After seeing a 30% devaluation of the Rupee since last August, the central bank of India has been strugling to stabilize their currency – but the citizens of India have their eyes open, and have been buying gold coins, ingots, and even gold jewelry at a break-neck pace, further inflaming their trade imbalance (particularly in oil), and further driving depreciation of their troubled currency.
So what has the Indian government done? Prohibit the retail sale of gold coins and boulion. Unfortunately, this is no Joke – this makes India the first nation of the 21st century to force participation in their fiat currency scheme. Do not expect them to be the last. Greece may well enact gold confiscation shortly before converting to the new Drachma…thus ensuring that no Greek citizen escapes the privation to come… Cypress and Portugal are also very likely to first regulate, and then confiscate precious metals if their economies continue in the death spiral.
Please bear in mind that it was only 60 years ago that India went through a rather violent time of unrest to obtain their independence, and there have been repeated waves of religious conflict within the country since then, so “taking it to the street” is actually a common occurrence which often turns violent. In fact, civil unrest has been on the rise in India of late, although the western media seems to have a totally blind eye to this fact.
In fact, the increasing levels of violence, protests, and potential for non-democratic changes of government are increasing all around the globe. Russia, China, Mexico, and many other countries are experiencing the same monetary and economic forces which India and Europe are presently dealing with, and are doing their best to deal with the resultant social issues. We should pray that no one adds any more salt to the pot, as this is already quite a potent stew, and we shall be dining on it for years to come.
I expect that things will be very ugly across Europe and the Mid-East by the time Americans go to the polls in November.