That belief predisposes the fact that you can trust the people involved in the political and financial system.
I too am blindsided by paper money because it's worked for so long (the term long is of course relative to my own short-sightedness) and there has been ample flux built into the system to allow it to absorb ever growing levels of fraud, greed and laziness.
But it's over. It no longer works. You can't trust human beings because we are a pathetic lot. We're all greedy, it's no good blaming the banksters and the traders, if we could have profited personally from any of their shenanigans we would have had thoughts of how smart we were to outwit all those silly mugs working for a living.
I suspect the status quo will remain for some time to come, plodding along, bailing out this and that, talking up green shoots here and there, introducing regulations that probably already existed a decade ago, having inquiries into the larger bankruptcies and laying charges against the biggest prize scalps.
Meanwhile everyone will be still trying to make the killing that will make them rich, will be working the grey areas of every new regulation until that grey area now seems normal, seems ok, and inexorably start pressing into new grey areas.
Then, when everyone least expects it, despite all the Peter Shiffs, Ron Pauls and Jim Rogers in the world the whole shebang will come crashing down in a manner that will even leave the most pessimistic of us awe struck.
Paper money was good while the delusion existed that you could actually trust a human being. If you think you can trust a human being then I have a great used car that I'm selling for a really good price.
Fiat is finished in concept, just not in practice. All the while gold will rise and fall like a cork in the ocean until the tsunami built on decades of greed, mistrust, contempt, fraud, laziness and criminality blots out the horizon and sends the cork skywards.
When exactly that will happen, I have no idea. If the price of gold does skyrocket will that be because the US dollar tumbles, probably. If the US dollar tumbles, in relation to what currency, I have no idea and what effect this has on the gold price in AUD$, I have a vague idea. That vague idea suggests to me that my value of gold bullion in Australian dollars won't change whether gold goes to $10,000 US an oz or $500.00 US oz because the spot price in Australian dollars will simply move inversely to the exchange rate.
