Dear Reader,
Some days it is tempting to get tired of reading the same old thing. The contradictory headlines, the white-wash. Truth is refreshing. Faking it is tiring. For many, trying to make sense of the contradictory headlines is even more exhausting, so many switch off the information and switch on the entertainment. But if we know this, then that is even more motivation to keep seeking the truth. One of the oldest ploys to stop people from holding others accountable is the “confuse them til they give up” technique.
So, it was with relief that I stumbled upon this focused, alert piece from Before It’s News. The lack of political and economic double-speak is a metaphorical cool glass of water on a muggy day:
“2008 was a minor correction compared to the eventual collapse of the U.S. Dollar.
WHY: After the dot.com bubble burst in 2000, Fed chairman Alan Greenspan-led the Federal Reserve through a series of interest cuts that brought down the Federal Funds rate to 1% by 2004. The bubble created by those years of cheap Fed money at 1% resulted in U.S. households losing a total wealth of almost $14 TRILLION in the 2008 crisis. Stock markets fell by almost half for losing $7.9 trillion, and the housing market lost $6 trillion.
FAST FORWARD TO TODAY: We’ve had 7 years of interest rates at 0%. As a result, there is more than just a housing bubble this time. There’s a stock bubble, a housing bubble, a bond bubble, a student loan bubble, and I could go on. As Peter explains, the Fed only has ONE option at this point: Continue to fake it for as long as possible by printing more money (otherwise known as “quantitative easing”), or let the whole system come crashing down.
HERE IS THE REALITY: The world has caught on, and the gig is up. Under Obama’s stewardship, the U.S. national debt has gone from $10 Trillion, to what will be $20 Trillion by the time he leaves office, with nothing more than 100 MILLION Americans out of work, and 50 MILLION in poverty and on food stamps. That’s what cheap money bought for us. It was all “borrowed” cheap money too, making it infinitely worse, and the world is tired of lending.
The interview includes a 12 minute interview with Peter Schiff, who many of our readers will know from your own research. I’ve transcripted some sections of the interview that pertain directly to the global economy and Gold ownership:
Schiff: The problems since 2008 were created by monetary policy being too loose. Rates were too low at 1%; that’s what inflated the housing bubble. But by keeping them at 0% for 7 years (0.5% in U.K.) The damage the Fed has done to the economy this time is much greater than what was done prior. So, I think we’re heading for a much worse economic crisis than we went through in 08.
Interviewer: What is the average American looking at? Is there going to be a dollar collapse?
Schiff: Yes. That’s the end game. The dollar is going to have to collapse because the Federal Reserve is not going to allow the bubbles to deflate. They tried to raise interest rates at the beginning of the year and the stock market tanked because they didn’t want to let the air out of the bubble. The government can’t afford higher interest rates because the debt is so large. But everybody has so much debt in the United States. The only thing keeping them afloat is the low rate of interest. When the world perceives the prediction the Fed is in them the dollar is going to fall through the floor. We really need to go back to sound money, real money. Don’t wait for the government to do it. You can still save in Gold without the government. You can change your income into Gold. You can save in Gold. The difference is you’re not saving something that’s depreciating. Or more importantly, what you don’t spend, what you save, gains in value – as opposed to losing value, which is what happens with the fiat money the government creates.
Schiff: The country is heading for a major economic collapse, it doesn’t matter who wins the White House. We’ve got to pay for the sins of the past. The question is, “How are we going to restructure the economy to prepare for the future? Are we going to understand the root cause of the collapse? Are we going to dismantle all this government? Are you going to get rid of the Fed? Are we going to get back to sound money, get rid of the income tax and shrink government, so we can get out of this gigantic hole? Or are we going to be trapped in it forever?
Interviewer: I think that’s what’s angered so many people, is that there’s been no accountability. You know this; I’m sure a lot of your customers that come to you (in the U.S.) looking for advice and services from you have suffered, right, as a result of 2008/2009. Now, 0% interest rates, pensions are failing, they can’t get a rate of return, so [the bank is] essentially stealing from pension holdings etc. Is there any accountability at all, do you think through reforming the Fed, reforming the political system, how do we as liberty lovers change anything, because a lot of people look at this from a defeatist perspective, “Well they just get away with this, the bankers keep stealing from us, we see it time and time again. What are your thoughts on that?
Schiff: After we have this monetary collapse, and maybe a sovereign debt crisis. [It’s been] hinted about it for a while when he talked about restructuring the debt which is s polite way of saying “Default.” which is ultimately what needs to happen. But, if we don’t do that and we just have run-away inflation, we’re going to have a crisis and that could be the catalyst for some real soul searching and some real change. The question is, in which direction are we going to go? We’re at a fork in the road.
The stock market is not making new highs in terms of Gold (maybe against the dollar). But the high for the stock market against Gold was back in 2000, that was 16 years ago. That was the high for the stock market in Gold. And I think we’re in a major, major bear market in terms of the Gold price of U.S. stocks and I think they’re headed much, much lower. But this is all this inflation. It’s not that stocks are going up, it’s that our money is going down. So, as the dollar loses purchasing power, you need more dollars to buy the Dow. But this is all an illusion, the government creates this illusion. But we’re not really creating wealth. The voters know the economy is awful. They don’t buy what the politicians are selling about this “recovery”. They understand that their lives are getting worse, not better. This is the only recovery that is worse than the recession we’re supposedly recovering from! Most people did worse in the “recovery” than they did in the recession! They understand it. They know that they’re worse off than they were four years ago or eight years ago.” (28th July 2016)
If we think this is just an American problem, tragically we just need to research the ill-health of many pension funds in this country. The Telegraph published this article this week:
“Pressure is mounting on the Government to oversee a root-and-branch overhaul of Britain’s company pension schemes in which more than 11 million workers have savings. It comes as these “final salary” schemes are registering their biggest ever funding shortfall, now at almost £1 trillion (£1,000bn).This sum is the gap between the investments these pension schemes own and the likely eventual cost of the pensions they have already promised to pay. Unless solutions are found, experts warn, many hundreds of schemes are likely to fold into the Pension Protection Fund, the lifeboat scheme which provides reduced pension payouts for retired workers caught up in cash-strapped schemes. And while that may be bad news for scheme members, there will be difficulties faced by employers, too, as their ability to invest in current staff and future growth is hampered by a requirement to continually top up a burdensome pension scheme.Increasingly, savers may be required to give up some of their benefits in a compromise deal. For example, firms could promise to pay them more than they might obtain through a PPF rescue – but less than they are entitled to in the letter of their contract.” (The Telegraph, 31st July 2016)
This is tragic. But ever since the monetary methods used since 2008 were implemented, this future pension pot crisis should not have been a surprise to governments and economists.
If you would like to talk to someone about a different way of holding your pension, your legal right and ability to hold some of your pension pot outside of the stock market in Pension Gold, you may want to consider talking to your Independent Financial Advisor and our C.E.O. Caroline Peers.
If you are a UK citizen, you can invest in Gold Bullion through your Self-Invested Personal Pensions (SIPPS). SIPPS are personal pension schemes containing a basket of investments of your choosing until you retire and start to draw a pension income. SIPPs can hold tangible investments, which can now include Physical Gold. Investments made in gold bullion are topped up in the form of tax relief, meaning individuals can claim back the tax on the money they put in. The amount varies depending on the income tax band into which they fall, so if you are a higher rate tax payer you can get up to 40% back. So, for example, a £10,000 investment will only cost you £6,000. Physical Gold is allowed in a SIPP providing it is investment gold, as defined above. The bullion must be stored at ‘arm’s length’ with a secure third party. It cannot be taken possession of and used as a “pride in possession” article. It can, like any other investment, be sold within the pension wrapper and then the cash re-employed within the normal rules of a SIPP pension. Thus Physical Gold is allowed in your SIPP when we store it for you. Please call one of the Bleyer Team to find out more. We maintain the gold in your SIPP Gold account, while you are in complete control in instructing an Independent Financial Advisor (I.F.A.) and a Trustee Company will manage your SIPP Pension as a whole. You will instruct us to either communicate directly with you or with your I.F.A. / Trustee, whichever you would like. You don’t need a financial advisor and can set up an account with a pensions administrator directly directly for them to administer your pension trust. This makes it much cheaper for you. If any fresh funds are paid into your pension then they will claim the tax rebate element that may be due to you and add it to the pension sum. Once contributions have been made to a pension, you cannot withdraw funds until the age of 55 but you can change the investments and move provider.
To begin setting up your gold pension give our friendly team a call during office hours or send us an email. Bleyer Bullion is a leading UK supplier of fine gold for pensions, we source your gold at the lowest current market prices and store it for you in one of our allocated vaults. We have experts on hand to advise you on using gold as part of your pension, if you have any questions about starting a golden SIPP or SSAS then please use the website live chat or phone our friendly team on 01769 618 618 during office hours: Mon-Fri, 9:00 am – 5:00 pm.
Returning to the headlines, there are – then again – some headlines one doesn’t think one would ever see but one then does! This week the I.M.F. was finally blasted for its economic methods:
The International Monetary Fund’s top staff misled their own board, made a series of calamitous misjudgments in Greece, became euphoric cheerleaders for the euro project, ignored warning signs of impending crisis, and collectively failed to grasp an elemental concept of currency theory. This is the lacerating verdict of the IMF’s top watchdog on the fund’s tangled political role in the eurozone debt crisis, the most damaging episode in the history of the Bretton Woods institutions.
It continues with some comments by which many of our well-researched readers will not be at all surprised:
“It describes a “culture of complacency”, prone to “superficial and mechanistic” analysis, and traces a shocking breakdown in the governance of the IMF, leaving it unclear who is ultimately in charge of this extremely powerful organisation.
The report by the I.M.F.’s Independent Evaluation Office goes above the head of the managing director, Christine Lagarde. It answers solely to the board of executive directors, and those from Asia and Latin America are clearly incensed at the way European Union insiders used the fund to rescue their own rich currency union and banking system. The three main bailouts for Greece, Portugal and Ireland were unprecedented in scale and character. The trio were each allowed to borrow over 2,000pc of their allocated quota – more than three times the normal limit – and accounted for 80pc of all lending by the fund between 2011 and 2014.
In an astonishing admission, the report said its own investigators were unable to obtain key records or penetrate the activities of secretive “ad-hoc task forces”.
“Many documents were prepared outside the regular established channels; written documentation on some sensitive matters could not be located. The IEO in some instances has not been able to determine who made certain decisions or what information was available, nor has it been able to assess the relative roles of management and staff,” it said.”
When I read the above extracts from the report, I immediately think therefore that Greece, Portugal and Ireland are in even deeper trouble than I thought; because greater debt means a great fall to come. The can has been kicked even further down the road than I thought. 2,000% over their allocated quota. Just transmit that onto our own finances and imagine the carnage that would follow if everyone in this country had borrowed that much over their repayment ability?! All three countries are part of the eurozone. Add to this the almighty political rumblings in both Turkey and North Korea, which rarely receive the coverage such empire-building and war-like preparations should, and we have a world being shaken.
Many of us will remember the “facts” and “figures” the I.M.F. told Great Britain in the run up to our vote to leave the European Fiscal and Political Union. Italy, Cyprus, France and now even Germany are all in financial trouble. The facts are out there for all to find:
“Italy is in the middle of a white-hot banking crisis. Risk of contagion in Italy and far beyond is huge. And Deutsche Bank is so shaky that German Finance Minister Wolfgang Schäuble found it necessary to stick his neck out and explain to Bloomberg in February that he had “no concerns about Deutsche Bank.” Finance ministers don’t say this sort of thing about healthy banks.” (Business Insider, 8th July 2016)
More than ever, these economic and governmental developments and exposés encourage us to take part in our own thorough research, when considering and protecting our own family’s and loved ones financial position.
In conclusion, Mining.com published this headlines 15 hours ago: “It’s a fine time to own Gold.” I’d rather go to the coal face, so to speak, than listen to the news filtered through so many political positions I become despondent and apathetic.
We hope this blog has helped inspire you towards taking steps of owning your own Physical Gold and Silver. Many of our clients start small; some is better than none. Browse our Gold and Silver coins and bars, visit our Special Offers page and give one of the Bleyer team a ring to chat through which coins and/or bars might be right for you. Some products also offer Tax Advantages, please ring for details on 01769 618618.
