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Nickel
Ranttm:
Mr. Mental Explains -
The US Dollar Index

by Edgar J.
Steele

September 30,
2007

Downloadable audio files of
Mr. Mental Explains the US
Dollar Index:
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Note:  Tomorrow
morning, starting at 8 am Eastern time and 5 am Pacific Time, once again I will
be cohosting the Internet Radio Show, "Lighting the Fires of Liberty," for two
solid hours with the last Libertarian Presidential Candidate, Michael
Badnarik.  Go to http://www.truthnetradio.com/index.php?page=schedule
for different media-player links to the show and for information on the call-in
numbers.

My name is Edgar J. Steele.  This is a
Nickel Rant.

Ok, ok...I get it.  Though I
try to keep things pretty simple around here, many who follow my mutterings
simply have not read them all or paid attention or ... something.
So, let's review and consolidate for a moment.

Introducing Mr.
Mental

Or, perhaps I should adopt the superhero
persona I have for so long used only among my family members and closest
friends:  Mr. Mental.  "Aha, puny Earthlings!  No
wonder you are dazzled and befuddled.  How could you possibly hope to keep
up with the master of your universe ... Mr. Mental?"  (blare of
trumpets)  "Mr. Mental knows all.  Mr. Mental sees all."

The last time Mr. Mental put in a sustained
appearance, at the local bowling alley (yes, I admit it - I go bowling with my
kids about once every 3 or 4 years, whether I need to or not), he pointed toward
the pins and laughed with contempt.

With maniacal laughter and an imperious
tone:  "Pay attention, mere mortals, for Mr. Mental is about to show you
how this ridiculously easy game is played.  Watch, as Mr. Mental performs
what you would find impossible and bowls five straight strikes."
My son was doubled over with laughter.  Perhaps I've gone too
far, I thought, as my wife smirked at my youngest daughter and her new
boyfriend, Ringo.  Well, at least I don't look like him, I
thought.  Now I gotta do it.  Turning to the pins, I threw
a perfect strike, which added to the general hilarity.

Normally about a 110 bowler, I stood up
each of the next four times and pointed, Babe-Ruth-like, to the pins, insulting
the "insignificant human creatures" about myself and daring them to watch the
perfection of Mr. Mental in action.  Yep.  Five strikes in a
row.  They began to look at me strangely.  Secretly, I began to
wonder if it was an acid flashback.  This is a true
story.

Almost Always
Right

Lessee now, what was the point of all
that?  Oh ... yeah ... I'm generally right.  Often, unbelievably
so.  No, seriously.  Yes, I know you think you are
always right, but you and I both know how that usually works out,
now don't we?  Well, I am!  Right, that is.  If you don't
think so, then you obviously haven't read the economic and world war chapters in
my book.  Would Mr. Mental
lie to you?

US Dollar
Index

Probably the most repeated question I get
is about this mysterious dollar index I keep harping on - the one that I keep
saying is so significant.

The US Dollar Index is an average of six
foreign currencies, weighted in accordance with somebody's perception of their
relative importance in the year 1973, when the world's major nations first let
their currencies start to float "freely" against one another:

1. Euro - 57.6%.
2. Japanese Yen -
13.6%.
3. British Pound - 11.9%.
4. Canadian Dollar - 9.1%.
5. Swedish
Krona - 4.2%.
6. Swiss Franc - 3.6%.

In 1973, the Index started with a base of
100 for the US dollar.  Last Friday, for the very first time, the figure
fell below 78, the previous low-water mark set long ago.  That means that
the dollar has decreased in value by over 22% versus those six currencies since
1973.  Here is a chart of the US Dollar Index for the past 30
years:

Yes, the dollar was as much as 60% higher
than the index of those six currencies in the early 1980s.  Then, in 1992,
the dollar reached almost all the way down to 78 briefly.  In fact, the US
Dollar Index managed to threaten the level of 82 only a half-dozen times in its
history, crossing under 80 only once.

Looking at the chart, do you see now why I
made a such a to-do about 82 and why the Feds have moved heaven and earth to
defend the dollar at that level for so long?  Do you see why 80 was even
more important?  Do you see why 78 was ever so much more important?
Now you should understand why I said that I could not believe they would not at
least pay lip service to the 78 dollar.

Here's the same chart for the past year or
so, since the chart above ends in mid-2006:

When the markets closed on Friday, the
dollar was at its all-time low:  77.61.  It is twitching slightly just
now in the overseas markets, but tomorrow morning will tell us, finally, whether
WhirlyBen and his Mad Hatter Tea Party crowd at The Fed are throwing the dollar
overboard.  If they don't pull the dollar back up, then pull out the party
hats, because it is time to play musical chair.  That's just like musical
chairs, except only one person gets to safety when the music stops.

In reality, the damage already is
done.  The world watched the dollar breach 78 and then sit there over the
weekend.  Now they know it is possible.

All those foreign holders of massive dollar
stashes have got to be eyeballing each other, wondering when the first will make
a mad dash for the exit and try to sell his dollars before they become totally
worthless.  That, alone, now ensures the dollar's demise.

How is the Dollar Like
an Israeli Soldier?

It's just like Lebanon during Israel's most
recent invasion of that hapless little country, wherein the much-vaunted IDF got
its head handed back by a bunch of hole-popping Arabs firing anti-tank
RPGs.  When the smoke cleared and the Israelis went yelping home, tails
between their legs, all the Arabs throughout the Middle East looked at each
other and said, "Sumbitch!  Who'd a thunk it?"  Actually, it
sounded more like a lunch order from Ahab's All-Night Falafel stand, but you can
translate from the Idahun, can't you?

Israel is in much greater danger since its
Lebanese escapade than ever before.  And deservedly so, I say.  Well,
so is the dollar, now that it has been allowed to see the underside of 78 and
been left swimming in uncharted waters.

What I mean is, abandoning all historical
support levels indicates that hyperinflation now is the adopted policy of the
United States of Zion.  Oh ... that was that movie, wasn't it? The
Matrix or The Diary of Annie Strangelove or something or other.
You know - hyperinflation, as in you say, "dollar" and I laugh.
Hyperinflation, with kids dead of hunger, your sister hooking for cigarettes and
families living under overpasses.  Mass disease.  World War.
Police State.

So, what's new?, you might
ask.  You have no idea ... really.  None, whatsoever.  This is
going to become truly ugly, folks.  And it is why I harp on things
financial.  Just another way of telling where we are in the
program.

Better you should ask what that whistling
sound might be.  Hint:  it's just like the sound of air
slipping ever faster past your ears.  Such as  when you hang your head
out the car window with your dog ... or as you plummet into the yawning abyss
below.

Ok.  That was the good news.
That didn't sound so bad, did it?  The dollar is down by half in 20 years,
but things could be worse, you say?  Half.  That's why your
wife has to work while your mother didn't.  Half.
As in half a loaf.  Literally.

Now for the Bad
News

Now for the bad news.
All the currencies used in the US Dollar Index are inflating, meaning
becoming ever more worthless.  In other words, on our plunge into the
abyss, we simply are falling a little faster than the Japanese and the Brits and
the Europeans.

Then how do we tell how we are doing?
That's where so-called real money comes in and why the bankers have been
so eager to disconnect it from their increasingly-worthless paper money in their
attempt to convince you that it is just a relic.

That's the ultimate definition of fiat
currency, you know:  it is worth its intrinsic value.  In Zimbabwe
today, the currency actually is a much cheaper alternative to toilet paper,
believe it or not.  What's a US dollar worth?  What's a hundred-dollar
bill worth?  Yep.  And, yes, that is exactly where the dollar is
headed, folks.

What's real money?  Gold and
silver, but especially gold.  Here's a chart of "CPI-adjusted" gold.
The problem is, the government lies about everything now and says that CPI
(Consumer Price Inflation) is just 2% or so.  In fact, it is close to 15%
and has been for a while.

An honest chart of gold would look more
like the silver chart, below.  Problem is, the silver chart also is
"CPI-adjusted," which tells you just how cheap silver really is today (cheaper
than it ever has been, save only a couple of years ago, when it jumped from 6 to
14 in a few days).

Before things get worse, they will get
much worse, rest assured.  And you will be able to tell just how bad
by the prices of gold and silver.  The central bankers are on the verge of
losing control of the price of real money.  The first paper gold seller to
default will topple the entire house of cards.  That is why I issued the
call to exit all ETFs recently.  Who will it be?  Why do you suppose
they are so adamant about bailing out their buddies in the big banks?

Real
Money

The US Dollar Index shows us just a part of
the problem - the part that is getting bad faster than the economies of the
other countries that make up the Index.  But, truth be told, things are
going bad over there just as fast (faster in Britain, some might say).  We
are all going to Hell in a handbasket, as they say.  Who happens to
get there first is about as relevant as who is in the front row of a crashing
jetliner.

Problem is, we will be in the middle or
aftermath of WWIII by then.

When the prices of real money, gold
and silver, take off like skyrockets, then you will know that they have lost
control of them and only then will we learn just what a dollar is
worth.  This business of gold and silver doubling in price over the last
couple of years was peanuts, compared to what is coming.  Me?  I'm
using dollars to stock up on toilet paper, meanwhile, because that is a choice I
simply do not want to have to make.

New
America.  An idea whose time has come.

My name is Edgar J. Steele.  Thanks for listening.  Please visit my
web site, http://www.conspiracypenpal.com/,
for other messages just like this one.
-ed

Copyright ©2007, Edgar J. Steele

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