Gold Reserves Now A National Security Issue For The World's Governments

I've been feeling that the "India buys Iran's oil with gold" story (e.g. click here) was quite important for understanding the world geopolitical situation and for gold investing, but I wasn't sure exactly how. Just last night the reasoning to support the feeling came to me.

Let's review the major, recent geopolitical gold-related news stories:

• Libya's Ghadafi pays his mercenaries with gold as he attempts to fend off the Bankster Empire attack masquerading as an Air Campaign to protect citizens from slaughter.
• Venezuela's Chaves demands the return of Venezuela's gold from London. He realizes that Venezuela is definitely on the Bankster's list of "regimes that need changing".
• Iran relies on gold to maintain international trade using gold as the Bankster Empire cuts it off from the dollar system and escalates its increasingly violent (bombs, assinations, etc.) campaign for regime change.
• India relies on gold to maintain its supply of Iranian oil.
• China and Russian, still not under the control of the Bankster Empire, eschew dollars for gold, beefing up their gold reserves as fast as they can without driving the price of gold too high, too fast.

Gold is what a nation (regime) relies on should the Bankster Empire turn against that nation.

The first thing the Bankster Empire does when its turning the screws on a regime is to freeze its assets. After that comes the kind of things happening to Iran (funding and supplying internal opponents, preventing them from doing trade by locking them out of the banking system, assinations, bombings, etc.). Throughout, gold reserves held within that nation allow the nation to continue to function and trade with other nations.

So, to any nation that is not fully integrated into the Bankster Empire (a non-aligned nation), gold reserves aren't a nice investment, they are an integral part of National Security (survival). As we know in the USA, national security trumps all other political priorities.

Here's my quick estimate of those nations which constitute the core of the Bankster Empire (dark green) and those nations that are clearly either close allies or vassals of the Empire (light green). Dark yellow constitutes those nations which are clearly outside of the control of the Bankster Empire with light yellow nations constituting those that I deem to be mostly outside of Bankster Empire control. Countries which are white are countries that I just don't know enough about to categorize. Please leave me a comment if you think I have a country misclassified.

As a result of the pattern formed from the Libya, Venezuela, Iran, China, Russia (all non-aligned), I'm expecting that every nation in the world (beginning with the non-aligned nations, but continuing to fully aligned nations like Germany) are going to making the accumulation a significant, no-kidding physical gold bullion reserve located on their own soil as a matter of national security, a top priority.

This major geopolitical shift is an unexpected consequence of the Banker Empire's squeezing of the Iranians that has enormous long-term bullish implications for the price of gold.

It seems Saddam Hussein's decision to sell oil in something other than the US dollar (Euros) was the final straw that drove the Bankster Empire to attack Iraq. I think that the Bankster Empire is not at all amused by the Iranian Gold For Oil deal and that they will be escalating their attack on Iran. Jim Rickards and Ron Paul are right. In my view, sanctions are a prelude to war and war with Iran is already underway and that will become more apparent as time goes by. That seems bullish for oil and gold for the short and medium-term.

MontyHigh, www.worldofwallstreet.us

Comments

[MontyHigh]

Well, like I said how you play it depends on your personal situation. I see that you are attempting rapid wealth appreciation via Jr precious metal mining stocks. Ok.

If that's the way you're going to play it then you have to pick really good Jrs (with no kidding wealth in the ground on a risk/reward basis) and either BE RIGHT and HOLD TIGHT no matter what OR be able to tell when the big one is coming and take a significant loss and dump the stocks. Depending on how much you have, a false alarm where you dump and buy back is going to cost you 10 or 20%.

I've seen two significant data points:
(a) Fall of 2008, Jr mining stocks got creamed (80% hits not unusual), but if you had the guts to hold for a year I think you were all right. I held tight and did quite nicely but I went from being a newly rich man to a middle class guy and back to a somewhat richer man and I don't want to do that again.
(b) Fall of 2011, Jr mining stocks took another painful hit (30%ish hits) and now are pretty much ok.

Next time we have a systemic threat, I expect another flight to safety and Jr miners (especially those that need financing) will get creamed again. Why should it be any different from the previous two data points?

So, how are you going to play it? By the way, my favorite Jr Mining stock picker is Otto Rock, Inca Kola News (IKN). You know anybody who is as good? I don't have time right now to play that game myself.

MontyHigh

[Wim]

Hello Monty,

Thanks for your answer. It is well appreciated.

I am a little confused because Jesse Livermore(great investor) always said:

"the big money is made by man who can both be right and sit tight, my thinking(in and out trading) never made the big money for me."

Thats why I am sitting in my junior gold and silver stocks(i am sitting right) from the year 2009 till now.

I am right and now is the question if i will be sitting tight through these volatile years 2012, 2013, 2014, therefore my question to you.

Kind regards, Wim

[MontyHigh]

Thanks for leaving a comment Wim. I just don't know whether a crash occurs in the next two years. I'm pretty much with Catherine Austin Fitts thinking that the Powers-That-Be are planning on a "slow-burn" where stagflation (with plenty of austerity) transfers middle-class wealth to the Powers-That-Be. They could make a mistake like they did with Lehman, but I don't know.

How you decide to play it depends on a lot of factors. Except for a core position in GORO, I'm not leaving money in any mining stock beyond what I can pull out in a single day taking a 5-10% hit from my selling or that I'm willing to have "go to zero". This limits my Jr mining exposure.

If you have adequate savings and are mainly focused on gradual wealth increase (say 20% a year real wealth increase) I'd get a subscription to Stewart Thomson's Graceland Updates. He's got quite a good approach for making it thru the upheavals that are coming.

Feel free to continue the discussion if you find this helpful.

MontyHigh

[Wim]

Hello Monty,

I have another question for you.

It seems clear that with all this money printing in the Western World that a crash such as the Lehman Brothers in 2008 seems likely within 2 years(in 2013 or 2014).

Is it then wise to sell your gold and silver stocks in the strength of the stockmarket in 2012(election year, this year) and then buy these stocks later cheaper after the crash in 2013 or 2014 or do you believe that the gold and silver stocks will not crash during the coming crash?

I would like your answer.

Kind Regards, Wim

[agsigo]

The gold for oil trade has been denied in the Indian media but alternatives like trade in rupees and a barter system like exports of other goods from India being done in exchange for oil. But the hitch here is the value of oil exports is far greater than imports from India. The challenge remains in bridging this deficit.