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Global Monetary Systems Set To Collapse

Posted By PC On March 22, 2010 @ 12:23 pm In Gold News | 1 Comment

By Peter Costa In the last article I posted I exposed the two types of global monetary systems [1] we have gone back and forth from for centuries. If you did not read it please make sure you read it before you continue reading this article here is the link http://goldcoinblogger.com/fiat-monetary-systemrevealed/ It is important for all my readers to know how currencies and global monetary systems [1] are currently manipulated. As discussed in my prior work the mechanism behind the manipulation taking place is a central banking system backed by fiat currency. This is the central system most established countries operate from. As revealed this type of system allows banks to practice fractional reserve banking which essentially promotes banks to loan out more money than they have thus artificially expanding the money supply causing major instability in the economy. This type of practice has enabled companies to become too big to fail as well as currencies to become devalued at a rapid rate. As a result of this practice we now have a deadly web of financial

turmoil so well woven that it is only growing by the day. The structure of this web is simple to identify. The structure of our financial system is setup so you have a central bank known as the Federal Reserve that is allowed to print the US currency. Every bank in the nation is attached to the central bank in order to protect them from the threat of bank runs. This in return enables banks to loan out more money than they have thus allowing fractional reserve banking to exist. This type of practice promotes companies and individuals to go to the bank and seek money they do not have. Throughout the years this has created complete reliance on credit and loans for individual and with companies it has created an outlet for them to continue to be in business as long as their credit line continues to be extended at the bank. As we all know a system like this always has a breaking point and the breaking point of this system was caused by individuals faltering on their mortgages. With this happening in such large numbers it has caused banks to tighten up their lending and has exposed bank balance sheets for what they really are. Now the jig is up and these banks that were allowed to loan money at an accelerated rate have had to slow down their pace. This has lead to many companies closing their doors for business as well as too big to fail companies receiving big bailouts to keep operating. As the days go by this web of financial Armageddon is only growing and will soon have us so entangled that there will be no escape. As a result of this current fiat system we now have a similar model that is forming all over the world. What is happening in the United States is a glimpse of what is going to happen worldwide. In the United States we have the Federal Reserve that is the central hub for the US economy. Attached to the Federal Reserve you have all the banks in the nation who in return are protected by FDIC if they were ever to go bankrupt. With such lee way banks have been over lending and over spending for decades not worrying about the repercussions. With all the banks in the nation being attached to the same reserve this has enabled them to artificially expand the money supply and bail each other out of financial trouble. As borrowers continue to default on loans and mortgages with various banks this puts pressure on them causing investors and depositors to withdrawal their money. With all the banks in the nation attached to the same reserve this puts pressure on the entire monetary system and affects every bank. With so much pressure on all the banks this has restricted their lending and has caused failing banks to face closure. As a result of this over 200 banks have failed in the last 3 years. With over 200 bank closures in the US this has drained FDIC of their insurance fund and has lead to the larger banks having to come up with a bailout solution for failing banks. This has only added pressure to the entire system and as each bank fails it puts more weight on the system ultimately threatening the survival of the US dollar. You would think as each bank folds that it alleviates the surrounding banks but it does not. It actually makes things worse because it is like having a group of people holding up an object and as each falls out it only makes the weight heavier. With over 500 banks on the troubled list the weight is only growing heavier and the survival of the US dollar is looking bleak. At this point the Federal Reserve has no choice but to continue to print money in hopes that things will turn around. With the continued printing of money it creates inflation which if not handled correctly could lead to a collapse in the dollar. This exact same model can be seen globally and is a direct result of the financial catastrophe that is taking place with the euro. In Europe you have the European Central Bank also known as ECB which is the central hub of the EU. Attached to the ECB you have every country in the EU who

in return are protected by the IMF if they were to have any financial collapse. With this system in play it has allowed countries in the EU to be careless with their balance sheets. With all the countries in the EU being attached to the ECB it has allowed them to be reckless with their spending and enabled them to bail each other out of financial trouble. As countries start to default on their debts this puts pressure on them leading to foreign investors withdrawing their money from the country which ultimately leads to financial meltdown and a need for a bailout. Unlike banks they cannot just close their doors for business and they become a massive weight on the whole system. With every country attached to the EU a country failing will greatly affect the entire power of the EU. As a result of this it has lead to the PIIGS (Portugal, Italy, Ireland, Greece and Spain) nations which is only becoming worse by the day. What started with PIGS (Portugal, Ireland, Greece and Spain) has now become PIIGS adding Italy to the equation. The IMF has already bailed out Iceland, Hungry, Romania and Latvia putting an enormous amount of financial pressure on them. With the IMF in such financial constraints countries such as Germany are now being forced to come up with a bailout solution. More countries will be added to the list as the days go by and with the way things are going it looks like France is next. The weight on the system is only growing and is threatening the survival of the euro. With more countries coming out of the woodwork this is causing an enormous amount of pressure for the ECB. Similar to the Federal Reserve they may be forced to inflate their way out of this mess which if not controlled properly could lead to a collapse in the euro. The United States is so far in debt it cannot possibly inflate its way out of it. This is identical to an individual deep in credit card debt continuing to apply for credit cards to pay off the old ones. Sooner or later he will not be able to get a credit card and will be forced into bankruptcy. Just the banking crisis alone is projected to cost the US $23.7 trillion to fix. Along with the social security crisis, the mortgage crisis, unemployment numbers and loss of foreign investors a collapse in the green back is inevitable. Similarly the EU faces the same fate and will not be able to inflate its way out of this mess. Greeces sovereign debt is currently 13 times its gross domestic product. Translated into USD, Greece owes the world over $300 billion. This will also run the risk of calling attention to questionable loans European banks still have outstanding to governments, firms, and government-sponsored enterprises in Eastern and Central Europe, many of them highly leveraged. With Portugal, Ireland, Italy, Greece, Spain, Iceland, Hungry, Romania and Latvia in deep financial trouble it paints a picture of the future for the euro. What is taking place globally is the collapse of fiat currencies. The IMF is in so much financial trouble that they are being forced to sell their gold reserves just to keep things a float globally remarked Ronald Fricke president of Regal Assets in response to the EU problem. I am calling for a complete restructuring of currencies globally. I am not only calling for a collapse in the US dollar I am calling for a collapse in global currencies. Not only are the US and the EU in trouble but the list goes on. Dubai is in a situation as dire as Greece in regards to sovereign debt problems and currently has over $320 billion in debt. The UK is facing a similar problem leaving the pound on very shaky ground. Fiat global monetary systems [1] have never worked and as a wise man once said to know the future is to know what was written. Look throughout history and you will see this type of system has only failed. It benefits only a small group while the whole is left to suffer. It is time for everyone to foresee the inevitable and to protect themselves accordingly. Gold have lasted thousands of years and is the only honest currency the world has ever had. To this day we have still not figured out how to create gold the

only way is to mine it out of the earth. This is where you want to put your hard earned money because it is what will last for centuries even when currencies collapse and new ones are created. I own gold and urge every single one of you to do the same because this option is limited and shortages are sure to happen in the near future. Related posts: 1. 2. 3. 4. 5. Stock Market Collapse [2] US Stock Market Collapse [3] Fiat Monetary System Revealed [4] Stock Market Crash [5] Fiat Monetary System [6]

Article printed from Gold Coin Blogger: http://goldcoinblogger.com URL to article: http://goldcoinblogger.com/global-monetary-systems-set-to-collapse/ URLs in this post: [1] global monetary systems: http://www.regalgoldcoins.com/freegold.html [2] Stock Market Collapse: http://goldcoinblogger.com/stock-market-collapse/ [3] US Stock Market Collapse: http://goldcoinblogger.com/us-stock-market-collapse/ [4] Fiat Monetary System Revealed: http://goldcoinblogger.com/fiat-monetary-systemrevealed/ [5] Stock Market Crash: http://goldcoinblogger.com/stock-market-crash/ [6] Fiat Monetary System: http://goldcoinblogger.com/fiat-monetary-system/ Click here to print. Copyright 2009 Gold Coin Blogger. All rights reserved.