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World War III & Gold

By David Vaughn     Printer Friendly Version
Feb 20, 2004

Well, how about those weapons of mass destruction?

“Kay (David Kay, former chief of the US arms search in Iraq) said he now believes that Iraq did not have banned weapons before the war and had probably destroyed them more than a decade ago.” John Diamond, USA Today, 2-13-2004

And how many young men died searching for those “weapons of mass destruction” that now are acknowledged to have NEVER existed? Over 500 young American men & women who will never see their children grow up have given their lives battling a country that did “…not have banned weapons before the war and had probably destroyed them more than a decade ago.”

But let me ask this question.

Was the attack on Iraq ever really about just Saddam & his supposed “weapons of mass destruction?” And how stupid are we going to suppose our American Intelligence really is? Are we to believe now that this was just a silly & stupid intelligence mistake?

Well, maybe I am naive but I refuse to believe that the decision to conquer Iraq ever was just about dangerous stockpiled weapons. I suppose we just discount the fact that Iraq is home of the worlds second largest oil reserves? Yes, those oil reserves are just a coincidence & their consideration did not have any influence over these war decisions.

And if the decision was simply to remove Saddam & to hand the country back over to the Iraqi people how quickly has that been accomplished? Yes, Saddam was finally found hiding in a hole, but I’d be willing to bet that it will be a long time before the US exits totally out of Iraq & hands the country back over to the Iraqi people.

But really, my intent here is not to weigh whether or not these decisions were right or wrong. But my point here is to define the inevitable future consequences of these actions.

Actually, the entire apparatus of politics that involves what is presently happening in Iraq & that general area I am not even attempting to touch with even a 20 foot pole. What is happening over there is very complicated & I am sure the US objectives are many.

But we can attempt to examine what the long term results will be by becoming more heavily involved in this very volatile part of the world. And how do we sum up simply in an understandable & uncomplicated way what is happening in Iraq today?

We are in the midst of the beginning stages of a long term war involving the interests of the East & the interests of the West. And let me repeat again that we are merely at the BEGINNING of this conflict that will not be solved until either side totally capitulates.

And I sure do not see either side capitulating any time soon if ever.

The earlier world wars of the 20th Century did not begin overnight but the process leading up to those events simmered & stewed for years & years.

And so too events today are simmering.

But again the important point to grasp is that we are in an ever escalating war that is not going to be resolved any time soon. This conflict will involve battles for supremacy over currency, oil & domination of world markets.

Let me recommend here one individual who devotes his life to studying these conflicts today. His name is Richard Maybury & it is really worthwhile subscribing to his newsletter because this fellow does an excellent job studying & examining what is happening politically in the Middle East, Iraq & all these countries that involve the region that Richard Maybury has appropriately termed “Chaostan.”

But lets remain focused & go over the title of this article again, “World War III & Gold.”

Remember all the negative articles & negative stories about gold’s growing irrelevance just a few years ago? But these negative diatribes against gold came out when the glorious bull market was heading to 100,000 & the worlds only major concern then was who was presently being entertained under the Oval Office.

But those days have changed & our world is changing DRAMATICALLY every day.

“Borrowing & spending has been sustaining the US economy for so long that the phenomenon seems utterly unremarkable to most investors.” Bill Bonner, Daily Reckoning, 2-12-2004

In addition to learning who Richard Maybury is another smart cookie who is worth listening to regularly is Bill Bonner & his daily commentary. Editor

“The Feds flow-of -funds data show that net foreign claims on US assets already are $2.3 trillion, or about 21% of nominal GDP. That total is being added to at a current rate of about $550 billion a year,” says Kasriel (Northern Trust economist Paul Kasriel.) Bill Bonner, Daily Reckoning, 2-12-2004

And as the east/west conflict grows so too is the world’s positive perception of gold evolving. I know that most folks are hoping for a specific calamity to act as a switch that will trigger a sudden panic buying of gold & gold equities. Will this trigger event ever occur?

It really does not matter if a definitive trigger event ever occurs. We really do not need any sudden dramatic event to draw the world’s attention toward gold.


And in what other ways are world events evolving?

Let me remind folks that the US is no longer a nation whose wealth is measured by its ability to manufacture goods for the rest of the world. But now we have a “service” based economy & our national wealth is based on these “service” sector jobs.
Now let’s define these wonderful “service” sector jobs awaiting tomorrow’s children?

“Wal-Mart has replaced General Motors as the largest employer in America with over 1 million employees where, instead of earning a middle-class wage, workers earn starvation wages of $13,861 a year – a salary that is below the poverty line. Meanwhile, 4 out of the top richest people in America are relatives of Sam Walton, Wal-Marts’ founder, and are worth over $100 billion.” Representative Bernie Sanders, Daily Reckoning, 2-16-2004

The above data that we just read has always appalled me.

This family is worth over 100 billion but yet their employees are paid scratch & have no benefits. And did you read the documentary a year or so ago about Wal-Mart taking out life insurance policies on their employees so that Wal-Mart can profit when their employees kick the bucket?

“And, according to a recent study by the Haas School of Business, 14 million white-collar service jobs, representing 11% of the total US workforce, are in danger of being outsourced overseas. US workers who have been outsourced are not moving into better-paying jobs.” Daily Reckoning, 2-16-2004


The above text we just read is heavy so let’s read it again.


Let me give another plug here for Bill Bonner & his daily commentary which he writes from little street cafes in France. The man is good & his analysis is right on the mark. His column is very much worth reading daily to get a good picture of what is really going on in the world. Editor

Now let’s repeat what was the title to this article? “World War III & Gold”

Maybe these different events seem unrelated that we have covered so far: unemployment, debt, currency wars, east verses west conflicts, but do not be mistaken on what causes war. All these circumstances we have talked about are creating serious under currents of stress that will only build & intensify as time goes on. And it will be these cascading events that will eventually lead to greater regional & world conflict.

And as all these conflicts gather steam do you still want to believe that gold’s role is not also growing in the scheme of things? Continue to make no doubt that gold continues to represent the best investment of this dawning new century.

But let’s close by shifting our attention away from gold & on to something of even greater importance.

“The home is the most powerful place on earth. It is the cradle of the soul. Our minds & personalities, our loves & our hates, our fears & our dreams are all molded in the home. … IT IS SHEER HUBRIS TO THINK THAT WE ARE “SELF-MADE” WOMEN & MEN. We learn how to live from other people. We did not develop in a vacuum; we were taught how to function from other people & by no one more so than our parents & our siblings.” James Bryan Smith & Rich Mullins, An Arrow Pointing to Heaven, 2000

Some folks do not like it when the topic of conversation shifts to moral issues. And, indeed, there are gold & financial Internet websites that have policies that prohibit writers from discussing ethical & moral issues. But as we have said many, many times before: you can make all the money in the world, but money by itself with no family to share it with really means nothing.

“Many of us base our identity on what we do, or how we look, or how much money we have. BUT NONE OF THESE FORM THE FOUNDATION OF OUR TRUE IDENTITY.” James Bryan Smith & Rich Mullins, An Arrow Pointing to Heaven, 2000

Actually, my Dad said it best in a letter he wrote me years ago.

My wife & I had just gone through a bit of a spat. That woman walked out on me & headed out the door for 3 weeks without so much as a note to drive her point across. And I never quit respecting her for having had the courage to do that at the time. Anyway, after we got our act & our marriage back together my Dad wrote me a letter with his own earthly wisdom. The following is a text from that letter:

“I do not measure a man’s success by his breadwinning ability but also his success at being a whole man, and being able to command the willing love & respect of his wife & family.”

And as you invest for the future be sure to put your family first & your portfolio second.

For a conservative review of precious metals mining stocks & other significant contrarian plays subscribe to Gold Letter Alert. While Gold Letter is dedicated to the gold & silver stocks we have been asked by our subscribers to cover on occasion other contrarian plays as we run across exceptional situations.

It doesn’t hurt to have a little DIVERSITY among a portfolio & while our major emphasis will continue to be gold & silver we will also share with subscribers what we consider to be exceptional non mining contrarian plays that we run across via our connections & sources.

What makes many of these issues so attractive is their potential to often generate returns of over 100 times.

“Thank you for the recommendation.
Invested just a small sum.
Have already made over $400.
Proves your service is worthwhile!
Keep sending choice non-PM (non-gold contrarian recommendation) nuggets such as this.”
Wells Shoemaker

And your subscription to Gold Letter Alert is for life: your life or ours.

You will only find the Gold Letter Commentary on select websites that meet our high standards of journalistic excellence!

As a side note I just wanted to take the time to thank everyone for your kind messages & prayers concerning my Mother’s terminal cancer. We were informed today that she has about 3 weeks or less now & I have appreciated the kind emails concerning this circumstance.

If there is ever anything I can do for any of you out there please let me know & I’ll see what I can do.



David N. Vaughn
Gold Letter, Inc.
Gold Letter Website


February 20, 2004


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