Gold Hits Record After Fed and White House Unleash Economic Terrorism – Hayden’s Note

Posted on Jul 14, 2011 in Economic News, Featured Articles – Kevin Hayden

Source: Bloomberg

Gold advanced to records in London and New York as concern about more U.S. economic stimulus and debt woes in the country and Europe boosted demand for the metal as a protection of wealth.

The dollar fell against six major currencies after Federal Reserve Chairman Ben S. Bernanke said the central bank is prepared to take additional action, including buying more government bonds (from Goldman Sachs at a higher price than if buying from the Treasury Dept!), to boost the economy. Moody’s Investors Service said the U.S. may lose the Aaa credit rating it’s held since 1917, while Fitch Ratings slashed Greece’s rating and said that a default is a “real possibility.”

Hayden’s Note:

The Dollar ALWAYS seems to fall after Bernanke opens his mouth.  But in regards to this “debt default” nonsense, I have to offer a few words.  The Treasury and White House Administration are trying to scare Americans into thinking this “default” would be bad for America, that SS checks won’t go out the day after and that Moody’s is going to downgrade our credit.  Stop being distracted by the circus show, people!

Moody’s SHOULD downgrade our credit.  We’ve been a reckless little kid with a platinum credit card and it’s high-time we’re slapped on the wrist for our spending sprees.  And I would bet my last paycheck on the fact that the Treasury or the New York Federal Reserve requested Moody’s to make this announcement – something that has been announced several times over the last few months.  It’s not as if this is some surprise; some crazy notion.  This has been on the chalkboard for everyone to see and hear about a half dozen times now.

Social Security checks will go out because it’s already been accounted for.  Come August 3rd, no one is going to walk into some large, looming bank vault looking for money to send out and see cobwebs instead.  The money is all digital.  It’s already allocated and contained within the previous budget.  Now, September’s checks?  Sure.  Might be a problem, there.  But the White House enjoys using scary rhetoric and terrorism to distract the masses.

And regarding the debt – who do we owe this debt to?  A large portion of it goes towards the Federal Reserve.  They printed the money out of thin air (fiat currency = value by decree), so we should hand them a large suitcase full of more ‘thin air’ and call our debt even with them.  Eh?

Investors are concerned “about the impact that further policy easing by the Fed will have on the dollar” and this will support gold, said Peter Fertig, the owner of Quantitative Commodity Research Ltd. in Hainburg, Germany. “The possibility of a U.S. default by not increasing the debt ceiling in time and a possible downgrade is a reason to invest in gold as a safe haven. There is still the risk that the crisis in Europe will prevail further.”

Immediate-delivery gold rose as much as $12.07, or 0.8 percent, to $1,594.45 an ounce and was at $1,586.75 by 12:56 p.m. in London. The metal is up for a ninth day, the longest streak of gains since April. Gold for August delivery was 0.1 percent higher at $1,587.10 an ounce on the Comex in New York after reaching a record $1,594.90.

Gold, which typically moves counter to the greenback, advanced 12 percent this year after climbing for the past 10 years, the longest run of gains in at least nine decades. Ireland this week became the third nation in the European Union to have its credit rating cut below investment grade, helping to send gold priced in euros and pounds to record highs.

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