Reading time: 2 – 3 minutes
After being hit with twin massive financial earthquakes of Fannie Mae and Freddie Mac it appears that another financial catastrophe will quickly follow Hurricane Ike. Because of the counter-party risk resulting from trillions of dollars of derivative risk exposure the collapse of Lehman Brothers could cause a systemic meltdown of the worldwide monetary system. The Lehman Brothers and Merrill Lynch bankruptcies are huge. AIG, one of the largest insurers in the world, is begging for the Fed’s money.
Trust in everything is being lost at rapid rates. Institutions, organizations, corporations and governments are not trustworthy. The books of almost all publicly traded companies are deceptive. All paper is becoming suspect. The Federal Reserve is now taking a ‘wider range of assets’ as collateral. I wonder if that includes beanie babies. In addition, doing so is illegal under the Federal Reserve Act Section 23 A found at 12 USC 221.
For years General Motors, United Airlines, Ford, General Electric, Enron, etc. have smoothed earnings with derivatives which while previously latent are becoming lethal. Bear Stearns was only the latest and largest carcass.
When in physical possession the monetary metals have no counter-party risk. Keep in mind that the paper price of the metals has diverged from the physical price.
We now exist in the Information Age. The Internet is rapidly pulling back the curtain and exposing all the lies. When trust lost in the dollar it may be nearly instantaneous. See an example from the Lehman/Merrill news
If you have not taken protective action by purchasing some of the monetary metals (at least 5-15% of your net worth) and taking physical possession yourself or through a trusted third party then you may not have much opportunity left. So again, have you protected yourself? If not, why? Do you even understand the words you are reading? The currency of last resort is gold; not the US$. The gold cartel keeps trying to suppress the price of gold but all it does is laugh, right in their face. Thus the snowfall of the Deflationary Winter is intensifying.