"Is it too late, to buy gold and silver at these prices? It's never too late to buy gold and silver, to be held until the end of the fiat money era."
From Goldbug!-The final and definitive work on gold investing by Mr James Dines
Goldbug! is intended to be the final word on investing in gold and its role in government from Mr James Dines, "The Original Goldbug" and internationally known gold expert. Mr Dines, was the first Security Analyst on Wall Street to recommend gold at $35 an ounce at a time when the President of the United States and Under Secretary of the Treasury, Paul Volcker, swore that they would "never" allow the price of gold to rise. Since then, gold has risen over 3,000% to a high of $1,218.25 on December 3, 2009- a record-setting level that has made a fortune for some shrewd investors.
After Mr Dines was fired from his Wall Street job for recommending gold, he began to publish The Dines Letter (TDL) independently and defiantly became known as "The Original Goldbug." Indeed, in the last decade, gold has risen every single year. It's a performance that's been matched by no other asset. In addition, Mr Dines predicts much higher gold prices ahead, for the reasons carefully delineated in his brand-new book, Goldbug!
Goldbug! not only provides unique insight into gold investing that only Mr Dines can provide, it also offers historical perspective and little-known details.
For instance, it's a virtually unknown and startling fact that gold stocks also soared during the 1929 Crash (from 1928 to 1937), indicating similar causes behind the economic plunges of 1929 and 2008.
Those who boasted of having studied the 1930s in order to guarantee such a Depression would never happen again are in effect studying the symptoms rather than the true cause, a classic case of falsely concluding that wet sidewalks cause rain!
The book will give you insight to the past, present and future of precious-metals holdings and the state of world governments. Mr Dines' accurate predictions are uncanny. Here is a sampling of what you will find in Goldbug!
- Many naturally think of the "price of gold," whereas the counterintuitive truth is the other way around. Gold is the real money, and it commands different quantities of paper in various countries."
- "Inflation is not the same as rising prices. Checking the dictionary reveals that inflation is "an increase in the supply of money and credit," the result of which is often -- but not always -- higher prices."
- "Periods of inflation are invariably followed by deflationary corrections, albeit sometimes interrupted by a hyperinflation, which Mr Dines baptized "The Supernova of Inflations."
- "There must be an approximately equal connection between creating paper money and the true wealth created by work and services enshrined by our Founding Fathers in the gold and silver clause in our Constitution."
- The Dines Letter (TDL) originated the phrase "Silver is the poor man's gold" and later came up with the phrases "Platinum is the rich man's gold" and "Palladium is the poor man's platinum."
- Nobody could stop what TDL calls political Taxpigs at the trough. The key to stopping them cold is linking paper money to gold."
- "Every nation in the world is recklessly printing money, in varying quantities, at their whimsical choosing, and nearly everybody accepts this as natural. If a government could really create prosperity by printing more money and creating credit, why not double the money supply every day and give everybody a million dollars?"
- It's one of the shocking predictions in Goldbug! that 1980 was actually the onset of a deflation that has yet to run its course. America is still slipping toward "The Coming Great Deflation" compared to the ongoing one that began in America in 1980, and for Japan starting in 1989."
- "Bubbles are invisible to those inside the bubbles."
- Nations have been cutting their interest rates so much that their currencies have become less attractive to income-seeking investors and thus have declined, which aided their exporters and inhibited imports! Competing currency devaluations are what Mr Dines calls a "fool's race to the bottom" because, sooner or later, interest rates would be at zero, could go no lower, and then what?"
- "The disintegration of the international monetary system as we know it lies somewhere just ahead."
- "Fiat money is paper currency not convertible into coin or equivalent value."
- By 1600, a strong business-minded state as a natural partner of a political state was known as Mercantilism, which in those days gained silver and gold by emphasizing exports over imports."
- "All a gold standard does is simply force a government to give to the world as much as it takes in, using gold as an international common denominator for all currencies. America could not have run up its sky-high debts if the dollar had been linked to gold."
- At the little-noticed Genoa Conference starting on April 10, 1922, the politicians slipped a profound change into the law by changing "the gold standard" into what they called "the gold-exchange standard." Politicians decided to count gold twice (the gold itself and also the gold-backed currency). That doubled the money supply. (The fallacy is that the gold-exchange standard counted the gold twice-once where it was stored, and again in any country that held paper dollars or pounds backed by gold.) The unleashing of that much cash in 1922 was the true cause of the subsequent boom into 1929. It was an inflation that was punished by the subsequent deflation of the early 1930s. Believe it or not, this is a position almost totally disbelieved to this very day, and you won't even readily locate that 1922 Conference in current history books, much less in the press!"
- "These days the Fed resists an audit on the grounds it would make its decisions controllable by politicians, which it already is anyway."
- "Gold is the fulcrum, the very central lever within the deepest inner recesses of capitalism itself. Touch the golden lever, and its effects are so profound that they could surface many years later. Gold is the very pituitary gland of our economic organism."
- History never reveals its alternatives."
- "Inflation is cumulative and exponential."
- On December 17, 2008, a front-page headline in The New York Times proclaimed, "In a Bold Action, Fed Cuts Key Rate to Virtually Zero: Plans to Print as Much Money as Needed to Ease the Frozen Credit Markets." In other words, to cure an indigestible excess of fiat money, they'll print more, except now "as much as needed," without apparent limit!"
"Our economic leaders know not what they do. The predictable punishment will be a historic deflation, perhaps interrupted by a horrifying hyperinflation featuring runaway price rises, depending on upcoming political decisions."
- "Gold through the centuries has proved to be unsurpassed as a standard of measurement, a medium of exchange and a store of value."
- Inflation is not the cure for deflation."
- "The very function of a Depression is to return money to its rightful owners. And who are those rightful owners? Those who wind up with the money!"
- "How about a flat tax of 10% for everybody, but as the only tax for all levels of government, letting them fight it out? But with absolutely no tax deductions for anybody!"
- "As "The Original Silverbug," Mr Dines considers this metallic element to be the single most underpriced metal on the planet and headed for sky-high prices."
- "The Coming Currency Upheavals" and "The Coming Gold Crisis" are yet ahead."
- "Soviet archives confirmed that Harry Dexter White was indeed spying for the Soviet Union while he was a primary participant in the Bretton Woods conference, the formation of the International Monetary Fund and the World Bank, according to Encyclopedia Wikipedia."
- "Too few are aware that the BIS (Bank for International Settlements) is the central banker's banker for all the national central banks in the world. Some banks own the banks that control America's interest rates that in turn control the economy and the stock market. At the top of the pyramid is the Orwellian BIS (Bank for International Settlements) in Basel, Switzerland, which some currency conspiracists assert control the center of the economic world, and nobody knows exactly who owns it. The BIS describes itself as "central bank for central bankers," yet it shuns publicity. This bank in Basel has the most incredible powers, including inviolability of all papers and documents, immunity from jurisdiction and arrest, the right to use codes in official communications and to receive or send documents by couriers or diplomatic bags. It's not open to the public, protected by armed guards, and somebody ought to call for an audit of the BIS as well."
- China will probably eventually buy every ounce of gold (also silver, platinum, palladium and Rhodium) it could cart off, sending precious metals prices to the stratosphere. Without a doubt, when the price of gold bursts higher, it will help save those who had held precious metals and their mining stocks. The political ramifications are profound."
- "There is a new geopolitical system coming."
- Our longstanding prediction of "The Coming Great Deflation," (an echo of what we baptized "The First Great Depression") will cause in this 21st century what we named several decades ago "The Second Great Depression."
Preparations must be made without delay. An inflation can be ruled out because at this late stage, a deflation is a near certainty. The only remaining question is whether there will be an intervening hyperinflation.
This is Mr Dines' final book on gold and is expected to be widely read and discussed in the highest investment and government circles.