Note from Jim

Posted at 5:14 PM (CST) by & filed under General Editorial.

Jim is travelling today and tomorrow on corporate business but wanted a post to stay in touch.  The Fed action today changes nothing, it may in fact speed up what is going to happen.  Either they get their “reflation” or they don’t.   The “don’t” part is the scary part and would mean debt being crushed in a deflationary collapse.  You must understand deflation is THE best environment possible to own gold.  A deflation means a shrinkage of money supply, in the current case it will be a scarcity of CREDIT.  Gold is money, according to JP Morgan himself, everything else is credit.  Gold is also liquidity.  The two best things to have in a deflation is money and liquidity. 
   Raising rates upon the shoulders of the greatest credit bubble in all of history is not wise.  Every single past crisis was preceded by rising rates…here we go again.  The odds of a deflationary mistake are rising along with interest rates.  Know why you own gold or silver in the first place and know history.  Never before in history has a fiat currency gained value versus gold in outright deflation. 

Jim/Bill