Capital controls, here we come

It must be an election year.  Senator Lieberman is trying to pass legislation to discourage speculation in crude oil.  It's those greedy speculators that are driving up the price of oil.  So if he has his way, pension funds won't be able to invest in oil.

Trouble is, it's not just oil that's going up.  It's also natural gas, silver, gold, copper, tin, zinc, aluminum, iron, lead, corn, wheat, soybeans, and just about any other commodity you could name.  The real problem is that it's not these commodities going up as much as it is the US dollar going down.

That's how we protect ourselves from the depreciation of our currency; we buy stuff that might hold its value.  A year from now, I expect the price of oil, gold, silver, and anything else tangible to cost more because the government is increasing the money supply at the rate of at least 16% a year.

Maybe Senator Lieberman and his colleagues in Congress and the frat boy in the White House could start spending our money as though it were THEIR money.  Then they wouldn't have to monetize the debt that foreign central banks have finally learned not to buy.  We've only been running this scam for 37 years, but they finally figured out there hasn't been anything backing our dollars since 1971.

I happened to be in England in August, 1971 when then-President Nixon dissolved the Bretton Woods agreement, and decided to let the dollar float.  He really didn't have any choice.  Those dastardly French suspected that gold was worth a lot more than 35 of our dollars, and started demanding payment in real money.  Fort Knox would have emptied in a hurry (which it probably is anyway, but that's another story) if Nixon didn't close the gold window when he did.

But I digress.  As we enter the Way Back Machine again, it's August, 1971.  My dad was working in England on business, so I spent six weeks there.  But when the dollar floated (i.e sank)our money was no good.  For a couple of days we had to eat all of our meals in the hotel restaurant because no one knew what a dollar was worth.  We didn't have a lot of local currency, and we normally charged meals to a company credit card, but the good people at VISA had no idea how many dollars a British pound was worth.

So here we are again.  We have lots of dollars; we just can't use them to buy anything useful, like for instance oil.  So take my advice and buy oil, gold, silver and anything else of value while you can.  Because soon these things will be rationed, and with rationing comes shortages.  Tried to buy a Silver Eagle from the US Mint lately?