Monday, October 12, 2009

Central Banks Are Dumping Dollars

This should send fear into the hearts and minds of anyone who does not own physical gold and silver - and I don't mean GLD, which is nothing but a pure derivative of gold:
“Global central banks are getting more serious about diversification, whereas in the past they used to just talk about it,” said Steven Englander, a former Federal Reserve researcher who is now the chief U.S. currency strategist at Barclays in New York. “It looks like they are really backing away from the dollar.”  (source:  Bloomberg).
Central Banks, in April, May and June, the latest quarter for which data is available, put only 37% of their new reserve funds into U.S. dolllars, an amount that has plunged from the 63% average level since 1999 (source: Bloomberg - here's the LINK).

When you look at this statistic, and combine it with several recent public statements from China beating the drums for a new global reserve currency - plus the report that several large countries including Gulf Arab States are looking at dumping the dollar in oil trading - it is becoming increasingly apparent that the U.S. dollar is losing its status as the world's reserve currency. 

Anyone who still has HOPE that the Obama Administration is implementing policies which support a strong dollar (i.e. reducing spending deficits, reducing Treasury debt levels, promoting real economic growth vs. just subsidizing more debt-fueled consumer spending), will be in for a very rude awakening when they wake up one day to discover that the dollars in their bank account are close to worthless.  Actually, it will be more akin to being blind-sided in the head by a swinging two-by-four piece of wood.

The ONLY way to protect yourself from the rapidly growing fraud, corruption and massive wealth theft by the large Wall Street banks, and enabled by the Obama Administration - Bush was guilty too, but everything happening now is on Obama - is to move as much of your wealth as possible in to gold, silver and mining stocks.  You only have yourself to blame if you don't.


  1. There was a follow on story this morning your time on Bloomberg TV about "Central Banks Are Buying Gold."

    I am looking for a linkable reference.

  2. Yeah here's a hat tip for you, right here. LOL

  3. Dude, is that what they call "a hat tip?" LOL

    Thanks, I'll see if I can find it.

  4. Sir, this is an "R"-rated forum with any pornographic references edited...scatalogical metaphors/allusions are okay LOL

  5. Interesting. Was not even aware of Esperanto. The secondary universal language analogy with the dollar stops at "secondary." The dollar is going to eventually collapse and not be used at all except maybe inside U.S. borders.

    Thanks for post. By the way, Dickens is my favorite writer after Shakespeare...

  6. Dave,

    Everyone's got an opinion, but I think it's going to take quite a while for the dollar to be completely phased out.

    I'm with you on everyone heading for the exits. There just aren't enough exits right now. My opinion is we'll see a phasing out much like the British Pound Sterling. It'll be a gradual thing--not so much a waterfall. Maybe 10-20 years.

  7. Dave,
    I can say with complete confidence that any move away from the dollar will be "orderly" and "well contained". I mean, our policy makers have done everything right so far, correct?

  8. You can't eat Gold. Stock up on canned goods first. Then work on a shelter plan. If you have a fixed mortgage, you will be fine. If you rent try to extend and prepay your lease. A long term lease can be as good or better than a fixed mortgage during inflation.

  9. one-up ya: rents going down, keep all money in gold/silver coins until you need to spend money on canned goods and pasta. don't want to pre-pay rent because if your landlord goes bust, yer an unsecured creditor and the bank can boot you out if they want...rents are going lower so keep leases short - like 1 yr.

    we rent a 3000 sq. ft. brand new construction townhome in a trendy 'hood for $2600/mo - I bet when our lease is up in June '10, we'll be able to find a similar deal even closer to the park for $2200-2000k month.

    anyone who doesn't plan on dying in their home should sell. I've been right about housing for the last 5 years - I said 50-75% decline from the peak, which means we have another 50% from where we are now...

  10. Yo dudes!

    Americans are funny!

    First you make us laugh with your subprimes, lies, denial, witless responses and endless baleouts and now you cheer us with your collapsing dollar, faltering commerical real-estate markets, 600+ bank failures and the primes, alt-As and option ARMS which will crush your worthless plebs further into the dirt.

    It is so amusing to watch a 3rd world country being created, isn't it?

    And because of all the 'good things' the usa has done in the world, expect us to p*ss on your upturned pleading faces in thanks real soon!

    yours sincerely,