Gold is the final refuge against universal currency debasement

States accounting for two-thirds of the global economy are either holding down their exchange rates by direct intervention or steering currencies lower in an attempt to shift problems on to somebody else, each with their own plausible justification. Nothing like this has been seen since the 1930s.

“We live in an amazing world. Everybody has big budget deficits and big easy money but somehow the world as a whole cannot fully employ itself,” said former Fed chair Paul Volcker in Chris Whalen’s new book Inflated: How Money and Debt Built the American Dream.

“It is a serious question. We are no longer talking about a single country having a big depression but the entire world.”

The US and Britain are debasing coinage to alleviate the pain of debt-busts, and to revive their export industries: China is debasing to off-load its manufacturing overcapacity on to the rest of the world, though it has a trade surplus with the US of $20bn (£12.6bn) a month.

Premier Wen Jiabao confesses that China’s ability to maintain social order depends on a suppressed currency. A 20pc revaluation would be unbearable. “I can’t imagine how many Chinese factories will go bankrupt, how many Chinese workers will lose their jobs,” he said.

Plead he might, but tempers in Washington are rising. Congress will vote next week on the Currency Reform for Fair Trade Act, intended to make it much harder for the Commerce Department to avoid imposing “remedial tariffs” on Chinese goods deemed to be receiving “benefit” from an unduly weak currency.

Japan has intervened to stop the strong yen tipping the country into a deflation death spiral, though it too has a trade surplus. There is suspicion in Tokyo that Beijing’s record purchase of Japanese debt in June, July, and August was not entirely friendly, intended to secure yuan-yen advantage and perhaps to damage Japan’s industry at a time of escalating strategic tensions in the Pacific region.

We have a new world order where China and India are buying gold on every dip, where the West faces an ageing crisis, and where the sovereign states of the US, Japan, and most of Western Europe have public debt trajectories near or beyond the point of no return.

The managers of all four reserve currencies are playing fast and loose: the Fed is clipping the dollar; the Bank of England is clipping sterling; the European Central Bank is buying the bonds of EMU debtors to stave off insolvency, something it vowed never to do just months ago; and the Bank of Japan has just carried out two trillion yen of “unsterilized” intervention.

Continue reading - Gold is the final refuge against universal currency debasement

BP's Shock Waves

It was sickening enough when British oil giant BP set new standards for corporate scumbaggery in the Deepwater Horizon oil spill, turning the Gulf of Mexico into its own personal toilet and imperiling entire species of wildlife in an attempt to save a few nickels. But with the Gulf geyser finally capped, there's still a way for BP to cause an even more unthinkable disaster: an AIG-style, derivative-fueled financial shitstorm. If the company decides to declare bankruptcy — a very real possibility with these bastards — it could trigger chaos in our casino system of finance, underscoring the insane levels of leverage and systemic risk we have left in place, even after the global economic crash of 2008.

The first serious whiff of trouble came on June 15th, when Barack Obama manned up and went on national TV to tell the nation that he wasn't going to let BP worm its way out of this one. "We will make BP pay for the damage their company has caused," he declared, vowing to push BP to set aside $20 billion to clean up its mess and compensate victims.

That sound you heard the very next day was Wall Street's collective asshole slamming shut in terror. If the government was seriously going to stick BP with the tab for the worst environmental disaster in America's history, then there was suddenly a real chance that one of the most lucrative moneymaking machines the world has ever seen could go bankrupt. And if there's one thing we've learned from the disastrous implosion of AIG, there is no such thing anymore as a giant company dying alone.

To Wall Street, a firm like BP isn't just a profitable energy company with lots of assets like oil rigs and pipelines and gas stations — it's also a corporation that routinely borrows hundreds of millions of dollars to keep its business up and running. And as a Grade-A corporate borrower of the first rank, BP and its debt are at the center of billions of dollars of gambling action on Wall Street, in the same way millions of home mortgages fueled the vortex of credit-default swaps and other derivatives that crashed the world's economy in 2008.

In today's casino economy, you don't need the permission of a company like BP (or a homeowner in Florida, or a country like Greece) to place a bet on their debt. You don't need to put any money down to back your losses. And there's no limit to how many times you can wager on the same outcome: A company may have only taken out $1 million in loans, but scores of banks, hedge funds and other financial players might cumulatively wager $100 million on whether or not the company will pay off that single million on time. That's why, if a behemoth as large as BP goes under, it can cause losses beyond its own liabilities: Derivatives now comprise a virtually unregulated shadow economy that is 100 times larger than the federal budget.

Continue reading - BP's Shock Waves

MUST WATCH! Mike Maloney Schools Bankers on Deflation, Gold and Silver

Mike Maloney was recently invited to speak at the 8th International Banking Forum in Sochi, Russia. The purpose of the conference was for bankers from around the world to meet and discuss the current state of the global economy, the banking system, and strategies for protecting their personal wealth (hence the speaking spot for Mike).

The first morning passed without too much fuss as each speaker gave an introduction and a brief talk on his or her area of expertise. However, by the end of the day...it became obvious that something was definitely wrong. After speaking with many of the attendees, Mike was alarmed to find that practically none of the international bankers understood our present monetary system. Most had no idea how currency is created! Here at wealthcycles.com, we've often wondered exactly how well modern day bankers understand the worldwide predicament that we find ourselves in. Ladies and gentlemen, our worst fears have been confirmed - the lights are on, but there's nobody home.

Mike's presentation on personal protection of wealth changed overnight, into one of basic education on our monetary system. How can anybody take the role of wealth protection (or running an economy!) seriously unless they can see the massive storm that lies ahead?

Whether you are a banker or a baker, a lawyer or a bricklayer...the time to get educated is NOW. We hope you enjoy Mike's frantic effort to awaken the conference from its slumber. It would have been nice for Mike to finish his speech, but perhaps there was a little too much reality on the stage for these Masters Of The Matrix, the Demigods Of Delusion.

$10 Oil? Mike Maloney Schools Bankers on Deflation, Gold and Silver (Part 1 of 2)


$10 Oil? Mike Maloney Schools Bankers on Deflation, Gold and Silver (Part 2 of 2)

Fractional Reserve Banking Demystified

We have already described one part of the contemporary flight from sound, free market money to statized and inflated money: the abolition of the gold standard by Franklin Roosevelt in 1933, and the substitution of fiat paper tickets by the Federal Reserve as our "monetary standard." Another crucial part of this process was the federal cartelization of the nation's banks through the creation of the Federal Reserve System in 1913.

Banking is a particularly arcane part of the economic system; one of the problems is that the word "bank" covers many different activities, with very different implications. During the Renaissance era, the Medicis in Italy and the Fuggers in Germany, were "bankers"; their banking, however, was not only private but also began at least as a legitimate, non-inflationary, and highly productive activity. Essentially, these were "merchant-bankers," who started as prominent merchants. In the course of their trade, the merchants began to extend credit to their customers, and in the case of these great banking families, the credit or "banking" part of their operations eventually overshadowed their mercantile activities. These firms lent money out of their own profits and savings, and earned interest from the loans. Hence, they were channels for the productive investment of their own savings.

To the extent that banks lend their own savings, or mobilize the savings of others, their activities are productive and unexceptionable. Even in our current commercial banking system, if I buy a $10,000 CD ("certificate of deposit") redeemable in six months, earning a certain fixed interest return, I am taking my savings and lending it to a bank, which in turn lends it out at a higher interest rate, the differential being the bank's earnings for the function of channeling savings into the hands of credit-worthy or productive borrowers. There is no problem with this process.

The same is even true of the great "investment banking" houses, which developed as industrial capitalism flowered in the nineteenth century. Investment bankers would take their own capital, or capital invested or loaned by others, to underwrite corporations gathering capital by selling securities to stockholders and creditors. The problem with the investment bankers is that one of their major fields of investment was the underwriting of government bonds, which plunged them hip-deep into politics, giving them a powerful incentive for pressuring and manipulating governments, so that taxes would be levied to pay off their and their clients' government bonds. Hence, the powerful and baleful political influence of investment bankers in the nineteenth and twentieth centuries: in particular, the Rothschilds in Western Europe, and Jay Cooke and the House of Morgan in the United States.

By the late nineteenth century, the Morgans took the lead in trying to pressure the U.S. government to cartelize industries they were interested in – first railroads and then manufacturing: to protect these industries from the winds of free competition, and to use the power of government to enable these industries to restrict production and raise prices.

In particular, the investment bankers acted as a ginger group to work for the cartelization of commercial banks. To some extent, commercial bankers lend out their own capital and money acquired by CDs. But most commercial banking is "deposit banking" based on a gigantic scam: the idea, which most depositors believe, that their money is down at the bank, ready to be redeemed in cash at any time. If Jim has a checking account of $1,000 at a local bank, Jim knows that this is a "demand deposit," that is, that the bank pledges to pay him $1,000 in cash, on demand, anytime he wishes to "get his money out." Naturally, the Jims of this world are convinced that their money is safely there, in the bank, for them to take out at any time. Hence, they think of their checking account as equivalent to a warehouse receipt. If they put a chair in a warehouse before going on a trip, they expect to get the chair back whenever they present the receipt. Unfortunately, while banks depend on the warehouse analogy, the depositors are systematically deluded. Their money ain't there.

An honest warehouse makes sure that the goods entrusted to its care are there, in its storeroom or vault. But banks operate very differently, at least since the days of such deposit banks as the Banks of Amsterdam and Hamburg in the seventeenth century, which indeed acted as warehouses and backed all of their receipts fully by the assets deposited, e.g., gold and silver. This honest deposit or "giro" banking is called "100 percent reserve" banking. Ever since, banks have habitually created warehouse receipts (originally bank notes and now deposits) out of thin air. Essentially, they are counterfeiters of fake warehouse-receipts to cash or standard money, which circulate as if they were genuine, fully backed notes or checking accounts. Banks make money by literally creating money out of thin air, nowadays exclusively deposits rather than bank notes. This sort of swindling or counterfeiting is dignified by the term "fractional-reserve banking," which means that bank deposits are backed by only a small fraction of the cash they promise to have at hand and redeem. (Right now, in the United States, this minimum fraction is fixed by the Federal Reserve System at 10 percent.)

Continue reading - Fractional Reserve Banking by Murrah N. Rothbard

Bill to ban Fractional Reserve Banking introduced in the UK

UK House of Commons
Ten Minute Rule Motion; Financial Services (Deposits and Lending)

Douglas Carswell's UK banking reform bill, first reading (2010-09-15)

Alan Greenspan: "Fiat money has no place to go but gold"

Alan Greenspan spoke at the Council on Foreign Relations earlier today, and what was his advice? That central bankers should be doing what these columns, among others, have been rattling on about, namely that they should be paying attention to gold. “Fiat money has no place to go but gold,” the former Fed chairman said at the Council, according to economist David Malpass, who quotes Mr. Greenspan in one of Mr. Malpass’ emails on the political economy. Mr. Malpass writes that the former chairman of the Federal Reserve’s board of governors was responding to a question in respect of why gold was hitting new highs.

Mr. Greenspan replied that he’d thought a lot about gold prices over the years and decided the supply and demand explanations treating gold like other commodities “simply don’t pan out,” as Mr. Malpass characterized Mr. Greenspan. “He’d concluded that gold is simply different,” Mr. Malpass wrote. At one point Mr. Greenspan spoke of how, during World War II, the Allies going into North Africa found gold was insisted on in the payment of bribes.* Said the former Fed chairman: “If all currencies are moving up or down together, the question is: relative to what? Gold is the canary in the coal mine. It signals problems with respect to currency markets. Central banks should pay attention to it.”

To which, forgive us, one can only say, “Now he tells us.” The fact is that if Mr. Greenspan governed the Fed with an eye on gold, it wasn’t a particularly steady eye. He might argue that when he left the chairmanship of the Fed, in January 2006, he left a dollar worth a 400th of an ounce of gold, slightly more valuable than the 461st of an ounce of gold that it was worth when he came in nearly 20 years before. But in the first five years of the 21st century, when he was in the last quarter of his years as chairman, the value of the dollar started its long collapse, plunging from the 282nd of an ounce of gold that it was worth on January 4, 2000. In the years since, it has cratered to record lows once imagined only by such sages as Ron Paul.

Mr. Greenspan’s remarks at the council were not the first time he gave us a glimpse of his views on gold. He discusses gold on several pages of his memoir, “The Age of Turulence,” reminding that he once told a Congressional committee that “monetary policy should make even a fiat money economy behave ‘as though anchored by gold.’” He wrote that he had “always harbored a nostalgia for the gold standard’s inherent price stability.” But he confesses that he’s “long since acquiesced in the fact that the gold standard does not readily accommodate the widely accepted current view of the appropriate functions of government — in particular the need for government to provide a social safety net.”

The American people, he asserted in his book, have for the most part “tolerated the inflation bias as an acceptable cost of the modern welfare state.” And he claimed, “There is no support for the gold standard today, and I see no likelihood of its return.” We’ll hazard a guess that the statement makes him a man more of the past than of the future. But at least some politicians are hearkening to his advice about the price of gold. They’re people like Congressman Ron Paul and his son, Rand, who may yet be a senator, and Governor Palin, who was one of the first to warn about the gold price, and Congressman Paul Ryan, who asked Mr. Greenspan’s successor, Ben Bernanke about gold.

And, by the way, a few journalists, like Glenn Beck, who are students of history and just can’t believe their eyes that the dollar has plunged to the level it has with so few people raising an alarm. We are in a period when gold is more than a canary — to cite Mr. Greenspan’s bird of choice — it’s a full-throated rooster, cock-a-doodling at the top of its lungs. It was nice to see Mr. Greenspan mark the point at the Council. Would that he’d taken more of his own advice. And nice to see Mr. Malpass mark the Greenspan comments so prominently in his letter to his economic clients. He is more for a gold price rule in monetary policy than a gold standard, but we hope he makes another run for high office at the first chance, and presses the principle for all its worth. It’s what we need in the national debate, and none too soon.

________

* Not just in World War II did the special role of gold come into focus. Covering the fall of free Saigon for the Wall Street Journal in April 1975, your editor witnessed a bank run in which panicked Vietnamese citizens, in the streets outside the financial institutions, bought, when they could, gold that had been pressed into sheets the size and approximate thickness of cigarette paper.

Continue reading - Greenspan’s Warning on Gold

Council on Foreign Relations - A Conversation with Alan Greenspan (Video)

Jim Rogers: Get Rid of the Fed!

On Freedom Watch with Judge Napolitano, Jim Rogers discusses the massive US debt, what he’d do as Treasury Secretary, and the future of the country if Washington doesn’t change course.

The debt problem is a problem for “you, me, and our parents,” says Rogers. “This is a problem that’s hitting all of us in the face right now.” Rogers explains that Washington is only concerned with re-election, not whether the country survives.

If Treasury Secretary, Rogers would cut spending dramatically, cut taxes, let the American people decide what to do with their money, and abolish the Federal Reserve. He predicts the economy will continue to decline, the currency will continue to weaken, interest rates will rise, and more inflation will result if Washington continues its current path.

“You have to have people who save and invest to have a thriving economy. In Washington, they’re destroying the saving class. People who save money and have done the right thing for the past ten years are suddenly being smashed because they get zero interest on their savings. When you destroy the saving class, you destroy the future of your country.”

Jim Rogers on Freedom Watch Sept 11 2010

French Protests

More global outrage as we progress further with the current fraudulent enslaving economy. Raising retirement age and reforming pension simply do not solve the underlying root causes. The only solution is to end the banking oligarchy and ignite a groundbreaking revolution for the sake of humanity.

Millions Demonstrate in France Against Planned Retirement Age Rise


"Millions" protest as unions fight pension reform


French Strike Over Pension Reforms


Sarkozy pensions plan faces angry French street

Malaysian Muslims Go for Gold, But It's Hard to Make Change

KOTA BHARU, Malaysia—Umar Vadillo bounds into a hotel room here in northern Malaysia with several stacks of gold and silver coins in his hands and slaps them down on a coffee table. "This," Mr. Vadillo says, "is what it means to be free."

A quarter century ago, this Spanish-born Muslim convert set to work with other European Muslims to find a substitute for the U.S. dollar and other paper currencies.

Pricing goods in greenbacks, they argued, was unfair. Many countries earn their income from finite resources like oil and other minerals, they said, while the U.S. and other countries can crank up their printing presses to pay for them—especially after Richard Nixon helped break the Western world's historical dependence on gold as a measure of value by taking America off the gold standard in 1971.

Last month, Mr. Vadillo's solution took shape when the local Muslim-led government in Malaysia's Kelantan state joined forces with Mr. Vadillo to introduce Islamic-style gold dinar coins as alternative currency.

Mr. Vadillo and the Kelantan government have persuaded more than a thousand businesses here in the state capital, Kota Bharu, to paste stickers in store windows saying they accept the coins.

Ordinary people can also pay taxes and water bills in gold and silver instead of paper money.

"Our lands are being subjugated," says Mr. Vadillo, a powerfully built 46-year-old with a shiny suit, swept-back hair and a tidy goatee. "Today, in Kelantan, we're fighting back."

Plenty of people have their doubts about the dollar, as well as other currencies that aren't backed by gold or silver.

American libertarians such as Ron Paul frequently call for the reintroduction of a gold-backed currency, arguing that the Federal Reserve's ability to print money causes inflation and destroys savings.

Gold bulls have developed a cult following among investors who worry that precious metals are the only reliable store of value during rocky economic times.

If there's a utopia being formed for the globe's gold bugs, though, it's happening in a few unexpected outposts in the Muslim world like Kelantan.

Mostly that is because some Islamic thinkers teach that using currencies whose value is declared by governments is a form of usury. A piece of paper, they say, is just an IOU.

But with the global economy showing fresh signs of faltering, some believers think there's also a strong financial incentive to switch to gold dinars or the silver coins, known as dirhams.

At the Peter Libly tailor shop in central Kota Bharu, proprietor Ariffin Yusof reckons the new dinars "save people from exploitation."

"Gold is money because people make it money. Paper money is money because governments make it money," says Peter Schiff, President of Euro Pacific Capital Inc. in Westport, Conn., and a notable dollar bear. "But what happens if people lose their faith in governments, and the U.S. government in particular?"

Continue reading - Malaysian Muslims Go for Gold, But It's Hard to Make Change

Campaign For Liberty Rising

"Our presidential campaign ignited a revolution," said Congressman Ron Paul as he announced the launch of Campaign for Liberty. Dr. Paul had a vision for an organization that would harness the enthusiasm surrounding his presidential campaign while maintaining an unwavering resolve to carry the torch of liberty far into the future. Just over 2 years later, C4L membership has flourished nationwide, and activism courses consistently fill to capacity. Already, Campaign for Liberty is on its way to becoming the most influential political organization not only in the country but also in the world. Hello C4L from the other part of the world.

C4L Rising

Overdose - The Next Financial Crisis

In times of crisis people seek strong leaders and simple solutions. But what if their solutions are identical to the mistakes that caused the very crisis? This is the story of the greatest economic crisis of our age, the one that awaits us.

Overdose: The Next Financial Crisis

Even Tony Robbins Is Warning That An Economic Collapse Is Coming

It seems like almost everyone is warning of a coming economic collapse these days. Do you remember Tony Robbins? He is probably the world's best known "motivational speaker" and his infomercials dominated late night television during the 80s and 90s. He was always urging all of us to "unleash the power within" and to take charge of our lives. Well guess what? Now Tony Robbins is warning that an economic collapse is coming. In fact, he has issued a special video warning about what he believes is about to happen. Considering the incredible connections that he has at the highest levels of the financial world, it makes a lot of sense to consider what he is trying to warn us about. Robbins says that a "major retracement" is coming to financial markets and that the coming collapse is going to be a "painful process" as we go through it. Those familiar with Tony Robbins know that he always goes out of his way to stress the positive, so if even he is openly warning the public about a coming economic nightmare than you know that things are starting to get really, really bad out there.

The video that Tony Robbins published where he gives his economic warning is posted in two parts below. This is unlike any Tony Robbins video that you have ever seen before and it is absolutely jaw dropping....

Tony Robbins Economic Warning 1-2


Tony Robbins Economic Warning 2-2

Wall Street's Big Win

Cue the credits: the era of financial thuggery is officially over. Three hellish years of panic, all done and gone – the mass bankruptcies, midnight bailouts, shotgun mergers of dying megabanks, high-stakes SEC investigations, all capped by a legislative orgy in which industry lobbyists hurled more than $600 million at Congress. It all supposedly came to an end one Wednesday morning a few weeks back, when President Obama, flanked by hundreds of party flacks and congressional bigwigs, stepped up to the lectern at an extravagant ceremony to sign into law his sweeping new bill to clean up Wall Street.

Obama's speech introducing the massive law brimmed with celebratory finality. He threw around lofty phrases like "never again" and "no more." He proclaimed the end of unfair credit-card-rate hikes and issued a fatwa on abusive mortgage practices and the shady loans that helped fuel the debt bubble. The message was clear: The sheriff was padlocking the Wall Street casino, and the government was taking decisive steps to unfuck our hopelessly broken economy.

But is the nightmare really over, or is this just another Inception-style trick ending? It's hard to figure, given all the absurd rhetoric emanating from the leadership of both parties. Obama and the Democrats boasted that the bill is the "toughest financial reform since the ones we created in the aftermath of the Great Depression" – a claim that would maybe be more impressive if Congress had passed any financial reforms since the Great Depression, or at least any that didn't specifically involve radically undoing the Depression-era laws.

he Republicans, meanwhile, were predictably hysterical. They described the new law – officially known as the Dodd-Frank Wall Street Reform and Consumer Protection Act – as something not far from a full-blown Marxist seizure of the means of production. House ­Minority Leader John Boehner shrieked that it was like "killing an ant with a nuclear weapon," apparently forgetting that the ant crisis in question wiped out about 40 percent of the world's wealth in a little over a year, making its smallness highly debatable.

But Dodd-Frank was neither an FDR-style, paradigm-shifting reform, nor a historic assault on free enterprise. What it was, ultimately, was a cop-out, a Band-Aid on a severed artery. If it marks the end of anything at all, it represents the end of the best opportunity we had to do something real about the criminal hijacking of America's financial-services industry. During the yearlong legislative battle that forged this bill, Congress took a long, hard look at the shape of the modern American economy – and then decided that it didn't have the stones to wipe out our country's one ­dependably thriving profit center: theft.

Continue reading - Wall Street's Big Win

Malaysian Province Moves To Gold And Silver-Based Currency In "Main Islamic Event Of The Last 100 Years"

More world governments are "just saying no" to the ponzi. Last week, the Malaysian government of Kelantan "said it was introducing a new monetary system featuring standardised gold and silver coins based on the traditional dinar and dirham coins once used by the Ottoman Empire." And as everyone who has taken game theory 101 knows, the first defector wins the most, while the last one is left with nothing. A small province in Malaysia just made the critical first defection. The question now is who will be next... and next...and next.

The FT reports:

Nik Abdul Aziz, the state’s chief minister, spoke in visionary terms of an economy in which state civil servants would be paid in the new sharia currency, and the poor would be protected against inflation by the intrinsic value of the precious metals used to produce it.

About 1,000 shops and restaurants in the state have said they will accept the new currency, which follows an earlier issue of gold dinars in 2006. The coins comply with traditional Islamic teaching on the use of coins with intrinsic value as a medium of exchange, rather than paper money.

And for those who think that the move is a regional hoax that is not being taken seriously by anyone, the Malaysian National News Agency Bernama notes that the repercussions of the "move to gold-standard" decision has reached the very top:

Only Bank Negara Malaysia (BNM) can issue currency that is legal tender, said Prime Minister Datuk Seri Najib Tun Razak.

Unlike the US, where the Coinage Act of 1965 gives citizens the right to use refuse the usage of cash in transactions (and thus opt in for a different form of currency), Malaysia is not quite as liberal:

Commenting on the Kelantan government's introduction of gold dinar and silver dirham as an alternative currency in the state, Najib said BNM would be looking into the matter to see if any laws had been broken.

"Follow the laws of the country, only Bank Negara is authorised to issue currency that is legal tender," he told reporters after handing over Ramadan aid to mosque and surau from the Pekan parliamentary constituency here Saturday.

On Thursday, when launching the Syariah currency, Kelantan Menteri Besar Datuk Nik Abdul Aziz Nik Mat had said the state would strive to expand the use of the gold dinar and silver dirham in all transactions, including paying civil servants' remuneration.

However, he said there were still many technicalities that had to be addressed by the state government over the use of the currency.

The New Straits Times in its front page today said BNM had stated that only it had the right under the law to issue currency in Malaysia.

If there is one thing we are sure about, is that any time the government steps in before a decision that has been taken by a clear majority, with the purpose of making life easier, the outcome is usually lethal, especially in volatile Islamic countries. Whether the transition from paper to a hard-backed currency will be the first spark in social upheavals as government slowly realize all their printer-induced leverage is slipping away, is still unknown. What is, however, is that many more will soon follow Kelantan's lead to abolish an endlessly dilutable thought experiment, which has no intrinsic value, and whose purchasing power is decimated by the minute, as hundreds of billions in new money are printed every month by the world's central banks. Yet perhaps, this is precisely the example that is needed for the world to realize that someone is actually willing to do more than just talk pointlessly about the transition to a gold standard, and actually is willing to risk enough by following through with it. What happens next is Ben Bernanke's worst nightmare.

Continue reading - Malaysian Province Moves To Gold And Silver-Based Currency In "Main Islamic Event Of The Last 100 Years"

BREAKING! Kelantan Wants To Have The Gold Standard Restored!

Alhamdulillah, we are happy to announce the news all of us have been waiting for – the official launch of Dinar and Dirham in the state of Kelantan will be held in its capital, Kota Bharu, on 12 August 2010.

The upcoming event in Kelantan is history in making as it marks the beginning of both, the rise of Islam and demise of Capitalism for the two can’t co-exist: when the light comes darkness disappears.

This is the first time in the last 100 years, since the fall of the Ottoman Caliphate, when a Muslim government introduces Shariah Currency. Indeed there has been four generations of Muslims who have not seen Gold Dinar and Silver Dirham; four generations of Muslims who have been divided into little national reservations and sentenced to permanent robbery first by local, then by international Masters of Riba; four generations of Muslims who haven’t known what is their Deen. The introduction of Gold Dinar and Silver Dirham in the state of Kelantan is not a new idea or experiment, it is the return to the medium of exchange that has been known for 1400 years throughout Dar al-Islam as Money of Shariah taking its legislation from Allah’s Revelation and Rasul’s Sunnah.

On the 12th August people of Kelantan are going to say “NO” to the insane world order created by bankers after WWII not by blasting offices and embassies nor by deciphering bloodlines and agendas of occult societies but by putting Halal money in their pockets.

On the 12th August people of Kelantan are going to say: “One Dinar – One Ummah”.

On the 12th August people of Kelantan will uplift dignity of Malays not through nationalistic UMNO-type policies of Bumiputra privileges but through restoration of Muamalat.

On the 12th August the government of Kelantan will start moving with the current, Divine Current, and every stroke in the direction of the current would bring Kelantan 10 times farther than a stroke against it; the first stroke will be the payment of 25% of salaries to public servants in Dinar and Dirham; all state companies will be accepting payments in Dinar and Dirham is another stroke; 600 shops will receive stickers “We Accept Dinar and Dirham” – yet another stroke.

However the 12th August is not the moment of celebration but rather the moment of Tauba, Tauba for all of us without exception, for we all have allowed the Deen of Islam, the most precious gift we were given, to slip away from our lives and replace it with primitive puritanical monotheism centered around sexuality, woman’s dress code and halal chicken, a religion which Umar Pasha Vadillo calls Islamic Protestantism.

Yes, before and especially on the 12 of August we have to put our foreheads on prayer mat in a long sajdah and ask forgiveness from Allah Subhanahu for letting Riba, the most heinous crime, become part of our daily existence, for our great Ulama in the past would not tolerate even one bank in their lands, let alone declare it Halal, because they really believed that “dirham of Riba is worse than adultery 36 times”. And there are Ulama today too who are not compromising the Deen, Umar Pasha Vadillo said in one of his lectures in Kazakhstan last year: “One bank on your street is worse than prostitution in your own family!”.

So this is the moment of realization of how far we have gone out of the Deen and how urgently we need to go back.

August 12 is not the end but the beginning of our affair as the Shariah currency is the first element to be put in place then to be followed by the second, Souq (Islamic market) which in turn will require all other elements of Islamic Muamalat to come into picture thus bringing an entire paradigm shift of what is money, trade, wealth, investment, - and what is not.

The ceremony will be attended by many guests: besides Chief Ministers of several Malaysian states, there will be government officials from Sulu Sultanate, Indonesia, Pakistan, Turkey, as well as leaders of various jama’as and organizations from Germany, Spain, Kazakhstan and other countries. The event will undoubtly signify the emergence of the new centre of the Islamic world in the 21st century: NUSANTARA.

Muslim leaders, activists and especially media are most welcome to Kota Bharu, Kelantan to witness the main Islamic event of the last 100 years.

As the historic day of 12th August approaches Muamalah Council Malaysia and its chairman, Hajj Umar Azmon, wish to express thankfulness to Datuk Nik Abdul Aziz and Datuk Husam Musa of Kelantan state government; may Allah grant Datuk Nik Abdul Aziz and Datuk Husam Musa, their families and their people total success in this world and, most importantly, in the next. Amin.

Continue reading -
KELANTAN LAUNCHES DINAR AND DIRHAM ON 12TH AUGUST 2010

Kelantan Government Reminded To Comply With The Law On Dinar

The Kelantan government is reminded against making new regulations indiscriminately such as using the gold dinar and silver dirham without referring to the federal government as it could be against the national regulation.

International Trade and Industry Minister Datuk Seri Mustapa Mohamed said the statement by Kelantan Menteri Besar Datuk Nik Abdul Aziz Nik Mat that the dinar and dirham would be used as alternative currencies clearly breached Bank Negara Malaysia (BNM) regulations.

"I advise the Kelantan government not to do so (introduce regulations) as it likes. Whatever it wants to do must be discussed, otherwise members of the public will be confused over the jurisdiction of the Federal and State governments.

"Matters concerning currency comes under the jurisdiction of the Federal government, and not the state government, and what had been done clearly breached the country's law. We have the constitution and regulations," he told reporters after chairing the meeting of the Kelantan Umno Liaison Body, here Saturday.

Two days ago, Nik Abdul Aziz had launched the dinar and dirham syariah currencies which would be used in day-to-day transactions including salary payments to civil servants.

About 1,000 entrepreneurs in the state were reported to have agreed to accept the gold dinar and silver dirham in their business transactions.

The Dinar and dirham are produced by a subsidiary of Perbadanan Menteri Besar Kelantan (PMBK), Kelantan Golden Trade.

Yesterday, the BNM pointed out that only the ringgit is the valid currency for payment for goods and services in the country and rejected the use of the dinar and dirham introduced in Kelantan.

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Go Go Datuk Nik Abdul Aziz Nik Mat, you have my full support. May all the heroism spirit of the Malaysians be with you. Restore the Gold Standard!