There is no way out

The age of leverage is coming to an end.  A fiat currency has an inherent liability tied to it and is called a “note” backed by the full faith and credit of the issuing country.  Civil unrest is coming.  The masses will revolt against the politicians and the wealthy.  If you are surprised by the impending second dip of the double-dip recession, you have not been reading this blog site. See blog on November 22, 2009 (

You can use words of persuasion to a point.  But when people’s fear of financial loss comes to the forefront in the minds, they will head for the hills.  Over the last 50 years, people have been convinced to borrow to get ahead.  Growth was funded by leverage, much of it had greed at its source.  The government facilitated loans to those who could not possibly pay off their notes.  Financial institutions were quick to accommodate the process since the executives would receive substantial bonuses.  Greed ruled the day but now that has been replaced by fear.  Real unemployment in the U.S. is much higher than what the networks report.  Inflation is also grossly underreported.  Our seniors are being thrown under the bus by using fictitious CPI numbers to eliminate any increases in social security.  The motivation behind all of this is to reliquify  the banking system by reducing their cost of funds to zero while the loan money at 6% and higher.

The European crisis will exacerbate the U.S. recession and both will impact the rest of the globe.  The volatility of gold was also expected.  As investors suffer losses, they must liquidate positions in anything of value including gold investments.  It is my belief that gold and silver will be the last investments standing along with critical commodities such as oil, gas, and food.  I expect continued volatility in the markets and would not be surprised to see gold and silver decline further.  Those who have no solid conviction about these metals will jump out forcing lower prices on a temporary basis.

What’s next?  At a personal level, it is critical to draw closer to Our Heavenly Father and only act as HE directs.  We must be led by HIS Spirit and not by fear or greed.  There will be times when HE will tell you to direct money to specific areas that do not seem to make sense.  HE expects you to have faith and walk in it during these times.  Why do we need faith if there is no pressure to test us?  As we are faithful to these small requests, we set the stage to be stewards over much greater responsibilities.  Look in your checkbook and inspect your fruit.  That might give you a barometer of where you are at in your “Love, faith, and hope” walk.  Love gives, greed takes, fear hoards.