The Obama administration’s inability to obtain an improved tax revenue for federal coffers is the latest farce in the comic American tragedy unfolding before our very eyes. This government appears incapable of understanding that printing increasing amounts of currency while realizing deteriorating tax revenues and generally lethargic economic conditions is the direct path toward default.
It would be excellent entertainment for the rest of us were it not for the fact that this bumbling government is likely to precipitate an even broader economic meltdown than that of 2008 with its arrogant insistence on unilateral financial dis-incentives. Future generations are now further encumbered by a debt and deficit load that is growing exponentially.
Forget the feel-good reports coming out the main stream media. They are nothing more than post-meal flatulence from a body fed on the gassy and rosy statistics generated by payroll economists. Ridiculous new configurations in the English language are evidence of the totality with which financial journalism has been compromised. Who ever heard of something so utterly vapid and oxymoronic as a “jobless recovery”?
Bankruptcies loom at the state, county and municipal level throughout the U.S. Even wealthy jurisdictions, like New York’s Nassau County, home to some of the most expensive schools in the United States, faces a fiscal crisis.
California is battling insolvency on an almost daily basis, and the U.S. Federal Reserve is forced to buy T-bills from the Treasury department just so the government can continue kiting checks to itself to stay operational.
While America heads blindly towards third world status, there is immense opportunity for investors in gold and silver in such pig-headed policy. For the more money the government prints, the more the jobs market limps, the more homes half-built linger on disinterested markets, the more gold and silver will rise in price relative the U.S. dollar, which is increasingly representative of nothing, and now, less than nothing.
Larry Summers, whose stint as Barack Obama’s National Economic Council director thankfully comes to an end this year, is largely responsible for ensuring the enshrinement of unregulated derivatives and financial services industries from administration to administration as the number one hatchet man for Wall Street. That such a hugely ignorant human being can come to preside over the lofty highest offices of finance and education (as Harvard University president) is testimony to the existence a self-destructive genetic predisposition of the American people.
Obama has essentially been castrated by the Republican and his own party in a presidency that was designed to fail, as Republican economists rightly identified the opportunity presented by the financial contraction precipitated by the absence of transparency in unregulated derivatives and swaps markets. He is forced to make deals and concessions to his ambitious plans that amount to status quo in most cases. He is facing defeat of key provisions in health care, his foreign policy on the middle east is continuously stymied, and now he is forced to extend tax cuts for the wealthy to preserve aspects of his initiatives.
And so here we sit on the cusp of another year, where the bull market in gold and silver is now legislated into continuing thanks to the sterilized tax base of the American government. There is now absolutely no doubt that gold and silver with both continue to power higher throughout 2011, as the crumbling U.S. Dollar, expanding sovereign debt crises, general economic deterioration in the G7 nations induces even more demand for the safe haven monetary metals.
Gold will likely break through $1,700 an ounce by the end of 2011, and silver will likely see $35, and may even go through $40 an ounce.
Ben Bernanke recently commented that the $600 billion ‘QE2” stimulus package might yet be expanded on if deemed necessary. That comment in and of itself is almost guaranteed to push gold through $1500 an ounce within the next two weeks.
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Catch James West on BNN, Canada’s National business network, on Thursday, December 16 at 2:15 on Business Day, where he’ll be talking about the growing copper bubble, and mentioning a few of his favorite stocks.
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