Sunday, September 16, 2012

Liberty's Outlook

is the newsletter (archive) sent out from Liberty Coin Services.  I think they're sending it to me (on occasion) because I bought some silver coins about 25 years ago.

Here's some of their latest:

Despite all the recent fireworks, though, in my judgment, we haven’t seen anything yet!

I look for gold and silver to be much stronger for the balance of 2012. It is not out of the question that gold could reach $2,000 and silver could top $60.00 by year-end.  [the prices were 1690.75 and $32.75 as of 9/5/12]

The main reason for expecting precious metals prices to soar are that the financial problems that are hurting the US and global economies have not and will not be cured by politicians and bureaucrats. In fact, they are getting worse day by day.

The actions taken by the US government have the effect of destroying the value of the US dollar. Quantitative easing is just another way of saying inflation of the money supply without having to mention the “I” word.

Inflation of the money supply always ends up reducing the purchasing power of the currency, no matter whether people realize it or not and no matter how the government inflating the currency describes it.

So, it isn’t the value of gold or silver that is changing. After all, an ounce of pure gold or silver last year is still worth an ounce of pure gold or silver today. Rather, the actual problem is the falling value of the dollar when compared to gold or silver.

During his speech at Freedom Fest in Las Vegas in July, Wall Street Journal Senior Economist Stephen Moore said he considered the 2012 US Presidential election to be the most important since 1980. While I understand his reasons, I don’t agree that the 2012 elections are that important.


First, the candidates are lying. Second, even if they were honest, neither they nor other politicians have the backbone to genuinely solve the problems.

None of the major candidates for president are being honest about the financial problems of the US government, the economy, and the US dollar.

Rather than discussing the more accurate accrual basis of accounting of government finance, which includes rising future liabilities for things like Social Security, Medicare, and other pensions incurred during the accounting period, the Libertarian Gary Johnson, incumbent Democrat Barack Obama, and the Republican Mitt Romney mislead people by only referring to the numbers from the cashflow basis of accounting. [wow, even the Libertarian?]

Overall, the fiscal plans of Obama and Romney are quite similar and won’t prevent the US dollar from falling further in value.  While Johnson advocates a huge 43% reduction in federal expenditures, that still leaves the US budget deficit in the trillions. Although Johnson may tip the results of the election, he will not win. No matter whether Obama or Romney is elected, the US government will be headed by someone who has repeatedly deceived the public and has no real plans to save the US economy and dollar.

I think the decline of US economy and US dollar are past the point of no return, no matter who is elected. I anticipate that they will fall so much in the coming months and years that the dollar may fail as a currency.

From that perspective, I’m sure you can see why I don’t think it matters who becomes the next US president. Whoever is elected, the real problems with the US economy and the dollar will not be addressed.


A recent poll by the Adelphi University Center for Health Innovation about personal emergency preparedness behaviors revealed that almost half of US households do not have any emergency plans in place!

While this particular survey focused on response to health emergencies (the West Nile virus is now considered an epidemic among Michigan’s citizenry and there have been substantial multi-day power outages along the Gulf Coast), I expect that a high percentage of Americans are also not financially ready for the economic catastrophes coming our way.

Think about your personal circumstances. What problems would you endure if the electricity failed for a week or more where you live and work? You would not be able to write checks or use your credit cards. Banks, grocery stores, and gasoline stations could be closed.

Do you have enough food and medical supplies to manage for at least a few days without electricity? And,
even though its value is declining, do you have a stash of Federal Reserve Notes to use when checks and credit cards are not accepted forms of payment?

To a greater extreme, do you have some physical gold and silver set aside in your direct possession as your insurance against the failure of the US dollar? [at last!]

and so on..

The editor, and I assume writer, is Patrick Heller (seems to be right up Buddy's alley).  Fortunately you can survive all this by loading up on gold and silver (conveniently being sold by Heller's company as a public service).

What's cool [or scary] is that Heller could be appearing in a movie.

I have now an investor in the making of a motion picture titled Alongside Night. I am one of the executive producers along with actor Kevin Sorbo and others. In addition, my company, some of the staff of Liberty, and I will make cameo appearances in the film. Retiring Congressman Ron Paul (R-TX) will play himself in the film. There will also be a few other surprises that I’m not going to disclose just yet except to tell you that gold plays a significant role.

The movie is adapted from the 1979 novel Alongside Night written by J. Neil Schulman. The subtitle of the book at the time was “A Novel of 1999.” The book projects a plausible scenario how life in America
could deteriorate as governments expand their power over the citizenry.

[Then again, Buffett prefers stocks over gold.  But I suppose some gold wouldn't hurt.]

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