This is an article posted by Jeff Nielson on Bullion Bulls Canada.
To those readers hoping/expecting to see Part II of “The Great Debate” when they stopped by our site today, I'm sorry to keep you in suspense. Once I had mapped-out what I wanted to say in that analysis, I realized that my explanation of certain aspects of the gold market would be better appreciated if I provided readers with some additional context.
There are many interesting and complicated facets to the gold market, and few are as intriguing or paradoxical as the love/hate relationship between bankers and gold miners. I got into some aspects of this marriage of strange bedfellows, anecdotally, in a recent commentary (“Goldman Sachs and Gold”), but there is still much more to be said.
In January of 1961 (a mere ten days after I was born), President Dwight Eisenhower gave one of the most famous speeches in American history – in his farewell address. Specifically, the speech was historic and remarkable because of one short passage, from which I take this excerpt:
We must guard against the acquisition of unwarranted influence, whether sought or unsought by the military industrial complex. The potential for the disastrous rise of misplaced power exists and will persist. We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals.
With nearly fifty years of hindsight to guide us, several observations can be made about those famous words. First, Eisenhower's warning was not so much “prophesy” as it was a description of what he saw already taking place around him.
The Vietnam War was already underway, even though few Americans realized it at that time (officially, the conflict is described as lasting from 1959-1975). The alliance of the military “machinery” in the U.S. government with large and powerful industrialists had already been cemented...and I'm sure readers are thinking: what the heck does this have to do with bankers and gold-miners?
In fact, by the very term “military industrial complex”, it is clear that Eisenhower was completely oblivious to the most malevolent force in this new alliance: the bankers. As writers such as Darryl Schoon continually remind us, using constant wars as a tool to drain the wealth of entire economies, and enslave people with debt was nothing “new” to the bankers, even back in 1961. They had already had more than two centuries of “practice” in hollowing-out the economy of the British Empire. With that economy sucked-dry, it was now time to do the same to the United States.
For the sake of brevity, the rest of the article is linked: