Monday, January 26, 2009

Gay Hush Money; Gold; Obama's Vision

Hush Money Paid to Prevent "Outing" the Minister

Truth Wins Out (TWO) today called on Colorado officials to investigate New Life Church, after the Associated Press revealed that New Life paid money to keep a male volunteer from publicly disclosing a romantic affair with the church’s former minister Ted Haggard.

“Until conservative churches stop shaming gay people and learn to accept them, we will see more tawdry scandals,” said Truth Wins Out’s Executive Director Wayne Besen. “These calamities are a direct result of the closet.” TWO

Such calamities are indeed the direct result of closets where they don't belong, unnatural in their metaphysical being, unethical in their use of the public trust in our places of worship.

The Future of Gold

On September 17, the Treasury announced the creation of the "Supplementary Financing Account" in the Federal Reserve. This is a capital reserve in the Fed financed by the Treasury selling new debt, but its excess capital is "trapped" and does not immediately reach currency in circulation. As of January 2, $259 billion is in this cash pool and $365 billion counting the Treasury's "General Account." The capital itself is money borrowed by the public, so its immediate net effect is deflationary.

With an insolvent public and no foreign demand for Treasuries, the Federal Reserve will monetize debt to finance its continued bailouts and economic stimulus. This is purely created capital pumped right into the system. This is not anything new for the Fed — for the past two decades, it has kept interest rates artificially low and created massive artificial wealth in the form of malinvestment and debt financing.

Purchasing-power destruction is much more desirable by the Fed. Its effects are "hidden" to a certain extent, as the public doesn't see any nominal losses and only feels wealth destruction in obscure price inflation. It breeds perceptions of illusionary strength rather than deflation's exaggerated weakness. The typical taxpayer will panic when his or her mutual fund goes down 20% but will probably not react to an expansion of monetary supply unless it reaches 1970s price-inflationary levels.

On December 2, COMEX spot prices for gold were 1.99% higher than December gold futures, which are for December 31 delivery. This is highly unusual and it provides strong evidence for the theory that the Fed is abandoning its support for gold shorts.

The unique nature of gold and precious metals provides its desirability in this Fed operation. Gold has little utility except as a store of value, unlike most commodities (like oil, which is consumed as quickly as it's extracted and refined), so its supply/demand schedule has unusual traits.

My predictions: gold at $2,000/oz by the end of the year and $10,000/oz by 2012 and silver at $30/oz by the end of the year and $130/oz by 2012. Ludwig von Mises Institute

Weisberg on Obama's "Vision"
Myrhaf rightly notes that the real meaning of Barack Obama's recent swipe at Rush Limbaugh is to attack the Man with the Golden Microphone as a surrogate for holding pro-capitalist principles.

... I think Obama's statement is about a deeper issue than any single radio personality. Rush Limbaugh is a symbol here for holding principles. Granted, Obama is overestimating the Republicans by implying they might have principles any more, but that is what he is truly attacking in his statement. [emphasis added]

He elaborates more on that last thought:
If the Republicans had free market principles, they would be fighting for separation of economy and state. Any compromise they make with Obama on a stimulus bill helps only the side that wants more big government. Freedom is not advanced by any compromise any more than a man's health is advanced if he only takes half a dose of poison instead of a full dose. [emphasis added] gus van horn

For the benefit of all my regular readers, I apologize for getting today's blog out so late. An illness in the family, one that is getting better, prevented the earlier publication. CEC

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