Nixon was “forced to” de-peg the USDollar to gold by pressures from two major factors around government overspending: LBJ’s Great Society and the Vietnam war. Both contributed to the draining of America’s gold reserves, pegged at $35/oz. Why? Because European countries like Italy and Franc, led by De Gaulle, bought gold at that artificially low gold price as they knew the price of gold and inflation would soar, as the U.S. dollar printing machine would go into overdrive. They were right. US gold reserves shrunk from 21000 metric tons to the “current official” 8100 (much of which is long gone), forcing Nixon to close the window of redeemability. Kissinger was brilliant—evil but brilliant, and convinced the Saudis to accept oil exports in USDollars as they were now as “good as gold”. In exchange for accepting petrodollars, America offered the Saudis “protection” by selling them US weapons. Full disclosure: I was too young to know this at the time, but my late father worked at the State department under Kissinger, and I worked in the defense industry, so while I’m proud of contributing to America’s security interests, it’s bittersweet because dollar hegemony is the one of the primary factors in these endless wars for regime changes. Which is why I pivoted to the private tech industry in the 90’s with the collapse of the Berlin Wall and end of the Cold War. Instead of being a benevolent peacekeeper, the US chose to continue its military expansion.
Historically this is how empires collapse, as the Romans experienced twice with their military overreach. That includes debasing of its sovereign currency. America did that in 1965, by removing silver from its coinage, similar to the Romans’ clipping of their coins. Unfortunately I have no confidence we can reverse the sinking of the USS titanic unless we implement sound money . The fiat paper experiment as been a disaster. We need clean air, water, and food. In that sequence. We also need clean money. This is why I’ve been stacking gold since 1999 and later became a distributor. It’s also why I’ve been stacking bitcoin since 2013. While my portfolio has appreciated, I’m not doing celebratory touchdown dances. Because if 97% of the population experiences their purchasing power and standard of living being persistently eroded, it’s not a world I want to celebrate.
By the way, rising gold prices signal financial distress. This is why the monetary authorities and central banks enlisted commercial banks to artificially suppress prices by using financial futures derivatives. This was why futures exchanges were created in 1975. The official reasons are for producers to hedge their output and to provide liquidity for market efficiency. But the unwritten reason is to manipulate and suppress prices.
This is not conspiracy theory. JPMorgan traders were convicted of manipulating gold futures. The bank paid $920 million in fines. Initial charges were under RICO statutes which labeled the bank an organized crime enterprise.
Trump may now be pro-bitcoin, but he ordered the CFTC chairman to create futures exchanges for bitcoin in 2017 to literally drive its price down. It was effective as the price peaked the exact day bitcoin futures started trading December 18, 2017. I literally wrote about it a month prior to the CBOE and CME started trading bitcoin futures.
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