We all know what the establishment did in the 1970s. When gold raced over $800 in January 1980, they said, “We will pretend that this whole affair never happened. It is too embarrassing to admit that we were wrong and the gold bugs were right.” Those who do not learn from history are condemned to repeat it. And repeat it (the seventies) they are.

Silver can be described as gold’s little brother. It lags along behind gold, underperforming for a long time. Then, all of a sudden, it comes to life, makes up all of its underperformance and goes on to exceed gold to the upside. Gold has a reputation for stability and conservatism. Silver is volatile and subject to big price moves – both up and down.

There be some vile, dastardly creatures who seek their economic goods from others by stealing that which these others have produced. Back in the Dark Ages (an evil time) a class of men (the Medieval Aristocracy) organized criminal gangs to abuse, torture and rob the common people of their day. These men called themselves governments, and they gave the Dark Ages its name.

It is difficult to understand how idiocy like this gets parroted throughout our society when the only proper place for it is the mental institutions of said society.

Upon the completion of QE2, the U.S. money supply will have approximately tripled in some 3 years. What will the results be? Well, general prices in the U.S. will approximately triple.

Now you all know what has been going on in the markets over the past few weeks. The Fed has begun another program of the massive printing of money, this one labeled QE2 and estimated to amount to $600 billion (although larger numbers are mentioned). If we consider the (more than) doubling of the U.S. money supply which has occurred between mid-2008 and November 2010, then QE2 will bring the total increase in money up to approximately a triple. And this leads me to expect an increase in consumer prices (from current levels) to approximately triple over the next 3 years.

Today I would like to continue my discussion of the (so-called) Great Depression as this is the giant lie which is behind most of the other economic lies which have deceived so many people and cost them so much money.

America is in very big trouble because the inmates are in charge of the asylum. Bernanke, for example, thinks that he is boosting the U.S. economy. How is it possible to improve the nation’s economy by counterfeiting money?

It is well known that silver is more volatile than gold. You can make more, but you can lose more. The key is to know when silver is playing possum and when it is waking up.

Hey, wait a minute Mr. Geithner, weren’t you talking, just a minute ago, about love and good will toward all men? It’s only the political right which engages in hate. Aren’t you all men of the left? Aren’t you for love and peace? Then how could you have come into a field as benign and harmonious as economics and turned it into a war? After all, Adam Smith showed us that everything in economics operates by a harmony of self interest.

For those of you who are wondering just how far this current move in silver will carry, the price objective line offers a clue. It is currently closing in on $26. So we must consider the possibility that there will be a short term reaction in silver, which will take us back to the breakout point ($20-21).

Sad, sad news in the daily paper this week. We live in a world where the leaders of our country, and every country in the world, believe that there is nothing more to the production of wealth than to simply create, out of nothing, the money which symbolizes it.

Ah, yes, the silver bubble of 1978-80 was a time to remember in financial history. Bunker Hunt, heir to the H.L. Hunt fortune, became an aggressive bull on silver and tried to engineer a silver corner. But no one has ever engineered a corner on a free market, and Bunker Hunt did not become the first. He stayed too long. He overplayed his hand. And when the bubble collapsed, he lost his daddy’s fortune.

As we have seen, both gold and silver hit important highs in March 2008. However, since that time gold has gone up almost 30%, and silver is flat. So we have just been through a substantial period when silver lagged. Similarly, the exploration stocks (as measured by the CDNX) lagged badly in 2008. Will they now start to play catch up?

The world is about to get a sobering lesson over the next year or two as the precious metals markets move explosively to the up side. As happens so often in the affairs of men, reality is there in front of us just sitting and being itself. Yet so few of the species homo sapiens can see it.

My basic philosophy is that the universe is governed by the law of cause and effect. This is why science has been so successful in finding out so many relationships. If B occurs shortly after A occurs and if this happens again and again and again, it becomes more and more likely that A causes B.

In mid-September 2008, the New York Times began to scream, in a series of big headlines, that the nation was in a financial crisis. I have studied the American media, and it is absolutely amazing. The overwhelming majority of newspapers will pick up a line of propaganda from the Times and repeat it mindlessly ad infinitum.

The time has come. Look to the skies. ~ The price of gold is on the rise. ~ In bullish years, on Labor Day ~ The price of gold becomes in play.

The two biggest headlines in the New York Times over the course of the 20 th century were Pearl Harbor and the landing of men on the moon. The “financial crisis” of 2008 was only slightly behind these two in size of headline and quantity of space. And it surpassed them in frequency of repetition. Both Pearl Harbor and the moon landing only happened once. But the “financial crisis” of 2008, not being a real event, could be strung out and reported over and over.

Here is the problem. The client has not come to appreciate just how ignorant and irrational today’s media is. You can count on it. The media will speak with one voice and with great confidence. They will be humiliatingly and embarrassingly wrong, over and over and over. And then they will refuse to acknowledge their horrific error.

The last part of “hyperinflation” is “inflation,” and this is perhaps the most important part (because it receives the least comment). If we examine the word “inflation” as it is used outside of economics, then it always means a going up. For example, one inflates a balloon or an inner tube. Always it refers to something which gets bigger.

Strangely enough, some people in the gold bug community try to erect a wall between gold as an “investment” and gold as a political issue. “Investment” is in quotes because the abolition of the gold standard means that no investment is possible in the world anymore (with the possible exception of Switzerland).

Last week I argued that the theory of a coming decline in prices just around the corner was a balloon full of hot air, and like all such balloons it was bound to sail into the atmosphere. So far from this “deflation” theory being true, it is a deliberate falsehood and in fact is a very good indicator that the exact opposite will happen.

As with any misinformation, one must make a distinction between a deliberate lie and an honest mistake. As I have studied this, it is clear to me that, at the very top, it is deliberate.

Today I wish to continue my theme that the theory of “deflation” propounded by the media in late 2008 is the main enemy of speculator profits at this time. I have argued that the theory is false a) because there is not the slightest evidence of declining prices and b) because there is enormous evidence of a massive rise in prices to come (perhaps the greatest rise since the depreciation of the American continental from 1776 to 1780).