China Gets the Picture!

Data courtesy of the World Gold Council.

The number of gold savings accounts launched by the Industrial and Commercial Bank of China Ltd. only a year ago, has grown beyond 1 million without much public relations or marketing, “which is an extraordinary pace of demand growth,” said Martin Hennecke, associate director at Tyche Group in Hong Kong

Wake up and smell the coffee, the Chinese government doesn’t change an almost century long policy of not allowing citizens to own gold and silver with out good reason. Maybe they sense the growing global distrust if US policy makers and the FEDs willingness to print trillions of USD to serve as the “lender of last resort” as the Chinese themselves grow weary of US debt and Treasuries.

It escapes me when over a billion Chinese citizens, who have a 30% average savings ratio, rapidly move to exploit the option of using gold and silver as a more stable method of wealth preservation over a traditional savings accounts and yet less than 3% of Americans who have had this option at their disposal for over 40 years fail to see it’s benefit? The world is changing before your eyes and those who resist that change will be rudely awakened when the true dire nature of the US economy comes into light in 2011.

I am the one to blame

I just received this email from Campaign for Liberty. I am a proud member of this group.

Dear William,

Did you know you are single-handedly responsible for nearly shutting down the federal government?

Not a Congress, White House, Treasury, and Federal Reserve that have racked up more than $14 trillion in debt.

Not legislators whose policies will result in a $1.6 trillion budget deficit in this year alone.

Not the statists who want to force you to bow to their demands and fund their agenda with your tax dollars.

They're blaming you, me, and everyone else who thinks America has no choice but to slam on the brakes before we fly over the edge.

Unlike the federal government, let's be honest. The kind of debate we have witnessed over the past several months has almost nothing to do with what over half a million Campaign for Liberty members have joined our organization to accomplish.

While we want government on all levels reduced and its spending drastically curbed, the White House and congressional leadership have agreed to less than $40 billion in cuts this year.

That's not even a pinprick on the colossal monster their reckless mismanagement has unleashed.

Despite the establishment's fear mongering, if the government had "shut down,” the Treasury Department would have continued to sell debt, the printing presses would have rolled on, the IRS would still have confiscated your hard-earned money on time (though getting any back may have been delayed), the surveillance state would have kept watching you, and the TSA would have remained in airports nationwide to sexually assault fliers.

If our “leaders” were serious, they would:

- Thoroughly audit the Federal Reserve and end Ben Bernanke's ability to control our economic future with no real accountability or oversight. Then they would abolish the Fed entirely.

- Debate and vote on Rand Paul's proposal to cut $500 billion from the budget. This year. And that would only be for starters.

- Enact a Balanced Budget Constitutional Amendment with legitimate spending restrictions.

- Free us to make our own health care decisions by halting the implementation of a program to force Americans to buy bureaucrat-approved insurance and give the government more control over what remains of the free market.

- Strengthen our national security by refusing to use our military to police the world, nation-build, and enforce the United Nations' dictates.

- Protect civil liberties by repealing the Patriot Act, eliminating the TSA, and ending the many other ways government intrudes into our lives.
The list of what is not being addressed could go on and on, which further proves how the vast majority of both Republicans and Democrats are ignoring their oaths to defend the Constitution.

Government doesn't need a tune-up. It's time for a complete overhaul, which is why a real shutdown is needed.

Instead, America is in for more posturing for the cameras, blame-shifting, and name calling – traits more expected of spoiled brats than elected officials.

America's debt crisis is a natural consequence of a system so wrecked by statism that less than $40 billion in cuts to a multi-trillion dollar budget nearly brings the government to its knees.

Out of control legislators and their dangerous policies brought us to this point, and I won't accept their blame for fighting to prevent them from further destroying our country.

I will, however, promise them that Campaign for Liberty will never stop working for freedom and a federal government that acts only within the confines of the Constitution.

I hope you will take advantage of these current events to discuss the role of government on the local, state, and federal levels and spread our message to family, friends, and neighbors who are constantly bombarded by the establishment's tired rhetoric.

Invite them to join Campaign for Liberty and help us take back our lives from the government's control.

Only in the principles of liberty can our nation find effective, lasting solutions to its challenges and secure a bright future for ourselves and future generations.


In Liberty,



John Tate
President

GOLD FOR THE GOOD AND BAD THAT BRINGS ABOUT A GOOD QUESTION

Excerpt from Asset Strategies International (ASI) on core holdings.

Core holdings were on my mind two weeks ago, when I flew to St. Petersburg, Florida, to represent ASI at the Investment U conference the Oxford Club was hosting. I leaned back in my seat, opened the Financial Times – and saw an article about the importance of core holdings to Libya’s beleaguered dictator, Col. Moammar Gadhafi.

The article explained that Gadhafi had only one hope of financing his war against the insurgents who were threatening to topple his regime. He couldn’t borrow the money; he couldn’t even access funds Libya had moved abroad. His accounts were frozen worldwide.

His only source of funds was his “core holdings” – the gold that he had stored at the Libyan Central Bank. While most central banks store their gold in London, Switzerland, or New York City, this is not the case with Libya. Gadhafi had always insisted that Libya’s gold be stored at the Libyan Central Bank in Tripoli.

We’re not talking about some coins or bars tucked away in a safe-deposit box, by the way. Libya’s gold holdings rank in the top 25 in the world. It is estimated that the bank is sitting on roughly 144 tons of the world’s oldest and best form of money. At today’s prices, that is $6.5 billion worth of the yellow metal. That may only represent a few minutes worth of government spending in this country; but in Libya, it’s enough to finance a war.

So while no legitimate business or government will loan Gadhafi money now, or even trade with him, his hoard of gold may be the answer to his financial needs. He can use it to acquire currency, arms, food, and other supplies for his military.

As I read the article, I was struck by this real-world example of the message we have preached so many times: In an emergency, you need some “core holdings” of gold and silver. There is simply no better “wealth insurance” than the real thing – gold and silver that is in your own personal possession.

We saw the value of gold as emergency money when the Vietnamese refugees fled South Vietnam in the 1970s. If you have not heard this story before, please click here to read Michael’s Tale of the Taels. We saw it repeated when South Korea emerged from the Asian currency crisis several years ago. Gold helped them rebound faster than most other countries from the Asian flu.

We saw it in this country when the stock market tumbled. In many cases, margin calls could only be met by the liquidation of gold and other precious-metals holdings (which, by the way, maintained their value while paper assets were crumbling).

Time and time again, we have seen the value of gold as wealth insurance. Granted, some causes are nobler than that of Libya’s dictator. In good times and bad (and for good guys and bad), throughout history the role gold can play in solving a financial emergency is well-documented.

Simply put, gold is a store of value, in a liquid form, for a financial emergency that you pray you never have. You buy it and you hold onto it regardless of price fluctuations. If you have a financial emergency, you sell the gold to meet those obligations. That’s what it is there for.

If you are fortunate to never have a financial emergency, even better. You can make certain your children or grandchildren have their own Golden Anchor to protect them from the vicissitudes of life, by leaving them your core holdings. What a great blessing that would be for them!

Too many times when discussing gold, people get wrapped up in debates about interest, dividends, yield, and profit, when they argue about whether or not gold is a useful asset class. We say, start with the basics. The number one reason to include gold in your portfolio is wealth insurance.

Do you have enough gold and silver in your core holdings? Have you exchanged all the depreciating dollars you should, to achieve your own “sleep at night” comfort?