There are some noteworthy news items and I would like to tie them together.

First, Steve Jobs passed away yesterday.  May he rest in peace.  Jobs was a brilliant thinker and a brilliant entrepreneur.  I don’t know what kind of a person he was, but he certainly made the world a better place.

There will always be comparisons between Jobs and Bill Gates.  I think Steve Jobs was more intelligent than Gates is, but that is just my opinion.  While Gates may have been less original, he was a more successful businessman to start.  Just about the whole computer world used Microsoft.  It took more time for Apple to gain its footing.

Overall, I am bigger fan of Apple than Microsoft when it comes to computers.  The operating system on a Mac is superior.  But again, Gates was successful as a marketer and businessman with Microsoft.  Apple may win out at the end, but Microsoft certainly had its day in the sun.

It is reported that Steve Jobs was a liberal (in today’s language).  While this might be the case, there are many libertarians who admire the work he did.  While his opinions may have been leftist, his actions were not.  He is one of the greatest examples of capitalism that we have.  He was a major player in the internet and technological revolution.

Meanwhile, there have been protests against Wall Street.  This new group is being called the Tea Party of the left.  If you look at their list of unofficial demands, it is horrific.  They want a “living wage”, even for those unemployed.  Their ideas are anti-capitalist.  They are contradictory in many ways.  They are a dream that is impossible.

Just like the Tea Party, I’m sure that different people in this group have different ideas.  Some are worse than others.  Generally speaking though, they are a group of anti-capitalists.

I have sympathy for those who are speaking against government bailouts.  I could not agree more that these big businesses should not be handed favors by the government.  The problem is that most of these protesters go way beyond this.  The other problem is that they should be protesting big government, not big business.

While I think many Americans are upset about government bailouts, and rightly so, I don’t think they are anti-capitalism like these protesters.  Bailing out corporations is not capitalism.  You can call it corporatism or anything else, but it is not free market capitalism.  In a truly capitalist society, there would be no government bailouts.  So the protesters are against the bailouts (I think) and yet they are anti-capitalist.  Their own thoughts are contradictory.

Overall, I don’t see this mentality as a major threat.  Going back to Steve Jobs, he is a hero to most people.  Businessmen are often vilified, yet Jobs is not.  Jeff Tucker wrote a piece on this and speculates that it is because “he made his products elegant and made our lives more beautiful.”  While I agree with this, I am hopeful that it goes beyond this.

Speaking in generalities, one thing that still makes Americans different from many others around the world is that Americans like success.  With the exception of a few on the far left, most Americans do not want to kill entrepreneurism.  Some might be a little envious of those with more money, but most Americans think it is ok to be rich, especially when it is done by creating wealth and pleasing consumers.

I think the one thing where Americans need to learn a little more is that there are millions of people working every day to help consumers.  Most people are nowhere near as savvy as Steve Jobs was.  But there are millions of people in their own little way who work behind the scenes to fulfill human wants and needs.

The things that Steve Jobs helped produce were obvious and they were obviously beneficial.  You don’t see the entrepreneurs and workers who manufactured and delivered all of the little things that go into an iPad or iPhone.

I am still hopeful for the future.  Americans still want to see successful people.  As long as that attitude remains, there is hope in regaining liberty.

With a push to have a full audit of the Federal Reserve, critics of this move (such as those with the Fed) say that a full audit could jeopardize the Fed’s independence.  Of course, Fed officials and other government elitists who benefit from having a secretive central bank do not want an audit because they want to keep the party going at the expense of others.

With that said, perhaps those pushing for an audit should be careful what they ask for.  If there were a full audit and there were enough things found to cause major outrage, there is a chance that Congress could strip power from the Fed and take over the monetary controls.  In fact, Dennis Kucinich is advocating that Congress reclaim its authority (his view, not mine) and take over monetary policy.

As Gary North has pointed out, having Congress in direct control of the money supply would increase the chances of hyperinflation.  In contrast to many other libertarians, I do not believe there is a high probability that we will see hyperinflation.  I think high price inflation is possible, like what the U.S. saw in the 1970’s, but I think the chances of hyperinflation (for example, prices doubling every year) are slim.  If Congress directly controlled monetary policy, I would raise the chances.

Assuming that the Fed keeps control of the money supply, I would not be surprised to see double digit price inflation in the somewhat near future.  However, I have given this whole issue some more thought and I also wouldn’t be surprised if price inflation does not get as bad as we saw in the 1970’s.

I have some reasons for this view.  One reason in particular is Facebook.  We live in a different world now.  While I have many “friends” on Facebook who are libertarians, the majority are not.  I have other libertarian friends who are in the same situation.

If price inflation reaches 10% or more, we just need for someone to produce a good 2 or 3 minute video that explains in simple terms how the only way there can be a sustained increase in the general price of goods and services is by having an increase in the money supply.  Then the video can explain that only the Federal Reserve can directly control the money supply (and maybe the banks with fractional reserve lending).

For every one person who posts a video like this, a hundred people or more will view it.  We live in the age of the internet.  It is harder to get by with ignorance these days.  The Fed can’t hide behind the media any more.  Ron Paul has brought this issue to the public’s attention and the internet users have spread the word.  With the communication lines wide open as never before, I am hoping that is enough to prevent massive price inflation.

As far as promoting policy, I think the best thing we can do as libertarians is to advocate the repeal of legal tender laws.  We should be free to use the money of our choice.  Who can object to this on moral grounds?  You can ask your non-libertarian friends if people should be allowed to do business with other forms of money without going to jail.  I’m guessing most won’t object when you put it in these terms.

If we can repeal legal tender laws, then it will either force the Fed to stop inflating and buying government debt or else other money will become more popular.  We can do to the Fed what the internet and Fed Ex are doing to the post office.

Also, if legal tender laws are repealed and other forms of money begin to sprout up, then hyperinflation becomes less risky to our civilization.  If the dollar became worthless, then there would already be other forms of money to take its place to do business.  The trucks could keep delivering food to stock the shelves of our grocery stores, which is really the most important thing.

The subject of China and its currency has been building for the last several years and now more and more government officials are pointing the finger at China for manipulating its currency and not allowing the yuan to rise.  There is legislation currently being debated in the Senate that would compel the Obama administration to make a determination if other countries are not aligning their currencies in the manner that the U.S. government deems acceptable.  Eventually, this could lead to tariffs on imports.

Several Chinese officials spoke out against this action today and said that it would start a trade war, which they (the Chinese) do not want.  House Speaker John Boehner has come out against the legislation.  Even if it did get through the House, it is unknown if Obama would sign it.

This rhetoric has been heating up more and more.  I heard it from Romney in the last Republican debate, which tells us enough right there about that man.

The latest and most interesting person to join in the party of blaming China is Ben Bernanke.  Good old Helicopter Ben is now instructing other countries on how to manipulate their currencies.  Bernanke said, “Right now, our concern is that the Chinese currency policy is blocking what might be a more normal recovery process in the global economy.”

So there you have it.  Bernanke has chimed in.  Since unemployment is still over 9% and the economy shows no signs of getting better with all of the massive deficit spending, the idiot Keynesians are now going to blame China for the horrible policies of the U.S. government and Federal Reserve.  Bernanke’s Keynesian policies have failed and he knows it and he refuses to take any blame.  It doesn’t take a libertarian to see that he and the others blaming China are simply trying to escape responsibility for their own failed policies.

If the U.S. government were actually stupid enough to pass this legislation, China would be stupid to get into a trade war.  Instead, Chinese officials should just immediately start to sell U.S. treasuries.  If they really wanted retaliation, they should make an announcement that if the tariffs are not repealed within 60 days, then they will dump approximately one trillion dollars of government debt onto the open market.  This would send interest rates soaring in the U.S. and would immediately trigger a massive recession.

As to the actual merits of China affecting the U.S. economy, these idiots and/or liars have it completely backwards.  If anything, China is subsidizing the U.S. in a couple of ways.  The Chinese are buying U.S. government debt and doing a favor to the U.S. government.  In addition, the Chinese are subsidizing U.S. consumers with inexpensive products.

I think China should have a stronger currency and let their currency rise against the dollar.  But this has little to do with the U.S. economy, at least directly.  Chinese officials should do this for the benefit of the Chinese citizens who would benefit with cheaper goods and a higher standard of living.  It would hurt some exporters in the short term, but overall it would be highly beneficial for the average person living in China.

It seems that every major central bank on this planet is inflating extensively right now.  They are all shooting themselves in their respective feet.  Even the Swiss and Japanese are doing it.  This is mercantilism and it is bad policy.  It helps subsidize the exporters at the expense of everyone else using that currency.

This is why gold and gold related investments will continue to do well in the future.

Don LaPre, an entrepreneur known for his television infomercials, was found dead on Sunday of an apparent suicide.  You can read the story here.  He was in jail, awaiting a trial.

This news is quite sad to me for various reasons.  LaPre is best known for his infomercials in the early 1990’s when he sold his money making strategy.  While some may call it a scam, it was like many other money making kits that are sold today.  It doesn’t matter if it is trading stocks or buying real estate.  Most people understand what they are getting when they buy these things.

These money-making strategies are not a guarantee for success.  None of them are.  However, they can give you great tips and provide motivation to take action.  LaPre’s money-making system was no different. In fact, his might have been better in the fact that it gave some sound marketing advice and also provided good tips and motivation for budding entrepreneurs.

The reason he was in jail was because of his latest money-making venture selling vitamins.  The FDA (of course) went after him because he was making claims about these vitamins and he did not pay the appropriate bribe of about one billion dollars to the FDA to get it approved as a drug.  The FDA already has plenty of blood on its hands from withholding life saving drugs off the market, not to mention the drugs that never come into existence due to the major barrier of the FDA.  I suppose we could add one more death to its resume as it ruined LaPre’s life and most likely pushed the man into committing suicide.

It is ironic that the federal government put this man in jail because his vitamins were not performing what was being claimed.  Yet we have the giant pharmaceutical industry, in hand with the government, pushing vaccines, cholesterol medication, blood pressure medication, depression medication, ADHD medication, and everything else you can think of.  Not only do these vaccines and drugs not always do what they claim, but they oftentimes cause more harm than good.  At least if you take a vitamin that doesn’t do anything, there is no harm done.

This is just the latest example of the government being completely out of control.  Just look at all of the different counts that LaPre faced.  He was charged with mail fraud, wire fraud, money laundering and a host of other charges.  This is a joke as all of these charges stem from one thing: selling a vitamin that made certain claims that had not been approved by the FDA.

This is Martha Stewart all over again.  Luckily for Martha Stewart, it was a happier ending.

I have no idea what kind of a guy Don LaPre was, but he was not a criminal based on anything that I’ve read.  He was a successful entrepreneur, but he was not approved by the bureaucrats in Washington DC.  May he rest in peace.

I try to give updates and comments on the adjusted monetary base so that we can keep up with what the Fed is actually doing and not just saying.  I haven’t commented on this subject in detail for a while, mostly because there hasn’t been much change.  However, that in itself is a story in which we should pay attention.

You can view a short-term chart of the adjusted monetary base here:
http://research.stlouisfed.org/publications/usfd/page3.pdf

You can view a longer-term chart here and see the dramatic rise in the last 3 years:
http://research.stlouisfed.org/fred2/series/BASE

Now, here is a chart of the excess reserves held by banks:
http://research.stlouisfed.org/fred2/series/EXCRESNS

So what’s the story here?  Basically, the Fed has followed through on what it is saying.  QE2 ended in June, and since then we can see that the monetary base has been flat or even down slightly.  Meanwhile, the excess reserves being held by banks has an almost exact correlation with the monetary base.  This has been the case since the fall of 2008.  It does not seem that anything is changing here.

The Austrian Business Cycle Theory teaches us that loose money and artificially low interest rates will cause an unsustainable boom.  This boom will go bust when tighter money appears.  However, one thing that is important to note is that we do not have to see a contraction in the money supply to see a bust.  Just a slowdown in the growth of money can be enough to induce the inevitable bust.

The huge increase in the money supply over the last 3 years has been tempered by the huge excess reserves and a high demand for money.  This has kept a lid on price inflation.  However, it has still caused distortions in the market.  While we may not see a huge bubble like we previously saw in real estate or technology stocks, there are still certain sectors that have benefited from the monetary inflation.

Now that the Fed has been keeping the money supply fairly constant over the last 3 months, it will not be surprising to see a further downturn in the economy.  We are already seeing a flattening of the yield curve, which is an indication of recession.  It is unlikely we will see an inverted yield curve, but that is only because the short-term interest rates are already near zero.

This “bust” may show up in different ways.  We could see another increase in unemployment.  We could see the stock market crash.  We could see gold and oil go down further.  We could see housing prices go down further.  It is hard to say at this point what sectors will suffer the most, but we should not be surprised to see trouble ahead.

It is anyone’s guess what the Fed will do next.  However, if things get really nasty, it seems likely that the Fed will take further action and try to prevent the correction.  If the Fed starts a heavy dose of QE3, then we should expect a huge run in the price of gold at that point.  Stocks are a little harder to predict.

We will keep watching the adjusted monetary base and the excess reserves.  So far, the Fed’s actions have reflected its rhetoric.  The Fed is not creating new money out of thin air right now, so we should not be surprised by the lower prices in many asset classes.

Yesterday, there was a report of a new poll that showed Ron Paul beating Barack Obama in a head-to-head matchup, 51% to 49%.  Today, there is a report of a poll showing Ron Paul in virtually a statistical dead heat with Obama in the state of Florida.  Florida tends to be a good cross-section of the country, except that it has a higher percentage of seniors.  This just shows that the Medicare/ Social Security issue is not scaring a lot of seniors to turn away from Paul.

This is quite significant.  While I think Paul could conceivably win the Republican nomination, I wouldn’t bet even money on it right now.  While there has certainly been a shift in public opinion, the Republican Party is still too pro-war and that will make it difficult for him to get the nomination.  However, if Paul did get the nomination, I think his chances would be quite good against Obama.  I think there would be a lot more independents and Democrats receptive to his anti-war message.

So while I’m not exactly banking on a Ron Paul presidency at this point, I still think these polls are very significant and should give us great reason for optimism.  This shows that there has been a dramatic shift in public opinion.  With Paul running as a Republican and getting into the debates, it has helped spread his message and reach people that have never heard this message.  And of course the internet has been absolutely wonderful for the advancement of liberty as it has opened up the lines of communication.  We can now circumvent the mainstream media.  We are now at a point where a majority of people do not trust the mainstream media and more people are getting their news from alternative sources like the internet.

The best news in all of this is that Ron Paul draws a large portion of his support from young people.  While he has a diverse group of followers, the largest demographic seems to be people in their twenties.  Many of these people will be libertarians for life, which should really give us great hope for a few decades down the road.

There is still a lot of work to do for libertarians in trying to convince others of the benefits and morality of liberty.  But this just shows that progress has been made.  Ten years ago, most people didn’t know who Ron Paul was.  Not only do people know him now, but he is polling about even with the sitting president.  I think we will eventually win this battle of ideas.

We don’t need to elect Ron Paul to become free.  We just need to change the hearts and minds of the people and that is starting to happen.

After the price of gold fell off a cliff last week, the metal continues to look weak for the short term.  It was down significantly again today after bouncing up yesterday.  Silver has taken an even bigger beating than gold, showing us all why it is better to have the majority of your core holdings in gold.

I would not be surprised to see the metals fall a little further still.  We have to look at it all in context though.  The price of gold has been up every year for the last 10 years.  It is still up significantly for this calendar year.  It was hitting new all-time nominal highs and it should not be surprising that there has been a big pullback.

The current environment looks ripe for another recession, or a continuation of the recession depending on how you look at it.  The Fed has pumped in all of this money in the last 3 years and we still see relatively small price inflation.  The banks have piled up this money as excess reserves and the American people remain fearful (and rightly so).

Since the American people have been more conservative with their money, it has kept velocity low.  There is no actual way to measure velocity, but it seems that there is a high demand for dollars due to fear and uncertainty.  Since money is changing hands less frequently, it counteracts a large portion of the Fed’s loose monetary policy.  In other words, the low velocity keeps a lid on price inflation, along with the massive excess reserves.

When there is fear and a looming threat of recession, people tend to flock to the American dollar.  For a while there, people were flocking to gold.  I expect people will return to gold, but the short term is more questionable.

As far as your investments go, you should maintain a buy and hold strategy of gold and gold related investments for your permanent portfolio.  If your investment portfolio does not include at least 20% in gold and gold related investments, then this is a great time to accumulate more.  If you are a short-term speculator with gold, then good luck because I have no idea what you should do right now.

Don’t let the latest fall in the precious metals scare you.  It is going to be a roller coaster ride.  Nothing goes straight up.  There will continue to be run-ups and corrections.  The low velocity of money may keep things down for a while, but I expect the Fed to start QE3 if things start to look too gloomy.

Since Gary Johnson was allowed to participate in the last debate that was hosted by Fox News, I figured I would comment on a few things he said, since he has gained a little bit of attention.

Johnson’s best line and the funniest line of the debate was when he said his neighbor’s dogs have created more shovel-ready jobs than Obama.  He obviously had this line ready to go before the debate, but it got a good laugh and that can sometimes draw attention.

While I personally like Ron Paul’s version of libertarianism far better than Johnson’s, it is still good for libertarianism when he is in the debates.  Sometimes his comments can enhance the message being sent by Paul.  If Paul weren’t in this race, Gary Johnson would be by far the best candidate on foreign policy, social policy, and fiscal issues.

One thing that Johnson said several times during the debate was that he had a plan to balance the budget and he wanted to institute the Fair Tax.  As a libertarian, I am against the Fair Tax and I am against a lot of the versions out there for a balanced budget amendment.  However, when you combine the two ideas into one, then they are not as bad.

The worst thing about the Fair Tax is that it is “revenue neutral”.  In order to be revenue neutral, we would need a national sales tax of around 30%.  While I don’t like the complications of filling out income tax forms, that is not the really bad part of having an income tax and all of the other taxes we pay.  The really bad part is that it takes way too much money from us and the Fair Tax doesn’t help this situation at all if you don’t address spending with it.

If we had a balanced budget by cutting spending in the neighborhood of $1.5 trillion per year, then we still might need a national sales tax of 30% to pay the bills.  But at least it would neutralize the Fed as there would be no need for the Fed to buy any more government debt.  This would help the economy tremendously.

The reason I get skeptical of a balanced budget amendment is because a lot of people want to balance the budget with tax increases.  To paraphrase Ron Paul, I would rather see an unbalanced budget of $2 trillion than a balanced budget of $4 trillion.  But I am certainly in favor a balanced budget if it means getting there by dramatically cutting spending and not raising any taxes.

I am still hesitant on the Fair Tax, even with a big cut of 43% as Johnson is suggesting.  I might be more prone to liking it if it meant a national sales tax of 10% or less.  That would only be acceptable with the repeal of the 16th Amendment.

I think Johnson should stick with his cheerleading of a balanced budget through a 43% reduction in spending.  He should drop the Fair Tax.  Ron Paul should take a lesson from this and come out with his own plan to balance the budget.  In fact, he should one-up Johnson and get the federal budget below $2 trillion and advocate tax cuts along with a balanced budget.  He should start being more specific.

Next, the two of them should team up on the other candidates.  Michele Bachmann says she wants a balanced budget, but I have no idea how she is going to get there without cuts in military spending.  She should be challenged.  Herman Cain and Rick Perry should be challenged too.  Ask them how, specifically, they would balance the budget.  How would you cut $1.5 trillion out of the budget this year?  Not next year or ten years from now, but right now.

If the moderators of these debates and the mainstream media won’t ask these tough questions, then Ron Paul and Gary Johnson should start asking them.  Unless you cut military spending significantly, which means ending the wars, then it is almost impossible to balance the federal budget, unless you want to start cutting Social Security payments.  Bachmann, Perry, and Cain should be pinned down.  We shouldn’t bother with Romney as he is out in left field.

I was planning on writing a post this week on Herman Cain.  Now that he won the Florida straw poll by a substantial margin, it makes it that much more important.  While the Florida straw poll tends to be tilted towards the more establishment figures (I knew Ron Paul had little chance of doing well) because of the way it is run, it is still significant for Cain because he is getting a little more attention now.

I wrote a post about Cain a few months ago.  He is a statist.  He claims to be a political outsider and yet he was chairman of the Federal Reserve Bank of Kansas City.  He has some libertarian rhetoric and that is why I focus some attention on him.  Romney is a statist too, but it is more apparent to those with libertarian leanings.

While Cain has previously supported the so-called Fair Tax, he is now advocating a plan that he calls “999”.  It is a proposal to have a flat tax rate of 9% for businesses, 9% for individual income taxes, and 9% for a national sales tax.  He claims it is revenue neutral, just like the Fair Tax.

I am against the Fair Tax for various reasons, particularly because it is revenue neutral.  (I really don’t like the term revenue, since government is not a business and this money is obtained through the threat of force and not through providing goods and services.)

However, Cain’s 999 plan is much worse than the Fair Tax.  At least the Fair Tax is supposed to repeal the 16th Amendment and abolish the federal income tax.  With Cain’s plan, we would have both a national sales tax and an income tax.  What is to stop the next congress and president from raising the income tax rates on high-income earners, while leaving the sales tax in place?

In addition, this 999 plan would be horrible for the middle class.  It would be a massive tax hike on the poor and middle class.  Many lower to middle income families pay very little or nothing at all in the way of income taxes.  They just pay the payroll taxes.  Now they would also have to pay an additional 9% on everything they buy?

Cain’s income tax plan also doesn’t allow for any deductions, except for charitable donations.  His website says it would be “gross income less charitable deductions”.  Then it says “Empowerment Zones will offer additional deductions for those living and/or working in the zone”, whatever that means.  This sounds like more central planning from a former Fed official.

This 999 plan would be an absolute disaster.  It would raise taxes on the poor and middle class and it would leave higher income earners more vulnerable in the future.  It would not cut anything out of the budget.  It would leave us with the IRS and it would have to create another IRS or another division of the IRS just to collect the sales tax.

It doesn’t matter how abysmal Cain is on all of the other issues.  This 999 plan alone should tell every libertarian to run in the opposite direction.  If Cain were at all a libertarian, he would be advocating at least some spending cuts.  I am no fan of Michele Bachmann, but she is far better than Cain on fiscal issues.  And Gary Johnson is far better than Bachmann.  And Ron Paul is far better than Johnson.

On Wednesday, I wrote a short piece on the Fed’s announcement that it would buy longer-term government debt.  In the comments of that post, I received a question asking, “Can you provide some insight as to why this would have caused gold to lose value?”

I was going to defer this question until later in the week, but gold had a huge down day again on Friday, this time dropping about one hundred dollars in one day.  This was mild compared to silver in percentage terms, which has basically crashed this past week.

First, I should point out that in a somewhat free market, all prices are determined by buyers and sellers.  This is no different for gold and silver.  There were obviously more anxious sellers of gold this past week than there were buyers.

With that said, I can speculate on some of the reasons that gold had such a terrible week.

On Friday, there were stories about an increase in the margin requirements in the gold market.  Many believe that this caused the sell-off and there is probably something to that.  In addition, this happened after it had already had a fairly big sell-off during the week.

As to the drop in the price of gold on Wednesday, there was apparently something that did not please gold owners about the Fed’s statement.  I think one possibility is that the market expected more from the Fed.  Many investors were hoping, or at least expecting, that the Fed would announce some mild form of QE3.  But the Fed’s announcement to rearrange its portfolio does not add any base money.  For the longer-term government bonds that are bought, an equal number of short-term bonds will be sold (or retired).  We should not see any significant increase in the adjusted monetary base based on these actions.  In other words, gold investors were counting on more loose money from the Fed and they didn’t get it with that announcement.

Another possibility in contributing to the gold price decline this week is that the economic outlook is gloomy.  This was confirmed by the Fed’s statement.  If we enter into another recession (even though I’m not sure we ever left the first one), this may be very bad for gold in the short run.

For some reason, investors still flock to the U.S. dollar during recessions.  I’m not saying they should flock to the euro or some other fiat currency, but it is fairly obvious that the U.S. dollar is in a long-term decline.  But economics and investing is based on human action, and a lot of individuals still like to park their money in U.S. dollars during down times.

This means that the velocity of money may slow down even more.  There is a higher demand for dollars (more liquidity and perceived safety), so dollars are not changing hands quickly.  Banks are not loaning money like they used to and consumers are not spending money the way they were 5 or 10 years ago.  This puts a downward pressure on prices and this will include gold and silver.

Although the gold market suffered greatly this week, I am still bullish on the metal right now.  In the not-so-distant future, we will start to see days where the metal is also going up one hundred dollars or more in a day.  It won’t just be on the down days when we see these big moves.  That is when you will know that we are getting close to bubble territory.  But even when we get into a gold bubble, we can expect it to last for a while and see prices go to the moon.  There will be a time to sell some gold (not all) and take some dollar profits.

If this crazy week in the markets confirmed one thing for me, it is the wisdom of the permanent portfolio.  It showed us that it is better to put more in gold than silver.  It also showed us it is important to have some exposure to bonds, as that was the only thing (besides cash) that didn’t get hammered this week.