Yes, a gold backed currency is possible in the modern age.

 EVERY FIAT CURRENCY ENDED IN BEING WORTH 0

FIAT CURENCY IS LOVED BY POLITICIANS

This past weekend I listened to Warren Buffet, who claimed that gold is not viable in a modern economy. He supported Central Bank digital currency, even though he admitted it would give governments unlimited power over every aspect of life. He believe CBDC would be faster and more convenient.  He also failed to mention that it could be diluted in value on a daily basis without any control. 

Only currency with firm backing can be a real store of value and only such a currency can maintain a sound economy. 

I do believe a gold backed currency is not only possible, but it is the best solution to the crisis that is soon going to engulf the western world. I also expect such currency will be introduced at some time in the future.

For such a currency to be accepted, it cannot be the creation of any one nation, it will need to be a joint effort by a group of nations, the more the better. This is how such a sound money system could work in the modern world.

First this currency would be created for international settlement and commerce. Every nation could still use the currency that is in use for domestic commerce and even for international commerce if accepted. I suspect that it would soon be unacceptable.

This new currency, we will call it UNIT, could only be created with the deposit of gold into a system of banks and bullion storage that would exist in all participating countries. For each ounce of gold, lets say we could receive 480 UNITs, of course these values would need to calculated. These UNITs would represent real gold and could be exchanged for gold, if one should desire. This could be a paper currency, or an electronic deposit, it could be transferred electronically, just like digital currency. It would have all the characteristics of modern trading, except it would not be controlled by any one government and no units could be created without a equal deposit of gold. The audit and control would be facilitated by a board from the participating countries.  

If someone wants to have UNIT they would have to purchase gold in their currency then make the deposit of gold and receive the UNITs. If someone wants to exchange physical or paper UNITS for electronic, the paper UNIT's would be destroyed. The idea is that there would never be more UNITs  in existence whether paper or electronic than a corresponding amount of gold on deposit.

This would eliminate monetary inflation, it would soon require nations to be fiscally responsible, or they would soon run out of gold. It would lower interest rates to borrowers, because it would not include the need to account for the declining value of currency. Lenders could be assured that their loans would not be repaid with depreciated currency. 

It would lessen abuse by governments and central banks, force financial responsibility and would create real sound money and a solid store of value for workers and savers.

I do expect we will see some sort of such system in the near future, it could be participated in by all nations, or it will soon require non participating countries to make drastic changes in their fiscal policies. It will most likely create a flight from fiat or fake currency to real currency.  It would be in the best interest for all.

Gaza ceasefire, more about backing Netanyahu, than peace.

 OBJECTIVES OF CEASEFIRE, MAY HAVE BEEN ACCOMPLISHED

HOSTAGES RELEASED, POSITIVE SPIN

One has to wonder if the great Gaza ceasefire was more about propping up the Netanyahu government in Israel and in the U.S. , and of course a release of the last hostages. Watching the speeches in Israel, as this deal was made, we saw fantastic praise for Netanyahu, " The greatest wartime president in history" and an extreme attempt to point out his unwavering focus on releasing the hostages. Then we see Miriam Adelson brought out as prop for an indication of U.S. donors support for Netanyahu. a message to Israeli's, that Netanyahu is instrumental in maintaining unwavering U.S. support. 

As was expected, it did not take long for the death and destruction to commence. One excuse was that Hamas did  not come up with bodies of the deceased hostages. Did anyone in Israel, in a official capacity, speak to Hamas about this? Is it possible that many of these deceased are still buried under tons of ruble, along with thousands of others, the result of the Israeli devastation. 

Then there is reports of some one in Gaza shooting across the new line. This is of course an excuse to resume bombing and killing dozens more. I suspect that there is little government or control in Gaza and we can expect similar incidents in the future. Good faith on both sides would require communication and cooperation for any such ceasefire to be successful.

I see no good faith, no positive communication, just a pause, waiting for the excuse to resume the killing. I suspect that there is no communication, no commitment for a long term peace and of course no commitment for any self determination of people in Gaza or the west bank. In reality, no hope of a real resolution, other than the elimination of the population in Gaza and the west bank.

Capital gains need to be adjusted for inflation.

TAXING IMAGINARY GAINS

UNREAL GAINS CAUSED BY GOVERNMENT IRRESPONSIBILITY

It is amazing that in today's litigious society that no one has challenged the fairness of long term capital gains that are not adjusted for inflation. While we understand that assets that have a gain, especially those held for a short time do indeed likely have a profit, but gains on assets held for 20, 30, or even forty years old may show an increase in dollar value, but in effect, are actually a loss due the depreciated buying power of the dollar caused by inflated prices caused by government action. 

The average inflation, lets say on asset that cost $1000, could be more or less depending on item or asset, in 20 years is 112% or $2125. so a rise in value of $1125 would actually be the break even amount and that would not include any costs associated with owning that item.

For a 30 year period it is estimated at 147% or $2478, an implied gain of $1478 is actually the break even point.  

For a 40 year period the average rate is 201% or $3010, an implied gain of $2010 is actually the break even point.

While those numbers are revealing the rate in the foreseeable future are going to be far worse, with near double digit inflation rates expected for the some time.

Can anyone argue that this is not indeed actually another fraud caused by the government devaluing the purchasing power of out money and then taxing us on the perceived increase caused by their actions.

Short term capital gains, assets held less than year are taxed at your bracket tax rate 10 to 37%.

Long term, held over 1 year tax rates are up to 20%. but there is no provision for assets held a very long times. these assets should be indexed to account for the cumulative inflation over that time. 

In effect we are being taxed on assets that we held for many years, in effect taking most likely any increase in value that has occurred. By holding those assets it seems the government reaps more of a reward for your having done so, than you. 

Is trade decoupling on the horizon?

TRADE WARS NO LONGER ABOUT RECIPROCITY

CAN CHINA SURVVE WITHOUT U.S. TRADE?

It is no longer trade negotiations, based on using tariff's to address trade restrictions and barriers by trading partners. It is now using trade as a weapon to force submission to U.S. will in not only economic, but political and maintaining geopolitical supremacy.  It is no longer about reciprocity, which was a method of insuring fair trade between partners.

It seems our leaders in Washington believe that the U.S. is essential to the economic health of the rest of the world. A country with a population of 330 million vs a population of over 6 billion. While the U.S is a huge trading nation, it is debatable who will be more damaged by a decoupling of trade with the rest of the world. While the goal for Washington is submission and maintaining supremacy, its opponents understand that as sovereign nations they cannot allow themselves to submit to this intimidation. It is very likely this will  end in decoupling, a suspension of trade that will have uncalculated repercussions around the world.

While some believe that this will rebuild American industry and cause a decline in the economic power of China and its affiliated countries, it seems to be a delusional belief that the world can not survive without U.S. trade.

It is similar thinking that believed that Russia could not survive without selling energy to the EU, a policy that has forced Russia to focus on other buyers and has destabilized the economies of EU nations. The reality is that the EU may have lost the access to Russian energy for decades.

I suspect that if this trade war continues the U.S. is in store for increased inflation, a shortage of essential materials and even a shortage of simple domestic goods. While China and India and others will suffer for some time, they will have access to a market of over 6 billion willing to do business, that is proving to be a mutual prosperous endeavor.

It is possibly the end to globalization in trade and will descend into trading blocks made up of nations focused on manufacturing and essential materials and those who are made up of financial services and consumerism. In the end a very lopsided and unlikely competition.

The solution is co-existence as equals and mutual prosperity, not subjugation and submission. The alternative is a recipe for poverty of nonproducers or war as a last resort to maintain supremacy. 

 

Only fools believe that war can save their economies.

 THE WORLD HAS CHANGED SINCE 1939

WAR WILL BE THE END, NOT A NEW BEGINNING

It is not a secret that the economies of many countries are in dire straits, particularly in western Europe. We hear some who still believe that war can rescue them by stimulating economic activity and of course hoping to acquire assets of others. This has been a historical reality in the past, but the world is a far different place for many reasons.

At one time the west had a huge manufacturing capacity and during the depression, brought about by debt and speculation, that was infinitesimal compared to their debt today, war put all those idle factories and underutilized labor to work producing war materials. Money was supplied by increased borrowing and every aspect of the economy quickly accelerated.

Today those manufacturing facilities no longer exist and the debt is already at unsustainable levels. It will take decades to rebuild those manufacturing facilities and the same applies to the skilled workers to provide the labor. The last few decades has eroded the generational supply of specialized workers in manufacturing. There no longer are workers whose family worked in steel mills and mining that considered it part of their heritage. Only decades of new realities of child rearing that instill the virtues of producing things and a solid work ethic can produce a work force that provides national self sustainability.  

As for the finances to rebuild that infrastructure, western countries are now in a position that they will be having a hard time financing the interest on their past debt. 

It is also unlikely that they can muster the enthusiasm for large numbers of draftees to provide the personnel willing to fight to their death. 

The real solution for their internal problems needs to come from stopping the delusional messaging and entertain a frank conversation with their citizens as to how to rebuild their economies for a self reliant strong future. External threats are not their real problem, but decades of financial nonsense that does not produce real goods and wealth have eroded the financial health of these nations. Attempting to go to war with others, who actually have not engaged in those policies, will end in disaster.

Is Trump engaged in cryptic messaging?

 DOES HE HAVE AN END GOAL?

OR IS IT A DAY TO DAY NAVIGATING MINEFIELDS?

One has to have a certain bewilderment as to what Trump is up to in Gaza, Ukraine, and then there is Iran. The reality and narrative is often contradictory. 

In Gaza, which this ceasefire is a result of Israel's attack on Qatar and the implosion of Israel's political support in the U.S. This seemed to give impetus to bringing together enough forces to at least start a process to some semblance of a better place in Gaza. Only time will tell if this is going to be a reality. The amazing part that we have, or will be witnessing, in the coming days is the outrageous attempt to support the image of Netanyahu.

First there was envoy Witcoff,  Gerald Kushner and Ivanka in a speech to the relatives of the hostages, touting the efforts of Netanyahu in getting the hostages released. They were were met with boos and other negative remarks from the crowd. It was obvious that their presence there was to support the policies of Netanyahu to the Israeli population. This may have been planned as an effort for the domestic consumption, but today, everything is streamed around the world in minutes. I suspect that in the rest of the world it will not get a positive reaction, not for Netanyahu or the Trump team. Kushner also praised Israel for its taking to the high ground by not responding to Hamas in kind, but by its humanitarian focus.

Then there was the address to the Knesset by Trump, where he touted Netanyahu as the greatest wartime leader in history.  Acknowledged Miriam Adelson, who was present, as being instrumental in his policies with Israel, with their constant communication, and that she supported Israel over the United States. He also lobbied for a pardon for Netanyahu, one has to wonder if the whole media operation was orchestrated by Netanyahu himself. Trump knows well that this will be played around the world and also knows that this will be counter productive in raising the image of  Israel. Some will say he is just stupid, but it raises doubts about his motives.

Then there is Ukraine, where the huge tariff's demanded by the U.S. senate, on India and China, to discourage purchases of Russian oil, are a disaster and made the situation worse. Now we hear calls for Trump to Ok Tomahawk missiles for Ukraine, after similar calls, for Abrams tanks, Hi-Mars, Atacms missiles and F-16's, all that made no difference in the direction of the war. It seems Trump will go along and promise these, so that he can claim he has done all that he could to save Ukraine.

The suspicion is that Trump attempted a negotiated settlement, rejected by Ukraine and the EU and now is going to give lots of lip service, but is not going to go to war with Russia. If we recall, Trump criticized Russia as a paper tiger and not a real military force, while many believe this, I suspect he was telling Putin to get this over with on an accelerated rate.

While many are pushing for war with Iran, a potential disaster for the worlds fragile economy, I suspect that Trump is going to try to sidestep that in any way that he can, while giving lip service and even appearances of readying for war.

While, of course much of this speculation, there is no definitive plan by Trump, at least not in public, this leads to speculation. What is obvious, don't listen to what he says, but watch what is happening.

Is a currency crisis underway?

 END OF CONFIDENCE IN FIAT CURRENCIES 

NO WILLINGNESS TO RESTORE TRUST

Are we now witnessing the end of Fiat currencies, paper money without backing and created by governments without restraint? Indications are that the world is on the verge of a collapse of confidence in paper currency and the ability or willingness of  governments to make hard decisions on debt, deficits and financial responsibility.

While this is primarily the problem of the western world, it is a problem in every country, as no country has any backing of its currency. Paper currency was at one time a receipt for a unit of silver or gold and exchangeable. That reality began to be diluted in the 1930's and ended for good in 1971. It has been accompanied by deficit spending, inflation and now has exploded to levels that may usher in a period of hyper inflation and a total debasement of the currency.

Today the price of Gold is $4139. an ounce. silver has broken its all time high and is priced at $51.70 an ounce, numbers that indicate a growing doubt about the viability of the present fiat currency system. While these price increases have been huge and intense, it has actually created a freeze up in the market as the dealers and refineries are deluged with sellers and are unable to soundly price in risk and the future. There could be a temporary sell-off and price decline but many are reluctant to sell solid value for depreciating paper currency. It is an indication that many fear that their holdings of paper currency will evaporate in value and any price for solid assets may be better than nothing.

This takes us back to 1980, only 9 years after the end of metal backed currency, when inflation hit 14.6% which prompted the federal reserve to raise rates to near 20%. I remember receiving over 14% on CD's. Gold skyrocketed to $850 and ounce and silver near $50. The high interest rates led to severe recession until 1983 when a recovery began and gold remained under $500 for the decade. In reality that has been the last actual recession. The debt crisis of 2008 was minimized by more debt and helicopter money, same during the Covid era. No one has been willing to suffer the pain of recession and the liquidation of bad debt. 

Today we see the U.S. government shut down because they are not spending enough, even with a near $2 trillion deficit, same applies to the finances in Japan and Europe all are at the limits of their debt expansion but still talking about more spending. Many are unwilling to believe that these governments are nearing a crisis and others fear that their solutions will evaporate their wealth and assets. The U.S. is now expected to lower domestic interest rates, a fact contributing to this crisis.

The reality is the western democratic socialist economies are in severe trouble and there is no way out without tremendous long term pain. The problems indicated in 2008 have been addressed with more deficits and more inflation.

While many want to blame other countries reluctance to take these currencies as payment or hold their debt, it because of their hope of preserving their own economies rather than going down with this ship. 

We are hearing of solutions of Central Bank digital currencies and the elimination of cash. This would lead to restrictions on what is allowed to be bought and sold especially alternatives to this digital currency. Solutions that will in effect rob workers and savers of their assets to preserve a mismanaged and irresponsible currency system. It would most likely result in worldwide poverty for most.

The real solution is sound money representing a store of value for ones labor and savings. Sometimes the simplest solution is the best solution.

Hostages released, Hope, but difficult negotiations ahead.

 PALISTINIAN PRISONERS RELEASED

AID RESTORED

All 20 living hostages have been released and over 2000 Palestinian prisoners have been freed. Israeli troops have partly withdrawn from Gaza and aid trucks are beginning to enter the area. So far, all is according to the terms of phase 1. While it is a hopeful sign, it is going to require patience, cooperation and a regaining of trust to move to the next steps. 

The first sticking point will be Hamas disarming, it is understandable that they will be reluctant to give up their weapons until their is some sense that they will not be immediately attacked. There is also the makeup of a new governing body that needs to be made up of unbiased and objective leaders that can gain the trust of both sides. This will not happen in days or even weeks, but will be a process one day at a time.

The next phase will require patience from Israel and a clear indication that they are willing to let Gaza exist as an independent entity. The past narrative will need to be realigned if any confidence can be restored. Is this ceasefire is just a needed break in a hope of Israel restoring its image, or is it a real effort for a lasting solution? It will take trust and confidence on both sides for this to succeed, it will not happen overnight.

There probably should be some sort of peacekeeping troops in Gaza, not Israeli, not American or European. Some sort of order will need to be implemented. Thankfully the 200 U.S. troops are to stay out of Gaza, It seems their role is to monitor the situation.

Everyone will be on their best behavior while Trump and other leaders are in the region, it will be up to the Palestinians and the Israeli's to deal with their internal extremists, it seems their are plenty on both sides.  

Real peace can only be accomplished with communication and a real effort to deal with problems jointly, not in an eye for an eye policy or demanding submission. Gazans need to accept that Israel is going to exist, publicly, and only coexistence will end the death and destruction. It will take real diplomats from both sides and a close moderating and involvement from the international community. 

Money, Digital ID and Digital currency.

 MONEY SHOULD BE YOUR ASSET

IF YOU NEED PERMISSION, IT IS NOT YOURS

Historically, at least until the late 20th century, money was gold or silver and only represented by a receipt called paper money. For a deeper look at the history of money https://www.blogger.com/blog/post/edit/219171338015504465/828743332419915216. Today we are being bombarded with all kinds of alternative "money" none of which are an asset and increasingly they are not under your control or available for your access or even in your possession. What ever they want to call it is not money. 

The digital revolution has been a miracle of accessibility and innovation. It has made most everyone to have the ability to access the world in information and commerce. While it is a positive development we are now seeing the potential for abuse, particularly from governments and financial players. One example is digital currency, which has no backing of any kind, does not have the ability to ever be in ones possession and could disappear in the push of a computer button. It is touted as an investment and in some instances has increased in value by 100's of multiples, even though it is not accepted for most transactions.

But now governments, who are most likely the creators of digital currency in the first place, are proposing that they can insure it reliability and convenience by making a government controlled form of "MONEY". Again this new currency will not be anchored to any real asset will not be in your possession and can be limited to transactions only approved and permitted by the government. Every transaction can be taxed, cost fees and if you should fall out of favor for any reason can be  frozen or completely destroyed. 

The European community is expected to put digital currency into use by next year. We can expect it will start out as voluntary, but they have already put severe restrictions on cash or even any transaction that is not accompanied by signed statement from both parties as to what is being transacted, even among family members. The United States now have restrictions and limits on gifts or loans and many are subject to tax. Digital currency will be the most aggressive loss of freedom and rights to everyone in the history of government. Presently Europeans are attempting to move assets out of the country and the accompanying restrictions are being increased by the day.

It will all require a digital ID, which seems to be the newest attempt to track, store information and increase the ability of government to control and monitor your life. The so called, "Real Id" is in effect a national Id, something always opposed by rights advocated. This id's feature will be a digital picture that can be scanned and reveal everything about you, from your bank account, family members, medical history, all stored in a government database. This will be sold to increase your convenience and  your security. 

We can expect this ID will evolve into containing QR codes that will be used to conduct financial transactions, permits, registrations and most likely any transactions everywhere. Those who refuse to comply will be cut off from normal everyday living. Systems similar to this are already in use in China, a far larger country than ours.

Gaza progress?

 PHASE 1 AGREEMENT

HOSTAGE AND PRISONER EXCHANGE, CEASEFIRE

It seems that an agreement has been made on the first part of a Gaza peace deal. Hamas will release the hostages, both dead and alive, and Israel will release Palestinian prisoners. Israel will stop military action and withdraw to a prearranged position. There is still some uncertainty about what prisoners will be released. While this is an agreement, it has not yet happened.

There is concern that as soon the hostages are released, Israel will resume its offensive. This has happened before, but it may be a different situation as the world is focused on this crisis and it may be difficult to pull off a false flag or blame a breakdown on Hamas. There are lot of parties involved in this process and is the best hope of success so far.

The ultimate sticking point is going to be security and enforcement. A situation where Israel is out of Gaza and security and order is maintained by a third party. The makeup of the governing authority will be another problem. If this deal evolves into a resumption of the situation of a Gaza prison, it will not last. We can assume there are forces that will not want this to be a success.

Then there is still the possibility of an impending Israeli attack on Iran. That would lead to a suspension of negotiations as war would create a dangerous environment for the negotiators. Extended negotiations will also make resumption of the Iran war difficult and most believe that as time goes on, Iran will be more prepared to defend against an attack.

It is doubtful that this situation can be resolved quickly, the major questions for a long term solution are ahead and they could take the rest of the year. This is going to put Israel into a dilemma about how to proceed. Hopefully it will end with a satisfactory Gaza plan and the end of hopes for an Iran war.

Desperation everywhere. Ukraine, Euroland, Israel.

WE WONDER WHAT COMES NEXT 

EXPOSURE CONTINUES IN MANY PLACES

It seems we are bombarded daily with a narrative of desperation. No solutions, no, at least no public, strategy or plans to deal with multiple crisis around the world.

Ukraine, approaching 3 years of massive death and destruction, the 21st. century should be labeled the era of death and destruction, and the policy by the West seems to be just more of the same, threats and escalation will bring Russia to capitulate and kneel before them at any minute. It is indicative of biblical prophecy of delusion that ends very badly. The latest desperate act is to offer strategic missiles to Ukraine to attack Russia, of course everyone now knows these weapons will be manned by U.S. personnel and assets. In fact, war that can only end in a nuclear confrontation.

Then there is Euroland, desperately seeking relevance, with economies on the verge of collapse, political instability and leaders whose focus is, is, is who knows? Engaging in political chicanery in Romania, Moldova and at home to hold power. Then talking of conscription and massive borrowing to defend themselves against the self promoted fear of Russian invasion. Sadly, they may be the most desperate of them all.

The U.S. while many still advocate for "America first" is torn by foreign influence from many places. This is indicated by shifting policies daily. If guided by "America First" it would not be that hard, but it seems America had become entangled with foreign powers who demand allegiance or else. The or else is not defined, but is assumed that it could spell danger for family and loved ones or worse. Washington knew what he was talking about, when warning about getting involved in European politics, this could apply to many places. Domestically it seems politicians are desperate to find a cause to rally the citizens to their side, an increasingly difficult trick. Even a government shutdown is now ho hum to most, is this the result of continuously declaring the wolf is at the door.

It seems the British empire still lives, even when it is a shadow of its former self, but has been able through its massive intelligence network, which is probably larger than its military, to be able to cause division and instability and enlist the U.S. military to preserve and enhance its economic power when necessary. With a military of under 50,000 men and a leader with an 18% approval rating, it is the poster child for desperation.

Then of course, there is Israel, whose position as the underdog, was well cultivated to gain the support of many around the world. It seems the lowly Gazans have now usurped their position as the major underdog in the region. Only by the arrogance and hubris of its leaders have they been able to lose their most valued status. Due to their own self destructive polices, they have now set out on another desperate act, and that is to visibly and openly indicate that they will resurrect their former positive image by taking over TIK-TOK and and even have eyes on X. This coupled with openly paying influencers to enhance their image is indeed a spectacular sign of desperation. I suspect that it will result in a further decline of its approval.

Desperation is indeed visible everywhere, the hope is that this desperation will be followed with acceptance, acceptance that the world is changing and dealing with that change will be in the best interest of everyone. The alternative will, without a doubt, lead to much more death and destruction.

$4000 Gold, Bubble or flight from unbacked paper currency?

 GOLD OUTPERFORMS OTHER ASSETS

ALL CURRENICIES LOSING PURCHASING POWER

Today Gold is trading at $3950 an ounce, an amazing number, and it seems no limit to its rise. Silver is at $48 an ounce, very near its all time high and likely to break that in the near future. One would think due to its rapid rise that it is long overdue for a correction due to profitmaking, the dilemma is, sell it for paper currency that is losing its purchasing power at an accelerating rate.

The current U.S. budget has a deficit of near $2 trillion, almost 1/3 of the budget. This translates into further erosion of the purchasing power of the dollar, while this is bad, it is still the best in the western world, the lesser of other currencies evils.

It may still be true that Gold is in bubble territory. It is doubtful that there are many retail average buyer of gold at these prices. That is now probably reserved for silver buying. The Gold to silver ratio is now 82 to 1. Historical, for over 5000 years, that number has been between 12 and 15 to 1. so is gold overvalued or is silver undervalued. At 15 to 1 silver would command a price of $263, or using silver as a basis, Gold at 15 to 1 would be $720.  While gold may be overvalued, silver may be still much undervalued.

Gold it is being reported is being purchased by Central Banks and institutional investors. It seems it is moving out of Europe and into the U.S. and contracts are being liquidated and the gold is being taken for possession. For years gold contracts have been traded back and forth without anyone actually taking possession, that is no longer the case. It is not clear who is taking possession of all this gold, there is speculation that it is the U.S. treasury. The biggest market for gold contracts is the London bullion market and the Comex. Trading for physical bullion is conducted in Moscow and Shanghai where contracts are not sold. There has for decades been accusations that the trading of contracts has been effective in keeping the price of gold undervalued.

The other impetus for the accumulation of gold is the new trading settlement system that is evolving in the non western countries of the world. This is called BRICS-Pay and is a block chain electronic system that consummates transactions in seconds and is done in trading partners currency. This is less costly and quicker than the current SWIFT system. It also is setting up bullion vaults around the world were trade deficits will be settled in gold. The first 2 are in Shanghai and Saudi Arabia. An example is that China can buy oil form Saudi Arabia in Yuan and Saudi Arabia can use that Yuan to make purchases in China and if there is a surplus it can be exchanged for gold. Saudis could use their currency to make purchase in China in the same way. it will make it necessary that trading partners have reserves in gold available. This system will eliminate the need to have U.S. dollar reserves or assets. If the U.S. would be part of this system it could also engage in the same manner. It seems this system will encourage balanced budgets and balanced trading or you better have a large reserve of gold.

The BRICS do not desire that any country's currency becomes the reserve currency, which they believe has led to abuse. While there is talk of a new gold backed currency in the future, the present system may be just a step in that direction.

The reality is that the abuse of fiat or non backed paper currency is coming to an end. Every historical move to fiat currency has ended poorly. In reality, it is a type of fraud that robs workers and savers of their wealth.

 

Hamas says yes, with amendments, Trump orders ceasefire.

 DEAL POSSIBLE, IF COMPROMISE

129 KILLED IN WEEKEND GAZA BOMBING

President Trump released a letter from Hamas accepting his peace plan with certain reservations. The letter was very articulate and constructed to give Trump hope that a deal was possible. They agreed to release the hostages, a ceasefire, and the acceptance of an independent governing body. They will most likely not accept disarmament and one must wonder how Tony Blair became part of this deal, since he is very unpopular in the Arab community for past behavior. Trump has enthusiastically agreed to negotiate details by sending negotiators to begin talks in Cairo today.

Trump also ordered Israel to stop the bombing, but reports are out that 129 were killed in attacks in Gaza over the weekend. There has not been much of a clear response from Israel as yet.

While everyone is hopeful, it is far from a done deal. While disarmament is one of those problems, another is how will any such deal be enforced. It cannot be possible with Israel being the security enforcer inside Gaza. Security will need to be made up of independent forces not U.S., British or European. Malaysia has already volunteered 20,000 troops,  maybe as independent as possible. A joint venture would be best. For a new independent governing body be successful, Israel needs to withdraw from Gaza. Gaza is not Israeli territory. It may be best if a wall be erected between the two for increased security on both sides.

It seems there are talks and approval of these negotiations by the majority of the neighbors in the region. 

World opinion has dramatically turned against Israel, especially after their attempted assassination of the negotiators in Qatar, these same negotiators are now in Cairo. The magnifying glass is now focused on Israel, they broke the last ceasefire deal. There are many who are skeptical that they actually want an end to the Gaza conflict until the people are gone. It seems there is also growing opposition inside of Israel after 2 years of war.

Then there is still the looming question of war with Iran, which seems imminent. Would war with Iran be a quick death for any end to the Gaza conflict?

It is unlikely that real peace is possible without a change of policy from Israel and that may require new leadership.

Bait and Switch Gaza deal dead. WW3 risks rise.

 MEDIA EVENT WITHOUT REAL SOLUTIONS

NO ONE CAN BE TRUSTED, NO GOOD FAITH

It is clear that the deal for Gaza will not be accepted, nor will it be renegotiated. It has been revealed that the Arab community which tentatively approved a deal, saw a far different deal when displayed on national Tv. It seems after meeting with Netanyahu, the deal was changed to make it unacceptable to Hamas and the other Arab leaders, probably intentionally. Of course, now it can be blamed on Hamas and the killing can continue. The deal basically required surrender and perpetual subjugation by Israel.

It also appears that a major attack on Iran is in the works and there is speculation that this will be coordinated with escalation in Ukraine and even a possible attack on Venezuela. Is the plan now to cut oil supplies to China from the middle east, destabilize Iran as vital link in the belt and road initiative and tie up Russia in Ukraine to avoid intervention? A complicated and dangerous plan with many risks. 

There is little doubt that an attack on Iran is being prepared, it seems large amounts of materials and resources moving to the middle east can not be concealed. At the same time we see France illegally boarded and detained a Russian ship in international waters with the public acknowledgment that they want to destabilize Russia's supply chain, an act of war.  Estonia also is advocating embargoing all sea traffic out of St. Petersburg, another illegal act. All this is coupled with political election shenanigans in Romania and Moldova to possibly open another front over Ukraine. There are continuing reports of expanded U.S. preparations for an operation on Venezuela to control that oil and deny it to China and other buyers.

One can expect the subjects of these attacks understand these realities better than anyone, and one must wonder when they may come to believe that they would be best served with a massive pre-emptive attack.

While for a time it appeared we had moved back from a potential WW3, any such plan will indeed be WW3, once it starts, the odds are in favor of ending in a nuclear confrontation.

Is Venezuela a threat to U.S. ?

 WHAT'S UP WITH POSSIBLE WAR WITH VENEZUELA?

DO WE NEED MORE FIRES TO DEAL WITH?

Speculation abounds that the U.S. is expected to take military action with Venezuela. We know that opposition to the government of Venezuela has been a hot topic ever since the election of the socialist government of Hugo Chavez in 1998. Chavez put in many policies of redistribution and nationalized much of the industries in the country. It seems he was elected in a democratic elections and popular with a majority of the country, by a small margin.  He died at an early age in 2013 and was followed by Nicolas Maduro, as he was vice president.  He was elected later in a special election with a narrow margin of 1.5%. In later elections the last which was in 2024 there have been accusations of corruption and fraud. In 2019 many claimed that the country was moving to a dictatorship and the U.S. and Organization of America States considered the president of the Assembly, Juan Guaido as the legitimate president. 

Accusations by Maduro of assassination attempts and internal unrest fanned by the CIA have been prevalent for years. John Bolton under Trump advocated military intervention in Venezuela in Thump's first term. At that time the accusation was spreading communism or his human rights violations in Venezuela.

Recently there have accusations of Venezuela being a major drug supplier to the U.S. While we can expect that there is drug business in Venezuela it is most likely dwarfed by such business in Mexico, Columbia, Canada, and even the U.S.  

As for Communism and socialism, I do recall the whole reason for the war in Viet Nam was the spread of communism, the  domino theory. Today Viet Nam is still a dedicated communist country with government advocacy for communism on the internet, yet it is visited by American presidents and has most favored trade arrangements. I expect, like much like our middle east policy, it is all about oil. Oil that Venezuela would sell in any amount, one would desire to buy.

The biggest method of the continuation of dictatorships and communist dictatorships in particular, is the always continuous external threats, sanctions and fear of foreign intervention.  Communism and socialism are failed economic policies that will in time fail, as in the Soviet Union and even in the western democracies. Foreign intervention and threats will usually unify the citizens around even the leaders they despise and thus prolong their power.

Secondly any military intervention in South America will raise red flags and anti-Americanism to new level in other places that view the U.S. as a bully and needs to be feared, opening the door for real opponents to take advantage.

I suspect that U.S. has enough crisis that it needs to address, without looking for more. Venezuela is not Panama or Grenada and the world is far different than in the 1980's. 

Military reform, a positive move for military morale.

HOPEFULLY THE END OF SOCIAL ENGINEERING IN THE MILITARY 

ALL STANDARDS TO BE BASED ON MERIT

Yesterday, Pete Hegseth, the head of the defense department, made his big speech before the high ranking members of the military. It was a surprisingly well delivered and appropriate speech in an effort to restore the integrity and morale of the United States military. It was in effect declaring the end of social engineering in the military, an end of all woke policies and return of uniform standards for all without special cutouts or exceptions, especially for combat soldiers.

All soldiers would need to qualify on a semi-annual basis, combat standards would be based on male expected performance. Uniform and personal hair and beard standards would be uniform as in former times. He stated that these standards would be the same for all members of the military.

I would hope that there would be still exceptions for the older commanders of the military, if look at the past we have seen in war some of the best commanders would not have been able to compete physically with 20 year old soldiers, General Schwarzkopf and in fact the present commander in chief would be good examples. Many of the high ranking generals of the past were valuable for their experience and decision making ability rather than physical ability. 

I watched all of Hegseth's speech and part of Trump's, I think it would have been best to have let Hegseth have his day, Trump did his usual political highlighting of accomplishments. The major statement he made was reiterating that the U.S. is in effect, out of the Ukraine conflict. Weapons would be sold to the EU members and they can do what they want with them. He made it clear that there will not be any more aid to Ukraine. We will see if this is true.

Many believed this was some sort of preparation for war, but I believe it was just the much needed reform to make the military a high morale and cohesive fighting force, as in the past.