Gold & Silver's Dead Cat Bounce

Stationdealer
this theory by Millar is just return to gold backed BUT not the currency is backed but the currency that is mssing i.e. the debt is gold backed. ( Scratching head)
It could be CBs onna back debt with gold they have already sold off.

Looks like a huge "bounce" for a dead cat. ;)

The British economist Peter Millar speculated two years ago that a exponential rise in Gold prices might be necessary to prevent debt deflation:
While it is almost a year old, a study of the enduring importance of gold in the world economic system by R. Peter W. Millar, founder of Valu-Trac Investment Research Ltd. in Scotland (www.valu-trac.com), seems ever more compelling, and Millar graciously has agreed to let it be shared with you.

Millar stresses the periodic upward revaluation of gold as the mechanism for defeating a deflationary debt depression at the end of an economic cycle. Millar writes:

The first cycle unfolded as follows:
Phase 1: Stability under a gold standard until 1914.
Phase 2: Inflation until 1921, which resulted in a buildup of debt.
Phase 3: Disinflation, which brought stability and allowed asset inflation until 1929, but encouraged a further buildup of debt.
Phase 4: Instability after 1929 caused by deflation of assets from overpriced levels and exacerbated by excessive debt levels, leading to depression of economic activity.
Phase 5: Monetary reform enabled by a revaluation of gold to overcome deflationary debt depression.
In the second half of the 20th century we saw a repeat of the first three phases of the same cycle:
Phase 1: Stability from 1944 to 1968 under a gold standard.


Phase 2: Inflation from 1968 to 1981, which caused and justified another buildup of debt.
Phase 3: Disinflation from 1981 until the end of the 20th century, and maybe to the present.
However, it appears that Phase 4 (instability and ultimately deflation due to excessive debt) may have started. If so, Phase 5 (revaluation of the gold price to raise the monetary value of the world monetary base and hence reduce the burden of debt) becomes likely or inevitable. The extent of that revaluation would need to be major according to our calculations, probably by a factor of at least seven times, possibly up to 20 times the current price of gold.
The price of gold when Millar wrote his study, in May 2006, was about where it is tonight.

The full document can be read below:
PeterMillarGoldNoteMay06 http://www.scribd.com/doc/31183598/PeterMillarGoldNoteMay06

When Millar wrote that study gold in the visible market was trading at about $650 per ounce. Millar thus envisioned the necessity of a gold price of between $4,550 and $13,000. FOFOA puts golds current secret market price at around $6,000. On CNBC the other day, Rickards said he expected gold to reach $5,000 once the manipulation of the paper market was defeated.

It is observed by FOFA (USAGOLD)

that physical gold and contracts for gold are different things entirely. New contracts can be produced much faster than new physical gold can be mined. But when demand shifts from contracts to physical (which is happening), this puts great strain on the market that tries to price them as equals. And what must ultimately happen when this strain breaks the parity between physical gold and contract gold is that the membrane separating the Bank for International Settlements physical gold price from the ordinary market will break.
When this happens, all your debt problems will be reset to manageable and sustainable levels again. In fact, the entire monetary and financial order will be reset. This is going to happen. And the central bankers can make it happen whenever they want, when they finally feel the heat of the fire on their own butts.
The question though is when will the central bankers around the globe decide that the weight of debt has now reached beyond their manageable limits and let Gold take control.

Dear Ashraf ,

On your charts , Silver 100 MA cross over 200 MA ? or not yet ?

Hi ashraf and all traders ,
I think gold now prepare to Sell ( now = 1158.00 $)
I think the target of gold is S=1020