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Robbing the Old to pay the Rich

By: Sol Palha, Tactical Investor

-- Posted Tuesday, 9 March 2010 | Digg This ArticleDigg It! | | Source:

People who treat other people as less than human must not be surprised when the bread they have cast on the waters comes floating back to them, poisoned.

James Baldwin,1924-1987, American Author


The senate boldly and blatantly refused to give 57 million elderly individuals $250 more. The story below highlights this point.


A measure to give some 57 million elderly people, veterans and persons with disabilities a $250 check was rejected by the Senate on Wednesday, a setback for the powerful seniors' lobby.

Social Security payments for the elderly and disabled will stay flat this year for the first time since 1975 because they are tied to consumer prices, which decreased amid the worst economic recession in 70 years.

That follows a year in which payments rose by 5.8 percent, largely due to a spike in gasoline prices."It is wrong to turn our backs on seniors in this moment of economic difficulty," said Independent Senator Bernie Sanders, who sponsored the amendment.

But Republican Senator Judd Gregg pointed out that the bill would defeat the purpose of indexing Social Security payments to inflation. "The law says it shouldn't be given," Gregg said. At least 10 Democrats agreed with Gregg and joined 40 Republicans to defeat the proposal. Full Story


Under normal circumstances, I would have just ignored this story and moved along, but when I read the statement that is boldfaced above I felt I had to say something. The dimwits in Washington would not know what inflation was if it hit them right in the face and then drove over them.


The real and only definition of inflation is an increase the supply of money. It is not defined as in an increase in price as so many economists love to falsely proclaim.   The money supply has gone ballistic, our national debt has doubled in the last 10 years, and we continue to create money and a mind boggling rate. Therefore, inflation has not disappeared, its pace has continued to increase, though the effects of inflation have not always manifested themselves immediately (price increases); based on this simple fact these individuals should not be getting $250, they should be getting between $600-1000. The masses are being blindly robbed via this silent Killer tax, otherwise known as inflation.


If Senator Judd and everyone who voted against this bill feel that we have no inflation, why are they are not lowering their salaries to compensate for this so called low inflationary environment? It will be a cold day in hell when anyone in congress voluntarily takes a pay cut. Senator Bayh was right, every incumbent needs to be kicked out and replaced with new blood; while not the perfect solution, it will send a message to these guys that itís time to do something. When you bite the hand that feeds you, you are doomed to lick the boot that kicks you.   


To add insult to injury after increasing the money supply, the Feds then lend billions of dollars to bank all of which played a huge part in making a bad situation even worse. The Feds inflate the money supply and then freely give this money out to individuals who really donít need it but those who really need it have a hard time even getting $250 bucks.


We can see the effects of inflation everywhere;

Higher gas prices, higher heating prices, higher rents, cost of basic staples increasing, etc., etc

Gold one of the best measures of inflation is up roughly 400% from its lows. If we were in a low inflationary environment the price of Gold would not have risen so much. Oil is up over 800% from its lows and not too long ago was up almost 1400% from its lows. The average personís salary has not increased enough to take inflation into consideration. All one has to do is look at the price of homes, even after pretty strong pull back, the average Joe cannot afford to buy a decent home in many parts of the country on his salary.  In the old days (1950ís) if one saved enough one was assured of being able to purchase a decent home.


We spend money defending other nations and trying to promote peace and justice in the world. Why canít we spend some of this money on individuals that really need it? Where is the justice there?


What will congress have to say when Gold eventually trades past the 2000 mark and then hits the $3000 mark? They are now projecting that our national debt will hit 20 trillion in the next 10 years; at the rate we are spending, we would hit this mark well before the decade is over.


The best hedge against an inflationary environment is to be in hard assets. That means anything that cannot be mass produced or just created; basically almost anything to do with the commodity's sector, for example Gold and Silver bullion.  If many of the individuals today who are on fixed incomes had put aside a bit of extra money and deployed this into Gold and Silver bullion they would be in a far better off than they are today and would not be completely at the mercy of the very same individuals who created this mess in the first place.


The best way to protect yourself from the evil effects of inflation is to live 1-2 standards below your means; the money saved should be put in investments that will hold their value over time such as Gold or silver. Over 100 years ago one gold Coin purchased a very good handmade suit, 100 years later one Gold coin can still purchase the best handmade suit and if you go to Asia it will purchase even more. Can one say the same for 1 dollar?



Nothing in the world is more haughty than a man of moderate capacity when once raised to power.

Baron Wessenberg

-- Posted Tuesday, 9 March 2010 | Digg This Article | Source:

- Visit the Tactical Investor Web Site


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