The bottom line is euro-gold €1000 is a very important psychological milestone in this global gold bull. Just as $1000+ did here in the States last autumn, €1000+ will make gold far more appealing to legions of European investors. Their buying will drive gold even higher. So to see €1000 challenged this week for the first time ever, even if it doesn’t hold, is very exciting. Gold history is being made before our eyes.

While probabilities favor the super-oversold euro bouncing and scuttling this initial €1000 attempt, it is only a matter of time until this level holds for good. Euro gold has powered higher on balance for years despite the simultaneous strong bull market in the euro. While it isn’t as bad as the dollar, ultimately the euro is just another devaluing fiat currency that investors can help protect themselves from by owning gold.

Read the article: Euro Gold €1000 at zealllc.com

For everyone in Washington D.C., the Cato Institute is screening the film on the 17:th of May 2010.
Facebook group is also available.

…Just like a capitalistic society cannot return back to slavery, or just like slavery cannot return back to the primeval society of hunters and gatherers, so we can no longer return to the capitalistic economic model that is based on consumption.

Development of all complex systems, whether we are dealing with a society, a business, or a human being, always take place in cycles. There is a time of balance (equilibrium), then a period of confusion (disequilibrium), and afterwards the system will be re-organised at a new, higher level, so that the problems that were a source of conflicts at the previous level will be resolved. This is the essence of Hegelian dialectics…

The economic system has gone critical – it has reached point from where there is no turning back. The worst part is that the system cannot self-organise. “Normal” business organisation typically means that if you are doing business and make wrong decisions in a particular economic environment, then you should also suffer the consequences. In other words – if a bank has made bad loans, then we should let it fail. Failure is part of capitalism. Individuals and businesses that have deposited their money in this bank and, therefore, made a wrong decision, should also lose their money. Simple and logical, this is what capitalism is all about.

Unfortunately, governments and central banks do not want to accept that. They think that trying to feed a dead horse will bring it back to life. And if it won’t revive, then it has to be fed even more…

Financial history teaches us that every time a financial crisis has been alleviated by printing more money instead of cutting costs and prices, it has ended up with hyperinflation…

In conclusion, let us reiterate: “Don’t say you haven’t been forewarned.” But of course, this warning is just as good as giving a moralizing speech about drinking in a packed bar – no one would listen anyway. However, you have been warned – protect yourself, buy gold!

Read this great article here.

In his latest weekly New York Times column, Nobel Prize-winning economist Paul Krugman put forward arguments that were so nonsensical that the award committee should ask for its medal back…

According to Krugman, our secret weapon of economic invincibility is the Fed’s ability to print dollars endlessly. If China were to foolishly decide to attack us by selling our debt, the Fed could simply step in and buy the excess with newly printed greenbacks. (In other words, Krugman sees no difference between funding the debt and monetizing it. See my latest video blog on the subject.). For Krugman, China would gain little from such an attack, but would lose the ability to export to its best customer and suffer severe losses in the value of its dollar holdings. Krugman’s worldview is reassuring - but it has absolutely nothing to do with reality…

There is a huge difference between selling your debt to another and “selling” it to yourself. When China buys our debt, it uses its own savings. In order to purchase a trillion dollars of U.S. Treasuries, the Fed would have to expand our money supply by a corresponding amount. Even Krugman acknowledges that this would cause the dollar to lose value; however, he feels that a weaker dollar is good for America and bad for China…

Krugman does not believe that a tanking dollar will translate into higher interest rates or higher consumer prices at home. No matter how many dollars the Fed creates, or how much value those dollars lose relative to other currencies, he is confident that as long as unemployment remains high, rates will stay low and inflation will remain under control. This is absurd…

To construct a policy around Krugman’s ridiculous assumption that we benefit China more than they benefit us is to invite catastrophe on an unimaginable scale.