Competitive currency devaluations are in effect a continuation of currency debasement. Debasement is simply the devaluing of one’s currency or money. In ancient and medieval history it used to be done through the clipping of gold and silver coins.
Today it is done through excessive money creation through the printing of, and indeed the electronic creations of billions and billions of dollars, pounds, euros and other fiat currencies. Indeed, today central bankers are creating billions and billions of electronic money simply by pressing a few buttons on a computer.

Currency wars are set to deepen as most industrial nations in the western world are close to insolvent and look on the verge of recessions – potentially deep ones.
The U.S. will never be able to pay its debts back and so it will attempt to inflate them away through currency devaluation. This poses risks to the global reserve currency status of the dollar – especially as the world moves to a multi polar world where India, Russia, Brazil and China exert their increasing economic and political power.

 

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From Goldcore:

Today’s AM fix was USD 1,580.00, EUR 1,196.15 and GBP 1,034.78 per ounce.
Yesterday’s AM fix was USD 1,568.50, EUR 1,189.34 and GBP 1,030.96 per ounce.

Silver is trading at $28.65/oz, €21.80/oz and £18.81/oz. Platinum is trading at $1,611.50/oz, palladium at $731.00/oz and rhodium at $1,175/oz.

Gold climbed $12.30 or 0.79% yesterday in New York and closed at $1,576.90/oz. Silver surged to a high of $28.88 and finished with a gain of 0.53%. Euro gold climbed back to €1,196/oz and platinum lost $32.50 to $1,613/oz.


Cross Currency Table – (Bloomberg)

Gold recovered on Friday, adding to gains yesterday on news that the U.S. economy is still faltering and concerns that the U.S. Fed’s QE will continue despite assertions to the contrary.

The U.S. economic growth stalled in Q4, and the jobless rate rose up to 7.9% this January.

Investors will look for clues in Bernanke’s testimony before the U.S. Congress on Tuesday and Wednesday. However, the fiscal cliff drop is still dangerous as the U.S. government will embark on spending cuts, debt limits and the U.S. Fed has every reason to keep its stimulus package in place.

Smart money bought the dip yesterday, especially in China where premiums in Shanghai were nearly $20/oz over market prices.

In the Eurozone, the EU commission said today that Europe will not recover until 2014.

Fearful investors continued liquidating positions in ETFs like SPDR Gold Trust, which saw its largest one day fall in positions yesterday in the past year and a half.


Gold Spot $/oz, 5 days – (Bloomberg)

GoldCore Insight – Currency Wars: Bye Bye Petrodollar – Buy, Buy Gold
Currency wars are probably one of the greatest risks posed to the wealth of nations today.

In September 2010, Guido Mantega, Brazil’s finance minister, warned that an “international currency war” had broken out, as governments around the globe peg their currencies and devalue their currencies against each other.

His comments were echoed by senior Russian and Chinese officials.

The G20 said last week that there would be no currency wars and some central bankers such as the ECB’s Mario Draghi have recently dismissed talk of “currency wars” as excessive.

Sir Humphrey, the wily civil servant in ‘Yes Prime Minister’, always stressed how important it was “to never believe anything until it is officially denied.”

Competitive currency devaluations are in effect a continuation of currency debasement. Debasement is simply the devaluing of one’s currency or money. In ancient and medieval history it used to be done through the clipping of gold and silver coins.

Today it is done through excessive money creation through the printing of, and indeed the electronic creations of billions and billions of dollars, pounds, euros and other fiat currencies. Indeed, today central bankers are creating billions and billions of electronic money simply by pressing a few buttons on a computer.

Currency wars are set to deepen as most industrial nations in the western world are close to insolvent and look on the verge of recessions – potentially deep ones.

The fiscal situation of the U.S., the largest economy in the world, is appalling with the national debt having increased from $5.7 trillion in 2000 to over $16.5 trillion today.

Besides the U.S. national debt of over $16.5 trillion, the U.S. has off balance sheet debt or unfunded liabilities of between $70 trillion and $100 trillion.

The U.S. will never be able to pay these debts back and so it will attempt to inflate them away through currency devaluation. This poses risks to the global reserve currency status of the dollar – especially as the world moves to a multi polar world where India, Russia, Brazil and China exert their increasing economic and political power.


XAU/GBP Currency – (Bloomberg)


XAU/EUR Currency – (Bloomberg)

This is why it is important to consider the energy money nexus and to look holistically at the world of energy and money as Chris Sanders has done in this interesting insight.

Currency wars and the threats posed to the U.S. dollar as the global reserve currency of the world, make owning physical gold essential to all who wish to preserve wealth in the coming years.

We do not endorse the opinions of guest contributors but where we find an argument interesting and potentially valuable to our clients and the public in helping to protect and grow wealth we share it.

Click here in order to read GoldCore Insight – Currency Wars: Bye Bye Petrodollar – Buy, Buy Gold 

NEWS  
“Gold market sentiment is the most negative that we have seen in recent years” – Wall Street Journal

Gold futures inch higher after selloff – Market Watch

Gold Poised for Weekly Loss on Concern 12-Year Bull Run Ending – Bloomberg

Gold, silver head a bit higher – UPI

COMMENTARY
Gold’s Death Cross May Not Be So Bearish – Wall Street Journal

Video: Peter Schiff Takes On Credit Suisse Gold Bear – CNBC

 

Media has been stating not to buy gold for years – JS Mineset

 

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  1. The petrodollar is what our involvement in the Middle East is all about.  That system is on the cusp of changing.  Should a petro-gold system evolve, which seems likely, a nation will need gold to ensure their energy needs and thus their prosperity and sovereignty.

  2. The thing that really bothers me is the world wide currency wars.  Every large GDP country is engaging in the debasement of their currency, desperate to keep the exports flowing, forcing high inflation into the pocketbooks of the citizens while creating some harsh and debilitating conditions in many countries including Japan and Germany.  In 1914 an obscure duke was assassinated, setting off WWI, the communist takeover of Russia (never let a crisis go to waste) and leading to WWII and  several worldwide depressions.  Much of the  war funding was provided by the newly formed Federal Reserve Bank.  It would not surprise me to find that the Fed helped precipitate WWI. It certainly had its hands into the financing of WWII.
    Given the TBTF banks are not making the usual amount of income they would like, what with the retail consumers fleeing these banks and the cost of regulations eating into their profits, these banks have yet accounted for their bad loans.  So what actions would present a huge profit making opportunity? 
    War.
    Central governments are good at two things
    Making war
    Debasing the currency
    Bankers finance both and profit immensely from these actions.
    We now have worldwide recessions and depressions, massive arms buildups, real stresses in  many of the larger GDP countries, high inflation in many countries (lied about by TPTB).  Currency wars beget saber rattling on most continents as pricing pressures and currency devaluation coupled with  food, oil, water and commodity shortages to produce real dangers of a war starting that can’t be contained by normal means like sending in the troops or the UN.

    • And it won’t be a little war.  Something along the size of a China or a Russia will be necessary.  Conflict with tiny Afghanistan just won’t cut it for the banksters.

  3. Or maybe, just maybe the sheep in this country will wake up and take this place back. Highly doubt it as long as the government bennies keep flowing but as soon as any one of them gets cut things will start to fall apart. Hopefully it won’t be to late.

    • Mary, you say that as if the sheep can do anything but chew, sleep, and make more sheep!  That is about the extent of their capacity. Do not look to them to take anything back.  Any taking back will be done by patriots… by peaceful means, if at all possible, and by stronger measures, if necessary.
       

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