Previously, I have shown how we could be close to major financial crisis with the monetary system at the center. The following chart that shows the ratio of gold to the monetary base was used:
.
.
The chart shows the ratio of the gold price to the St. Louis Adjusted Monetary Base back to 1918. That is the gold price in US dollars divided by the St. Louis Adjusted Monetary Base in billions of US dollars. (from macrotrends.com)
You can get more details about the chart and the commentary here.
It would seem that we are now closer to point b, where that major monetary event could start to happen. An event similar to the 1933 gold confiscation (bankruptcy) and the 1971 announcement where the US ended the dollar convertibility to gold (at a fixed rate).
The stock market was always going to be the trigger for this event, and it is now very extended. When it falls over, we can almost be sure that big financial pain is coming.
Below, is a more short-term chart of the ratio of the gold price to the monetary base:
The ratio is getting ready to pop. There is no certainty when the crisis would hit; however, it will come some time during the rally and after/during the stock market crash. Physical gold and silver will likely be key assets during this crisis.
*
Note to readers: please click the share buttons above. Forward this article to your email lists. Crosspost on your blog site, internet forums. etc.
Disclaimer: The contents of this article are of sole responsibility of the author(s). The Centre for Research on Globalization will not be responsible for any inaccurate or incorrect statement in this article. The Centre of Research on Globalization grants permission to cross-post Global Research articles on community internet sites as long the source and copyright are acknowledged together with a hyperlink to the original Global Research article. For publication of Global Research articles in print or other forms including commercial internet sites, contact: [email protected]
www.globalresearch.ca contains copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available to our readers under the provisions of "fair use" in an effort to advance a better understanding of political, economic and social issues. The material on this site is distributed without profit to those who have expressed a prior interest in receiving it for research and educational purposes. If you wish to use copyrighted material for purposes other than "fair use" you must request permission from the
copyright owner.
