THE GOLDEN BULL

A raging, rampaging “Golden Bull” market is a rare thing of beauty in its explosive power and force.  They don’t happen every day either – the last major bull market for Precious Metals occurred during the 9 year period from 1971 to 1980, when Gold rose over 2,700% and Silver rose an astounding 4,000%!

Ultimately, the strong fundamentals and future prospects driving the current "Golden" Bull Market for precious metals are rooted within the nature and operations of our current global monetary system - the Central Banking system, as represented by the privately held U.S. Federal Reserve Banks, other international central banks like the European Central Bank, the Bank of Japan, Bank of England, etc., The World Bank, International Monetary Fund, and Bank for International Settlements.

Truly, a country's economic system defines its political system, and vice versa.  Money supply, interest rates, general pricing, and resource allocation are either ''free market'' driven – where all transactions are voluntary and mutually favorable, or controlled by a "central authority" - whatever political label you want to apply to either system.  Unfortunately, “Central Banking” is one of the principle tenets of the Communist Manifesto - not the US Constitution!

Many of the economic forces that fueled the 1970’s Golden Bull market exist today.  In fact, the present economic conditions appear far worse due to the following: 

1. The bull market in precious metals during the 1970’s was brought on by currency devaluation resulting from a “guns & butter” policy to finance the Vietnam War and domestic social programs.  Today, we are carrying record current account deficits of approximately $9 trillion which does not include the costs to finance 3 wars – Afghanistan, Iraq and the War on Terror, plus a possible fourth conflict with Iran looming!  Further, unfunded liabilities such as Medicare and Social Security benefits total over $70 trillion!

During the 1970’s the US was the world’s largest "creditor" nation.  Now the US is the world’s largest "debtor" nation.

During the 1970’s the US economy led the world in manufacturing and production.  Now, 70% of the US economy is driven by “consumerism” – as in people using credit cards and their homes as ATMs to purchase flat panels and Hummers!  Also, Americans have a negative savings rate for the first time since the Great Depression.

At the end of the 1970’s, in order to support the US Dollar, which was in a state of collapse, the Federal Reserve under Paul Volker raised interest rates to 19%.  Given current Housing and credit conditions, this is simply not possible.  In fact, the current Federal Reserve regime under Ben "Helicopter Drop" Bernanke thinks they are going to INFLATE their way out of our current situation!

On-going investigations into possible covert and concerted Gold & Silver price manipulation by central banks over the past 10-15 years may produce similar imbalances to those caused by the fixed price in Gold at the commencement of the 1970’s precious metals bull market.

"...In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold..."

"...The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves...This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth..."

"...Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard..."

Alan Greenspan - Essay on Gold and Economic Freedom, 1967 [before he became a central banker]

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