Unbacked Paper Currencies Forbidden - Gold is HOT!

God's word speaks very strongly against the use of unequal weights in monetary transactions. He told the nation Israel that they should not even have such weights in their homes. He knows people! He knew that rather than through such weights away or destroy them, people would keep them in the home as reminders of the past evil sin. He knew that the very presence of the unequal weights would be a temptation for all, and that many would yield to the temptation.

When the founders of our nation wrote the Constitution, they gave the power to COIN, not print money, to the Congress. As Rushdoony reported in his American History series, the colonist were familiar with FIAT paper currency. They had used it to pay the English traders for merchandise brought over by ships. The traders would object, this was legal tender in the colonies, but worthless anywhere else. The traders would go home to England and King George would forbid the colonists from issuing that currency. However, the communication process was slow, so the colonists had months in which they could use it. When the order came, they would issue, not the same, but another Fiat currency and the slow process would be a repetition of the past.

Yes, they were aware of the dangers of paper currency and sought to disallow it in the new nation. However, in the enlightened age in which we live, our leaders have violated God's Law and the Constitution by issuing unbacked paper currencies. Thus, we have the financial fiasco of the present. We will not be out of this trouble for some time. God must be rollicking about in Heaven as He looks upon this folly of man. Unbacked paper currencies are a violation of God's Law forbidding the use of unequal weights. In fact, the value of such currencies has been ever changing in concern with the whims of man.

God's word is replete with examples of the use of gold and silver as real money. This is real money and provides the stable currency for all. It provides more freedom for man and this is what governments fear the most.

The bail outs continue to put dollars and other paper currencies in different banks, financial institutions, and assorted businesses. Still the credit crunch remains stubborn. Consumers do not want to borrow and lenders are reluctant to lend unless the potential borrower qualifies at higher standards. So nothing happens except for the explosion of paper currencies. This inflation is bound to result in price inflation and in the not too distant future.

The run up of precious metals is testimony to this. The supply of coins is being overwhelmed by the great demand. As reported recently, even the well heeled are buying bars of gold. The word is getting out. Can the Gold Rush be much farther ahead? Could we see it toward by the second half of this year. Watch the entertainers on TV news and the newspapers for reporting on the movement of gold prices. This is the normal tip off of the coming rush. More people read the media news; therefor, if gold is presented more frequently in the mass media, more folks will be interested. It is coming! The big question is "WHEN?"

From the Daily Pfennig: "A trader friend of mine there sent me this note..."One of HSBC's bullion customers is a large coin manufacturer - we learned today that the demand for investment coins continues at an astonishing pace - the order book for Q109 has already surpassed C2008. The main order flow is European." So... There you have it! Gold is hot!"

Chuck Butler said that correctly! Both silver and gold are showing signs of being allowed by the cartel to trade at a higher level. Perhaps, they will be targeting above $900 for gold. It may become a bit expensive for them to continue their capping.


Once again, we can see almost identical graphs for both of the precious metals. Gold is 917.10 and silver is 12.49 and both are on up ticks. They are off from their highs, but still holding for now. Our trading stocks are holding as follows: DROOY 6.90; HMY 11.73, and VGZ 2.29.

From Financial Times:

Wen and Putin lecture western leaders

By Andrew Edgecliffe-Johnson and Gillian Tett in Davos and John Thornhill and Catherine Belton in Moscow

Published: January 28 2009 19:17 | Last updated: January 29 2009 08:39

The leaders of China and Russia on Wednesday turned the tables on their western counterparts who have dictated the world’s economic agenda, lecturing them for policy failures they said had led to the global financial crisis. Read it HERE.

How about that! Though China and Russia may not be our closest friends, they are showing a good bit of insight into the genesis of the credit crunch. Maybe they will do better than we in the future which seems to belong to Asia.

From Financial Times:

Hedge funds offer to price in gold

ByJames Mackintosh and Javier Blas

Published: January 29 2009 00:15 | Last updated: January 29 2009 00:15

A hedge fund has begun offering investors the chance to have their investment denominated in gold, as worries grow over governments debasing their currencies by printing money.

Osmium Capital Management, a $178m hedge fund manager based in Bermuda, is launching a new share class allowing investors to hold shares measured as troy ounces of the fund, rather than US dollars, sterling or euros. Read it HERE.

Pricing in gold! Wow, what a wonderful concept. Would that all would do this. Perhaps, some day we will return to a gold standard. I still wonder which country will be the first to go to such.

From Reuters:

DAVOS-UPDATE 2-Gold likely to hit new highs on dlr fear-Barrick

DAVOS, Switzerland, Jan 29 (Reuters) - Gold is likely to hit new record highs, spurred by serious concern about the U.S. currency and doubt about the state of the world economy, the chairman of Barrick Gold Corp. said on Thursday.

There was even a possibility, although not a probability, central banks, including China's, might start to switch from dollar holdings to gold, which could cause the metal's price to treble or more. Read it HERE.

Of course, Barrick was deeply into hedging the price of gold a while back. This should be no new revelation to the company.

Lots going on these days. It is important to keep our eyes, thoughts, and efforts directed toward service in obedience to our Lord and Savior Jesus Christ. He is life and all else is death.

Best to each, Doug