gata.org / By Fergus Hodgson, Gold Newsletter, Metairie, Louisiana / November 23, 2016
Many people seek gold as a safeguard against inflation of fiat currencies, but they often forget how fiat currencies came to be in the first place.
This blind spot has permitted the very same deceit to play out in our time — but without detection in the major financial press.
The blind spot is fractional reserves. It is the holding of precious metals — the hard money — below the number of claims of customers. It was the precursor to modern fiat currencies, which now only have shadow “reserves” of more cash. Similarly, conventional banks now hold cash as “reserves” for checkbook and digital money.
Who is the dummy in this situation? As Chris Powell of the Gold Anti-Trust Action Committee says, “If you don’t know who … you’re the dummy.”