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Here I am waiting for gold and silver to bottom out, and I read a nice précis by Alasdair Macleod in "gold money." Again he explains how fiat money printing must lead to price inflation; you all know that if you have purchased coffee, candy etc. eventually the inflated price has to spread to government bonds, etc. We are in a “debt trap”; government help to solve the problem would entail raising interest rates and the stopping of printing money. This would immediately lead to government insolvency. Thus that is not an option for any government so obviously it is not going to happen, and will have to occur on its own.

“Though the Keynesian vs. Austrian economic debate is attracting increasing attention, financial services companies recruit economists who have been trained in the traditions of Keynes and Friedman. They are thus immersed in economic disciplines that assume gold is old-fashioned and has no meaningful place in a modern economy.” This partly explains the current gold price.

With apologies to those well acquainted with the Austrian & Keynesian economic theories, Keynes was an economist that believed that governments had the ability, by juggling interest rates for example, to flatten out the (usually) smooth curves of the normal cycles of economic fluctuation. Everything has cycles: rabbit population, coyote population, grasshoppers, wheat, almonds, ’seven years of plenty’ etc. As soon as economists started to fool with Keynes philosophy, all hell broke loose. Recent examples are Germany in the 30’s where the first cup of coffee was 5000 marks and by the time you ordered a second cup it had changed to 15,000. What once bought a house eventually you couldn't’t even buy one loaf of bread. The avowed socialist Mitterrand tried this in France, (in 1980 4 francs=$1.00, 5 years later it devalued to 10 francs). All this was to save the workers from the ravages of capitalism. GDP fell, unemployment rose – you know the story all too well.

(Phi Beta Kappa is an unique award given to the brightest students). The definition of an economist: “An economist is a man that wears his watch chain with his Phi Beta Kappa award on one end of his chain, but is lacking a watch on the other end.”

So if the best economists are unable to figure out that history has demonstrated time and time again that mankind did best when there was a "hands off" policy, and that the gold standard has worked reasonably well for 5000 years, it follows then that the pendulum continues to swing wildly. Consider that it will be another 25 years or so before computers can match the human brain with our 100 billion neurons and 100 trillion connections! If a computer didn’t have emotion and an opinion then perhaps Keynes’s theory might work. Except who’s to know if the new computer doesn’t have an opinion, is very emotional and is too smart to tell anyone?

The problem is that economists do have emotions and opinions; these factors create tunnel visioned individuals. When a person is tunnel visioned and refuses the possibility that he/she may be wrong, then in my opinion, unfortunately their intelligence takes a dive. Read Stockhouse for confirmation. We all have choices, and it is rather amusing to me that for instance an individual can proudly state he is an atheist, and knows that he is absolutely right and therefore the ten commandments must be removed from a public building because he pays taxes. Or perhaps he doesn’t pay taxes at all but could if wanted to look for work. Then in answer to the next question he firmly and absolutely believes there are flying saucers. If you have nothing better to do this weekend consider the “infinite monkey theorem” that states that a monkey hitting keys on a typewriter keyboard, at random, for an infinite amount of time will almost surely eventually type a given text, such as William Shakespeare’s Hamlet. This atheist firmly believes and has firmly stated his opinion regarding two completely independent conditions; if two events are statistically independent, then the probability of both happening equals the product of the probabilities of each one happening independently. This tiny, tiny fraction leads one to conclude that this tunnel visioned person is probably incorrect. SH posters are convinced anyone investing in Tesoro is a fool, falling for a scam, etc etc. Tesoro is not a solar wind in the sky, it is altered rock thrown up by nature from pyroclastic events over eons, leaving impressive measurable electro physical residues that have been measured with 95% accuracy. Probabilities can be vastly different, and although Tesoro is still not proven there remains a possibility either way.

(Incidentally I do not discount the possibility that alien ships have visited our planet. One exquisite writing by a settler in the Boston area around 1637 vividly describes a dazzling bright light, lighting the sea and land, darting in different directions for an hour or more. His writings were long before electric lights, jet lights, weather balloons etc. This description has been repeated over and over again in many places on this earth. The Roswell story has always been suspect. In 1970 the pilot, Bruce Gernon Jr.took off, flying from Andros Island to Miami and was caught in an electronic tunnel. Their flight time was 47 minutes instead of 75 minutes. For a short while the spiraling tunnel jettisoned the airplane faster than the speed of light-this may represent the first reported earth nurtured space ship! Actually the second, as Lindbergh reported the same thing in 1927. See<www.bermuda-triangle.org/html/bruce_gernon.html>)

One concludes therefore that the possibility does exist that "In His house there are many mansions" and the possibility does exist that spacecrafts have visited this earth. The possibility also exists that the Tesoro ovoid contains gold grades of 9 gms /ton for example. We all do our studying and come up with our own opinions.

It is almost a certainty that unless something extraordinary-such as cheap hydrogen energy comes along, that the financial systems, one by one will collapse and “The destruction of fiat currencies themselves is becoming more likely by the day. Meanwhile, the weakness of “risk-on” gold has led to a serious mispricing in the market. This has happened because the financial community, sucked into the bond market bubble, has not even begun to discount the debt threat to government paper from sovereign bankruptcies.

When this mispricing is inevitably resolved, it is unlikely to be gradual. It will be so swift that those old-fashioned enough to own gold for insurance purposes will have the protection they sought. Those that fall for modern neo-classical economics will learn a very sudden lesson about what gold is actually for.” Alasdair Macleod.

Thus I am optimistic that the price of gold will have started its ascent when our SLI value becomes known.