The future direction of the planet is between the central bank’s counter-party paper Ponzi currency or the independence of real money.
Foresighted central banker John Exter is famous for his classification of risk assets. Using Exter’s Golden Pyramid the riskiest assets are those at the bottom of the pyramid and situated at the top of the apex is gold bullion – independent from the counter-party risk of central banks’ paper and electronic currency.
At the bottom of the wealth asset pyramid are overleveraged paper derivatives estimated to be a magnitude of up to six times the world’s wealth. An example of this is in Germany today where it was recently estimated that Deutsche Bank has a massive 70 trillion dollars worth of exposure to derivatives. Meanwhile, annual GDP in Germany is just 4 trillion dollars.
Warren Buffett warned of these “financial weapons of mass destruction.”
This staggering giant paper Ponzi of unpayable leveraged finance means there are multiple counter-party paper claims within complex risk structures that will bankrupt the entire counter-party paper and electronic global financial system in a derivative collapse.
The downward arrows on the inverted pyramid point to wealth fleeing from the perceived risk of unpayable counter-party paper to the ultimate assured protection of gold as independent money that offers the security of having a physical asset that will retain liquid disposable wealth.
Gold is the mortal enemy of the central bank counter-party paper system; to prevent the flight of capital away from the Ponzi of paper finance markets and into independent wealth, the price of gold is tightly suppressed by the central planners as documented by GATA, especially during times where there is market uncertainty or periods of geopolitical stress.
Losses from deleverage and deflation since the 2008 paper crash have been so immense that central banks’ counterfeit of quantitative easing has been necessary to prevent a collapse of the derivative complex.
At the same time re-inflated worldwide stock markets have become totally dependent on managed central bank intervention for life support, while gold and gold mining shares have been monkey-hammered even though the physical demand for gold greatly exceeds world mining supply.
From trying to meet insatiable world demand, the Western gold pool has reached a critical level of available supply that could finally end the ability of central banks to maintain their gold price suppression.
Within the structure of a central bank counter-party paper Ponzi, central banks are trapped into a future of negative interest rates and the end of capitalism.
For capitalism to work there must be a return on capital and no amount of counterfeited money or easing can re-engineer the tragic collapse of a financial house of cards built on a pyramid of unpayable leverage or prevent gold from being independent money!
The smartest money on the planet has logically anticipated in advance the tragic end of the central bank paper Ponzi and has positioned in secure physical gold that is held in storage free from the risk of counter-party failure.
The eventual staggering monetary value of one ounce of physical gold will be the amount of quantitative easing that is required to try and save the derivative complex which is thought to be in excess of one quadrillion dollars, plus attempts to rescue the bond markets, worldwide stock markets and the Ponzi of unallocated gold instruments where upwards of 200 claims exist for every ounce of gold sold, divided by the ounces of gold in the world.
Money is defined as any good that can be used in exchange for other goods and services and as payment of debt. It has to be a tangible asset to be a sound unit of measure to value other goods and services, to act as a stable unit of exchange and to provide a lasting store of value that can protect wealth.
Counter-party money is someone else’s liability, it is the liability owed to the issuing central bank and it has no value apart from a legal stipulation that prevents real money from being used in competition.