"It Shall Be" Are we keeping the faith?

If money was just based on faith instead of a physical commodity like gold or silver, we would need a name for it. That is just the idea when Fiat money came into play in the 20^th century.  Fiat translates from Latin to “it shall be”. With Fiat money the risk is huge when it comes to hyperinflation, since fiat currency is just a type of paper printed out, it has nothing backing it in true form. Since the change Nixon ordered in 1971 after the collapse of the Breton wood system, the conversion from the USD to gold no longer exists. Fiat money was then printed out, in fact supply and demand has nothing to do with fiat money, it truly is just paper. If the people lose “faith” in the USD, it will then be a worthless currency.

            Many gold holdings go unreported. Central Banks, countries and larger corporations are known to stockpile gold and metals without detection. We are seeing many other countries right now buying up gold and other metals in mass quantities. It is crazy to think that other countries are returning to a stable monetary system as we had pre 1971, a reliable gold backed currency. They are possibly quite ahead of the game. In the U.S. we see that our society is breaking down, with a population that cannot pay for basic needs or sustain itself with rising prices. The only reason we are not seeing people lined up for rations is that they now get food stamps and welfare via card.

           PMs seem to be the one thing overtime that has been guaranteed to hold value. Paper money is a game and unless you do not mind losing a lot, you can play, but remember there is a counter party who knows and plays better than you and backs every paper dollar printed.

Now that the Shanghai futures market is open with what seems as a better offer than COMEX, stating that it is backed by actual gold not just highly leveraged paper, we see a slight decline with the PM markets, it’s just the time difference and volume that are swaying it.

 China shows photos of a fashion catwalk with 13 million in gold bars seen though a glass floor just for decoration, so you can imagine what the investors are holding. Even with the luxury bans happening, smugglers are finding ways to get gold in to China and India. Look at the charts of China and Russia, they are accumulating mass amounts of physical gold and the demand is growing.

Positions:Long GLD June 19th, 2015 114.00 calls. Paid $6.80, currently $8.05, with a gain of +18.38%
Buy Gold $1191.50, Currently at $1223.20 for a gain of 2.66%