Private Sector Is Hurting and Washington’s on a Spending Spree

Across the country people have seen their retirement funds halved. Companies have tightened their belts as they sought to rein in spending and remain profitable. As a result, many workers have lost their jobs and unemployment is bumping 9 percent, the highest rate in years.

Salary reductions, reduced shift lengths, forced vacations and job cuts have forced families to cut back on their spending. Even those who have not yet lost jobs or faced cutbacks on their paychecks are spending less and saving more, hoping to set up a buffer against the news that another job is lost.

Yet as the personal (individual families) and private (businesses) sectors cut their spending, increase their savings and pay down their debt and cut their workforce the government—at least on the Federal level—is doing just the opposite.

In April, private sector employment fell by 611,000 jobs, according to the United States Department of Labor (DOL). That leaves 13.7 million people in the country unemployed. But, Federal government jobs increased by 66,000 the same month.

And spending? A new budget more than $3 trillion; stimulus package $787 billion; Troubled Asset Relief Program (TARP) $700 billion; and it all adds up to more spending this year than all the previous years combined spending in U.S. history.

And what about those people who are voting to spend this money—your money—while you struggle to make ends meet and look toward the possibility of working an additional 10 years just to recover your lost retirement? Have their retirement funds taken a similar hit?

Not on your life. You see, the pensions of the president, senators and congressmen don’t work like yours and mine.

Rather than going into an IRA or 401(k), theirs is managed by the government. They are backed by the full faith and credit of the U.S. Participants (senators and representatives) put in their contributions and the federal government makes an employer contribution to cover any balances, according to Pete Sepp, vice president for Policy and Communications of the National Taxpayers Union.

The operations of those retirement funds are overseen by federally funded boards, Sepp said.

So, is it any wonder that politicians on the Federal level seem unconcerned about the state of the economy beyond the political ramifications on the next election cycle?

Now you know why Federal-level politicians aren’t showing the same angst as most people over the state of the economy. “The fundamentals of the economy are strong,” Senator John McCain said during the presidential election. Now President Barack Obama says the same thing.

And it is if you work for the Federal government where when you need a little cash all you have to do is fire up the printing press for another run.

But on Main Street, auto dealers, coffee shop owners, gift shop owners, restaurateurs, blue collar workers and white collar workers all have a different take. And it shows once again that there is a standard for “them” and one for the rest of us.

Expert: Research on link between vitamin D and Alzheimer’s ‘warranted’

Research on link between vitamin D and Alzheimer's 'warranted'A California scientist has been arguing there is a good reason to conduct more in-depth research on the possible causative link between vitamin D levels and the development of Alzheimer’s disease.

Dr. William B. Grant of the Sunlight, Nutrition and Health Research Center, writing in the current issue of the Journal of Alzheimer’s Disease, analyzes a growing body of evidence linking the development of Alzheimer’s disease and vascular dementia to vitamin D deficiency.

The key piece of the puzzle, in his view, is that low serum levels of vitamin D have been associated with increased risk for cardiovascular diseases, diabetes, depression, cavities, osteoporosis and periodontal disease.

These conditions, in turn, are considered either a risk factor for dementia or may precede its onset.

Scientists also believe the vitamin plays a role in inflammation reduction as well as brain development and function.

Grant says the elderly tend to be vitamin D deficient, and those over the age of 60 should consider having their serum vitamin D tested and aim to maintain it at the level of at least 30 ng/mL but preferably over 40 ng/mL.

Recent studies have found that the average blood levels of vitamin D have decreased in the U.S. between 1994 and 2004, and American teenagers are at a particular risk for the deficiency.

As a result, health practitioners have suggested increasing the daily recommended doses of the vitamin to as much as 2,000 IUD.
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Clashes loom over Guantanamo detainees

Clashes loom over Guantanamo detaineesPresident Obama’s decision to close the Guantanamo Bay prison has put the future of its detainees in the spotlight, and a political battle is on the horizon over the issue of bringing some of the terrorist suspects to the U.S. for trial.

Earlier this month, the media reported on plans to bring a group of Chinese Muslims, known as Uyghurs, to a prison in Fairfax County, Virginia, sparking a great deal of controversy.

A Republican congressman from Virginia, Frank Wolf, has been explicit in his opposition.

"[The Uyghurs are] one group that … should be released somewhere abroad," he said, quoted by CBS.

"There is potential radicalization … having been at Guantanamo for seven years," he added.

However, his Democratic counterpart Jim Moran has said it makes sense to settle the men in Uyghurs communities, such as the one in northern Virginia.

"To just detain somebody to rot in prison for the rest of their lives, who is in there because they oppose the policies of a nation that we also oppose, is not a sufficient plan of action," Moran added, quoted by the AP.

Moran is referring to the fact that Uyghurs are persecuted in China for their opposition to the communist government, and there have been speculations their presence in Afghanistan may have been linked to their domestic political activities rather than links to international terrorism.

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Sotomayor nomination continues to stoke controversy

Sotomayor nomination continues to stoke controversy In the days since President Obama has announced Sonia Sotomayor’s nomination to the U.S. Supreme Court, a variety of conservative groups have expressed their reservations.

Calling her "a radical pick," Americans United for Life has criticized the judge’s allegedly activist record and expressed concern that her appointment will perpetuate what it calls the Supreme Court’s role as a "national abortion control board."

"This appointment would provide a pedestal for an avowed judicial activist to impose her personal policy and beliefs onto others … at a time when the courts are at a crossroad and critical abortion regulations like partial-birth abortion and informed consent laws lie in the balance," it said.

Meanwhile, Citizens Committee for the Right to Keep and Bear Arms has said the nomination validates the concerns of millions of American citizens who fear their Second Amendment rights are in jeopardy under the current administration.

It has pointed to the fact that Sotomayor was part of a Second Circuit Court panel that ruled in Maloney v. Cuomo in January that the Second Amendment does not apply to the states, which is in conflict with a Ninth Circuit opinion this spring in Nordyke v. King that it is incorporated to the states, and therefore places limits on their ability to regulate the right to bear arms.

Commentators across the board are expecting partisan confirmation hearings for the 54-year-old Sotomayor.
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Industry insiders offer tips on debt management

Industry insiders offer tips on debt management The Illinois CPA Society has provided advice on how to stay out of debt during challenging economic times.

It has issued its 10 Strokes to Stay Afloat to help Americans navigate through the turbulent economic waters. They include common sense advice such as the need to tread carefully with spending and creating a budget to ensure that it does not exceed disposable income.

The Society also stresses the importance of taking care of big savings projects such as retirement or college.

Even those who sustained serious losses due to the stock market collapse may recover by making well-considered decisions or consulting a trusted financial advisor to devise a strategy based on how close the individual is to retirement.

Meanwhile, parents of college-bound children should not worry if they have not saved enough to cover the expenses, the Society says.

There is a plethora of tuition assistance options, starting from the Free Application for Federal Student Aid form that should be submitted on time to open doors to government funding.

Moreover, it is wise to explore local or national private grants and scholarships which can save families thousands of dollars in educational expenses.

The Illinois CPA Society also reminds readers that with record low mortgage rates, large inventories of unsold homes and an $8,000 new homebuyer’s credit for 2009 now is a great time to buy or refinance a house.
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Preterm birth risk appears to fall with folic acid supplementation

Preterm birth risk appears to fall with folic acid supplementation A new study has suggested women who take folic acid for at least one year before they become pregnant may reduce their risk of having a premature baby by half.

The results are significant given the serious human and economic costs of premature births as preemies are at an increased risk of complications such as cerebral palsy, mental retardation, chronic lung disease and blindness.

The study, conducted by scientists from the University of Texas Medical Branch at Galveston analyzed folate supplementation of 38,033 participants in an earlier trial sponsored by the National Institutes of Health.

The effect holds regardless of age, race or other health factors, they say.

Dr. Alan R. Fleischman, senior vice president and medical director of the March of Dimes, says it has been known for a long time that folic acid supplementation beginning before pregnancy and continuing into the first trimester helps prevent serious birth defects of the brain and spinal cord.

"[The new] research reinforces our message that every woman of childbearing age should consume 400 micrograms of folic acid daily," he adds.

The study was published online in the journal PLoS Medicine.
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Louisiana schools oppose college gun laws

Louisiana schools oppose college gun laws As Texas lawmakers passed a bill which allows concealed weapons on state college campuses, a coalition of Louisiana higher education institutions has vowed to push back against similar laws in their state.

Seven Louisiana state universities, including Louisiana Tech University, University of Louisiana-Lafayette and Southern University A&M College, have signed resolutions opposing efforts to arm students.

"America’s college campuses are among the safest environments for students because they do not permit guns on their premises," says Andy Pelosi, president of GunFreeKids.org, which launched the Campaign to Keep Guns Off Campus last December.

"If the gun [lobby succeeds] our universities will become less safe and prone to more violence. And if lawmakers truly believe in creating a safe learning environment for students, they will oppose [their] extremist legislation," he adds.

Anti-gun groups have also accused the gun lobby of using the Virginia tech tragedy as a cover to promote their agenda of pushing guns "into every nook and cranny of our society, including our schools," in the words of John Johnson, outreach coordinator for the campaign.

In Louisiana legislature, the pending House Bill 27 would allow students, professors and staff who have weapons licenses to carry hidden and loaded handguns onto campuses as well as in classrooms and at sporting events.
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IRS zeros in on wealthy individuals, companies

IRS zeros in on wealthy individuals, companiesThe Internal Revenue Service has said it is expanding its audit efforts among rich individuals and companies with foreign operations in an effort to enhance its enforcement.

According to Reuters, the statement came in response to one congressmen citing data which suggests the IRS audit rate for millionaires fell 19 percent between 2007 and 2008, while for big corporations it allegedly declined by 9 percent from 2005 to 2008.

"Our long-term investment is to have a trend where wealthy individuals, large corporations, [and all those] who have benefited from being in the U.S. … pay their taxes," said IRS Commissioner Douglas Shulman, quoted by the news source.

Shulman has also urged House lawmakers to enact President Obama’s proposals to fight offshore tax evasion, which include a $400 million increase in the IRS enforcement budget over fiscal year 2009 funding levels.

Earlier this year, the IRS announced a six-month amnesty program to encourage individuals and companies holding assets in offshore accounts to voluntarily declare them in exchange for lower penalties and avoidance of criminal prosecution as long as the assets were acquired legally.
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Scientists to collaborate on herbal remedies for swine flu

Scientists to collaborate on herbal remedies for swine flu A partnership that has been announced between scientific research centers from Mexico and China aims to explore a role of herbal medicines in containing the outbreak of the H1N1 flu.

The agreement between Mexico’s National Polytechnic Institute (IPN) and China Medical University in Beijing is expected to be signed in July, according to Xinhua News Agency.

It quoted Javier Grandini Gonzalez, director of the IPN’s National Medicine and Homeopathy School, as praising both countries’ "excellent" record in herbal medicine study.

Herbal therapies, along with acupuncture, exercise Qi Gong and massage have been the cornerstones of Chinese medicine dating back more than 2,000 years.

"We are seeking to find in the herbal traditions [of the two countries] plants that serve as anti-virals," said Guillermo Perez Ishiwara, the IPN’s head of postgraduate studies and research, quoted by the agency.

"Some of the components of herbal formulas may stimulate the immune response, which means they could become an alternative in preventing any outbreak that may come in winter," he added.

The current outbreak of the H1N1 influenza, also known as the swine flu, originated in Mexico in early April of this year. To date, it has killed more than 100 while infecting some 4,500 people in the country.
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A Memorable Memorial Day

I don’t know how it was in your neck of the woods, but I’m delighted to report that in our area, this Memorial Day was truly memorable. There were lots of flags flying on our street; the cemeteries (especially those containing the remains of veterans) were filled with flags and flowers; many of the stores and supermarkets — and even the local baseball game — observed a few moments of silence at 3:00 pm, as our country paused to pay tribute to all those who made the ultimate sacrifice for freedom.

And while I have been very critical of our new president for many of his policies and proposals — and expect to be again — I have to say, I was very pleased by Barack Obama’s actions this past Monday.

His day began with a breakfast in the White House for several "Gold Star" families. These are the relatives of service men and women who were killed in action on behalf of their country.

Later that afternoon, President Obama laid a wreath at the Tomb of the Unknowns in Arlington Cemetery. This annual ceremony dates back 141 years and I’m glad the current occupant of the White House continued to observe it. In his remarks, the President said that the men and women buried at Arlington "waged war so that we may know peace." Then he continued, "They were willing to give up everything for the defense of our freedom [and] were willing to sacrifice all for their country." And he concluded, "They are the best of America."

President Obama also sent wreaths to two other memorials — the Confederate Memorial at Arlington and the African American Civil War Memorial in Washington. A week ago, a group of 60 professors urged the President to break with tradition and not honor veterans who fought for the Confederacy. I’m happy to report that the White House ignored the request.

Other Memorial Day events in our nation’s capitol included a separate Memorial Day observance at the Vietnam Veterans Memorial, a National Memorial Day Parade in front of the Capitol, and a concert of patriotic music on the west lawn of the Capitol building that evening.

Memorial Day was first celebrated on May 30, 1868, three years after the end of the Civil War. Earlier that month, the Grand Army of the Republic urged that the day be celebrated as follows:

"The 30th day of May, 1868, is designated for the purpose of strewing with flowers or otherwise decorating the graves of comrades who died in defense of their country during the late rebellion, and whose bodies now lie in almost every city, village, and hamlet churchyard in the land. In this observance no form or ceremony is prescribed, but posts and comrades will in their own way arrange such fitting services and testimonials of respect as circumstances may permit."

At the end of World War I, Memorial Day—or Decoration Day, as it was then called—was expanded to commemorate American casualties of any war or military action. For many years, the holiday was celebrated on May 30th, no matter what day of the week that happened to be. But in 1968, Congress in its infinite wisdom decided that we needed more three-day weekends. So it decreed that the event would henceforth be celebrated on the fourth Monday of May.

It’s easy to understand why, for many people, Memorial Day has come to represent the unofficial beginning of summer. It’s a time for picnics and parties and lounging at the beach. But I’m happy to see that the day still means so much more to so many people.

Texas approves gun bill

Texas approves gun bill Despite protests of anti-gun activists, Texas legislature has voted to allow college students and employees to carry concealed handguns on campus.

According to Houston Chronicle, the bill allows students who are at least 21 years old and licensed to carry concealed handguns to bring those weapons into state campus buildings, although private institutions will be able to opt out.

Only university hospitals and athletic facilities will remain off limits to guns, it says.

"I would feel personally guilty if I woke up one morning and read that something similar had occurred on a Texas campus," said State Senator Jeff Wentworth, a Republican, who introduced the bill after the 2007 massacre at Virginia Tech, quoted by the newspaper.

However, his Democratic counterpart Rodney Ellis expressed concern that the situation could confuse police, who will not know if a person carrying a gun on campus is violating the law or not.

"When there is an alcohol-related tragedy on campus, you don’t hear claims that giving students a 12-pack is the solution," he was quoted as saying. "Yet, when it comes to gun-related incidents, we seem to think that putting more guns in the mix will lead to a good, rather than bloody outcome."

Despite the developments in Texas, seven Louisiana state universities have recently signed resolutions opposing legislation to permit the carrying of loaded guns on college campuses.
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California upholds ban on same-sex marriage

California upholds ban on same-sex marriage Ratifying the results of last year’s popular vote, the California Supreme Court upheld a ban on same-gender marriages yesterday, sparking fierce debate between critics and supporters of the move.

The ruling is based on the passage last November of Proposition 8 which sought to restrict the definition of marriage to opposite-sex couples.

Family Research Council President Tony Perkins has praised the court’s decision.

"California’s constitution gives its citizens the right of self-governance and we are pleased that the court resisted demands to strip the right of the people to amend the state constitution," he stated.

"Even this widely-recognized liberal court understands that overturning Proposition 8 would represent a repudiation of the state constitution it is sworn to uphold," Perkins added.

Meanwhile, supporters of gay marriage, who called the decision a sad day for freedom and fairness, have said the civil rights struggle this case represents has not yet ended.

"Across the state, community gatherings will demonstrate the continuing support for marriage equality … and prepare for taking the necessary next steps forward toward securing civil marriage equality at the state and federal levels," LA Gay & Lesbian Center said in a statement.

Yesterday’s decision preserves the 18,000 same-sex marriages performed last year between the justices’ ruling in May that same-sex marriage was constitutional and the passage of Proposition 8.

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Experts stress role of exercise in chronic disease management

Experts stress role of exercise in chronic disease management Although emphasizing it is not a magic bullet, experts are using the Exercise is Medicine Month to focus attention on the benefits of physical activity for overall health.

In particular, they say there is growing evidence exercise may help prevent or manage the symptoms of diabetes, arthritis as well as heart disease.

"We know exercise is a great preventative for chronic illnesses, but it should be included in the treatment planning of these illnesses, as well,"says Dr. Andrea Boyd, assistant professor of physiological and technological nursing in the Medical College of Georgia School of Nursing.

"Whether you’re healthy or not, exercise has the potential to improve quality of life and make you feel better, and this is a great time to get started," she adds.

However, she cautions physical activity is not a one-size-fits-all prescription, and before embarking on any routine it is important to explore which exercises benefit patients with heart failure, and which are best suited for hypertension or other conditions.

According to the Centers for Disease Control and Prevention, $76 billion in annual direct medical costs can be attributed to physical inactivity which has been associated not only with obesity and diabetes but also cancer, depression and osteoporosis.
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Blood Viscosity and pH Balance

The blood must circulate in a continuous pattern in order to provide nutrition to trillions of cells, as well as remove and transport wastes to the kidneys and lungs.

Anything that slows down blood circulation, even for a fraction of a second, can result in oxygen depletion, leading to severe damage to organs. This is directly related to the blood viscosity, its rate of flow which is directly affected by blood composition. The main reason blood flow is hindered is due to high viscosity. Blood viscosity is four times greater than water viscosity. Acidic water increases blood viscosity.

Consumption of water is far more than just hydration. It should also remove acidity from tissues, and increase cell detoxification.

Conclusion: If we have acid/alkaline (pH) balance slightly in favor of alkaline, then we don’t draw on our bone calcium, complicating or compromising our health.

Symptoms of "acid indigestion" or "heartburn" don’t originate in the stomach but in the body tissue, which can be corrected by high doses of calcium lactate and Cataplex F.

Remember we said that the papilloma virus causing cervical cancer in women is because too much calcium is trapped in the blood. Some women accumulate too much vitamin D from the sun in the hot summertime. Vitamin D pulls calcium from the gut into the blood. We said this is relieved with the fatty acid Cataplex F which causes the high blood calcium to diffuse into the body tissue. So vitamin D loads the blood with calcium and Cataplex F releases or diffuses the calcium into the tissue.

The very important conclusion is that we need higher doses of calcium lactate plus Cataplex F to guarantee adequate tissue calcium.

Most people who are sick and enter the hospital have low tissue calcium or by another name—low diffusable calcium. However, it is never tested by doctors. Low tissue calcium means pathology and sickness.

So we have two body acids, one very strong acid in the stomach created to function without buffering with alkaline. The second is tissue acidity created by acid foods and acid water to be corrected with vitamin D, calcium lactate and Cataplex F. Adequate diffusable calcium in the body tissue will stop all symptoms of "acid indigestion" and maintain teeth and bone health.

If we mostly avoid the sun—and most of us do—we need vitamin D3 plus calcium lactate plus Cataplex F.

And we need to make sure we drink alkaline water using alkaline drops. You can test your own water.

Obama Supreme Court nominee touted as “moderate liberal”

President Obama has nominated Sonia Sotomayor, a current federal judge on the U.S. Court of Appeals for the Second Circuit, to the U.S. Supreme Court to replace retiring Justice David Souter.

In making the announcement, the president called Sotomayor "an inspiring woman" and said, "[She] has worked at almost every level of our judicial system, providing her with a depth of experience and a breadth of perspective that will be invaluable as a Supreme Court justice."

However, critics have been quick to stress her "activist" record as exemplified by her 2008 opinion supporting the city of New Haven’s decision to annul the results of a firefighter promotion exam because almost no minorities qualified for promotions.

While promising a "fair" treatment during the confirmation process, Senate Minority Leader Mitch McConnell, a Kentucky Republican, said, "[we] will thoroughly examine [Sotomayor’s] record to ensure she understands that the role of a jurist in our democracy is to apply the law evenhandedly, despite their own feelings or personal or political preferences."

If confirmed – as is highly likely given the Democrat-dominated Senate – Sotomayor, 54, will be the first Hispanic U.S. Supreme Court justice and the third woman to serve on the high court.

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Credit card law includes gun provisions

Credit card law includes gun provisionsPro-gun advocates have praised the law signed by President Obama last Friday that includes a clause which allows guns to be carried in national parks.

As explained by Obama, the main purpose of the legislation is to bring clarity and transparency to the credit card market to protect customers from some of the techniques used by credit card companies such as unexpected fees and interest rate increases.

Among its provisions are a ban on retroactive interest rate hikes and an end to "late-fee traps," such as due dates that fall on weekends or change every month.

The new law is also designed to restrict credit card companies from advertising among and enrolling college students without the knowledge of their parents.

However, the bill also includes a provision that makes it legal to carry concealed and loaded guns and rifles in national parks.

The measure was supported by Senator Tom Coburn, an Oklahoma Republican, and endorsed by the National Rifle Association which argued the law would enable law-abiding citizens to defend themselves against acts of violence in the parks.

However, opponents counter by saying it will make the parks less safe.

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Scientists eye herb in diabetes treatment

Scientists eye herb in diabetes treatment Diabetes therapy may be in for a breakthrough if a particular type of African tea turns out to be useful in the fight against the debilitating disease, scientists say.

Danish scientists first studied the application of the tea on genetically diabetic mice. The liquid is obtained by boiling the leaves, young stalks and fruit of Rauvolfia vomitoria and Citrus aurantium, and has been used as a treatment in traditional Nigerian medicine.

The animal tests showed that after six weeks of daily consumption, combined with a low-fat diet, the pancreas health improved.

The researchers have recently completed a four-month long clinical test on human patients with type 2 diabetes who drank 750 ml of the tea each day and reported encouraging results.

"The [African tea] appears to differentiate itself from other current type 2 diabetes treatments because [it] does not initially affect the sugar content of the blood," says Joan Campbell-Tofte from the University of Copenhagen.

"But after four months of treatment we can see a significant increase in glucose tolerance," she adds.

The researchers say the patients who drank the tea had higher levels of polyunsaturated fatty acids, which make cell membranes more permeable, resulting in better glucose absorption from the blood.

According to the CDC, more than 23 million Americans are affected by diabetes, and between 90 and 95 percent of diagnosed cases involved type 2 diabetes.

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IMF Gold Sales May Be Reality This Time

This week we begin a new feature on Personal Liberty Digest which will appear the second and fourth Tuesday of each month. It is a column by Brien Lundin, president of Jefferson Financial and editor of Gold Newsletter. Brien has been editing Gold Newsletter since 1993, and during that time has provided readers with timely and profitable analysis of the precious metals and mining share markets and the economic and geopolitical issues that impact them.

We urge you to read Brien’s columns and consider his advice as you adapt your wealth and asset protection strategies to today’s tumultuous environment. We are excited to bring you Brien’s twice-monthly contribution to Personal Liberty Digest.

Thanks,


Bob Livingston, Editor
The Bob Livingston Letter
Personal Liberty Alerts

The Federal Reserve’s decision in late March to dive into quantitative easing was a watershed event in the gold market. It meant that a tidal wave of newly created money was headed our way.

Gold soared on the news. But this shouldn’t make gold investors complacent. In fact, we knew the market was sure to test our convictions, and harshly.

The first of those tests came and was administered by our official sector headmasters. In retrospect, we should have expected it. As experienced gold investors know, whenever the authorities feel the yellow metal is getting “out of hand,” the same tired old canard of central bank/International Monetary Fund (IMF) gold sales is dusted off.

And so it was on the close of the G20 summit in London, just before the heads of state gathered for a round of back-slapping, glad-handing and ear-to-ear grins in front of flashing cameras.

The summit was a surreal blend of glitz, glamour, bluff and bluster—the kind of two-dimensional publicity event that usually has no significant effect or long-term relevance. But this time there may be some very real and dramatic consequences.

Of course, the trillions of dollars of fiat currency pledged to the IMF and sundry international banks and bureaucracies will end up in the pockets of corrupt government officials in developing nations across the globe. It will also line the pockets of the minions staffing the institutions doling out the cash. The result will be more economic harm than good, and more fiat currency sloshing around the world.

Granted, the trumpeted claims of progress toward a new, socialist world order arising out of the summit were a bit disturbing, given our president’s tacit support of such devolution. But these things take more time to develop than the typical leader remains in power, and there doesn’t appear to be anyone—President Barack Obama included—with the necessary charisma to lead the entire world into socialistic decline.

So the most important development to come out of the summit was something most regarded as a minor side note: unanimous support for the sale of 403 tonnes of IMF gold.

The stated goal of the sales was to “use the additional resources from agreed IMF gold sales for concessional finance for the poorest countries.”

Apparently the original purpose of the funds when these sales were first raised months ago (to create an endowment to fund IMF salaries and keep these bureaucrats in high cotton) wasn’t polling well. You can rest assured, though, that the purpose will remain the same, regardless of the new packaging.

But, given the timing, the announcement was apparently intended to stymie a gold rally. And considering the unprecedented global monetary reflation now being perpetrated, it might seem especially important to push these sales through.

Of course, every time IMF gold sales have been proposed before, the announcements have had successively less effect on the market. It got to where you could almost hear the yawns from trading desks around the world.

The difference this time is that, with the Obama administration and the Democratic majority joining forces to expand government at the expense of individual rights, it seems very likely that IMF gold sales will receive the necessary approval by today’s left-leaning Congress. In fact, none other than the brilliant and entirely misguided Democratic Congressman Barney Frank has come out in support of the IMF gold sales, if about a third of the proceeds are dedicated toward “loans” that will further indenture poor countries.

As a side note, don’t be misled by those putting forth the bearish argument that, if the IMF is selling 403 tonnes (12.5 percent) of its 3,217-tonne gold hoard, what’s to prevent it from selling the remaining 2,814 tonnes?

The IMF’s founding Article of Agreement will prevent it. The remaining gold held by the IMF is actually owned by its member nations, according to their initial funding ratios and subsequent payments. IMF rules state that this gold cannot be sold to the market—it can only be sold back to the member countries that own it and the price of such a sale would be at the previously prevailing official price of 35 Special Drawing Rights (SDRs) per ounce.

An “SDR” is currently held to be worth $1.49783, so the IMF would be forced to sell its remaining gold to the respective countries at a price of $52.42 per ounce. It’s not likely that this bureaucracy will look to such an undertaking—which would concurrently destroy the value of its balance sheet—as a profitable venture.

While it remains to be seen whether the U.S. Congress will approve the 403-tonne IMF sale, much damage has already been done as gold investors were punished by the monetary overlords for being impudent enough to fight the oncoming inflationary tide.

In effect, resisting today’s political winds puts the average, freedom-loving investor in a worse position than if he were the victim of a mob protection racket. At least with the mob there is some honor among criminals…and there is the hope of justice through the legal system.

But when the U.S. government—and some “new world order”—are the ones robbing you blind, where do you turn for help?

Before giving up all hope, we need to remember that every previous attempt to rein in gold has only served to send the metal to greater heights.

Patience and persistence is the key, as the broad sweep of global events continues to turn in favor of gold.