Ireland, Greece, Europe, and the Death of Socialism

It's amusing to look at the outrage from European countries over the stimulus measures of the Federal Reserve which will cause more economic problems domestically and around the world, as Europe has been pushing for socialism to be embraced by America all the while their own socialist experiment has been crumbling all around them.

No one has described the inherent weakness of socialism better than former British Prime Minister Margaret Thatcher, who said the problem with it is you eventually run out of other people's money, and that's what is happening in Europe, as the debacle surrounding Greece and Ireland have shown, and they're far from being the only countries having the problems, although the majority of media have been far less than aggressive in exposing the real risks.

The response of those who have been parasites off of the productive in Europe is predictable, as they've been rioting over not being able to continue to siphon off money, as there is no more to give to them; at least in any sustainable manner. As Thatcher said, the money of other people has indeed run out, and now it's time to end what many have always seen as an experiment doomed to fail.

Now that the U.S. has partially embraced socialism itself, it is now facing similar challenges, and politicians so far are refusing to take austerity measures to combat it. The Federal Reserve is just going to print another $600 billion in order to mask the ongoing problem, and kick the can to the future.

The recent bailout of Greece and other countries in the EU confirms they don't work. Originally it was asserted that the bailout would last for several years, when it fact all it did was offer relief for several months.

Europe is probably a worst disaster than America at this time, and the sovereign debt crisis continues even as the announcement it was over is barely out of the mouths of its political and economic leaders.

Until they admit socialism is a dead theory, everything they do will only be a band-aide on the problem. Not only is socialism a dead theory in, well, theory, it's dead empirically, as we've seen it's total failure and the consequences of implementing it before our eyes.

Governments will be forced to slash their foolish programs and start to manage their promises, as they aren't able to be met, and never were able to be met.

America will have to do the same very quickly or end up in the same place Europe is heading, and is more than likely, already in.

These circumstances will be very beneficial to gold investors, and we're far from any real recovery. Most things central banks are doing are only making the situation worse. We need to keep looking for market corrections as buying opportunities at this time, as we're in for a long and wild ride with no light at the end of the tunnel.

Goldman (NYSE:GS) Predicts $1,650 Gold in 12 Months

Goldman Sachs (NYSE:GS) upwardly revised its 12-month estimate for gold prices, increasing them from previous 12-month projection of $1,365 to $1,650. Gold is already closing in on the prior numbers.

Also increased was the three-month and six-month gold price estimate by Goldman, which rose to $1,400 an ounce and $1,525 an ounce.

Goldman said in a note to clients, "With U.S. real interest rates pushing lower off the slowdown in the pace of the U.S. economic recovery and the growing prospect of another round of quantitative easing, we expect gold prices to continue to climb."

Expectations are inflating the money supply, or quantitative easing, will be again put into place in November 2010.

Until those misguided policies change, gold prices will continue to move up, although there will surely be occasional corrections along the way.

Goldman (NYSE:GS), Quantitative Easing, and Gold Prices

Goldman Sachs’ (NYSE:GS) economist Jan Hatzius says he sees the Federal Reserve beginning a new round of quantitative easing, and it could happen as early as November, he said.

Quantitative easing is the phrase the Fed hides behind for the printing of money, which our children and grandchildren will have to pay for, if they are even able to.

While the ongoing weak economy, and probably a recession that has never left, continues on (hidden by the printing of money and stimulus programs), gold prices always soar on that news, and it's possible the expectations of quantitative easing also resulted in the record gold prices today.

Hatzius said, “We don’t expect this at the September 21 meeting, but in November or December there’s certainly a possibility that it will be announced.”

The Fed will more than likely acquire about $1 trillion in U.S. Treasurys in their misguided effort to get us out of the recession, which has already failed with the over $1 trillion already spent, and will fail again.

Gold and gold mining companies will only benefit from continued policies of Ben Bernanke's Federal Reserve and the Obama administration.