AND THIS IS YOUR RECOVERY WITHOUT DRUGS « The Burning Platform

Income, home ownership and labor force participation. http://confoundedinterest.files.word...ng?w=585&h=418
Confounded Interest | Welcome To The WORST Real Wage Growth Economy Since WWII (What Will The Fed Do?)

Things don't look so good in China either. Protests are illegal in China. "Yet, according to official police statistics, the number of annual protests rose to 87,000 in 2005 from approximately 8,700 in 1993. Currently, there are 300-500 protests in China each day, with anywhere from ten to tens of thousands of participants"
http://www.cnbc.com/id/101918928

[Danny B]

Signs of desperation

The West has been inflated to the limit. The PTB are trying to pump in more debt but, it isn't doing any good for the producing economy
Prof Sims, nationalize credit; Nobel guru fears it may be nigh impossible to stop deflation – Telegraph Blogs

Prof Maskins; Nobel gurus fear globalisation is going horribly wrong (technical) – Telegraph Blogs

I can assure you that this isn't going to work out well. The investors do not consider themselves to be parasites. The enormous gains in productivity should have brought a dramatic drop in prices. The corporation is structured to pass profits to the stockholders. The workers did not see gains in remuneration that were equal to their gains in productivity. The greater the returns to the stockholder, the farther behind the worker fell. The greater the returns to the stockholder, the more that credit had to be extended. The stockholder assigns his credit to a corporation. This facilitates but, it does not produce.

Currently, the non-producers are reaping all the rewards. The worker has no bargaining power. He can't demand that the corporation starve the stockholder to effect price deflation in the things that he would like to buy. His effective remuneration falls and he reaches farther and farther into future wages. BUT, he reaches a point of debt saturation where he can no longer reach any further.

ZIRP is an effort to empower him to continue to consume without incurring any more interest load. BUT, he lost his job. He can no longer service his debt. Debt is offered to those who can't repay in an effort to keep the credit wheel rolling down the road. Not surprisingly, they default in masse.

The oversize gains of the non-producing stockholders are a short term benefit. Once the great mass reaches debt saturation, the disparity between productivity and prices wipes out consumption. The rich did well by extracting TOO MUCH rent on their money. If the middle class is destitute, then, de facto, the rent was too high. Over-consumption and global wage arbitrage play a part in this also. BUT, the banks threw away their lending standards.

Credit grew at 6 times the rate that the GDP grew. The blame falls mostly on the central bank. Bank credit suffered a massive crash. The CB tried to inject high-powered money to offset the credit lockup. FED money was used to rescue everything that was in danger of default. Catastrophic deflation was avoided. The price deflation that would be necessary to bring back consumption was avoided. The credit structure and price structure were rescued. Since the wage structure and aggregate wages continue to fall, the defaults will continue to grow.

Keep in mind that defaults are growing even though 50% of the population receives benefits from GOV to the tune of $ 2 trillion ++,,, counting non-federal benefits. The rich can overcharge for renting their free money but, the country is dying all around them. Their free money is just debt notes that they intend for the middle class to work off. The middle class isn’t working.

If 50% are receiving GOV benefits, you can bet that they aren't paying much tax or buying much in the way of non-necessity goods.

Where is the tax money going to come from. It has been well proven that every one dollar increase in taxes shrinks the economy by about three dollars. It removes capital off the top that we can no longer use for investment.

The producing economy is what keeps the country going. The producing economy stalls if the masses can't consume. So, while all the bankers, bureaucrats, beggars, AND investors may believe that they are entitled to part of the output, they have to keep the parasitism limited. The investor may make a killing in the stock market but, this causes price inflation down the road.

Short term thinking is starving the goose that lays the golden eggs.

[Danny B]

Rickards, gold and the collapse

Jim Rickards is a lawyer and investor. The Pentagon called on him when they wanted to do war-game scenarios of economic collapse. The Pentagon now claims that economic collapse is the number one threat to America. One would certainly expect Rickards to know the outcome of the war-games projections.
Hugo Salinas Price has written that we may go into a "500 year period of darkness" Robert Prechter calls for a deep depression.
Rickards has written a couple of books; The Currency War and The Death of Money. His predictions have proved to be accurate,, so far.

America has pissed off the whole world. Endless wars to keep the war merchants rich. Our current quest to destroy islam is making everybody nervous. The world would much rather align with Russia and China than a proven war monger. Every new attack that we make convinces more States to abandon America for their own survival.
Washington’s Nightmare Comes True: The Russian-Chinese Strategic Partnership Goes Global (II) | Oriental Review

GOV knows that there is going to be a cascade of defaults. They know that there is going to be a currency reset. The very serious problem is that there is no reliable storage of wealth. GOV has a runaway printing press. Jim Rickards talks about a bigger rollout of the Special Drawing Rights ( SDR ).
Why should anybody trust the IMF? "1979: U.S. inflation soared out of control, past 14%. Oil-producing countries fretted the value of their dollar reserves was plunging. The IMF issued 12.1 billion SDRs through 1981."
Print em up and send em out.
Rickards said that the world would go back on a gold standard. All States and economies would have to rebalance. He claims that Western gold is being shipped out so that China will have a backing for it's currency;

"The most provocative proposition in Rickards’ book, however, isn’t hidden global inflation. It’s this: Before the SDR can assume its role as the new leading global asset, China must accumulate a much larger stash of gold. And the gold price is being manipulated for the express purpose of making sure China gets it relatively cheaply.

We’ve long chronicled China’s gold accumulation. When we interviewed Mr. Rickards last year, he explained the rationale: “They want to be in a position where they just raise their hand and say to the world, ‘Hey, we’ve got our gold, now we’re a player. Now when the international monetary system collapses and the world has to reconfigure the system, we get a big seat at the table.’”

In The Death of Money, Rickards goes a step further: He says Western powers are making room at the table for China — using the precise mechanism we described in our “Zero Hour” scenario. Western central banks have “leased” their gold to commercial banks, and those commercial banks have sold that gold to Asian buyers — including the Chinese central bank.

“The gold price must be kept low,” Rickards writes, “until gold holdings are rebalanced among the major economic powers, and the rebalancing must be completed before the collapse of the international monetary system.”