The Ascendancy of Gold

The Ascendancy of Gold

That bright, yellow metal that has launched countless wars and built numerous empires has started its striking come back and all because of the blow back from the vary nation that had sabotaged its initial place in the world economy.

Least we forget, it was the USA, under Nixon, which removed the US and thus the non-Soviet world off of the gold standard in 1974. It did it because the US bankrupted itself by 1972 and when the US released the dollar peg against gold, the dollar devalued in half by the end of 1973. This move than helped cement the dollar in its place as the world reserve currency and allowed the US to print its insane prosperity even as its industry and jobs fled further and further afield.

So now,we come to 2012, where the US, desperate to hold on to it illusion of wealth, in a bankrupt, de-industrialized land of massive poverty and unemployment. To do so, to have any chance of kicking the can of responsibility further down the road of history, the US must destroy any threat to the Dollar. It did this in its invasion of Iraq, in its bombing of Libya. Even as its empire collapsed under the strain of insane debts and more and more nations started using their own currencies between each other, the US lashed out diplomatically, economically and militarily, like a spoiled and enraged child.

However, the use of various, minor and not so minor currencies, constantly changing in value and linked equally to nothing but trust, as much as the Dollar itself, were and are a minor threat. As soon as harder times hit, those nations instantly rush to the Dollar, which they have always still kept in reserve, just for such instances.

But something has changed and changed indeed.

The US has cultivated its regime change war against Iran for the better part of the past decade, through the Bush and now Obama administrations, with absolutely no real change. If anything, the rhetoric of the past two years, of both branches of the One American party, have become ever more shrill and venomous.

So what changed?

The US and its fellow psychopathic travelers, the EUcrats, have decided to take the final move to fully cripple Iran, by banning or embargoing any and every company and bank and nation that has any dealings with the Iranian national bank. In other words, not only are these two police states planning on making the US Dollars and for that matter Euros, that Iran holds, inert, they plan to hold the rest of humanity hostage.

But in doing so, the Americans and the Eurocrats created the very conditions that have assured the destruction of that same Dollar and in turn its Euro cousin.

Iran, as these psychopaths like to point out, is isolated from the world. Well that is not nearly the reality, as it still carries on very active trade with Russia, India, China and Japan, not to mention close relations with a large host of South American leaders, to include the critical Brazilians and Argentinians. In truth Iran is only isolated from the Western financial institutions.

And so came the monumental announcement that Iran and India have signed a deal that oil trade will come in gold, not dollars.

While the oligarch owned American press has made light of this and has said as little as possible, the earth quake of this move has shaken the very foundation of the economic order of the West.

The effects are many fold. Directly, this has shown other nations that there is still an active alternative to the US dollar, one that is anchored in an inherent value that has proven itself for thousands of years. Gold is immune to currency shocks, it simply can not be inflationary printed at the will of politicians. Gold is also fungible across all borders, something the Iranians can then use to buy needed goods from other countries. This will in turn drive more and more nations to use gold and dump the Dollar.

As a matter of fact, quite simply, just for 2012, the Indians no longer need those $12 billion US Dollars that they will use for Iranian oil. If they sell those dollars on the markets, they further suppress the Dollar and demand for it. While $12 billion is a very small hit, there is such a thing as death by a thousand cuts.

Further, the value of gold itself will rise, with its renewed value and will further depress the value of the US Dollar, forcing the American government to print more and absorb a greater inflation rate.

If, over the next couple of months, this begins to catch on with other nations, the Dollar's death knell may have already sounded.